Improving Oversight of Local Governments in Moldova

Dátum: 25.01.2016

Project is financed by the National Endowment for Democracy.

Partner:

Institute for Development and Social Initiatives (IDIS) „Viitorul“

Duration:

May 01,2015 – January 31, 2016

Summary:

The project addresses specific problem of fiscal decentralization, which is the risk of fiscal instability caused by unattended indebtedness of municipalities. Today in Moldova insufficient monitoring of the effectiveness and sustainability of expenditures; and the overall perception of using public resources, according to the evaluation of local entrepreneurs, is one of the worst in the world. The main objective of the project is to increase public awareness about financial health of cities and municipalities in Moldova and thus to increase pressure on improving their financial health and to strengthen their importance for local and regional development. We expect, that project will achieve these goals by creating an online portal on financial management of cities and municipalities of Moldova; portal will improve the transparency of financial management and enable comparison of key debt ratios and financial sustainability indicators of local budgets; portal will be based on the transfer of unique know-how of a similar project, which has been successfully implemented in the Slovak Republic and contributed to a dramatic decline in debt of municipalities within last two years.

Project Objectives

The main objective of the project is to increase public awareness about financial health of cities and municipalities in Moldova and thus to increase pressure on improving their financial health and to strengthen their importance for local and regional development. We expect, that the project will achieve these goals by:

  • Creating a web portal concerning economy of municipalities in Moldova with well-arranged and comparable data
  • Providing citizens of cities, their majors, representatives and also journalists with actual information on indicators of financial health of municipalities
  • Creating and improving methodology of evaluation of financial stability of municipalities – the outputs will be also recommendations for policy makers for collecting, processing and presenting relevant data
  • Improving management of municipalities and providing fiscal sustainability of local budgets

Key Results

In January 2016, INEKO together with Moldovan think-tank IDIS “Viitorul” launched a portal displaying financial data of all municipalities in Moldova – http://localbudgets.viitorul.org/. The goal is to increase financial transparency on the local level and thus to involve people in control of spending public money and to reduce the risk of corruption. The idea takes inspiration from similar portal run by INEKO in Slovakia.

The Ministry of Finance of Moldova added a link to our portal on its webpage.

Project Activities

Organization of the seminar 2
Evaluation Conference: Improvement the oversight of local governments in Moldova
Venue: IDIS “Viitorul”, Conference Room, Iacob Hincu10/1 Street, Chisinau
Date: January 21 , 2016

Agenda:
09.45 – 10.00 Registration of participants
10.00 – 10.15 Opening speeches
Igor Munteanu, Executive Director IDIS “Viitorul”
Liubomir Chiriac, Vice-director IDIS “Viitorul”
H.E. Robert Kirnag, Slovak Ambassador to Chisinau
Peter Golias, Director of INEKO
10.15 – 10.45 Financial transparency of municipalities, by promoting anti corruption measures
Gabriel Šípoš, Director of Transparency International Slovakia
Viorel Pirvan, Legal Expert IDIS “Viitorul”
10.45 – 11.30 Portal on financial health of municipalities in Moldova: more than 140 000 data for 930 municipalities
Ion Moraru, Associated expert IDIS “Viitorul”
Angela Secrieru, Financial expert IDIS “Viitorul”
11.30 – 11.45 Discussions and closing remarks
11.45 – 12.15 Lunch

Media and other releases:

For more pictures, please, check this website

Organization of the seminar 1
INEKO and IDIS launched the project by organizing a day-long seminar in Chisinau titled “Financial health of municipalities from Moldova using Slovak experience”. Its aim was to arrange a detailed plan of the project realization with the partner, to introduce the project to the public and key stakeholders, and to present the results of a sample project in Slovakia. The Slovak Ambassador to Moldova Mr. Robert Kirnag together with the Executive Director of IDIS “Viitorul” Liubomir Chiriac gave the opening speeches. These were followed by presentations of experts from Slovakia and Moldova and discussions with participants. The seminar was attended by 24 guests and included representatives from municipalities (Orhei, Larga, Rusestii Noi, Lozova and Mingir), academia (Academy of Economic Studies), civil society (the Congress of Local Authorities in Moldova – CALM), media, and from the Slovak Embassy in Moldova. More information about the event is available on IDIS webpage.

Venue: IDIS “Viitorul”, Conference Room, Iacob Hincu10/1 Street, Chisinau
Date: May 28, 2015

Agenda:
10.00 – 10.15 Registration of participants
10.15 – 10.25 Opening speeches
Liubomir Chiriac, Executive Director IDIS “Viitorul”
H.S. Mr. Robert Kirnag, Ambassador of the Slovak Republic in Moldova
10.25 – 11.00 Actual situation in public finance decentralization and transparency of municipalities in Slovakia
Peter Golias, Director of INEKO
11.00 – 11.30 Actual situation in public finance decentralization and transparency of municipalities in Moldova
Viorel Pana, Head of National Economic Finances, Capital Expenditures and Procurement Division, Ministry of Finance
Angela Secrieru, Financial expert IDIS “Viitorul”
11.30 – 11.45 Discussions
11.45 – 12.00 Coffee break
12.00 – 12.30 Presenting the project on transferring the Slovak portal on financial health of municipalities to Moldova
Peter Golias, Director of INEKO
12.30 – 13.00 Discussions and closing remarks
13.00 – 14.00 Lunch

Media and other releases:

For more pictures, please, check this website

Data identification

Processing the methodology of evaluation the financial health of self-administration

Data collecting and processing
IDIS experts collected data from the FintehInform, state institution responsible for administration, maintenance, development and functionability of the informational management system of public finances. For every municipality, following indicators have been collected for years 2012, 2013 and 2014:

  • Tax revenues (approved and executed)
  • Total revenues (approved and executed)
  • Total spending (approved and executed)
  • Spending by different categories according to the economic as well as functional classification (approved and executed)
  • Deficit – difference between tax revenues and total expenditure
  • Number of citizens

Programming of interactive on-line portal
Based on collected data and using the programming framework available at portals.ineko.sk, INEKO experts created a beta-version of a new internet portal displaying financial data of all local governments in Moldova: moldova.ineko.sk. The portal will be finished after collecting comments and relevant explanatory texts from IDIS by January 2016.

Analysis of management with emphasis on the biggest cities
In November, IDIS distributed a questionnaire to 50 biggest municipalities in Moldova in order to:

  • Gain information about transparency of their budgetary process,
  • Gain feedback on financial data collected from the central database, i.e. to correct the data if necessary and to comment on them.
    The answers will serve as a basis for the analysis of financial heath and transparency of 50 biggest municipalities in Moldova. The IDIS experts completed the draft analysis by the end of November and presented it to the expert public.