The Lithuanian Free Market Institute has introduced its first Index of Municipalities in Lithuania which was compiled using a unique methodology. Using overall 55 indicators, the Index measures the performance of municipalities. This project was aimed at creating a useful and convenient tool for gauging the performance of municipalities’ economic and social policy, at measuring and increasing the efficiency, the accountability and the competitiveness of Lithuanian municipalities. The Index will enable municipalities to improve their performance via comparing themselves with other municipalities and to develop competitiveness and the best practice sharing tradition in the Lithuanian municipal system. In addition, it will serve as a tool to advance cooperation between private and public bodies, civil participation in policy debates and trust in liberal policies.
Those municipalities that ensure the individual’s free choice, promote private property, create favourable business conditions, use public resources efficiently and ensure the transparency of their activities are higher in the index. The 55 indicators used in the Index are split into 3 groups. The first group is titled “Municipality for Residents.” It measures the performance of municipalities in 4 fields: public utilities and public transportation, education, health care and social care. The second group is labelled “Municipality for Investors,” consisting of 2 fields: investment and development and taxes. The third group of indicators is called “Management of Municipality” and includes 2 fields: asset management and administration and personnel management. Overall, the Index embraces 8 fields. The score from 0 to 100 is attributed to each municipality in each field, the group of indicators and the entire index. 7 city municipalities and 53 non-city municipalities are rated separately. The field of municipal budgets and finances is analysed separately and is not included in the rankings of the Index since Lithuanian municipalities do not have enough autonomy in planning their budgets and debt levels. The main decisions are adopted at central government level.
According to the Index, the best performing municipality among 7 city municipalities is Klaipėda city municipality. It received 59 points out of 100 and was ranked 1st. Panevėžys city municipality was ranked 2nd and Alytus city municipality was ranked 3rd. Palanga city municipality was ranked the lowest among city municipalities. Kaunas district municipality was ranked 1st among non-city municipalities. This municipality received 61 points out of 100. Birštonas and Šilalė district municipalities were ranked 2nd and 3rd accordingly. Šalčininkai district municipality was ranked the lowest among non-city municipalities.
Detailed information about the Index of Municipalities of Lithuania is presented in this publication. It consists of 6 chapters. Chapter 1 presents the general scores and rankings of municipalities. Chapter 2 gives a list of the best performing municipalities in each of the 8 fields. Chapter 3 offers analysis of the 8 fields dealt with in the Index with municipalities’ rankings and the data about indicators in each field. Chapter 4, the largest section of the Index, devotes a page per each municipality, presenting detailed information about municipalities’ scorings, the worst and the best fields, 5 best-evaluated indicators in each municipality and 5 policy proposals for each municipality with a view to increasing their ranking. Chapter 5 consists of detailed tables of the rankings and scores of all municipalities in all the fields and groups of indicators. Chapter 6 presents the methodology of the Index.
We hope that the Index of Municipalities in Lithuania will be a useful instrument in evaluating and comparing the activities of municipalities as well as a handy tool for proposing policy solutions towards a freer life for residents, better business conditions and more efficient activities of municipalities. The Lithuanian Free Market Institute plans to continue the Index of Municipalities of Lithuania on an annual basis.
Lithuania consists of 60 municipalities. Even though municipalities do not have complete autonomy from the central government, they are autonomous in the fields of their delegated functions such as health care, education, public utilities and public transportation, social care, and municipality’s asset management. Business conditions to some extent also depend on the decisions adopted at municipal level and on the rates of the land tax and real estate tax set by municipalities.
The project was funded by the Friedrich Naumann Foundation.