State Audit: Lezha and Lushnja Municipalities Risk Bankruptcy

Two municipalities in the country find themselves critically in debt and risk bankruptcy. According to the State Supreme Audit Institution (KLSh), the Lezha and Lushnja municipalities have many unpaid, outstanding debts, and if a solution is not found quickly, these municipalities risk going bankrupt.

In Lezha, KLSh found that the municipality, for years, had failed to pay third parties:

According to the data from the 2015 balance sheets (opened in 2016), obligations to third parties consisted of 446 million lekë (€3.5 million), whereas at the end of 2017 they consisted of 680 million lekë (€5.4 million), increasing by 52%.

According to KLSh, the mayor of Lezha should establish a working group made out of experienced specialists of every sector in order to analyse credit obligations. Furthermore, when drafting the annual budget for 2019, a fund to pay debts owed to third parties must be factored in.

The same thing happened in the Lushnja municipality, where:

About 203 million lekë (€1.6 million) are owed to suppliers for goods and services rendered, carried over from 2011 to 2018. These overdue debts have become a constant source of financial risk for the subject. The Lushnja municipality finds itself in serious financial difficulties as a result, and, if the situation persists, it may become unable to pay.

For the Lushnja municipality, too, KLSh recommend a speedy plan of action, otherwise the municipality risks bankruptcy.