Municipal coalition fails to adopt city budget in first reading

The budget of Chisinau municipality for 2008 was three votes short to be adopted in first reading. After the councillors cast their votes, the chairman of the Chisinau Municipal Council (CMC) expressed his confidence that the draft budget will be approved at a new meeting. “We will adopt it the next time, with or without the support of the Opposition councillors,” Mihai Ghimpu said. Twenty-three councillors voted in favour of the budget. Of these, eleven were representatives of the Liberal faction, five of the Social-Democratic faction, six of the AMN faction and one was a Liberal Democrat councillor. The faction of the Communist Party voted against. Two representatives of the Humanist Party, the councilman on behalf of the National Liberal Party Mihai Severovan and the representative of the Social-Political Movement “Ravnopravie” Valeri Klimenko abstained. The Social-Democrats voted for, but put forward several conditions. The party’s leader Eduard Musuc said that the incomes in the budget should be increased by including a number of investment projects in second reading, allocating additional benefits to the deprived groups of people and raising the allowances for repairing the buildings of the housing sector. The Social-Democrats will not vote for the budget in final reading if the proposals are not taken account of, Mucus said. Valeri Klimenko said that the proposed budget is stagnant. He said that when the planned revenues cover less than a half of the real necessities of the municipality, the only viable solution is to ask the central authorities to increase the deductions from taxes and duties levied in Chisinau, such as the value added tax and the road use tax, which are transferred to the municipal budget. The request should be made by the mayor of Chisinau and by the CMC chairman. “It is our legal right and this is the money earned by the townspeople,” Klimenko said. This opinion was shared by several councillors. According to Valentina Vazdautan, interim head of the General Finance Division, the incomes of 1.344 bln lei included in the budget for 2008 will be 80.6% collected from the revenues of the municipality (1.08 bln lei). The deductions from the state revenues will total 157.7 mln lei (11.7%), while the transfers from the state budget – 102.9 mln lei. A sum of 129 mln lei will be transferred from the state budget to the municipality of Balti. The state budget will include incomes from taxes levied in Chisinau of about 3.6 bln lei, Valentina Vazdautan said. The representatives of the Communist Party criticized the councillors for their intentions to seek money from the Government instead of looking for local resources to cover the budget deficit and promote investment projects. The Communists criticized and accused the City Hall’s functionaries of incompetence. The CMC chairman Mihai Ghimpu replied that the sums planned to be transferred from the state budget to the municipal budget in 2008 are threefold lower than the ones projected for 2007. Also, the local budget will lose about 350 mln lei after fixing a “zero” tax on the reinvested profit. Therefore, it is weird that the PCRM faction criticizes a budget that includes incomes that are by about 30 million lei higher than the ones voted by the Communist councillors last year. The draft budget provides for expenditure of 1.37 bln lei. A sum of 75.6 mln lei will go to maintain public order (79% of the necessities); 698.5 mln lei are planned for education (77%); 17.6 mln lei for healthcare (41%); 18.8 mln lei for transport and road administration (44%); 320.8 mln lei for the communal and housing sector (39%). According to the General Finance Division, the deficit of 27 mln lei will be covered from the money obtained from privatization. The list of facilities that will be privatized was not drawn up yet. The budget must be adopted by December 10.