The PSOE in Málaga are to present an urgent motion insisting that the Provincial Council set up a liquidity fund to assist municipalities whose population is under 20,000 people, with interest-free loans repayable in 44 months.
The PSOE filed a similar motion in October last year in which it was suggested to set up a technical committee to oversee such a fund.
According to the PSOE, many of the smaller municipalities are in danger of not being able to pay municipal payrolls, particularly after having to borrow funds under the Central Government plan to pay outstanding debts to suppliers.
The PSOE says that the Provincial Revenue Office has a surplus of €30,000 and half of this could easily be used as a liquidity fund.
Surely there has to be a limit to the ‘borrow, borrow and borrow more’ attitude. If a municipal authority can spend all its funds in the knowledge that it can just borrow more, where is the incentive for sensible financial management, innovation and the creation of alternative sources of municipal income?
It will never happen, but if all levels of government were subjected to a system of, pay all bills (suppliers, wages etc) and if there is anything left over, pay yourselves, one would probably very quickly see some innovation.