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December 4, 2022

Government announces municipality bankruptcy act

Three quarters of municipalities all over Romania are under financial strain, being unable to pay workers and suppliers with the money raised from council taxes and often resort to central government money, Administration and Interior Minister Vasile Blaga said, according to ‘Gandul’ daily. ‘There are 3,227 territorial-administrative units in Romania including the 21 county councils and Bucharest’s six districts and a major part of them – more than 2,400 representing 74 per cent of the total – cannot meet payroll requirements with money collected as council taxes’, Blaga warned. The announcement follows a draft law adopted by Government which stipulates that municipalities may file for financial crisis regime or even insolvency if they have debts older than 90 days and 120 days respectively. The President of the Association of Romanian Communes and also Mayor of Vulcana Bai, Emil Draghici, says a third of Romania’s communes – 950 municipalities – may file for financial crisis or bankruptcy. Constanta Mayor Radu Mazare welcomes new draft, but accuses the Executive of allocating money ‘based on moods and to chats between the sheets’. ‘This new bill is quite good as it will help them close down municipalities they want and then hand them all over to Elena Udrea. As long as they distribute the money based on moods and chats between the sheets, as we can all see, it is normal that those who do not receive anything should be in trouble’, Mazare told ‘Gandul’.

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