GEO

Remuneration expenses exceed legally defined amounts in 27 municipalities

21 June, 2016

 

According to Paragraph 3 of Article 156 of the Local Self-Government Code, “the local administration/city hall and local council staff remuneration expenses should not exceed 25 percent of the expenses envisaged by the municipality budget.

We examined the budgets of all municipalities in Georgia. The following is the information about the municipalities which failed to consider this legal requirement when defining their remuneration expenses. The information is divided by the region.

Samegrelo-Zemo Svaneti

According to the Martvili Municipality’s budget for 2016, GEL 1,828,600 is allocated for remuneration, which amounts to 30.5 percent of the GEL 5,993,100 budget; in the 2016 budget of the Khobi Municipality, GEL 1,996,400 is allocated for remuneration, amounting to 26.17 percent of the GEL 7,627,300 budget; in the Tsalenjikha Municipality, this indicator is 25.4 percent (GEL 1,722,000 for remuneration in the GEL 6,754,700 of the budget expenditures); in the Mestia Municipality, the allocation for remuneration amounts to 27.4 percent of the budget expenditures (remuneration – GEL 1,809,000, budget expenditures – GEL 6,580,900); in the Senaki Municipality, the allocation for remuneration amounts to 27.7 percent of the budget expenditures (remuneration – GEL 2,012,400, budget expenditures – 7,260,600); in the Abasha Municipality, the allocation for remuneration amounts to 28.2 percent of the budget expenditures (remuneration – GEL 1,764,600, budget expenditures – GEL 6,241,900).

Guria

In the Chokhatauri Municipality, the amount allocated for remuneration is 25.96 percent of the budget expenditures (remuneration – GEL 1,177,100, budget expenditures – GEL 4,534,200).

Ajara[1]

In the Shuakhevi Municipality, the amount allocated for remuneration constitutes 32.05 percent of the budget expenditures (remuneration – GEL 1,348,160, budget expenditures – GEL 4, 205,960). In the Keda Municipality[2], the amount allocated for remuneration constitutes 52.35 percent[3] of the budget expenditures (remuneration – GEL 2,563,700, budget expenditures – GEL 4,896,774).

Racha-Lechkhumi and Kvemo Svaneti

In the Municipality of the Self-Governing Settlement of Ambrolauri, the amount allocated for remuneration is 34.94 percent of the budget expenditures (remuneration – GEL 1,283,300, budget expenditures – GEL 3,672,600). In the Oni Municipality, the budgetary allocation for remuneration constitutes 35.89 percent of the budget expenditures (remuneration – GEL 985,900, budget expenditures – GEL 2,746,300). In the Lentekhi Municipality, the amount allocated for remuneration is 33.38 percent of the budget expenditures (remuneration – GEL 992 900, budget expenditures – GEL 2 973 700.

Imereti

In the Tkibuli Municipality, the amount allocated for remuneration constitutes 25.28 percent of the budget expenditures (remuneration – GEL 1,349,900, budget expenditures – GEL 5,338,800). In the Vani Municipality, the amount allocated for remuneration is 27.77 percent of the budget expenditures (remuneration – GEL 1,619,000, budget expenditures – GEL 5,829,000). In the Sachkhere Municipality, the amount allocated for remuneration is 26.85 percent of the budget expenditures (remuneration – GEL 2,133,900, budget expenditures – GEL 7,944,600). In the Kharagauli Municipality, the amount allocated for remuneration constitutes 25.93 percent of the budget expenditures (remuneration – GEL 1,648,100, budget expenditures – GEL 6,355,100).

Samtskhe-Javakheti

In the Akhalkalaki Municipality, the amount allocated for remuneration constitutes 27.05 percent of the budget expenditures (remuneration – GEL 1,991,100, budget expenditures – GEL 7,359,000).

In the Aspindza Municipality, the amount allocated for remuneration constitutes 32.02 percent of the budget expenditures (remuneration – GEL 932,800, budget expenditures – GEL 2,913,000).

In Ninotsminda, the amount allocated for remuneration constitutes 32.94 percent of the budget expenditures (remuneration – GEL 1,315,300, budget expenditures – GEL 3,992,200).

In the Adigeni Municipality, the amount allocated for remuneration constitutes 31.39 percent of the budget expenditures (remuneration – GEL 1,067,900, budget expenditures – GEL 3,401,400).

In the Akhaltsikhe Settlement Municipality, the amount allocated for remuneration constitutes 31.52 percent of the budget expenditures (remuneration – GEL 1,302,800, budget expenditures – GEL 4,133,200).

Kvemo Kartli

In the Tsalka Municipality, the amount allocated for remuneration constitutes 33.61 percent of the budget expenditures (remuneration – GEL 1,340,300, budget expenditures – GEL 3,987,300).

In the Tetritskaro Municipality, the amount allocated for remuneration constitutes 26.24 percent of the budget expenditures (remuneration – GEL 1,547,400, budget expenditures – GEL 5,897,100).

In the Dmanisi Municipality, the amount allocated for remuneration constitutes 29.97 percent of the budget expenditures (remuneration – GEL 1,122,000, budget expenditures – GEL 3,743,300).

Shida Kartli

In Kareli, the amount allocated for remuneration constitutes 25.44 percent of the budget expenditures (remuneration – GEL 1,838,200, budget expenditures – GEL 7,225,200).

Mtskheta-Mtianeti

In Kazbegi, the amount allocated for remuneration constitutes 28.22 percent of the budget expenditures (remuneration – GEL 801,700, budget expenditures – GEL 2,840,000).

Kakheti

In the Telavi Settlement, the amount allocated for remuneration constitutes 27.25 percent of the budget expenditures (remuneration – GEL 1 780 600, budget expenditures – GEL 6 533 300).

Transparency International Georgia calls on the municipalities:

1. To correct the budgets and bring the remuneration expenditures into compliance with the 25 percent limit set for remuneration in the municipal budgets as envisaged by Article 156 of the Local Self-Government Code as soon as possible.

2. To distribute the freed-up resources between programmes, sub-programmes and budget classification lines with the aim of implementing infrastructural projects necessary for the municipalities, in accordance with the Budget Code.

 


[1] Later, we established that the remuneration expenses exceed the legally defined limit in the Kobuleti Municipality too, specifically, it amounts to 44.24 percent of the budget expenditures (remuneration – GEL 6,244,634, budget expenditures – GEL 14,114,013).

 

[2] On 16 June 2016, after we had completed analysing the data, a new version of the Keda Municipality budget was publicized. According to it, the expenses were reduced from GEL 4,896,774 to GEL 4,885,899, while remuneration expenses – from GEL 2,563,700 to GEL 2,512,000, which reduced the share of remuneration expenses from 52.35 to 51.41 percent of the budget expenditures.

[3] In the Keda Municipality, the salaries of non-staff members and the staff of LEPLs (Legal Entities of Public Law) are assigned to the Remuneration budget line while they should have been assigned to the Goods and Services and Subsidies lines respectively. This is a serious violation of the Order No 672 on Budget Classification issued by the Minister of Finance. Keda was supposed to consolidate remuneration under the Goods and Services line in accordance with Paragraph 3 of Article 156 of the Local Self-Government Code rather than reflecting these expenses in the Remuneration line. Assigning the LEPL expenses to the Remuneration line is also completely incorrect as it is an important problem in terms of accountability.

If remuneration in Keda were accounted for in accordance with the existing legislation, its share in expenditures would constitute 27.3 percent, which violates the code in the same way as 52 percent but the fact that remuneration has been counted in violation of the law is the responsibility of the municipality as a whole. It also has to be noted that the consolidation as done by the Keda Municipality is something that we call on the government to do, however, consolidating remuneration under the Remuneration line before the corresponding amendments to the legislation are passed is a serious violation of the current regulations. As mentioned above, the Keda Municipality, in accordance with Paragraph 3 of Article 156 of the Local Self-Government Code, was supposed to consolidate the remuneration under the Goods and Services but not Subsidies line (to meet the 25 percent limit requirement), these expenditures were not supposed to be assigned to the Remuneration line.