Unconditional Transfer for Local Government over the years.

Uncoditional Transfer is a fund designated for the Local Government by the Budget so that the former can cover the costs associated with its functions and activities. Together with the revenues from taxes administered and collected by the Local Government, they form the main financing source of the Local Budget. The majority of the funds of the Unconditional Transfer is distributed according to a formula, which is part of the Budget Law. The variables that determine dhe amount allocated for each Municipality or Commune are: population (the most important criteria), urban services, and area size (applies only to communes). 

As far as the calcualtions for the Qark-s (a larger local organizational unit, larger than a municipality), in addition to the population, the two most important criteria are the geographic indicator and the road coefficient. Generally, the ratio of the funds from the Uncoditional Transfer distributed between the Qark-s and the Municipalities/Communes is around 1:9. It is interesting that while this is an “unconditional transfer”, the 2012 Budget Law conditions the use of certain part of the transfer .
  


^{Source: Ministry of Finance
Comments and Analysis: Open Data Albania}

As the graph shows, the grant awarded by the Budget to the Local Government is comparable to the latter’s own revenues from taxes and tariffs. During 2000-2005 the weight of the grant in the overall budget of the Local Government decreased from 76.4% in 2000 to 37.5% in 2005. On the other hand, during 2006-2010 the weight of the grant increased from 44.7% in 2006 to 61.3% in 2010.  This means that during these years the Local Government did finance the majority of its activity through the funds transferred from the State Budget.

From 2002 until 2009 the grant fund has undergone continuous increases. The largest increase dates during 2006-2009, reching an average increase of 30% year over year, and culminating in 2009, with a total of 21.4 billion leke in nominal value. 2011 was quite the opposite, marking the greatest decrease, 25.7% less than the previous year, whereas 2012 will maintain about the same level as 2011.

^{Source: Ministry of Finance
Comments and Analysis: Open Data Albania}

All the information is presented in the table below:

^{Source: Ministry of Finance
Comments and Analysis: Open Data Albania}