HEARING ON LOCAL AND REGIONAL
DEMOCRACY IN ARMENIA
5 JUNE 2014 BRUSSELS
EUROPEAN CHARTER PROVISIONES ACTUAL
I M P L E M E N TAT I O N I N A R M E N I A
D AV I D T U M A N YA N
MEMBER OF THE GROUP OF
INDEPENDENT EXPERTS ON THE
EUROPEAN CHARTER OF LOCAL SELF GOVERNMENT
Subsidiarity. This principle is not fully effective due to the
lack of necessary conditions.
- Firstly, there is a legislative gap here. The local selfgovernment is one-tier, and many of the functions,
characteristic of it, are performed by central government
bodies (secondary education, healthcare, public order, etc.).
- Secondly, this one-tier system has many small and poor
municipalities (about half of municipalities have less than
1000 inhabitants), the local authorities (LAs) of which are
unable to fulfill the powers they have by law. Thus, the local
self-government is not fully effective in Armenia.
General competence. The essence of the principle is that
the LAs have a right to apply to any issue of interest to
the municipality and solve it, if it is beyond the mandate
of the state bodies. The real capacities of the LAs are so
small, that they are actually unable to realize this right.
This principle is not practically enforced in many
municipalities.
Independence and responsibility. The degree of
independence of LAs in the country in many ways
depends on the overall state of democracy in the country.
In this regard the situation is far from being satisfactory.
The degree of development of local self-government
institutions (mayor, council, associations, etc.) is low
hence there is weak independence of LAs. Central
authorities continue to behave as superior bodies to LAs,
and the latter are extremely obedient and de facto
recognise their subordination.
Financial independence. The Armenian authorities do not
take measures to enhance the financial independence of
municipalities. The share of municipal budgets in the
expenses of the consolidated budget and GDP remains
very small (in 2012-9.4% and 2.4%). To compare, these
indicators in the countries of Central Europe and Baltic
states make 20-30% and 7-13%, respectively. Around
50% of municipal revenues are constituted by official
grants.
Financial equalisation. A significant shortcoming of the
existing mechanism of financial equalisation is that its
main indicator is the number of population within the
municipality’s mandate and, to a certain extent, its
financial capacities, while the needs of the municipalities
are completely neglected. Besides, the equalisation
grants are received by all municipalities, and not those
in the greatest need.
Administrative supervision. According to the European
Charter of Local Self-Government, the administrative
supervision of LAs should only be extended top include
the legal domain, i.e., the correspondence of the local
decision-making to the Constitution and the laws. Only
the scope of supervision over the delegated functions
can be expanded, the so called special supervision. In
practice the control over LAs is far beyond the legal
frames and is implemented by different representatives
of the upper tier of authorities.
Protection of common interest by LAs. The European
Charter of Local Self-Government records the right of LAs
to belong to an association for the protection of common
interest. This means an establishment and activity of a
municipalities associations on national and regional
levels. Of course, the municipalities themselves are
responsible in this matter, but the central authorities
should ensure the necessary conditions, which are not
provided yet. 24 municipal associations are established
in the regions of Armenia, they are mostly busy with
implementation of various projects rather than the
protection of common interest. National association of
municipalities is not strong yet.
The solution of problems of common interest to LAs. The
European Charter of Local Self-Government records the
right of LAs to form consortia with other LAs in order to
carry out tasks of common interest. These tasks are not
reflected in the legislation and there are not registered
consortias yet.
Full and exclusive powers of LAs. This means that none of
the central government bodies has a right to interfere
with the power, given to the LAs, and direct this power.
Besides, the power must be distinctly specified as
belonging to the LAs, with no dubious interpretations
possible. In reality the central government bodies not
only often interfere and direct, but also often impose
certain actions on the LAs.
Consultations. LAs shall be consulted by central authorities
In due time and in an appropriate way in the planning
and decision-making processes for all matters which
concern them directly if possible. This requirement is
actually fulfilled only formally because of the
independence of LAs is very low.
Functioning of municipal service institute. Steps were taken
to form the institute of municipal service. The RA Law “On
Municipal Service” is in force. But, anyway, its
implementation in small municipalities is in question and
not effective in medium-size and large communities.
Local taxes rates determination. There are two local taxes
in force (proporty and land taxes) but their rates are not
determined by LAs.
Borrowing of LAs. LAs have not access to the national
capital market in practice.
Legal protection of LAs. The right of LAs for legal protection
is seldom applied. The main reason is that the court
system of Armenia is not independent and does not enjoy
the trust of the society. Among other reasons for this one
can name the wish to avoid court hustle, lack of
appropriate knowledge, etc.
RECOMMENDATIONS
• Make necessary additions in the legislation for establishment of
consortias and mergers of small municipalities and
implementation in practice
• Increase financial resources of LAs by adopting the Law on Hotel
Tax, using tax-sharing model and transfering to LAs the right to
determine local taxes rates
• Allow LAs entrance to the national capital market
• Develop new mechanism of financial equalisation and
mechanisms of other state transfers (subventions and other
grants)
• Provide necessary conditions for enhancing real independency of
LAs
• Provide administrative supervision according to the requirements
of the Charter
• Provide citizens participation on affairs of LAs in practice
• Transfer new responsibilities and appropriate finance to LAs
Thank you