Municipalities spent a total of 12.5 billion leva, up 21.45% from the previous year, with the large increase partly explained by high inflation for the period, according to the Ministry of Finance in 2023. This is stated in an analysis of the Institute for Market Economics.
As expected, the highest expenditures are in the large municipalities – Sofia /2.22 billion leva/, Plovdiv /590.9 million leva/, Varna /577 million leva/, Burgas /74.1 million leva/ and Stara Zagora /229.5 million leva/. In total, the expenditures of the first five municipalities represent about 32% of the total municipal expenditures for the year, which is close to their share of the country’s population.
If we look at per capita spending, it averages BGN 1,940 for the country – about the same as the figure for Dolni Chiflik municipality – with 74 municipalities having a lower figure.
The municipalities with the highest expenditures in relation to the population are Chelopech /8410 BGN/person/, Byala, Varna region /6731 BGN/person/, Boinitsa /6415 BGN/person/ and Sukhindol /6397 BGN/person/. On the other side of the distribution are the municipalities of Asenovgrad /1427 BGN/person/, Ruen /1504 BGN/person/, Ruse /1522 BGN/person/ and Panagyurishte /1537 BGN/person/.
It is noticeable that the highest per capita expenditures are generally achieved by small municipalities. Logically, the number of inhabitants lowers the denominator in the indicator, but more importantly, a large part of the expenditures in the municipalities are fixed and cannot shrink relative to the population.
An example is the municipal administration, which must include a minimum number of employees in order for the municipality to function as an administrative unit and offer the public services required by legislation.
It is quite likely that this will involve a lower workload, but this is inevitable as the existence of the municipality requires it to carry out certain activities that involve costs – buildings, maintenance, staff salaries, etc. – even though the number of potential users is limited by the low number of inhabitants.
Reforms in the direction of sharing municipal services or clustering municipalities could solve this problem as they would generate economies of scale that would lower average municipal costs per capita.
The highest expenditures are in Sofia Municipality / BGN 309.4 million/, Plovdiv / BGN 100.1 million/, Varna / BGN 75.4 million/, Karlovo / BGN 31.3 million/ and Burgas / BGN 29.5 million/. Logically, the highest expenditures are in large municipalities, which have more infrastructure requiring the construction of new facilities, renovation and repairs.
At the same time, actual large investment projects can also move smaller municipalities up in the ranking. For example, in the period 2022-2023, Karlovo Municipality is implementing several large-scale projects to rehabilitate the road and water network on its territory, which is why the municipality is among the leaders in capital spending for 2023.
In total, capital expenditures per capita in 2023 are 291 BGN on average for the country – approximately the same as in the municipality of Shumen, for example – while in 106 municipalities this figure is lower. The highest expenditures are in Byala municipality, Varna region /3973 BGN/person/, Sukhindol /3016 BGN/person/, Tsarevo /2377 BGN/person/ and Kresna /2344 BGN/person/.
The lowest investment expenditures in relation to the population are in Pleven /59 BGN/person/, Dupnitsa /70 BGN/person/, Pazardzhik /80 BGN/person/ and Dulovo /81 BGN/person/.
