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On air on Rustavi 2, the Head of the State Audit Service, Lasha Tordia, talked about the State Audit Service Report which concerned the implementation of the 2015 state budget. He focused upon the growth of surpluses in the state budget and pointed out that bonuses have been replaced by surpluses in the public sector. As an example of the high growth in the amount of surpluses, Mr Tordia named the Ministry of Culture and Monument Protection of Georgia, stating that: "Surpluses at the Ministry of Culture and Monument Protection of Georgia increased by 1,509%."

The Minister of Culture and Monument Protection of Georgia, Mikheil Giorgadze, commented upon Mr Tordia’s statement: "This is an attempt to mislead the public as an absolute inadequate analysis has been made. It is a shame that a state structure makes such an inadequate comment."

Lasha Tordia responded to Mr Giorgadze’s statement on the same day. He explained that legal entities of public law have been added to the Ministry of Culture and Monument Protection of Georgia and that their funding was accumulated in the overall budget which caused such a drastic growth. "However, excluding these legal entities of public law, the amount of surpluses increased by 604% in the first nine months of 2015 as compared to the same period of 2015," said Mr Tordia.

FactCheck

looked into this issue.

According to the information of the Ministry of Culture and Monument Protection of Georgia, the official number of employees at the Ministry equalled 6,900 in 2014. Of this, about 140 people were working in the Ministry’s central apparatus. As of 2015, a total of 7,048 employees were registered in the Ministry’s system with 140 working in the central apparatus.

Table 1

Number of Employees of the Ministry of Culture and Monument Protection of Georgia in 2014-2015

Year Ministry System Staff (Central Apparatus) Freelance (Central Apparatus)
2014 6,900 140 56
2015 7,048 140 70
Change 148 0 14

As the table makes clear, the number of employees at the Ministry increased by 148 in 2015. The number of freelancers increased by 14. The number of employees in the Ministry’s central apparatus remained the same.

According to the information of the Ministry of Culture and Monument Protection of Georgia, a total of 86 legal entities of public law are subordinate to the Ministry. As for the number of staff and freelancers in these entities as well as their wages, surpluses and bonuses, the Ministry told us that we will have to request detailed information about this from them. According to the data of the first nine months of 2014, a total of GEL 32.6 million was spent in the form of subsidies for the remuneration of employees of legal entities of public law subordinate to the Ministry whilst this number increased to GEL 36.6 million in the same period of 2015.

According to the Ministry’s information, a total of GEL 3 million was distributed in the form of remuneration (wages, surpluses and bonuses) within its central apparatus in the first nine months of 2014 whilst this number increased to GEL 3.2 million in 2015.

Table 2:

Central Apparatus Remuneration in the First Nine Months of 2014 and 2015

2014 2015 Growth
Wage 1,787,603 1,923,599 7.6%
Bonus 1,123,771 458,410 -59%
Surplus 81,833 839,701 926%
Overall 2,993,207 3,221,710 7.6%

Table 2 makes clear that the Ministry’s central apparatus wage fund increased by GEL 228,503 (7.6%) in the first nine months of 2015. The amount of bonuses decreased by 59%; however, the amount of surpluses increased by 926%. If we summarise the changes in bonuses and surpluses, the amount of money spent for this purpose increased by 7.7% (92.5 thousand).

FactCheck

analysed the wages, bonuses and surpluses of the Minister of Culture and Monument Protection of Georgia and his four deputies separately (Table 3). According to the data of the first nine months of 2015, the remuneration of the Minister and his deputies increased by 24.5% as compared to the same period of the previous year. This was due to the growth of wages and surpluses.

Table 3:

Wage Fund of the Minister of Culture and Monument Protection of Georgia and his Four Deputies, (First Nine Months of 2014 and 2015)

Year Wage Surplus Bonus Sum
2014 108,631 24,483 80,429 213,543
2015 131,850 124,380 9,715 265,945
Difference 23,219 (21.4%) 99,897 (408%) -70,714 (-87.9%) 52,402 (24.5%)

Conclusion

The amount of bonuses distributed within the central apparatus of the Ministry of Culture and Monument Protection of Georgia decreased by 59% in the first nine months of 2015; however, the amount of surpluses increased by 926%. It should be pointed out that such a high growth in the percentage of surpluses was due to the practice of replacing bonuses with surpluses (hence we have the so-called base effect). Despite the fact that the distribution of bonuses was limited according to a directive of the Government of Georgia, it was replaced by surpluses straight away, becoming, in fact, a part of the wages. This is the exact same fact upon which the State Audit Service focused. According to its explanation, it is impossible to determine the types of extra work employees are given in order to merit their bonuses according to the rules governing bonus distribution.

Given the fact that the amount of surpluses was low in 2014 (because of the high amount of bonuses), the high growth rate of surpluses in 2015 is quite logical. In addition, the number of bonuses distributed in 2015 dropped significantly. If we analyse these changes taken together, the amount of money spent for bonuses and surpluses at the Ministry of Culture and Monument Protection of Georgia in the first nine months of 2015 increased by 7.7% as compared to the same period of the previous year.

Given the fact that the amount of surpluses at the Ministry of Culture and Monument Protection of Georgia did indeed increase drastically although the sum of the bonuses and surpluses rose by only 7.7%, FactCheck concludes that Lasha Tordia’s statement is MOSTLY TRUE.