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Friday, March 1, 2024

Organizations with financial problems. Suwałki must take a loan for “current activity”

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Local governments have to borrow money for current expenses. This is the perspective of 99 percent of the cities associated in the Association of Polish Cities. Local government officials talk about the government’s poor financial policy. Only partial consolation is the gesture of the government, which found additional money for local governments in the latest amendment to the state budget.

Until now, Suwałki – like hundreds of other cities in Poland – took loans for investments. Now, however, they need them for the so-called “current activity” – PLN 48 million. – That is lighting, that is electricity, that is the salaries of our employees. So these are the expenses that are current expenses that we simply have to bear due to the activities performed – explains Kamil Sznel, spokesman for the Suwałki City Hall.

– Every local government official, regardless of whether he is from PiS, PSL or independent committees, says: such funds that went to local governments for road infrastructure, for improving health centers, schools and so on, they had not dealt with such measures before – convinces Marcin Przydacz, minister at the Chancellery of the President of the Republic of Poland.

– Tasks that are commissioned by the government – financing does not go hand in hand. So there are plenty of problems. And unfortunately, this hole when it comes to the city’s finances is very big – emphasizes Małgorzata Moscow-Wodnicka, deputy mayor of Łódź from Nowa Lewica.

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Expensiveness is taking its toll on local governmentsTVN24

Artificial condescension?

351 out of 354 Polish cities will have a hole in this year’s budget. This is over 99 percent of cities associated in the Association of Polish Cities. In the state budget, unexpectedly amended by the government in the middle of the June long weekend, money for local governments suddenly found itself somehow. Prime Minister Morawiecki emphasized that this money is mainly for current expenses. – The Polish disorder, called the Polish Order, caused Law and Justice to steal about PLN 20 billion from Polish local governments. And suddenly it turns out that they want to give 14 billion to local governments in great kindness – replies Paweł Bejda from PSL.

The problem is not only that the great tax reform of PiS previously took more than now the prime minister wants to give to local governments. Because there may not be enough for everyone. – We hear that the algorithm in relation to other cities and the allocation of these funds will not be adequate to our needs – says Małgorzata Moscow-Wodnicka.

The subsidy is to favor smaller and poorer local government units in order to level the playing field. The opposition is afraid that this noble idea will be implemented in practice in a well-known way. – Today, local governments are forced by politicians of the ruling party to report to a given minister, a PiS politician. Ask for money, then take a picture with a plywood board and finally thank the great minister – says Miłosz Motyka, PSL spokesman.

Governments are short of money. "I call it a survival budget"

Governments are short of money. “I call it a survival budget”Marzanna Zielińska/Fakty TVN

Opposition alert

It’s a new feudal system – some people in Wiejska street thunder and add that there is still something missing in the local government’s coffers. It is about more than EUR 30 billion from KPO. – For example, the issue of reclamation of areas that are post-industrially damaged. This is all the money that local governments are waiting for. And as long as there is no money from KPO, local governments cannot undertake these investments – argues Katarzyna Lubnauer from Nowoczesna.

What to do in this situation? There is only one way out – credit. Suwałki wants to take out a loan until 2041. Therefore, there is a chance that the city will finish repaying the loan when its residents who have not yet been born enter the labor market.

Main photo source: Facts after noon TVN24

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