The state will help local governments through loans
Last update: 24.06.2020 17:05
Representatives of the Ministry of Finance took part in the special presidency of the Union of Slovak Cities, which took place in Bratislava. The main topic of discussion was the current situation in connection with the negative impact of the corona crisis on the income of local governments.
Representatives of the Union of Slovak Cities received a promise from the Minister of Finance Eduard Heger that the state would do everything to help local governments cover this year's shortfall in share taxes.
The preliminary agreement, which the Ministry of Finance will still negotiate with the municipalities, says that the state will provide the municipalities with loans in the amount they need to have the amount of money they were counting on before the coronary crisis. In addition, municipalities should have deferred loan repayments by approximately 4 years.
"The Ministry of Finance is aware of the seriousness of the situation in connection with the financing of cities and municipalities. The state cannot take hundreds of millions of euros out of pocket and donate them to cities and towns. It would be unwise and irresponsible on the part of the government. Municipalities must also realize that the burden left by the corona crisis is on the shoulders of us all, and local authorities must also take responsibility for the population. The model we have presented is responsible. Municipalities will receive resources, but on the other hand they will be forced to think about what projects they will finance from them. This does not mean that life and development in the villages will now stop. On the contrary. We believe that this step will also force a change in the ossified system and that local governments will also jump on the trend, which is our priority. To behave responsibly towards citizens' money and to apply value for money at the regional level in all circumstances, "said Finance Minister Eduard Heger.
The Minister of Finance, as well as city officials, also confirmed their interest in the overall reform of local government financing. They are currently dependent on the income from personal income tax, the collection of which, especially in times of crisis such as this, is significantly declining and thus significantly affects the budgets of local governments.
Ministry of Finance of the SR