MODERNIZATION OF FINANCIAL RELATIONS BETWEEN PUBLIC CENTRAL AND LOCAL AUTHORITIES
MODERNIZATION OF FINANCIAL RELATIONS BETWEEN PUBLIC CENTRAL AND LOCAL AUTHORITIES

Summary/Abstract: Financial relations improvement between public central authorities and public local authorities represents, at the same time, a need for the modernize the state administration and a challenge for the policy makers. In this respect, many governments successfully applied performed structurals reforms, from their experiences we can highlight some principles and good practices which can be used to rise the performance of the public financial management.These principles and good practices refer to some aspects that deep the devolution, such as: - emphasizing the public local authorities responsibilities regarding public expenditures; - improvement local taxation and other own local revenues; - better enforcement central – local grants mechanisms; - rising indebtedness capacity, including local public entities repayment capacity. Among the improvement solutions to finance devoluted public services, financial grants from central budgets and funds to local budgets have multiples forms, which present both advantages and disadvantages, depending on economic and social conjuncture and keeping in mind the needs of transparency in public administration.

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