The Successes and Failures of Bulgarian Municipalities
Close to 70% of the expenses of Bulgarian municipalities can be classified as „failures”, while only 5% can be considered successful. The rest, about a quarter of the activities, the execution of which doesn’t allow for a classification for either category, are considered as “unclassified”.
This is shown by an in-depth IME review of the audit reports of the Bulgarian National Audit Office. The reports contain data for 83 municipalities and their expenses for over 6 billion BGN for the 2011-2014 period.
Which Municipalities Absorb the Most EU Funds
The current inability of Bulgarian municipalities to carry out independent fiscal policy leaves EU funds as the only option for financing local projects. The prior statement is especially true for undertakings, which require significant capital investment, such as building a sewage-treatment plant. It goes without saying that the efficiency of the use of EU funds depends highly on how and for what purpose they are spent. This means that 1 million BGN spent in one municipality may lead to greater benefits than 10 million BGN spent in another. Therefore, the actual amount of operational program funds, provided for municipalities as beneficiaries, is one of the main indicators of the success or failure of municipal administrations – if nothing else, at least it is a signal of activity and administrative capacity.
Economic Populism in Bulgaria and Its Consequences
What if I told you that the poorest EU member state is a country in which economic populism is more often the rule of a thumb, rather than an exception? Would that surprise you, or would you think it is a fate just deserved by both the Bulgarian public and its government? Sure, when it comes to populism within the EU, Bulgaria seems like an OK place to be when compared to countries such as Greece and (arguably) Hungary. However, some recent developments have brought forward the question whether Bulgaria (the country which back in 2011-2012 was viewed as an example of fiscal responsibility in the heat of the European debt crisis), is going the right way, or has reversed course back to the well-charted, yet strangely endearing seas of cheap economic populism.