The first and main victim of the financial crisis is Local Government (LG). The dramatic decline in revenue came not only from an unprecedented for the Greek and European standards, cutting of government grants but also from the reduction in own revenues, due to the limitation of citizens to pay tax.
At the same time, the demand for services has increased leading to increased expenditure. While the central state kept its distance from local communities citizens found Local Government as their sole prop. How will LG however enable itself to meet the requirements while having to tackle with reduced revenues and the balanced municipal budgets that the Stability and Growth Program imposes?
One solution would be for Local Government to resort, at least on investment expenditures, in the financial market. If you ignore the obstacles that have been established by law 3852/2010, we all realize that the financial market in Greece, especially for LG, has almost dried up. So the challenge is to find access routes to effective, smart and viable investment capitals in Greece and abroad.
The difficult economic environment requires that all local authorities seek alternative or complementary financing solutions. Local comparative advantages should be examined in depth, in combination with international and Greek experience, so as to give rise to viable and tangible development outcomes for both local community and for the municipalities and regions themselves.
The new ESPA emerges as the main financial outlet for Local Government’s investments. However, its main features are the limited, compared to the previous NSRF budget and its highly competitive character. There is a risk that a large number of municipalities will not be able to follow these new requirements and therefore be de facto excluded.
An additional source of funding is the Community Initiatives and Programs launched directly from Brussels. Here though a range of requirements is needed, such as accurate and timely information, good preparation and solid proposals using successful international cooperation, especially with other European cities and research institutions.
But how can Local Government respond in this difficult situation? By upgrading structures and staff and where it can not, by leveraging knowledge and experiences that offer intelligent, economical and sustainable solutions.
That is why we founded SKePSIS LTD….. to support municipalities and regions with smart and cost effective solutions that should provide a coupling of high scientific training, international and Greek long experience and local particularities and needs.
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