Evaluation of the Budget Management of Local Government Units in Poland Based on Methods of Multi-Criteria Analysis in 2019-2021

Abstract

The idea of the present paper was to assess budget management in local government units in Poland in 2019-2021 using multi-criteria analysis methods. The evaluation was broken down by different types of LGUs using the TOPSIS method based on min-max normalization. The survey was conducted using secondary data obtained from the Ministry of Finance website, broken down by budget (per capita) and debt indicators. For all LGUs in total, the best position in 2019-2021 was found in voivodeships, whose ranking remained unchanged despite the COVID-19 pandemic. An analogous situation was observed in rural municipalities. The last position in the ranking was occupied by towns with powiat status (2019) and metropolitan areas (2020-2021). Between 2019 and 2021, the number of entities placed in financial condition class 2 was increasing only in towns with powiat status. A reduction in financial condition (in Class 2) was also evident in rural municipalities, in powiats, and metropolitan areas. Over the years 2019-2021, there was a reduction in the number of entities with financial condition class 3 in rural municipalities and towns with powiat status. The leaders in benchmarking in rural communes were Kleszczów and Godkowo; urban-rural communes: Kamieńśk and Lubniewice; urban communes: Krynica Morska and Hel; cities with county rights: Sopot and Świnoujście, metropolises: Katowice and Warsaw, voivodeships: Pomeranian and Greater Poland. The powiats were characterized by great diversity, the best places in the ranking in individual years went to the Wolsztyński, Sztumski and Golubsko-Dobrzański powiats.