By: C. R.
The Ministry of Finance invited representatives of municipal associations today to sign an agreement on the level of per capita funding for the next two years. As explained by the associations, the per capita funding for the coming year will be €771.33, with an additional €47.88 million to be provided to municipalities. The Association of Municipalities of Slovenia, however, will not sign the agreement.
Today, Minister Klemen Boštjančič and the presidents of the Community of Municipalities of Slovenia, the Association of Municipalities of Slovenia, and the Association of Urban Municipalities of Slovenia were scheduled to sign an agreement on the level of per capita funding, which represents the appropriate amount of funding per resident required for municipalities to perform legally mandated tasks.
While the Ministry has not disclosed the content of the agreement before the signing, the Community of Municipalities of Slovenia explained to the STA that the fixed per capita funding for the next year will be €771.33 per resident, which is €46 more than this year. Due to the higher per capita funding, resources for balancing municipal development will also increase by approximately €5.7 million.
Additionally, municipalities will receive extra funds for the variable part of municipal financing, aimed at correcting funding disparities among municipalities and reducing developmental differences. This funding will be provided in the amount of 1.5% of income tax collected in 2023. The variable portion would thus total an additional €47.88 million, with 75% of these funds allocated to correcting funding disparities among municipalities and 25% to reducing developmental differences. This means that municipalities with a demonstrated gap between income tax revenue and the costs of performing legal duties over the past three years would collectively receive an additional €35.91 million, with another approximately €11.97 million dedicated to reducing developmental disparities among municipalities.
Jasmina Vidmar from the Community of Municipalities of Slovenia told STA that while they would prefer a higher per capita amount due to the many needs of municipalities, this was the most the minister could offer.
The Association of Urban Municipalities of Slovenia explained to STA that they support the agreement, considering it very important and groundbreaking. In addition to a higher per capita amount, it also includes a commitment to amend the law on municipal financing to determine the amount of municipal funding. The proposed amendment would add additional resources for municipalities and introduce a provision to account for annual increases in costs when calculating the average costs of municipal tasks.
They also clarified that urban municipalities are at a disadvantage under the current system because they receive less funding for legally mandated tasks. The proposed measures for underfunded municipalities would somewhat improve their situation. Due to the absence of the association’s president, Peter Dermol, the agreement will be signed today on behalf of the Association of Urban Municipalities by Vice President Samo Turel.
The Presidency of the Association of Municipalities of Slovenia, however, has decided not to sign the agreement, according to the association’s president, Robert Smrdelj. He stated that the proposed per capita funding of €771.33 for 2025 and €775.29 for 2026 is disproportionately low. He reminded that the associations proposed per capita funding of €818, even though the costs of performing tasks are expected to exceed €870 per resident on average, and the proposed amount is €100 lower. “It is highly unreasonable to agree to something like this, as we know that municipalities are cornered by this per capita funding,” he said.
They also disagree with the method of allocating additional funds to municipalities, believing that the allocation criteria are unclear, not based on verified calculations, and contain many unknowns and ambiguities, making it impossible for them to support it. According to Smrdelj, the idea was to allocate the funds as efficiently as possible, targeting those who are most in need. However, the language of the agreement is very general, and it is unclear what criteria will be used to distribute the funds.
