This year the Bulgarian municipalities will have 1 billion leva less at their disposal compared to last year, due to the financial crisis. That is the forecast of the managing board of the National Association of Municipalities in the Republic of Bulgaria (NAMRB), presented here Friday at the annual meeting of municipal financial officers.

At the same time it emerged from the remarks by Deputy Finance Minister Kiril Ananiev at the same event that municipalities have until the end of June to submit to the Finance Ministry information about the measures they are taking to optimize their costs in the condition. Ananiev added that any savings the municipalities make will stay with them and will probably be kept in a reserve.

Municipalities will sustain 700-800 million leva losses in own revenue and another 10 per cent of the budget transfers is being kept as a crisis buffer, said NAMRB chairperson Ginka Chavdarova. She said the drop in receipts jeopardizes activities such as the maintenance of kindergartens, the meals-on-wheels service, landscaping and waste collection, among others.

She also said that being understaffed as a rule, the municipal authorities are not in a position to cut costs by cutting jobs. In her view, one opportunity for optimizing costs is by expanding the mobile services to people living beyond the municipal centres.

Chavdarova said that a wage freeze is an option but not wage cuts: at some places the staff in the municipal administration get too little anyway - 300-400 leva a month.

As of the end of April, municipalities reported receipts of 569.1 million leva which is 114.1 million leva (22.08 per cent) more than this time last year, said Deputy Finance Minister Ananiev. The revenue side of the municipal budgets is fulfilled at 28.9 per cent from the target which Ananiev said was a relatively good rate of collection. He said that the May figures will give a clearer picture of the situation because the period for collecting the municipal receivables this year is shorter than last year's due to legislative changes.

The receipts from the sale of municipal assets are much below the target - 8.7 per cent, said the Deputy Finance Minister. That shows both the instability of this kind of revenue and inadequate budgeting by the municipalities, he commented.

Municipalities' outstanding debts stood at 82 million leva at the end of April, and that was formed by 115 munucipalities. 234 municipalities have outstanding receivables of 79.8 million leva. Municipal authorities have taken to court debtors with a total debt of 6.9 million leva due to municipalities.

Source: BTA