This is the 4th report assessing the implementation of the Charter in Romania.
The rapporteurs conclude that the country’s system of local self-government works well and that the obligations of the Charter are generally fulfilled.
They note with satisfaction the improvement of the consultation framework as well as the weight of local authorities in public spending. The delegation also notes the precious role of the Court of Accounts improving the efficiency and transparency of the local sector. The rapporteurs highlight the positive effects of the reform of metropolitan areas and the proposals made to strengthen cooperation between rural communes.
However, the report points out a few issues that deserve special attention. In particular, the weakness and fragmentation of the communes, in rural areas; the transfers of competences that are not always accompanied by the necessary financial resources; strengthening the regional level and the currently limited possibility for local authorities to finance investments. There is also a lack of transparency in the allocation of financial resources between the central and local levels.
Therefore, it is recommended to improve and facilitate voluntary mergers or cooperation between municipalities; to allocate the financial resources corresponding to responsibilities exercised by local authorities. In addition, national authorities are encouraged to respect the legal deadlines to ensure the good conduct of the consultation process. Furthermore, the delegation recommends providing the capital city of Bucharest with substantial procedural safeguards to guarantee its autonomy.
The report also encourages Romania to sign and ratify the Additional Protocol to the Charter (CETS No 207), as well as to withdraw its reservations to Article 7.2, which is currently being applied in practice.
The principle of local self government shall be recognised in domestic legislation, and where practicable in the constitution.
Article 2 requires the principle of local self-government to be recognised at domestic level in an ‘open’ and ‘express’ manner, i.e. in written law. The practical and operational consequences of this recognition can be fully understood in the light of Article 11, according to which “the principles of local self-government as are enshrined in the constitution or domestic legislation” shall be protected by judicial remedies that local authorities can activate. Therefore, the written principles represent the standards for court’s ruling on the recourses submitted by local authorities against acts infringing their local autonomy.[21]
The principle of local self-government is guaranteed under the Romania Constitution. According to Article 120, paragraph 1, “Public administration in administrative-territorial units is based on the principles of decentralization, local autonomy and deconcentration of public services”. Article 121, paragraph 2, establishes that “The local Councils and Mayors shall act as autonomous administrative authorities and manage public affairs in communes and towns, in accordance with the law”. In several occasions, the Constitutional Court used those constitutional provisions as standards in constitutional adjudication.[22]
In addition, according to Article 73.3 of the Constitution, an organic law is necessary to regulate “the organisation of local public administration, of the territory, as well as the general regime regarding local autonomy”.
The legislation establishes in a very clear way the principle of local self-government. According to the Article 75 of the Administrative Code: “(1) The local public administration in the administrative-territorial units is organised and operates based on the general principles of public administration provided for in Part I, Title III and the general principles provided for in Law nº 199/1997 for the ratification of the European Charter of Local Self-Government, adopted in Strasbourg on October 15, 1985, as well as the following specific principles: a) the principle of decentralisation; b) the principle of local autonomy; c) the principle of citizens' consultation in solving problems of special local interest; d) the principle of eligibility of local public administration authorities; e) the principle of cooperation; f) the principle of responsibility; g) the principle of budget constraint”.
Local self-government denotes the right and the ability of local authorities, within the limits of the law, to regulate and manage a substantial share of public affairs under their own responsibility and in the interests of the local population.
The main question that must be addressed under this heading is whether, in the present situation, Romanian local authorities regulate and manage a “substantial share of public affairs under their own responsibility and in the interests of the local population”. This provision requires an assessment which takes into account the rather “subjective” and relative nature of such concepts as “ability”, “a substantial share of public affairs”, “under their own responsibility” and “in the interests of the local population” since no official or universal method of measuring such substantial character has yet been developed. The question must be addressed considering the historical evolution, the culture and the constitutional traditions of the country under analysis. It is also closely linked to the assessment of the compliance with other parts of the Charter, such as Articles 4, 8 and 9.
In order to assess compliance with this provision, both legislative and factual aspects should be taken into consideration.
As for legislative provisions, Article 5 j) of Administrative Code defines the local autonomy as “the right and the effective capacity of the local public administration authorities to solve and manage, on behalf and in the interest of the local communities at which they are elected, public affairs, under the conditions of the law”.
At factual level, could be mentioned the Local autonomy Index (LAI) County ranking 2014, considering Romania in an intermediate position among European countries.
Table 8. Local autonomy Index (LAI) County ranking 2014
Source: Ladner/Keuffer/Baldersheim/Hlepas/Swianiewicz/Navarro,Patterns of Local Autonomy in Europe, 2019, New York, Palgrave MacMillan
In 2019, local expenditure representing the 8,3% of the GDP (2019) and 23,6% of the public expenditures (EU 28 average being 23.3%);[23] local government revenues represent 25.5% of the public revenues, 7,8% of the GDP.
Table 9. Local government expenditures (2016-2019)
Source: NALAS,Fiscal Decentralization Report, 8thEdition, p. 159
Although the transfer of competences was not always sufficiently well-coordinated at the level of the ministries and the central administration has not always been able to accompany the package of decentralised services with the appropriate financial resources, thus resulting, in many cases, the local administration not having the necessary capacity to manage these new responsibilities, the decentralization has been a pillar of the democratic transition and democratic consolidation in Romania.
This right shall be exercised by councils or assemblies composed of members freely elected by secret ballot on the basis of direct, equal, universal suffrage, and which may possess executive organs responsible to them. This provision shall in no way affect recourse to assemblies of citizens, referendums or any other form of direct citizen participation where it is permitted by statute.
Article 3.2 is the main statement of the democratic principle in the provisions of the Charter. The right of self-government must be exercised by democratically constituted authorities.The concept of local autonomy does not involve the mere transfer of powers and responsibilities from central to local authorities but also requires local government to express, directly or indirectly, the will of the local population.
In Romania, local authorities are governed by a council which is elected every 4 years in fair and free elections.[24] The mayor and the president of the county council are also directly elected.
During the consultation procedure, the Ministry of Development, Public Works and Administration informed the delegation thaton the 23rd of May 2022, the Romanian Senate has adopted the Law for modifying and completing LawNº 208/2015 which stipulates that the lists of candidates, except the ones that contain 1 or 2 candidates, for the Romanian Senate as well as for the Romanian Chamber of Deputies should respect the minimum quota of representation of 33%, for women as well as for men, as that this Law is going to be voted also by the Chamber of Deputies, decision-making body. However, at the time of the visit, the rapporteurs noted that women are underrepresented at local level in Romania. Despite the fact that women represent 50% of the Romanianpopulation, at local level there are around only 5.33% female mayors and 12,4 are members of local councils,[25] a percentage that places the country at the bottom in the EU and Central and Eastern European Countries (CEECs) ranking.[26]
The last local elections took place on 27 September 2020, with a turnout of 46,02%.[27] The turnout in the parliamentary elections of December 2020 was 13% lower than for the local elections in 2020. Since 2008, turnout in local elections has been consistently higher than in parliamentary elections.
The basic powers and responsibilities of local authorities shall be prescribed by the constitution or by statute. However, this provision shall not prevent the attribution to local authorities of powers and responsibilities for specific purposes in accordance with the law.
Article 4, paragraph 1, of the Charter requires that the basic powers and responsibilities of local authorities are prescribed by the constitution or by statute, so as to ensure predictability, permanence and protection for the benefit of local self-government. Therefore, the tasks of local authorities should not be assigned on an ad hoc basis and should be properly enshrined in written parliamentary legislation. Establishing local powers and competences by means of administrative regulation should be avoided and goes against the spirit of the Charter.[28]
In Romania, legislation attribute to the local authorities a vast set of competences. Among them, a vast range of competences related to the social services. Article 129 of the Administrative Code lists, among the competences of the local councils, public services of local interest regarding: a) education; b) social services for the protection of the child, the disabled, the elderly, the family and other persons or groups in social need; c) health; d) culture; e) youth; f) sport; g) public order; h) emergency situations; I) environmental protection and restoration; j) conservation, restoration and enhancement of historical and architectural monuments, parks, public gardens and nature reserves; k) urban development; l) records of persons; m) bridges and public roads; n) community services of public utilities of local interest; o) mountain rescue, lifeguard and first aid emergency services; p) social-community administration activities; q) social housing and other housing units owned by the administrative-territorial unit or under its management; r) valuing, in the interest of the local community, the natural resources within the administrative-territorial unit; s) other public services of local interest established by law.
Article 173 of the Administrative Code attributes to the county councils the competence to establish “the necessary framework for the provision of public services of county interest regarding: a) education; b) social services for the protection of the child, the disabled, the elderly, the family and other persons or groups in social need; c) health; d) culture; e) youth; f) sport; g) public order; h) emergency situations; I) environmental protection and restoration; j) conservation, restoration and enhancement of historical and architectural monuments, parks, public gardens and nature reserves; k) records of persons; l) bridges and public roads; m) community services of public utility of county interest; n) tourism; o) rural development; p) economic development; q) other public services established by law”.
Urban planning is another important sector of competence for local authorities, according to the
Law nº 350/2001.[29]
Local authorities shall, within the limits of the law, have full discretion to exercise their initiative with regard to any matter which is not excluded from their competence nor assigned to any other authority.
According to Article 4, paragraph 2, local authorities must have the right to exercise their initiative on matters not explicitly excluded from their competence by law. In addition, they must have “full discretion to exercise their initiative”. Restrictions on local bodies’ full discretion can also stem from management, fiscal and budgeting rules that require a sound legal basis for spending[30].
In Romania, legislation awards the authorities of local public administration with the right to take initiatives in all areas, within the limits of the law, except for those which are expressly included in the scope of work of other public authorities.
As for restriction to full discretion, they stem from the lack of financial resources, much more than from interferences from other levels of government (see infra, sub Article 9). In Romania, local authorities are responsible for many social services. The decentralization raises many challenges, especially for the communes in the rural areas. The rural communes lack of human and financial resources to carry out their tasks, also considering the demographic tendenciesrelated to massive emigration and the ageing population.
Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. Allocation of responsibility to another authority should weigh up the extent and nature of the task and requirements of efficiency and economy.
Article 4, paragraph 3 of the Charter articulates the general principle of subsidiarity. It establishes that “Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. Allocation of responsibility to another authority should weigh up the extent and nature of the task and requirements of efficiency and economy”.
In Romania, the division of competences is regulated by Article 76 of the Administrative Code, mentioning the principle of subsidiarity consisting of “the exercise of competences by the local government authority at the administrative level closest to the citizen and which has the required administrative capacity;”, central or local authorities claim and consolidate this approach through legislative means or administrative mechanisms to enhance the capacity of local government authorities to exercise exclusive competences or to collaborate in the exercise of shared or delegated competences.[31]
To ensure the implementation of the principle of subsidiarity, in 2017 the Romanian Government approved the General Decentralisation Strategy concerning the analysis of the opportunity to decentralise new competences to the local government authorities in agriculture, culture, sports, youth, education, environment, health and tourism.
Powers given to local authorities shall normally be full and exclusive. They may not be undermined or limited by another, central or regional, authority except as provided for by the law.
Article 4, paragraph 4, provides that “Powers given to local authorities shall normally be full and exclusive. They may not be undermined or limited by another, central or regional, authority except as provided for by the law”. The law may certainly introduce limitations on the powers given to local authorities, but such limitations should be exceptional, based on objective reasons and interpreted narrowly. In addition, overlapping responsibilities can become a threat to local autonomy.[32]
Both during the visit and the written answers to the rapporteurs, no issues have been raised by the interlocutors. In Romania, local authorities are responsible for many social services.The challenges do not stem from the interference of State legislation, but by the expenditure pressure and by the lack of adequate resources.
Where powers are delegated to them by a central or regional authority, local authorities shall, insofar as possible, be allowed discretion in adapting their exercise to local conditions.
Article 4, paragraph 5, refers to delegated responsibilities, establishing that local authorities shall,possibleThe delegation of powers between different levels of government is a long-standing tradition in many European States. Central government benefits from the territorial network formed by local and regional authorities: they are closer to citizens and offer local knowledge, they reflect local conditions and provide economies of scale. Local bodies and services therefore discharge delegated functions on behalf of higher-level authorities, most commonly on behalf of the State[33].
Both during the visit and the written answers to the rapporteurs, no issues have been raised by the interlocutors on the delegation of competences, which appears to satisfy the requirements of this article in practice.
Local authorities shall be consulted, insofar as possible, in due time and in an appropriate way in the planning and decision-making processes for all matters which concern them directly.
Article 4 paragraph 6 of the Charter provides that “local authorities shall be consulted, insofar as possible, in due time and in an appropriate way in the planning and decision?making processes for all matters which concern them directly”.
Consultation is a key principle of the Charter. The Charter does not define or prescribe the forms of consultation or substantially regulate the consultation process. Since its basic function is to establish the general approach and framework for consultations, it may be concluded that the main process of consultation is dependent on three basic conditions: (a) local authorities should be able to obtain full information on decisions and policies that concern them directly, and this information should be available at the initial stage of the decision-making process; (b) local authorities should have the possibility of expressing their opinion on decisions and policies before these become legally binding documents; and (c) local authorities should have the time and ability to prepare recommendations or alternative drafts and submit them for consideration[34].
Recommendation 300 (2011) pointed out the necessity to improve the consultation mechanisms.
Since then, this aspect has been addressed by several reforms and during the monitoring visit the delegation was informed that, generally, the consultation works quite well, although sometimes the short delays do not allow the local authorities to duly examine the acts submitted for consultation.
The Administrative Code contains several provisions on consultation. Article 78 establishes the procedure for decentralising State competences.In all stages of the transfer process, it is mandatory to consult the associative structures of the local public administration authorities. Article 82 establishes that the representatives of the associative structures of the local public administration authorities are also members of the Committee for Local Public Finances, which has an advisory role in the drafting and implementation of financial and fiscal decentralization policies. Article 86 provides that
“Theauthorities of the central public administration initiating a draft normative act have the obligation to consult the associations of local authorities, at least 15 working days before the submission for adoption/approval of any draft normative act that directly concerns the local public administration and/or that has an impact on local communities. In the case of projects of urgent normative acts, the term can be reduced to 10 working days”. According to paragraph 3 of the same article, “The points of view of the associative structures of the local public administration authorities regarding the draft normative acts on which they were consulted are motivated in accordance with the legal provisions and can be transmitted, through the care of their presidents, within 10 working days from upon receipt, at the authority of the central public administration initiating the draft normative act, respectively within 7 working days, in the case of draft normative acts of an urgent nature”.
Those provisions have been specified and detailed by the Government Decision nº 635/2022 on the procedure for consulting the associations of local government authorities in preparing the draft legal acts.[35]
The delegation was informed by the Ministry of Development, Public Works and Administration (MDPWA) that, to ensure a coherent framework for analysing the implementation of the consultation procedure, consultative meetings are organised every six months at the level of the Ministry between its management and that of the associations. In 2021, the Ministry sent 230 draft legal acts to the associations of local authorities as follows:
- 155 draft laws;
- 30 draft Government decisions;
- 30 draft Government Ordinances;
- 4 draft Emergency Government Ordinances;
- 9 draft orders of ministers.
The associations of local government authorities have sent opinions on the draft legal acts mentioned above, as follows:
- 5 opinions from the Romanian Association of Communes;
- 36 opinions from the Romanian Association of Municipalities;
- 3 opinions from the Romanian Association of Towns;
- 183 opinions from the National Union of County Councils of Romania.
In 2022, new regulation was passed by the government also on the interministerial technical committee for decentralization[36]. It is a structure with a consultative and permanent character, with the participation of the president of the Romanian Association of Communes;the president of the Romanian Towns Association; the president of the Romanian Association of Municipalities; the president of the National Union of County Councils in Romania. It approves the draft of the general decentralization strategy developed by the coordinating ministry of the decentralization process; proposes solutions regarding the sectoral decentralization process or regarding the need to improve the way decentralised powers are exercised, as the case may be; endorses the projects of sectoral decentralization strategies and the projects of sectoral strategies for improving the way of exercising decentralised powers, proposed by ministries or other specialised bodies of the central public administration; approves the quality and cost standards proposed by the ministries or other specialised bodies of the central public administration, which are subsequently approved by a Government decision; approves the monitoring and evaluation reports regarding the implementation stage of the sectoral decentralization strategies and the sectoral strategies for improving the way of exercising decentralised powers.
Changes in local authority boundaries shall not be made without prior consultation of the local communities concerned, possibly by means of a referendum where this is permitted by statute.
This article requires that local communities should be consulted in case of changes of local authorities’ boundaries.
In Romania, protection of boundaries is guaranteed both by legislation and in practice. According to Article 95 of the Administrative Code, “(1) The territory of Romania is organised, from an administrative point of view, in administrative-territorial units which are communes, towns and counties. (2) Town and communes are basic administrative-territorial units. (3) Some towns are declared municipalities/cities under the law. (4) Any modification of the territorial limits of the administrative-territorial units regarding their establishment, re-establishment or reorganisation can only be carried out by law and after the mandatory consultation of the citizens of the respective administrative-territorial units through a local referendum, in accordance with the law”.
The rapporteurs take note that since 2001, the local government is rather fragmented, but no attempts to encourage amalgamation of administrative entities have been taken. Only recently an initiative to consult the population was presented. In Buz?u municipality/city a referendum was organised to consult citizens on the modification of the boundaries of the administrative-territorial unit of the city Buzau and the commune of ?inte?ti, in the sense of the union of the two administrative entities. If the citizens of the two localities had voted in favour of unification and had reached a quorum in each of them, there would have been a first in the last 30 years: the voluntary merger of two administrative territorial units. However, the quorum was not reached: in order to be valid, at least 30% of the number of people registered in the electoral lists should have participated in the referendum, and at least 50% plus one to agree with the merging of the two localities[37]. A major part of the voters is living abroad and don’t go frequently or at all to the polling stations. It makes difficult to reach the quorum and jeopardises the propre functioning of voluntary merger. During the consultation procedure, the Ministry of Development, Public Works and Administration highlighted Art. 4 para. (2) of the Law no. 351/2001 on the approval of the National Spatial Plan - Section IV Network of Municipalities, as amended in 2010 states: (2) In order to allow access to the Structural Funds granted by the European Union to the communes with a marked decrease in population, included in the tables in points 5.0 and 5.1 of Annex IV and located in the areas marked on the map in Annex V, the Government shall encourage the administrative unification of two or more of these communes which are adjacent, at the initiative of the local public administration authorities and following the will expressed by local referendum by the population of the communes concerned.
Without prejudice to more general statutory provisions, local authorities shall be able to determine their own internal administrative structures in order to adapt them to local needs and ensure effective management.
Article 6, paragraph 1 of the Charter provides that local authorities shall be able to determine their own internal administrative structure: the power to organise their own affairs is accordingly a part of the autonomy enjoyed by local entities.
In Romania, the law recognises the normative power of local authorities regarding their internal organisation. Local councils, according to Article 129.2, lett. a), of the Administrative Code, exercise attributions regarding the administrative-territorial unit, its own organisation, as well as the organisation and operation of the specialised apparatus of the mayor, of public institutions of local interest and of autonomous companies and regies of local interest. They approve (Article 129.3, lett. a) “the statute of the commune, city or municipality, as well as the regulation of organisation and operation of the local council; by order of the competent minister, an indicative model of the status of the administrative-territorial unit is approved, as well as an indicative model of the regulation on the organisation and operation of the local council”.
County councils approves regulation of organisation and operation of the specialised apparatus of the county council, as well as of public institutions of county interest and of autonomous societies and boards of county interest (Article 173.2, lett. c) of the Administrative Code).
The conditions of service of local government employees shall be such as to permit the recruitment of high-quality staff on the basis of merit and competence; to this end adequate training opportunities, remuneration and career prospects shall be provided.
Article 6, paragraph 2, of the Charter refers to theThe power to hire their own staff and set employee remuneration is a relevant factor highlighting the organisational and institutional autonomy of local governments.[38]
Local governments in Romania employ two types of personnel: civil servants and staff falling under special statutes and contractual personnel. The central government sets the base wage of all subnational government employees (both civil servants and contractual personnel). Until 2011 a system of bonuses and allowances, which could be granted at local discretion, existed. The first cases of such bonuses and allowances were introduced in 1993, their number has gradually increased over the years, and by 2004 they produced significant effects in terms of differences in salaries and overall increases in personnel spending. Since 2009, as part of a set of measures aimed to reduce personnel spending in local government, absolute ceilings of staffing levels and ceilings on personnel spending were introduced for the first and second tiers of local government units[39]. Later, Law nº 153/2017 regarding the salary of staff paid from public funds, was approved, differentiating salaries according to the category of the administrative territorial units and giving soe autonomy to local authorities, within a range (a maximum and a minimum). Recently, the Administrative Code regulated the status of civil servants.
The delegation was informed that it is becoming challenging, especially for small, rural communes, to attract skilled human resources. The Association of Municipalities of Romania pointed out, in its written answers to the questions of the rapporteurs, that, given to the fact that the attributions are the same, the establishment of the mayors' and vice-mayors' allowances, as well as the salary of the general secretaries, should be carried out only according to the number of inhabitants and not according to the category of the administrative-territorial unit.
During the monitoring visit, no special remarks have been made neither concerning numbers nor the quality of local government employees.
The conditions of office of local elected representatives shall provide for free exercise of their functions.
Article 7, paragraph 1, seeks to ensure that citizens are free to serve as elected representatives and are not prevented from holding political office owing to financial or material considerations. Nobody should be deterred from standing for election at local level; once elected, local councillors should not be prevented from discharging their duties effectively.[40]
In Romania, local representatives are elected for four years. A detailed regulation of the lawful termination of city councillors' and county councillors’ mandates is established by legislation: e.g. date of event - if domicile is changed to another administrative territorial unit; after the court order becomes final - in case of safeguarding of interests; as well as the authority finding the termination of the city/county councillor's mandate (prefect or city/county council).
Early dissolution of the councils is possible by holding a referendum (Administrative Code,
Article 143 on local councils and Article 184 on county councils). The referendum is organised as a result of the request addressed to the prefect of at least 25% of the number of citizens with the right to vote registered in the Electoral Register with domicile or residence in the administrative-territorial unit. The local referendum is valid if at least 30% of the total number of residents with the right to vote registered in the Electoral Register with their domicile or residence in the administrative-territorial unit turned out to vote. The mayor’s mandate also can end as a consequence of a local recall referendum (Article 162 of the Administrative Code).
No special concerns have been presented during the monitoring visit.
They shall allow for appropriate financial compensation for expenses incurred in the exercise of the office in question as well as, where appropriate, compensation for loss of earnings or remuneration for work done and corresponding social welfare protection.
Article 7, paragraph 2, refers to an appropriate financial compensation for elected representatives. The aim of the, in connection to paragraph 1, is to ensure that local elected representatives receive “appropriate financial compensation” and to avoid the conditions of office preventing, limiting, or even excluding potential local candidates from standing for office because of financial considerations.
Romania did not ratify Article 7, paragraph 2. However, as a Congress report pointed out in 2019, “Romania has made significant progress under Law nº. 393/2004, providing several arrangements for paying elective representatives bonuses and financial compensation in the exercise of their function (and even afterwards, in the case of former elected representatives, who reach the age of retirement)”[41]. The same report pointed out that “in Croatia, Ireland, North Macedonia, Montenegro and Romania, mayors’ salaries are about six times higher than respective national minimal wages”.[42]
The delegation was informed that a monthly allowance for taking part in the council’s and relevant committees of city/county councillors has been introduced and that the benefit for old age for the persons who have exercised executive authority - mayor, deputy mayor, President of county council and vice-President of county council, have been introduced.
Any functions and activities which are deemed incompatible with the holding of local elective office shall be determined by statute or fundamental legal principles.
Article 7, paragraph 3, deals with compatibility between the holding of a representative position at local level and other activities, either public or private, establishing that the “functions” and “activities” that cannot be made compatible with holding a local position once the candidate has been elected shall be determined by statute or fundamental legal principles.
In Romania, the incompatibilities are determined by several legal provisions. Law nº 161/2003, Article 88.1, lett c) states that (1) The position of local councillor or county councillor is incompatible with exercising the following positions or qualities: c) the quality of public officer or employee with individual employment contract in the own apparatus of the local council respectively or in the own apparatus of the county council or the prefect’s from the respective county. In addition, paragraph 3 of Article 91 of the said law obliges elected officials to resign from one of the incompatible functions within a maximum period of 15 days from the day of the election to the office of councillor, mayor, county president. Articles 227-230 of the Administrative Code introduced some additional provisions.
The conflict-of-interest regime for local elected representatives is clarified by systematisation of acts by Law nº 393/2004 on the status of the local elected representatives: on the one hand, by referring only to the patrimonial nature of the local elected representative's interest, and, on the other hand, by harmonising the second-degree kinship for all local elected representatives.
In the framework of anti-corruption programmes, the National Integrity Agency (ANI) carries out administrative investigations regarding conflicts of interests, incompatibilities of activities and unjustified wealth, and is responsible for the monitoring and verification of declarations of assets, including of all elected officials. Strengthening integrity in priority areas, such as health care, public procurement, and local administration is part of the new National Anti-Corruption Strategy for 2021-2025 was approved by the Government in December 2021[43].
Before the local elections of 20 September 2020, ANI reached out to central and local electoral authorities to inform on candidates who could be under a ban to hold a public office following a sanction for incompatibility or conflict of interests in the previous mandate. Over 500 persons were concerned by an interdiction[44]. After elections, ANI sent to the Courts, who have the competence to validate the mandates of the newly elected officials, a nominal list of candidates under the interdiction to occupy a public office for three years. While a number of candidates were prevented from running for office, and others have been denied office, the courts ruled in about half of the candidates who were under interdiction that they are allowed to hold the elected office. From the total of 103 candidates to the local elections under interdiction: 65 candidates have been elected, according to information available from official sources: 15 elected officials have been denied to hold the elected office, while 49 elected officials have been allowed to hold the elected office.
No issues have been raised during the monitoring visit.
Any administrative supervision of local authorities may only be exercised according to such procedures and in such cases as are provided for by the constitution or by statute.
Article 8 of the Charter deals with supervision of local authorities. Article 8, paragraph 1, establishes that any administrative supervision of the activities of local authorities must be exercised according to such procedures and in such cases as are provided for by the constitution or by statute. The Charter establishes an important principle here in the area of inter-governmental supervision of local authorities: any form of such supervision must be provided for by the constitution or by statute, i.e., the Charter introduces the legality principle into the supervision of a local authority.[45]
In line with the requirements of the Charter, in Romania the rules governing the supervision over local authorities and the powers of the central authorities concerned are determined by the Constitution and by the law. According to Article 123, paragraph 5, of the Constitution, the prefect "can challenge, before the administrative litigation court, an act of the county council, of the local council or of the mayor, if he considers the act illegal. The challenged act is suspended de jure". The Administrative Code establishes (Article 255) that: “(1) The prefect verifies the legality of the administrative acts of the county council, the local council and the mayor. (2) The Prefect may challenge the acts of the authorities provided for in paragraph (1) which they consider illegal, before the competent court, under the terms of the administrative litigation law”.
Any administrative supervision of the activities of the local authorities shall normally aim only at ensuring compliance with the law and with constitutional principles. Administrative supervision may however be exercised with regard to expediency by higher-level authorities in respect of tasks the execution of which is delegated to local authorities.
According to Article 8, paragraph 2, of the Charter, the supervision over local authorities can only aim at ensuring compliance with the law and constitutional principles. Expediency control can be used only in case of delegated tasks.
In Romania, (see above) the supervision over the acts of local authorities is carried out by the State and it is limited to a control of legality. No issues have been raised during the monitoring visit.
Administrative supervision of local authorities shall be exercised in such a way as to ensure that the intervention of the controlling authority is kept in proportion to the importance of the interests which it is intended to protect.
Article 8, paragraph 3, deals with the way in which the supervision is exercised in practice, and requireswith the principle of proportionality. Under the principle of proportionality, the regional or State body should intervene only to the extent necessary, taking into account the relevance of the public interest at stake, or the seriousness of the legal violation allegedly committed by the local authority.[46]
As for the practical exercise of the supervision, it is worth mentioning that the Administrative Code was amended by the government in 2021 through an Emergency Ordinance[47], so that prefects and sub-prefects can be party members. The growing political affiliation of the prefect has been criticised both by scholars[48] and international organisations[49].
However, no particular matters of concern have been raised during the monitoring visit in this respect.
Local authorities' financial resources shall be commensurate with the responsibilities provided for by the constitution and the law.
Another basic, established in Article 9, paragraph 2, requires that local authorities should have sufficient financial resources in proportion to the responsibilities assigned to them by law. This paragraph enshrines the so-called “principle of commensurability” of local authorities’ financial resources. This means that the resources available to local authorities should be sufficient and commensurate with their functions and tasks. To this purpose, any transfer of powers and tasks should be based on careful calculation of the actual service delivery costs to be met by local authorities.
The costs of mandatory and delegated tasks might include several factors (such as the socioeconomic structure of residents) in order to produce more precise calculations and avoid arbitrary political decisions.[51]
During the meetings, it was pointed out that several competences were transferred from the central authority to the local authorities. The Administrative Code (GEO 57/2019) clearly stipulates that one of the principles of the decentralisation process deals with the assurance of the resources corresponding to the transferred competencies [art. 76 letter b)]. Furthermore, the Code also regulates that the government, ministries and other specialised bodies of the central public administration ensure, in collaboration with the associative structures of local public administration authorities, the long-term correlation between transferred responsibilities and related resources, so as to cover cost variations in the provision of decentralised public services and utilities. [art. 78 (3)], but in some situations, this transfer of powers is not entirely accompanied by the transfer of the financial resources necessary to realise these competences in an appropriate way. In addition, local public administrations know the allocated budgets only at the time of the adoption of the State budget law, so no earlier than December of the current year for January of the next budget year. There were years when local public administration did not know the budget allocations they have in the current year, earlier than the months of February-March. This uncertainty does not allow local governments a proper programmation of their activities, undermining the efficiency of their administrative action.
For the purpose of borrowing for capital investment, local authorities shall have access to the national capital market within the limits of the law.
Article 9, paragraph 8, refers to the access to the national capital market for the purpose of borrowing for capital investment. Access to national capital markets is important for local authorities to finance investment projects necessary for the further development of the local area because in many cases the amount of their own “ordinary” resources is not sufficient to cover all the projects and plans decided on by local authorities to satisfy local needs. However, like other rights enshrined in the Charter, this is not absolute and must be reconciled with the general policy on public sector spending and debt. This is why the Charter says that the access must take place “within the limits of the law”. Moreover, as a result of the recent economic crisis, many countries have introduced austerity measures to deal effectively with public deficits, so access to the national capital market should be analysed in the context of national fiscal policy and the governance of public debt.[57] During the consultation procedure, the Ministry of Development, Public works and Administration developed that in order to overcome the financial difficulties regarding investment objectives, according to the Law no. 273/2006 on local public finances, with subsequent amendments and additions, the local public authorities expenses related to investments can be financed from local budgets and loans. Thus, art. 61 - 63 of the aforementioned normative act, provide for the possibility of local public authorities applying for bank loans for the financing of public investments of local interest. Local councils can approve contracting or guaranteeing for short, medium and long-term internal or external loans, for the realisation of public investments of local interest, as well as for the refinancing of local public debt. Local public authorities can contract or guarantee loans, according to the law, only with the approval of the Local Loans Authorization Commission.
In Romania, local government authorities may contract loans up to 30% of their own income, which consist of both local taxes and fees and income tax (in turn, it is considered own income). There is a total ceiling for the indebtedness, established on a yearly basis by the government. During the monitoring visit, the delegation was told by several interlocutors, including the municipality of Bucharest, that the ceiling is too low and it must evolve.
As far as possible, grants to local authorities shall not be earmarked for the financing of specific projects. The provision of grants shall not remove the basic freedom of local authorities to exercise policy discretion within their own jurisdiction.
Article 9, paragraph 7, of the Charter establishes that “As far as possible, grants to local authorities shall not be earmarked forthe financing of specific projects. The provision of grants shall not remove the basic freedom of local authorities to exercise policy discretion within their own jurisdiction”.
In Romania, State and European funds are an important part of local authorities’ income. The main concern on this issue is related to the criteria for distributing those funds, which are not always transparent and objective, raising very often criticisms and political debates[54]. An example could be represented by the Anghel Saligny National Investment Programme intended to provide over €10 billion to local authorities for various development works[55]. Several organisations pointed out the risks of mismanagement, due to the vague criteria on how projects should be selected, implemented, monitored, and audited[56]. During the consultation procedure, the Ministry of Development, Public works and Administration argued that the allocation of the funds was made using an algorithm that took into account the following criteria: number of territorial administrative units, population size, county income taxes collected, needs related to road modernization and water supply and sewage systems (using official statistical indicators for the last available years). The Ministry added that the allocation covered all the territorial administrative units that asked for financing (a total of 3140 out of the total 3228 local administration received allocation) and the amount allocated depended on population thresholds set out for each county and type of investment.
Local authorities shall be consulted, in an appropriate manner, on the way in which redistributed resources are to be allocated to them.
Article 9, paragraph 6, of the Charter refers to a general principle of consultation, as enshrined at
Article 4.6. In this case, consultation is required on the way in which redistributed resources are to be allocated to local authorities by other levels of government. Under Article 9.6, consultation is not merely a compulsory procedure that has to take place in a timely manner before a final decision is. It must also cover the manner in which a decision is made and the criteria for doing so, not only the decision itself.[53]
Consulting local public authorities when adopting decisions that substantially affect them is a legal obligation enshrined in the legislation that governs the activity of local authorities, also on financial issues.
Law nº 273/2006 defines the principle of consultation, according to which local public administration authorities, through their associative structures, must be consulted on the process of allocating financial resources from the state budget to local budgets.
The Administrative Code establishes a series of mandatory rules in this regard, namely the rules of the decentralisationprocess, the stages of the transfer of competences, within which it is mandatory to consult the associative structures of the local public administration authorities.
At the same time, the Administrative Code defines the Inter-ministerial Technical Committee for Decentralisation and the Committee for Local Public Finances, with the role of coordination and consultation in the development and implementation of financial and fiscal decentralization policies.
The representatives of the associative structures of the local authorities are part of these committees, respectively:
a) Association of Romanian Communes;
b) Association of Romanian Towns;
c) Association of Romanian Municipalities;
d) National Union of County Councils of Romania
The authorities of the central public administration initiating a draft normative act have the obligation to consult the associative structures, before submitting for adoption/approval any draft normative act that directly concerns the local public administration and/or that has an impact on local communities.
During the monitoring visit, the Association of Communes in Romania pointed out that the consultation process is based on a genuine dialogue and requires an active role of the Committee for Local Public Finances. The Committee for Local Public Finances is a body with a consultative role in the process of drawing up financial regulations, which directly concern local budgets and establishing the amounts for equilibration that are allocated annually from the state budget for local budgets.
The protection of financially weaker local authorities calls for the institution of financial equalisation procedures or equivalent measures which are designed to correct the effects of the unequal distribution of potential sources of finance and of the financial burden they must support. Such procedures or measures shall not diminish the discretion local authorities may exercise within their own sphere of responsibility.
Article 9, paragraph 5 addresses the question of the financial situation of municipalities that are financially disadvantaged due to their being located in economically or geographically weak areas (transition, mountain or island regions), or simply because they are too small to obtain the amount of resources needed to perform their tasks.
In Romania, there are important territorial inequalities. The Bucharest-Ilfov development region contributes 26.6% of GDP. According to the statistics on the contribution of the counties and regions to the GDP, South Muntenia (12.3%), North-West (11.8%) and Center (11.5%) followed. The development regions in the eastern part of the country improved their relative performance and managed to cross the ten percent threshold (10.5% for the Southeast and 10.2% for the Northeast). Below this threshold, for different reasons, the West development region (9.6% of GDP, composed of only four counties) and South-West Oltenia (7.4%, with only five counties but also due to the fact that it is a pole of poverty).[52]
Both the share of the income tax (14%) allocated for equalising and the amounts broken down from VAT for equalising are distributed in percentages for the county's own budget (15% in 2021 and 2022) and for equalising the local budgets of communes, towns and municipalities/cities (85%). The distribution of the 85% share is done through an equalising formula, so as to ensure a minimum level of income/inhabitant/year (e.g. 830 lei/inhabitant/year in 2021).
Currently, the equalisation system aims both at reducing imbalances in the financial capacity of administrative-territorial units (horizontal), and at the express financing of some powers delegated to local authorities, especially social expenses.
After 2019, in addition to the allocation criteria related to the financial capacity of the administrative-territorial units, additional criteria were introduced to compensate for revenue losses from the reduction of the income tax rate (from 16% to 10%), to compensate for transferred expenses in the social field and to ensure the expenses of the operating section of local budgets. All this has exponentially increased the complexity of the equalisation system, which can affect the objectivity and transparency of the equalisation.
Part at least of the financial resources of local authorities shall derive from local taxes and charges of which, within the limits of statute, they have the power to determine the rate.
Article 9, paragraph 3, requires that at least part of the financial resources of local authorities must derive from local taxes of which, within the limits of statute, they have the power to determine the rate. The Charter does not state that a local authority’s own resources must contain a uniform proportion of local taxes, but it does make it mandatory for “at least” part to derive from local taxes and charges. This part should be large enough to ensure the greatest possible financial independence of local authorities.
In Romania, according to the figures (see above), taxation accounts for 17.9% per cent of local revenues in 2021. Local governments have the decision-making freedom about the determination of local taxes and fees in the sense that the local government authorities are free to increase their level so as to ensure the funding needs in the exercise of the duties conferred by the law, although the delegation was informed that very often local governments are reluctant to increase local taxes. This reluctance is often guided by political considerations, such as keeping a good reputation, and can have damageable effects on the funds available.
In addition, the income tax collected at the administrative territorial unit's level, is fully allocated to the local government authorities (it represents 33.9% of local revenues in 2021). The local public finance law provides that 71.5% of the income tax remains at the level of administrative-territorial units, but, starting from 2019, through the annual budget laws it was approved that this income remains fully (100%) at their level. This share was distributed as follows: 63% to the local budgets of communes, towns and municipalities/cities; 15% to the county budget (county council); 14% for balancing the local budgets of communes, towns and municipalities/cities, as well as the local budget of the county; 6% is allocated to the local budgets of communes, towns and municipalities/cities by decision of the county council; 2% for the financing of cultural institutions.
Local authorities shall be entitled, within national economic policy, to adequate financial resources of their own, of which they may dispose freely within the framework of their powers.
Article 9, paragraph 1, of the Charter establishes two basic principles in the area of finance. First, local authorities should have theirownfinancial resources; the right to “adequate” resources is not absolute but has to be exercised “within national economic policy”. Second, they should be free to decide how to spend those.[50]This freedom takes the form of various spending decisions, the most important being the adoption of an annual budget. Any limits and restrictions imposed by higher authorities on local authorities should be specified and justified and aim at ensuring macroeconomic stability.
This paragraph is only partially respected in Romania. The financial resources are not always adequate, and in many cases the criteria to distribute them between local authorities are not transparent and it can be subject to political interference. Although local authorities have their own resources, the part coming from the local taxes is limited and they depend mostly from State or European founds.
The financial systems on which resources available to local authorities are based shall be of a sufficiently diversified and buoyant nature to enable them to keep pace as far as practically possible with the real evolution of the cost of carrying out their tasks.
Article 9, paragraph 4, refers to the need for the resources available to local authorities to be of a sufficiently diversified and buoyant nature to enable them to keep up as far as practically possible with the actual changes (increases) in the costs for carrying out their tasks.
In Romania, the revenues of local authorities may come from different sources (own taxes and fees, transfers, other sources). Local authorities may adapt their own income to the different circumstances: for instance, if the local tax intake goes down for general economic reasons, the local authority may decide to increase local fees and charges paid by local service users (especially in urban areas) as a way to offset the decline.
Local authorities shall be entitled, in exercising their powers, to co-operate and, within the framework of the law, to form consortia with other local authorities in order to carry out tasks of common interest.
Article 10, paragraph 1, refers to types of cooperation aimed at carrying out tasks of common interest. Under Article 10.1, local authorities firstly have a general right to co-operate with one another in order to deliver local services or discharge their responsibilities. Inter-municipal cooperation (or cooperation at other levels of local government) is a fundamental tool for local authorities in terms of delivering services, in view of the fact that many of them are too small or too weak (financially speaking) to deliver all the services they are supposed to or to carry out any meaningful local strategy or policy. This general entitlement to cooperate with other local entities is supplemented by a more specific right, namely the right to “form consortia”, i.e. to create separate organisations. Although the Charter only mentions “consortia”, the specific right to create joint institutional structures, separate from the participating local authorities, may take various forms.[58]
Several methods of cooperation between the administrative territorial units have been regulated so as to increase the administrative capacity of local government authorities to provide good quality public services to the citizens.
According to Article 89 of the Administrative Code, two or more administrative units have the right, within the limit of the competence awarded to their deliberative and executive authorities, to cooperate and become associated, according to the law, by establishing inter-community development associations, which are legal entities of private law and public utility, as a form of association with the purpose of a joint delivery of some development project of regional or local interest or in order to supply together some public services. In addition, the possibility of carrying out activities which are included in the duties of local government authorities to the associations of local government authorities declared to provide public utilities and having legal personality at county level. During the consultation procedure, the Ministry of Development, Public works and Administration informed the delegation that in 2022 the Romanian Parliament adopted the Law for metropolitan areas, which is the legislative response to a territorial reality that has been manifesting itself in Romania for at least two decades - the growth of cities, especially the capital and regional metropolises in the first peri-urban crown, and the extension of their influence to neighbouring local administrative units, mainly as functionally integrated labour markets that generate neighbourhood effects, both beneficial (jobs, innovation) and harmful (congestion, pollution). The Ministry developed that the law establishes the institutional framework, objectives, competences and specific instruments of metropolitan development policy in Romania. The ultimate objective of the law is to increase the quality of life and territorial cohesion by addressing existing problems at an appropriate scale that will make investment in infrastructure and the provision of public services at supra-local level more efficient.
A special provision has been introduced to facilitate the inter-communal cooperation in the field of territorial development and urban planning, which is deeply affected by the lack of professional figures (chief architect) in order to ensure the joint provision of public services regarding urban and territorial planning, the issuance of town planning certificates and building permits.[59]
Another form of association is represented by the metropolitan areas that are set up based on the express agreement of the local councils of the constituent administrative units; the purpose of such metropolitan areas is to develop infrastructure and development objectives of joint interest.
During the visit, the delegation was informed that the government was drafting a new law, aimed at facilitating the cooperation of rural communes through administrative consortia. During the consultation procedure, the Ministry of Development, Public works and Administration informed the delegation that the Law for Administrative Consortia was adopted by the Romanian Parliament in December 2022.
The entitlement of local authorities to belong to an association for the protection and promotion of their common interests and to belong to an international association of local authorities shall be recognised in each State.
In this paragraph the Charter clearly recognises and sets out another right of local authorities: that to belong to (a) a national association for the protection and promotion of their common interests; and (b) an international association of local authorities.
The “associations” referred to in paragraph 2 are different from those mentioned in paragraph 1. Those mentioned in Article 10.1 are set up for the delivery of local services, plans or projects and are instruments for discharging duties and responsibilities. Conversely, those referred to in Article 10.2 are instruments for the promotion of common interests. These associations play a fundamental role in representing and defending the rights, powers and interests of local authorities and they carry out many activities on behalf of them all (not only in favour of their members).[60]
In Romania, the associations of local governments[61] and the association of counties[62] are explicitly recognised by legislation. Article 86 of the Administrative Code mentions the Romanian Association of Communes; the Association of Romanian Towns; the Romanian Association of Municipalities; the National Union of County Councils of Romania and “other associative forms of general interest, established according to the law”. All those associations must be consulted by the government, as described above (sub Article 4 paragraph 6).
Local authorities shall be entitled, under such conditions as may be provided for by the law, to co-operate with their counterparts in other States.
Article 10, paragraph 3, addresses the cooperation of local authorities with their counterparts in other States. The right to engage in cross-border cooperation is also protected.
Romania has signed and ratified the European Outline Convention on Transfrontier Co-operation between Territorial Communities or Authorities (ETS No. 106). Legislation recognises the possibility of local authorities to cooperate and associate with administrative units from abroad, as well as the possibility to become member in international organisations of local public administration authorities, while the administrative units that are neighbouring border areas may conclude among themselves cross-border cooperation agreements with similar structures from neighbouring countries. Local authorities in Romania may conclude twinning/cooperation agreements with local public administration authorities in other countries.
During the monitoring visit, the delegation was informed that cross-border cooperation, in the case of Giurgiu County with Bulgaria, represents a component of the regional development policy, which aims to ensure economic growth and balanced and sustainable social development of the border regions. Giurgiu County Council is a member of the Danubius Giurgiu-Ruse Euroregion Association (Romania-Bulgaria cross-border cooperation) and has common development projects within the EU cross – border programmes.
Local authorities shall have the right of recourse to a judicial remedy in order to secure free exercise of their powers and respect for such principles of local self-government as are enshrined in the constitution or domestic legislation.
Article 11 of the Charter refers to an effective judicial remedy to ensure respect for local self?government. It stresses the requirement that local authorities should have the right to invoke and to defend in the courts the principles of local self-government, especially in the context of lawsuits in which their rights and powers are challenged or curtailed, or when those rights are endangered by the higher (central or regional) levels of government. “Recourse to a judicial remedy” means access by a local authority to either a properly constituted court of law or an equivalent, independent, statutory body.[63]
In Romania, the local government authorities have no special right of appeal to the Constitutional Court or other courts, but they must fulfil the normal requirements for having a right of action. Therefore, they have the right to apply to the courts to ensure the free exercise of their competences and the compliance with the principle of local self-government which are stipulated in the Constitution or the domestic legislation in administrative courts. Pursuant Article 1 of Law nº 554/2004 on the administrative courts, the local government authorities may ask the administrative courts to annul the challenged act, recognise the alleged right or the legitimate interest and repair the damages caused by a central government authority.[64]
The Association of Communes of Romania pointed out, in its written answers to the rapporteurs, that, according to Law nº 554/2004, the procedures are limited only to administrative acts and that local authorities aren’t able to challenge emergency ordinances or laws, because they can’t directly trigger the Constitutional Court. However, in the same document, they mentioned that on 14.06.2021, the Association of Communes of Romania filed a lawsuit with the Bucharest Court of Appeal - Section IX Administrative and Fiscal Litigation, to compel the Government of Romania to issue a decision regarding the procedure and methodology for the application of Article 210 of the Administrative Code, with the subsequent amendments and additions. The court's solution was to state that the referral to the Constitutional Court of Romania is admissible with the exception of unconstitutionality of the provisions.
Actually, indirect complaint to the Constitutional Court, against laws and ordinances, by the way of the exception of unconstitutionality raised by an ordinary court, is possible in Romania (Article 146, lett. (d) of the Constitution).
In Romania, the principle of local self-government is recognised in the Constitution (Articles 120 and 121) and other legal instruments.
