Tbilisi municipality and the central government became embroiled in a dispute over who has to cover expenses for various social benefits for hundreds of thousands of Tbilisites.
 
GEL 78 million was allocated to the Tbilisi municipality’s 2012 budget to cover state-funded health insurance for 90,000 Tbilisites; as well as various social benefits for 40,000 socially vulnerable families and to subsidize discounts for municipal transport fees for up to 600,000 citizens.
 
Six days before the new government, led by PM Bidzina Ivanishvili, took office, former PM Vano Merabishvili signed three decrees on October 19 transferring duties to implement and fund these social programs from the Tbilisi municipality to the Ministry of Healthcare and Social Affairs.

GEL 22 million is required for the remainder of the year to fund these programs, according to the Ministry of Healthcare and Social Affairs.

On October 31 PM Bidzina Ivanishvili annulled all three decrees of his predecessor and requested the Tbilisi Mayor’s Office to keep on implementing these programs with funds which were allocated to the capital city’s municipality.

On November 2 Tbilisi Mayor, Gigi Ugulava, who is President Saakashvili’s ally, appealed in a written form to PM Ivanishvili, telling him that his decision to annul the October 19 decrees was leaving social benefits of hundreds of thousands of Tbilisites without funding and expressed readiness to engage in consultations with the central government to solve the problem.

The new government, however, said burden of funding of these social benefits was assigned to the Healthcare Ministry without transferring relevant funds required to implement these programs.

Davit Sergeenko, the new minister for healthcare and social issues, said that his ministry had no GEL 22 million, required to fund the programs this year and added that his ministry was currently even running GEL 13 million deficit.

New Finance Minister, Nodar Khaduri, said that it was the previous government not the present one to blame for the problem. Khaduri says it was “irresponsible” on the part ex-PM Merabishvili to take such decision while knowing that no funds were allocated in the central budget for funding of these social programs. One of his deputies, Davit Ebralidze, even accused the previous government and the United National Movement party of “sabotaging” new authorities by shifting additional burden to the new government to fund various social programs, which originally were supposed to be funded by the local budget from the Tbilisi municipality.

The Finance Ministry has also alleged that the funds intended for these programs for the remainder of the year could have been misused by the Tbilisi municipality and for that reason it was now trying to “evade covering these expenses.”

Tbilisi Mayor’s Office said that the decision to transfer implementation of these programs from local to central government was part of a strategy to unify all the social programs and its funding under the central budget.

Asked where funds originally intended for the programs had gone, Tbilisi Mayor Gigi Ugulava told Rustavi 2 TV on November 2 that after implementation of these programs was transferred to the central budget, the Tbilisi City Council (Sakrebulo) redistributed funds to cover other expenses such as funding of kindergartens, rehabilitation of damaged houses and subsidizing waste collection services after its fee was halved.

Ugulava said that he was not surprised that such a problem emerged after the elections, which resulted in the Georgian Dream coalition taking over the central government, but local authorities still remaining under the control of the United National Movement. Previously, he said, no such problem was taking place because functions of the authorities at various levels were often intermingled, because a single political party was in charge. But now, he continued, functions should be clearly divided and defined, which might be a painful process, but it should not harm beneficiaries of various state-funded programs.