More powers to local budgets

Hotel Park INN held a discussion of the real situation of fiscal decentralization of the state budget. Topic of the same name offered to participants of the "round table" meeting is held on the initiative of the non-governmental National Budget Group with the support of the European Union and the organization OXFAM.

According to the speaker, the representative of the NGO "Support for Economic Initiatives" Rovshan Agayev said Azerbaijan will develop in detail the mechanisms to implement this idea. Unfortunately, the initiative of a special article of municipal budgets has not yet been implemented, the term "local budget" means income and expenses controlled by the local executive authority under the control of the Administration of the President.

Fiscal decentralization is not profitable (and in large federal countries) in terms of the concentration of financial resources and the implementation of projects of national importance, but they are vital to the influence of civil society and local authorities in the decision of the parliament and the government received over the revenue and expenditure of the budget. The center of political and economic opportunity in the hands of one person affects the initiative "from below", reduces the impact of leverage public participation and affected the transparency of the management and reporting of budgetary organizations.

The political component of fiscal decentralization is as follows: the local authority is more autonomy and responsibility for its own projects, the local population due to increased cash flows shows more interest in the elective bodies of self-government. The main thing - to strengthen the authority of the local government allows it to influence the decision of the central government.

In Azerbaijan there are legal mechanisms for fiscal decentralization. There is a three-level budget (central and local budget of the Nakhchivan Autonomous Republic.) The state budget assumes, along with the central, local revenues and expenditures. Thus, 80% of the content of local education and health belongs to local budgets.

On the other hand, the local executive authority is not empowered to shape the local budget, including its expenditure. The law is the concept of "the state budget of the Nakhchivan Autonomous Republic", but in practice, for the most part, subsidized (in 2008, subsidized component stood at 218 million, in 2013 - 305.3 million manat).

Local (municipal) budgets include utility costs, part of the social, economic and environmental costs, but they also artificially "planted" on the grant. According to data for the year 20123, the local authority had 0.6% of the income from investments, 4.9% - from agriculture, 9.3% - transport, 3.8% of public services and so on. The share of local revenues in GDP is 0.56%. Azerbaijan in this sector lags behind not only developed countries, but even from the neighbors - Armenia in the share of local revenues to GDP - 6.7%, in Georgia - 6.9%, in Russia - 5.6%, Turkey - 6.3%. - 17D-