The financial health of the City Council in question
The political forces of the council of Sant Feliu have been immersed in an intense debate about the economic stability of the City Council. At the end of 2023, a Public Hearing was called to address the financial situation of the entity for the current year. This meeting highlighted the municipality’s financial difficulties, suspecting a possible intervention by the state administration.
From the government of the PSC, TTSF and VxSF, the complicated economic situation was attributed to the bad management of the old government. This statement generated discomfort among the representatives of the former government, such as Sant Feliu in Comú Podem, who considered it a baseless political maneuver.
However, in March 2024, the 2023 liquidation report was made public, which indicates that the City Council will not be subject to any intervention, as its economic situation is favorable.
The comptroller’s report
The 2023 settlement report drawn up by the City Council’s comptroller reveals changes with respect to the initial predictions that were presented during the Public Hearing.
This document highlights the achievement of positive net savings and adjusted gross current savings of €259,555.17, a figure significantly higher than the previous year’s €86,580.07. This improvement has avoided the need for a sanitation plan, given that it meets the established requirements.
Also, the cash balance, which reflects the administration’s ability to meet its short-term obligations, has experienced a significant increase, going from €738,621 to €1,332,878 from one year to the next .
However, it should be noted that the report does not include the accumulated debt of more than 1 million euros in terms of waste collection and road cleaning.
Pending challenges
The 2023 budgets had not provided for the amount of €1,159,627 for expenses related to waste collection and road cleaning. As a consequence, price revisions have had to be made during the last months of 2023 and the first months of 2024. This issue was answered with the approval of several credit modifications in the sessions of November 2023 and March 2024.
This shows the need for more efficient management in this area, since the approval of another credit modification to completely settle this debt is still pending.
Key indicators
The document also examines the financing capacity of the City Council, noting a non-financial budget surplus of €905,461.62 at the end of 2023. This result complies with the legal requirement to keep municipal debt below 75% of current income , allowing the municipality to arrange long-term credit operations in the event of positive net savings.
Influential external factors
From the treasury department it is argued that the negative prediction at the end of 2023 was conditioned by the difficult economic situation at a general level, highlighting the increase in interest rates and the energy crisis as determining factors.
Likewise, it is emphasized that a strategy of austerity at expenditure level has had to be followed to reverse this situation.
Delays in payments to suppliers
Despite the good results achieved, the City Council has not complied with the maximum payment deadline established by the regulations, closing 2023 with a 33-day delay in payments to its suppliers, exceeding the 30 days set by law.
This non-compliance is mainly due to Extrajudicial Credit Recognitions (RECS), which require a long authorization process and tend to extend payment terms. We are working on a recruitment plan to streamline management and reduce this number of days.
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