Municipal spending
Local government is a mess once again. Petros Doukas and Thanassis Nakos, the efficient deputies at the Economy and Interior ministries, respectively, are struggling to tidy up the finances in the country’s biggest constituencies. Only a few days ago, most municipalities were celebrating the New Year with fireworks, music concerts and sky-high Christmas trees. Now it’s time to pay the bill. And what a sobering bill it is. Some 2.7 billion euros from the state budget goes to municipalities and communities every year. Also, residents pay hundreds of millions of euros in municipality taxes and duties. And yet virtually all municipalities have accumulated massive debts and are constantly pressing the Economy and the Interior ministry for extra handouts. Thanks to tight fiscal monitoring and the new legal code on local governments, Doukas and Nakos have so far resisted. But why are municipalities so stuck for cash? After all, no significant municipality projects have been made, sanitation is poor, roads are crammed with illegally parked cars and the quality of municipal services has deteriorated. Worse, conservative ministers complain that in a bid to dodge state auditing, mayors tend to set up dubious municipal offices (for pompous purposes, such as development and culture) that they then staff with cronies. The last pre-election period saw an unreasonable surge in recruitments. The Ano Liosia Municipality alone hired 650 people for the sanitary department that were never really put to work. Soaring municipality spending is putting a strain on fiscal stability. Economy Minister Giorgos Alogoskoufis’s tight income policy is offset by the lavish spending of civil servants that enjoy cross-partisan coverage. The law on local government must be enforced.
