The need for administrative-territorial reform.  Episode 3. Public money laundering in local governments

June 28, 2017 is not an ordinary date. This is the date on which the President of Romania, Mr. Iohannis (PNL), promulgated the law on the single salary of Olguța Vasilescu (PSD). It is the date from which the despair of salaries in the public administration started, which still affects today the unsustainability of the local public authorities and not only. In the previous episode, we proved to you with reality a reality: only 7% of the localities in Romania are autonomous.

A major cause of this collapse is staff costs.
The collapse cannot be diluted or masked. The numbers speak for themselves. Let’s see in the charts this mess in the local public administration:

The figures best reflect the unraveling that took place, especially in 2017 and 2018.

But we need to understand what has changed in Law 153/2017 on the remuneration of staff paid from public funds. Read this article from the law: “Art. 11. (1) For civil servants and contract staff within the occupational family “Administration” from the own apparatus of the county councils, town halls and local councils, from the institutions and public services of local and county interest subordinated to them, the basic salaries are established by decision of the local council, of the county council or of the General Council of the Municipality of Bucharest, as the case may be, following the consultation of the representative trade union organization at unit level or, as the case may be, of the employees’ representatives ”. Practically, the local authorities (town halls and county councils) were given free rein to set their own salaries. What did they do? They ate. In just 2 years, public administration salaries have increased 2 to 4 times. I ask you: has your salary increased 4 times in just 2 years?
These unsustainable growths went bankrupt and effectively put the public authorities in the spotlight in 2018. The effect: they ran out of money – 0 (zero) in investment budgets. The government’s measure was to change from the pen, from the center, the broken down quotas allocated to local budgets and thus increased the revenues of local authorities.

Here are some financial facts that clearly highlight the unsustainable direction of local authorities:
less than 50% of local government revenues are own revenues; the rest being sums coming from the Government.
current expenditure represents almost 70% of total expenditure.
– staff costs represent 24% of the total expenses.
– of the 30% of investment expenditure, approximately 70% of investment comes from national income.

The percentage of personnel expenses (2021) by types of ATUs is as follows:

The average salary of civil servants in local administrations in 2021 was: 5,657 lei / month, of dignitaries 9,303 lei / month, and of contract staff 4,039 lei / month. In the private sector, the average salary in the economy is: 4,678 lei / month. In the county councils the salaries are higher (2021): dignitary: 21,018 lei / month, civil servant: 10,121 lei / month, contract staff: 6,692 lei / month.

After the approval of the law on single pay, which gave the green light to local councils to change their organization charts and salaries within the institution, staffing budgets have grown fabulously. At national level, they account for 24% of total expenditure and current expenditure for over 70%.

Although the current legislation has many financial transfers from the central to the local level, staff and current expenditures are severely hampering the development of local communities.

Below is the distribution of localities according to the percentage of staff costs and total expenses:

If in 2017, by the will of the PSD, with the hand of Dragnea and Olguța Vasilescu they bought the loyalty of the public administration on the money of all Romanians, the disaster is carried on even now by this PNL & PSD & UDMR Government. A Government that keeps Romania captive to poverty, underdevelopment and social inequity.

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