Some actual issues for planning and forecasting budgets of territorial entities (ABSTRACT)

Prof. George Gavtadze, Dezdemona Maglakelidze

In the world as well as in Georgia one of the most important conditions for the development of democratic processes is implementation of decentralization principles in the administration and structure of the country.

Its necessary component is local governance realized through the local population by means of freely elected representative bodies. The material base for the activities of local authorities is local budget on which depends the quality of administration, population’s well-being, development of infrastructure, etc. Hence, of special importance is planning and forecasting future perspectives based on scientific research and analysis.
At the present stage, local budgets are an integral part of financial system in developed countries. Many problems, ways and resources for solving them are devolved on local authorities who undertake the burden of providing the development of population’s living conditions. As a result, the plan for strategic development in regions and use of forecast elements in planning process is essential. Forecasting is a base in the management of economic processes as it helps to reveal the factors and conditions through which targets could be reached. Besides, forecasting makes it possible to estimate trends of socio-economic development of territories and therefore, adopt concrete decisions.
Proceeding from the above-mentioned, budget planning is a process that determines the volume of the financial resources whose mobilization is provided in a local budget for financing local tasks and priorities of territorial entities.
Therefore, the principal objective of financial and budget planning proves to be determination of perspective directions for the functioning of economies in territories with the purpose of achieving, on the one hand, essential compliance of the volume and structure of local budgets and on the other hand, political, economic and social needs.