The Lithuanian Free Market Institute examined draft amendments to the Law on Budget Composition and the Law on Local Self Government aimed at broadening the opportunities of municipalities to borrow money without regard to the budgetary year limits.
In its position paper LFMI noted that the introduction of provisions on exemptions from borrowing limits would set a precedent for increasing the debt in order to attain other objectives rather than the intended implementation of energy efficiency improvement programmes in public buildings. What is more, drafters of the law did not evaluate the possible impact on the public finance situation. Therefore, LFMI proposes to evaluate the said impact as well as to apply the budgetary year limits set for the implementation of the energy efficiency improvement programmes. What is more, such programmes may also be funded from the revenue generated from the municipal property privatisation.
The full position paper (in Lithuanian) is available at http://www.llri.lt/naujienos/ekonomine-politika/valstybes-valdymas/ekspertize-idiegus-nuostatas-del-isimciu-skolinimosi-limitams-butu-sukurtas-precedentas-didinti-skola/lrinka