we offer the basic data here in one graph. The original intention to always have the budgets of local governments balanced, not in deficit, and if in deficit, because of investment projects, collapsed last year.
The governments of Igor Matovič and Eduard Heger have successively dropped about 5 atomic bombs on local governments in the form of additional obligations connected with expenses and reduced incomes connected with insidious intentions.
They didn’t approach anything conceptually and broke even what worked. Today, the financing of local governments is rehabilitated by ad hoc interventions and transfers of part of the collected corporate income tax (so far for the years 2023 and 2024), but not enough. Alternatively, the promise of energy aid.
In a cube:
2022: the deficit was 420 million euros, 2023: so far it looks like 400 million euros, 2024-25: the same 400 million euros each.
TOGETHER, in 4 years, local governments book a deficit of 1.5 billion euros. Yes, it is 400 million euros less than in our big article, and we thank the Ministry of Finance for the comment and explanation of the methodology. We had an error worth 400 million. euros for 2023. The deficit this year will not be 800 million euros, but ONLY 400 million euros.
what is the problem
So far, in the consolidation analyzes for the years 2023-2026, no one is solving and leaving the revenues of local governments at such levels, which in principle will lead them to bankruptcy.
But they will really need the additional 400 million euros, because their reserve funds are exhausted and they cannot borrow as easily as the state.
Few people understand it, almost no one works with real data. In the past, local governments at least shouted when their revenues started to grow more slowly in 2020 and 2021. Now, when they are actually going to decrease in 2023-24, they are only talking about energy aid for 108 million euros.
We don’t understand. But few people work with data in this country. But in the end we will find that the cash register and the pantry are empty and it will be bad. In the case of municipalities, really bad. We’ll see.
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