Gov't sends final bills on war veterans, local self-government to parliament

The Croatian government on Thursday forwarded to parliament several final bills, including one on Homeland War veterans and their families, local and regional self-government and the financing of local and regional self-government units, as well as on audits.

The implementation of the Act on Croatian Homeland War Veterans and their Families requires, compared to the existing legislation, an additional HRK 219.2 million, an increase of 44.5 million compared to the budget allocation for the War Veterans Ministry in 2017, said Minister Tomislav Medved.

He added that an additional 64 million would have to be allocated to the Labour and Pension System Ministry in 2018.

The funds needed for the implementation of the law are within the limits of total budget expenditures for the period 2018 - 2020, determined by economic and fiscal policy guidelines for the period 2018 - 2020, said Medved.

New rules for local and regional self-government

Unlike its initial draft, the final bill on local and regional self-government includes a possibility for a representative body to call, by a two-thirds majority vote, a referendum to replace the head of a local self-government unit, which strengthens the roles of both that representative body and citizens, said Public Administration Minister Lovro Kuscevic.

The main novelty of the bill on the financing of local and regional self-government units is that income tax revenues will go entirely to local self-government units and be distributed in such a way that towns and municipalities will get 60% of those revenues and counties 17%. The share for decentralised functions will be 6% as has been the case so far, and the share for fiscal balancing will be 17%, Finance Minister Zdravko Maric said.

The new law's fiscal effect is estimated at around 1.4 billion kuna, Maric said, adding that if those funds turned out not to be sufficient, the state would compensate local self-government units for the difference between their previous revenues and what they would be getting under the new law.

Compared to the bill's first reading, the final version of the bill prolongs the period for compensation measures from two to five years, i.e. until 2020. After that year, the state would compensate local self-government units for 60% of the missing amount in 2021 and for 30% of the amount in 2022.

The final audit bill was sent to parliament for a second reading. Under the bill, the Finance Ministry is in charge of supervising auditors and audit firms. Compared to the initial draft, the final bill introduces, among other things, the obligation for companies that employ more than 5,000 workers and have assets exceeding HRK 5 billion to sign contracts on auditing with at least two audit firms.

The new audit law is expected to go into force on 1 January 2018.

Gov't to convene in Osijek on Dec. 1

At the start of today's session, Prime Minister Andrej Plenkovic said that a third meeting of the Council for Slavonia, Baranja and Srijem was held earlier this week and that the government had received a letter from the heads of five northern counties who want the government to place similar emphasis on the country's north, adding that despite their being developed in comparison to eastern Croatia, those counties, too, had problems, such as the minimum wage in the textile sector.

Plenkovic said the government would focus on making the absorption of EU funds, notably for major projects, more efficient, and announced a meeting with the heads of northern counties, to take place by the end of the year.

He also said that the government would hold a session in Osijek on December 1.

Text: Hina

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