Local Finance in Portugal Rules and Performance

• Autor(a) principal: Baleiras, Rui
• Data de Publicação: 1997
• Tipo de documento: Artigo
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/89018
• topic: Budget rules; Local public finance; Portugal

Calls for reform of the Portuguese local finance system have been made in recent years. Most of them address changes in individual items only, such as the equalisation transfers or the real estate taxation. We believe a sound and sustainable improvement of the status quo requires a global approach. This paper provides a first step forward in such direction by presenting a comprehensive diagnostic of the current system. The performance of any institution is bounded by rules and so we start by taking a look at the constitutional limits the local administration sub-sector faces. Later, a number of quantitative indicators regarding the actual activity of local governments are produced, focusing on budget discipline, revenue diversification and expenditure scope. The constitutional rules provide guidelines according to which these indicators of performance are evaluated. The assessment of the current state of affairs highlights the direction of required changes. We hope to address them in a future paper.