The Financial Gap Arising from the Local Government’s Educational Tasks and the Sustainable Development of Communes in Poland

Abstract

In Poland, responsibility for educational tasks has mainly been delegated to local governments, although the state still plays a decisive role. Municipalities finance these tasks using educational subsidies and targeted grants from the central budget. Because transfers from the state budget cover an ever-decreasing share of the costs of educational tasks, municipalities increasingly need to engage their own resources. Such a situation (due to the limited funds of these units) poses a threat to the proper implementation of other tasks, which may ultimately negatively affect their sustainable development. This study aimed to determine the impact of the financial gap from implementing educational tasks on the sustainable development of communes and cities with county rights. The research primarily employed linear ordering methods and Spearman’s rho correlation. It also employed the nonparametric Kruskal–Wallis test and the Page test for trends. This study utilized two types of data: secondary data from Statistics Poland covering 2477 municipalities and primary data collected through a survey of 482 local government representatives. The correlation analysis revealed that sustainable development indicators decreased as the financial gap widened between 2012 and 2022. The highest correlation coefficients were observed in all communes combined and in cities with county rights. The weakest correlations between the financial gap and sustainable development were found in urban municipalities. Representatives of local governments had similar observations. According to 63.1% of respondents, the imbalance between funds transferred from the state budget for educational tasks and the expenditure incurred by the municipality for this purpose negatively affects the sustainable development of local governments.

1. Introduction

The current shape and scope of local government tasks in Poland result from reforms implemented since the beginning of the systemic transformation in 1990. As a result of decentralization, public authority was divided into three segments: voivodeship, county, and municipal self-government. In effect, the currently applicable administrative (territorial) division of the country includes 16 voivodeships, 314 land districts, 66 communes with the status of cities with county rights and 2411 communes, including 302 urban communes (i.e., communes with the status of a city), 711 urban–rural communes (i.e., communes in which one of the localities has the status of a city and the remaining area is a rural area), and 1464 rural communes (i.e., communes in which there are only villages) [1,2].

The communes (as basic units) were given responsibility for implementing all public matters of local importance that are not reserved by law for other entities. This includes current and uninterrupted fulfilment of the collective needs of the population by providing universally available services [3]. Local governments (municipalities and cities with county rights) perform various educational tasks. They are also responsible for transport and communication, culture and the protection of cultural heritage, physical culture, tourism and recreation, housing management, municipal services, social assistance and health protection, the construction and maintenance of marketplaces and market halls, urban greenery, municipal cemeteries, real estate management, geodesy and cartography, land and building records, safety and public order, maintenance of public facilities and utilities, and the promotion and dissemination of the idea of self-government.

Effective implementation of such a wide range of tasks requires decision-making autonomy, property autonomy, and sufficient financial resources. Since municipalities’ own revenues rarely balance the expenses incurred for task implementation, supplementary revenues in the form of subsidies from the state budget are necessary [4,5].

The area that generates the highest budget expenditure in most local governments is education. In 2023, municipalities allocated an average of 33.8% of total revenues for implementing these tasks, and the share of expenditure for this purpose in total expenditure amounted to an average of 31.8%. Despite the general agreement on the need to finance education from public funds, a debate has been ongoing in Poland for years regarding the method of its financing. Representatives of local governments point out that during the decentralization process, the state transferred responsibility to municipalities not only for education but also for many other tasks without providing them with an appropriate pool of funds for their implementation [6]. When the Act of 13 November 2003 on the revenues of local government units came into effect, the education subsidy covered 98% of wage-related expenditures in education. It was supposed to be adjusted annually to the increasing number of tasks; however, contrary to expectations, the situation worsened year by year [7]. Although funds transferred from the state budget nominally increased (32.2% from 2015 to 2022), the gap dividing revenues and expenditures incurred by municipalities and cities for educational tasks widened rapidly. It was caused, among other things, by rising energy prices and service costs, the regular increase in the minimum wage, pressure to adjust wages due to ongoing inflation, a sharp rise in the cost of servicing existing loans, the lack of real opportunities for local governments to generate new sources of income, and financial measures introduced by the government programme called the “Polish Deal,” which drastically reduced the revenues of local governments. Another reason was the underestimation of the education subsidy relative to the actual expenses incurred by local governments for educational tasks. As a result, the education subsidy became insufficient to cover the minimal operational costs of schools and to pay wages and related benefits for employees in the education sector [8]. Local governments are increasingly using their own funds to cover educational expenditures at the expense of infrastructure investments [9], which may have negative consequences for their sustainable development.

Considering the above, this study aimed to determine the impact of the financial gap from implementing educational tasks on the sustainable development of municipalities and cities with county rights. It sought to answer the following research questions:

• How has the level of sustainable development in local governments evolved, and how dynamic have its changes been?
• What was the financial gap resulting from local governments’ execution of educational tasks, and what was its leading cause?
• What sources do municipalities most often use to supplement their own revenues when they are short on funds for executing educational tasks?
• Is there a relationship between the financial involvement of municipalities and cities with county rights in carrying out educational tasks and the sustainable development of local governments?
• Does the imbalance between the funds transferred from the state budget for the execution of educational tasks and the expenditures incurred by municipalities for this purpose contribute to limiting investments that implement the concept of sustainable development?

The implementation of the aim was based primarily on the methods of linear ordering and Spearman’s rho correlation. The nonparametric Kruskal–Wallis test for differences (for more than two samples) and the Page test for trends were also used. The basis for the analysis was both secondary data (obtained from public statistics) and primary data (collected during the survey).

This study’s added value lies in combining two issues usually considered separately and describing the problem using objective data (statistical data for 2477 local governments) and subjective data (qualitative data collected from 482 local government representatives). The literature on the financing of education in local government units is quite extensive; however, authors usually focus on analyzing the revenues and expenditures of municipal budgets, as well as assessing the degree of imbalance between these figures (e.g., [9,10,11,12,13]), less often addressing the long-term consequences of the education financing system in Poland. On the other hand, studies dedicated to assessing the level of sustainable development in local governments most often represent case studies of municipalities from a single voivodship (e.g., [14,15]). Significantly more analyses focus on higher administrative levels, such as regions (e.g., [16,17,18,19]) or countries (e.g., [20,21,22]). Thus, this study, combining elements of sustainable development economics and public sector economics, provides knowledge on the consequences of the growing involvement of municipalities’ own funds in education for their long-term sustainable development on a national scale.

This article’s structure was designed to achieve the research goal. The following sections cover the fundamentals of sustainable development for local governments and the challenges associated with measuring it. The literature section also discusses the theoretical basis of how educational tasks are carried out by local governments in Poland. Next, this study’s methodological assumptions and the results obtained are examined. The paper ends with a summary and conclusions.

2. Theoretical Background

2.1. Sustainable Development of Local Governments

The existence of local government is part of the theory of new localism [23], the central pillar of which is local development. Local development is a complex process that can be considered from two perspectives, i.e., local and supra-local [24]. From the local perspective, it is a harmonized and systematic action of the local community, local authorities, and other entities operating in the commune, which aims to create new and improve existing utility values of the commune, create favourable conditions for the local economy, and ensure spatial and ecological order [25]. In turn, in the supra-local perspective, it means the spontaneous conversion of local processes into supra-local ones, which, despite certain interventions by supra-local authorities (district, regional, or national), takes place to a large extent freely [26].

Over time, development in territorial systems has evolved from economic growth (focusing on increasing the generated economic value) through stages of economic development and socio-economic development (including changes in the structure of generated economic value and improving quality) to the currently implemented sustainable development [27,28]. In the most general sense, sustainable development is a compromise between environmental, economic, and social goals to ensure the well-being of current and future generations [29]. It assumes that a situation in which growth in one sphere occurs at the expense of another is prevented, but as Guzal-Dec [30] points out, economic development is the driving force of development processes. The term “sustainable development” in the contemporary sense appeared in 1987 with the publication of the UN World Commission on Environment and Development report entitled Our Common Future (the so-called Brundtland report). According to his fundamental thesis, sustainable development is considered to be a development that meets current needs without compromising the ability of future generations to meet their needs [31]. In other words, it is about ensuring fair access to resources for everyone everywhere, now and in the future. Sustainable development does not mean rapid development in time and equalization in space but permanent (stable) and self-sustaining development [10].

Regardless of the definitional problems accompanying sustainable development, actions are taken to specify it internationally and nationally. In the international dimension, the activities of the UN deserve special attention. On its initiative, a series of meetings of member states were organized, the result of which were decisions regarding actions to protect the natural environment and then the sustainable development goals [32]. The first meeting organized under the auspices of the UN was a conference under the slogan: “We have only one Earth”, which took place in 1972 in Stockholm. The next ones were the Earth Summit in Rio de Janeiro in 1992, the Millennium Summit in 2000, Rio +10 in Johannesburg in 2002, and Rio +20 in Rio de Janeiro in 2012 [33]. An essential step towards specifying the concept of sustainable development was the adoption (during the UN Summit in New York in September 2015) of a document entitled “Transforming Our World: The 2030 Agenda for Global Action” (Agenda 2030), which identifies 17 interconnected (primarily positive) sustainable development goals (SDGs) and 169 specific tasks [34,35].

Even though the goals were adopted at the supranational level, their implementation must occur from the bottom up. It is estimated that without the involvement of local actors, as many as 65% of the assumptions cannot be fully achieved [36]. This results from the specificity of local government, which acts as the host in its area (which allows it to use local resources more effectively than other levels of government), as well as from statutory obligations (according to which the commune is responsible for tasks related to shaping the local living environment) [37,38]. Its tasks include developing infrastructure, providing services, caring for the environment, counteracting poverty and social exclusion, attracting investors, and promoting the area [16]. Boguszewski et al. [39] distinguished three approaches of local governments to sustainable development, i.e., proactive (characterized by setting sustainable development priorities and respecting them during planning and decision-making), reactive (reacting to sustainable development challenges as they arise without prior preparation of long-term action plans), and passive (based on minimal involvement of local governments in sustainable development issues).

The critical elements of sustainable development are the quality and access to development factors (capitals) and the efficiency of its management to achieve the durability of development capital [40]. However, as Kruk [41] emphasizes, the most important are less measurable factors, i.e., social capital, ecological awareness, the ability to create eco-innovations, and the interactions between them. According to Bali Swain and Yang-Wallentin [42], due to limited resources and structural constraints, developing countries should focus on economic growth and social development in the short term (however, while respecting environmental issues). In turn, developed countries should show a greater propensity to achieve sustainable development by focusing on environmental and social factors.

At the local level, awareness and engagement of local authorities, including analysis and action, are essential [38,43]. Regarding local government action, Salvador and Sancho [44] highlighted several institutional capabilities crucial for effective sustainable development policymaking, including strategic or leadership skills, analytical and data management proficiency, organizational management expertise, and collaboration or network management abilities. Mutiarani and Siswantoro’s study [45] showed that the level of implementation of sustainable development goals by local governments in Indonesia was most influenced by the size of the region and their local own revenues. Similarly, Boguszewski et al. [39] concluded that the intensity of local governments’ sustainable development activities in Poland positively correlated with their financial situation. A study of cities in the USA (with more than 50,000 inhabitants) showed that their sustainable development practices were associated with developing organizational capabilities in management, finance, and technical knowledge. Sustainability was also strongly linked to managerial skills and stakeholder engagement [46]. Similar conclusions were reached by Alpenberg and Wnuk-Pel [47], who, based on a case study of the municipality of Växjö (Sweden), indicated the charisma of local government authorities, cooperation of all political parties, employers’ organizations and educational institutions, a climate conducive to change, and high pro-ecological awareness of the local society as the main factors of success in the area of environmental protection and sustainable development. In turn, Bardal et al. [36], based on research conducted in Norwegian municipalities, found that financial, technological, substantive, political, cultural, institutional, and legal aspects influenced the implementation of sustainable development goals.

The multidimensionality and ambiguity of the issue of sustainable development pose not only theoretical and cognitive but also practical challenges related to its monitoring and evaluation [48]. Because there is no single, universal measurement tool, the assessment of the implementation status of this concept is mainly based on monitoring appropriately selected individual indicators that simplify, quantify, analyze, and convey complex information [17,49,50,51]. For example, the European Union monitors the implementation of the Agenda 2030 goals using a set of about 100 sustainable development indicators, which are based primarily on the resources of the European Statistical System. In turn, the United Nations uses a set of 231 global indicators adopted by the General Assembly in 2017 [52]. In addition, signatory countries are encouraged to set their sustainable development priorities, considering national conditions and measuring their implementation using their set of indicators. For this reason, in Poland, about 140 indicators are used to monitor over 70 national priorities for the analysis of sustainable development [53]. Therefore, while the guidelines of Agenda 2030 are relatively unambiguous at the international and national levels, they are challenging to apply to the study of local governments [44]. It raises numerous problems with selecting appropriate indicators quantitatively to describe the issues and results in many lists available in the literature (cf. [14,15,54,55,56,57]). Borys [58] claims that the foundation of measurement should be the specification of the sustainable development paradigm, considering its features, principles, goals, and orders. The key concept related to sustainable local development is the so-called integrated order, which means integrating social, economic, and environmental phenomena based on the order in ethics and morality. The integrity of orders is realized through the sustainable protection of natural capital (environment), social and human capital, and anthropogenic capital (produced by humans, and primarily cultural and economic capital) [59].

2.2. Educational Tasks of Local Government

The local government exercises public authority and performs the essential part of public tasks not reserved by the Constitution or laws for other bodies [60]. Some tasks are mandatory (these are statutory own tasks and tasks assigned from the scope of state administration), and some are voluntary (these are own tasks performed in their name and are their responsibility). The remaining part is entrusted tasks that the local government may accept based on an agreement [61]. In light of the currently applicable law [3,62], one of the mandatory own tasks of communes and cities with county rights is public education.

The transfer of educational tasks to municipalities took a long time and began with the fall of the communist system and the reactivation of local government. The first responsibility given to them was managing kindergartens (in 1990), followed by the operation of primary schools (voluntarily in 1993 and mandatorily in 1996) and middle schools (in 1999). The decentralization process was completed in 1999, with the transfer of secondary and post-middle schools to newly established counties and the adoption of an algorithm for distributing educational subsidies in 2000 [63]. As a result of these changes, Poland developed its education management model. On the one hand, this model stems from the primary goal of Poland’s transformation—building a decentralized and subsidiary state—while on the other, it results from the state’s desire to oversee critical issues that determine the accessibility and quality of education [64].

The duties of local government in this area are specified primarily in the Act of 14 December 2016—Education Law [65], which defines them as education, upbringing, and care, including social prevention. Due to their differing legal and administrative statuses, communes and cities with county rights have slightly different responsibilities. Specifically, cities with county rights, which operate as both communes and counties, have an expanded range of duties.

Municipalities establish and run public kindergartens and other forms of preschool education and primary schools (with exceptions indicated in the provisions of the law). They are also responsible for providing free transport and care for children during transport or reimbursement of public transport travel costs for a child and guardian. The scope of duties of a city with county rights additionally includes establishing and running public special primary schools, secondary schools, educational and upbringing facilities, artistic facilities, psychological and pedagogical clinics, youth educational and sociotherapy centres, special school and upbringing centres, rehabilitation and upbringing centres, facilities providing care and upbringing for students during the period of education outside their place of permanent residence, continuing education facilities, and vocational training centres.

Local government units that establish and run public schools and educational institutions act as their governing body and are responsible for their activities. The detailed scope of their tasks is vast, but they can be grouped into several categories [9]:

• Ensuring safe and hygienic conditions for the operation of schools and kindergartens, carrying out renovations and investments, equipping with teaching aids and equipment necessary for the implementation of teaching programmes, and other statutory tasks;
• Handling personnel matters and administrative, legal, financial, and accounting support for the education process;
• Organizing education and care in schools and institutions in cooperation with their directors;
• Obtaining finances and financial and administrative supervision over schools and institutions, controlling the correct management of entrusted property;
• Supervision of the correctness and quality of the operation of schools and institutions and the effectiveness of education or upbringing;
• Organizing and administering a network of local government schools and institutions and issuing permits for schools to be run by natural and legal persons.

In addition, local government units can define local government educational policy priorities and create a local educational offer (e.g., additional classes) related to social needs.

Implementing such a wide range of activities requires securing appropriate financial resources. In Poland, the financing of educational tasks is based on the hybrid responsibility of the local government and the central government [10]. Most of the expenditure incurred by the state from education is transferred to the budgets of local government units in the form of the educational part of the general subsidy (the so-called educational subsidy) and purposeful grants for current or investment tasks [66]. However, the educational subsidy is the leading state expenditure on financing educational tasks. Its amount for all local government units is determined annually in the budget act [67] and then allocated among individual local governments according to an algorithm published annually in a regulation by the minister responsible for education and upbringing [68]. The procedure for allocating the educational subsidy uses a complicated mathematical formula, which takes into account, among others, the type and kind of schools and facilities, the number and characteristics of children/students attending a given institution, the number and professional training of teachers working in them, and the financial situation of local government units [6,9]. Before the final division of the educational subsidy between local government units, the amount of the educational reserve is calculated (currently, it is 0.5% of the educational subsidy), which remains at the disposal of the minister responsible for public finances [11]. Funds from educational subsidies are allocated to finance the current expenses of schools and institutions run by local governments and to subsidies for public and non-public schools and institutions [69].

The second form of transfer of state funds to local governments is purposeful grants, although their pool is much smaller than the educational subsidy. Local governments can allocate these funds for the following purposes [67]:

• Investment projects of schools and educational institutions (up to 50% of planned expenditure);
• Initiatives supporting education in rural areas (including scholarships and financial assistance for rural youth);
• Implementing the education system reform, equalizing educational opportunities, and providing practical education.

Purposeful grants from the state budget are mainly intended for financing preschool education; the purchase of textbooks, educational materials, and exercise materials; and financial support for students [9].

According to a report by the Supreme Audit Office [70], the model of financing educational tasks based mainly on educational subsidies has led to their implementation depending on the wealth of local governments. Many authors (including [9,10,11,12,71,72,73,74]) point out that transfers from the state budget in many cases do not cover the incurred expenses, which necessitates supplementing them with own revenues, as well as funds from other sources (e.g., from the European Union budget). For the budgets of local governments (mainly rural communes), this is a significant burden, which may result in resignation from undertaking new tasks and/or limiting the scope of existing ones [66,75]. With limited funds, local authorities must prioritize expenses and focus only on those that have to be incurred [6].

3. Research Methodology

• The dual focus of the research topic undertaken (sustainable development of local governments and the inadequacy of transfers from the state budget about the costs of implementing educational tasks by local governments) was reflected in the research hypothesis, which assumes that the shortage of funds transferred to municipalities and cities with county rights for educational tasks negatively affects their sustainable development. The procedure for its verification was divided into three stages: Determining the level of sustainable development of local governments;
• Determining the financial gap resulting from the implementation of educational tasks by municipalities and cities with county rights;
• Comparing both values in order to determine the relationship between them.

The analysis was based on secondary data (obtained from the Local Data Bank of Statistics Poland) and primary data (collected using a survey questionnaire). The secondary data were used first to compute an aggregate measure that allowed for determining the level of sustainable development of municipalities and cities with county rights in Poland. Due to the lack of a universally accepted set of indicators, assessing the implementation of the sustainable development concept at the local level is a challenging task. In Poland, aggregated indicators at the national level are used to monitor the implementation of national priorities for achieving the SDGs. However, in most cases, it is impossible to reflect these indicators at lower levels of the country’s administrative division because of the lack of data. For this reason, measuring the sustainable development of cities and municipalities requires quantification that numerically describes the most important relationships and critical trends within the local society–economy–environment system. The selection of diagnostic variables was made based on a literature review (including [14,15,59]); however, it should be kept in mind that the final set of indicators is a compromise between substantive requirements and what public statistics offers. Significant limitations were the availability of indicators and the continuity of data series in the adopted time range of this study (2012–2022). The final set of indicators (divided into orders and thematic areas) is presented in

Table 1. Indicators used to assess the level of sustainable development of local governments.

Thematic Area	Indicator	Impact *
SOCIAL ORDER
Demographic changes	Natural increase (x1)	S
	Total migration balance (x2)	S
	Population of post-working age per 100 persons of working age (x3)	D
Public health	Primary health care—medical consultations per resident (x4)	S
	Municipal budget expenditure on physical culture per resident (x5)	S
	Municipal budget expenditure on health care per resident (x6)	S
Poverty and living conditions	Beneficiaries of community social assistance per 10 thousand population (x7)	D
	Average usable area of an apartment per 1 person (x8)	S
Education	Percentage of children aged 3–6 years covered by pre-school education (x9)	S
	Net enrollment rate (primary schools) (x10)	S
	Municipal budget expenditure on education and upbringing per resident (x11)	S
Access to the labour market	Share of registered unemployed in the working-age population (x12)	D
Public safety	Municipal budget expenditure on public safety and fire protection per resident (x13)	S
ECONOMIC ORDER
Economic development	National economy entities per 1000 working-age inhabitants (x14)	S
	Balance (difference) of newly registered entities and entities deleted from the REGON register per 10 thousand inhabitants (x15)	S
	Own revenues of the municipal budget per resident (x16)	S
	Municipal budget revenues from personal income tax per capita (x17)	S
	Share of own revenues in total revenues of the municipal budget (x18)	S
	Investment expenditure from the municipal budget per capita (x19)	S
	Share of capital investment expenditure in total municipal budget expenditure (x20)	S
Employment	Individuals conducting business activity per 100 persons of working age (x21)	S
	Share of employed persons in the working-age population (x22)	S
Transport	Municipal budget expenditure on transport and communication per resident (x23)	S
ENVIRONMENTAL ORDER
Climate change	Municipal budget expenditure on municipal economy and environmental protection per resident (x24)	S
Freshwater resources	Consumption of water from waterworks per user (x25)	D
Land use	Share of green areas in the total area (x26)	S
Biodiversity	Share of legally protected areas in the total area (x27)	S
Waste management	Percentage of sewerage users in population (x28)	S
	Sewage discharged per capita (x29)	D
	Mixed waste collected per year per resident (x30)	D
INSTITUTIONAL AND POLITICAL ORDER
Social capital	Foundations, associations, and social organizations per 1000 inhabitants (x31)	S
	Municipal budget expenditure on culture and national heritage protection per capita (x32)	S
Equality in management	Percentage of councillors with higher education (x33)	S
	Percentage of women in the municipal council (x34)	S

* S—stimulant; D—destimulant.

. The indicators all exhibited a required level of variability exceeding 10% [76].

The indicators (at the stage of searching for the most appropriate linear ordering method) were subjected to three procedures, including two pattern-based methods (i.e., the methods of Z. Hellwig [77] and TOPSIS [78]) and one non-pattern method (the J. Perkal index [79]), each time using two methods of data normalization, i.e., standardization and unitarization.

Standardization was performed according to the formula below:

$${\mathrm{z}}_{\mathrm{i}\mathrm{k}}={\displaystyle \frac{{\mathrm{x}}_{\mathrm{i}\mathrm{k}}-\overline{{\mathrm{x}}_{\mathrm{k}}}}{{\mathrm{S}}_{\mathrm{k}}}},$$

(1)

where z_ik—standardized value of the k-th variable in the i-th object; x_ik—value of k-th variable in i-th object; $\overline{{\mathrm{x}}_{\mathrm{k}}}$—arithmetic mean of the k-th variable; S_k—standard deviation of the k-th variable.

For unitarization, two formulas were used, for stimulants (2) and destimulants (3), respectively:

$${\mathrm{z}}_{\mathrm{i}\mathrm{k}}={\displaystyle \frac{{\mathrm{x}}_{\mathrm{i}\mathrm{k}}-{\mathrm{m}\mathrm{i}\mathrm{n}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}}{{\mathrm{m}\mathrm{a}\mathrm{x}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}-{\mathrm{m}\mathrm{i}\mathrm{n}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}}},$$

(2)

$${\mathrm{z}}_{\mathrm{i}\mathrm{k}}={\displaystyle \frac{{\mathrm{m}\mathrm{a}\mathrm{x}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}-{\mathrm{x}}_{\mathrm{i}\mathrm{k}}}{{\mathrm{m}\mathrm{a}\mathrm{x}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}-{\mathrm{m}\mathrm{i}\mathrm{n}}_{\mathrm{i}} {\mathrm{x}}_{\mathrm{i}\mathrm{k}}}},$$

(3)

where z_ik—normalized value of k-th variable for i-th object; min—minimum value; max—maximum value.

In turn, the Formulas (4)–(6) were used to determine aggregate measures (µi).

For Z. Hellwig’s index:

$${\mathrm{\mu }}_{\mathrm{i}}=1-{\displaystyle \frac{{\mathrm{d}}_{\mathrm{i}}}{{\mathrm{d}}_0}},$$

(4)

where d_i—Euclidean distance of the object from the pattern; ${\mathrm{d}}_0=\overline{\mathrm{d}}+2{\mathrm{S}}_{\mathrm{d}}$; $\overline{\mathrm{d}}$—arithmetic mean of the distance of objects from the pattern; S₀—standard deviation of the distance of objects from the pattern.

For TOPSIS:

$${\mathrm{\mu }}_{\mathrm{i}}={\displaystyle \frac{{\mathrm{d}}_{\mathrm{i}}^{-}}{{\mathrm{d}}_{\mathrm{i}}^{-}+{\mathrm{d}}_{\mathrm{i}}^{+}}},$$

(5)

where d_i⁺—Euclidean distance of the object from the pattern; d_i⁻—Euclidean distance of an object from the antipattern.

For J. Perkal’s index:

$${\mathrm{\mu }}_{\mathrm{i}}={\displaystyle \frac{1}{\mathrm{n}}}{\sum }_{\mathrm{k}=1}^{\mathrm{n}}{\mathrm{z}}_{\mathrm{i}\mathrm{k}},$$

(6)

where n—number of variables; z_ik—normalized value of k-th variable in i-th object.

Calculations using each method resulted in six different rankings, from which one was selected (the most similar to the others). For this purpose, an approach based on the m_pq measure (of similarity of rankings) and the average value of the u_p index was used [80,81]. These values were determined using the following formulas:

$$\overline{{\mathrm{u}}_{\mathrm{p}}}={\displaystyle \frac{1}{\mathrm{v}-1}}{\sum }_{\begin{array}{c}\mathrm{q}=1\\ \mathrm{p}\ne \mathrm{q}\end{array}}^{\mathrm{v}}{\mathrm{m}}_{\mathrm{p}\mathrm{q}},$$

(7)

where m_pq—the measure of rankings’ similarity p i q (p, q = 1, 2, …, v).

$${\mathrm{m}}_{\mathrm{p}\mathrm{q}}=1-{\displaystyle \frac{2{\sum }_{\mathrm{i}=1}^{\mathrm{n}}\left|{\mathrm{c}}_{\mathrm{i}\mathrm{p}}-{\mathrm{c}}_{\mathrm{i}\mathrm{q}}\right|}{{\mathrm{n}}^2-\mathrm{z}}},{\mathrm{m}}_{\mathrm{p}\mathrm{q}}\in \left[\mathrm{0,1}\right]$$

(8)

where v—number of rankings; n—number of objects; c_ip, c_iq—position of the i-th object in the p and q rankings, respectively; z = 0, when n belongs to the set of even numbers; z = 1, when n does not belong to the set of even numbers.

The ranking prepared based on the Perkal index (with data unitarization) obtained the highest average value of the u_p indicator (in each analyzed year); therefore, it was used to assess the sustainable development of local governments in 2012–2022.

The next step in verifying the research hypothesis was determining the financial gap from implementing educational tasks by communes and cities with county rights. For this purpose, the budget classification applicable in Poland was used (adopted by the regulation of the Minister of Finance of 2 March 2010, on the detailed classification of income, expenditure, revenues and expenses, and funds from foreign sources). Following this division, funds for educational tasks are concentrated in two sections of the commune budget, i.e., no 801 (education and upbringing) and no 854 (educational care). For this study, it was assumed that the financial gap resulting from local governments’ implementation of educational tasks is the difference between the sum of the revenues of both sections and the sum of the expenditure of both sections.

Spearman’s rho correlation coefficient was used to determine the direction and strength of the relationship between the financial gap and the sustainable development of local governments. The main reason for using this approach was the results of the Kolmogorov–Smirnov test, which showed that the results of the variables were far from a normal distribution (p < 0.001), making it impossible to use parametric tools. At a later data analysis stage, the nonparametric Kruskal–Wallis test (for more than two samples) was also used to determine whether the type of municipality statistically significantly differentiates sustainable development and the financial gap in individual years. Pairwise comparisons were corrected using the Bonferroni method. The Page test for trends was also used in the calculations to check whether there was a monotonic increase or decrease in the values of data describing sustainable development and the financial gap due to the implementation of educational tasks.

Although parametric tests are generally robust to violations of assumptions, it is safer to rely on nonparametric tests in clearly skewed distributions, even though they have lower power to reject the null hypothesis when it is false. Therefore, when confidence in the results of a parametric test decreases (due to the failure to meet its assumptions), it is safer to apply a nonparametric test [82].

The analysis was performed in IBM SPSS 26.0. All dependencies (correlations and differences) are statistically significant when p ≤ 0.05.

The secondary data analysis was supplemented with information on selected aspects of financing educational tasks in the context of sustainable development of local governments, which was obtained from representatives of local governments during survey research. The research was conducted in the fourth quarter of 2023 (round I) and the first quarter of 2024 (round II) using an online survey technique. The invitation to complete the questionnaire was sent to representatives of all 2477 communes in Poland (including cities with county rights) who had substantive knowledge of the financing of educational tasks and the impact of the financial gap on the sustainable development of local governments. Correctly completed questionnaires returned 482 communes, i.e., 19.5% of the population. With a confidence level of 95% and an assumed fraction size of 0.5, this sample size resulted in a margin of error of 4% [83].

4. Results and Discussion

4.1. Sustainable Development of Municipalities and Cities with County Rights in Poland

The analysis using the Perkal index (with unitarization) shows that the level of sustainable development of local governments in Poland was diverse. The rural commune of Nowy Dwór achieved the lowest aggregate measure value in 2017 (0.2163), while the rural commune of Kleszczów recorded the highest in 2015 (0.5943).

After averaging the data for 2012–2022, the values of the synthetic measure ranged from 0.2396 to 0.5571, with a standard deviation of 0.03 and a variability of 10.5%. In the population of 2477 communes in Poland, more than half (54%) were units characterized by a lower-than-average level of development, which was reflected in the positive value of the skewness coefficient (0.8962), informing about the prevalence of low results over high ones. In this approach, the highest synthetic indicator was obtained by the rural commune of Kleszczów (0.5571), followed by the cities of Podkowa Leśna (0.5072) and Warsaw (0.4775). Despite differing sizes and characters, these units are united primarily by a favourable economic situation. In the case of Kleszczów (for many years the wealthiest commune in Poland), its source is tax revenues from large enterprises located in its area, such as brown coal mines and the Bełchatów CHP plant, as well as entities operating in the Kleszczów industrial zone [84]. In Podkowa Leśna (following the idea of a garden city), these are revenues from taxes paid by wealthy residents, high investment activity of the local authorities, and the involvement of residents in various social initiatives and city management [85]. In turn, Warsaw’s high position results from the fact that it is the largest city in Poland (in 2022, it was inhabited by 1,861,975 people) and the country’s capital.

At the other end of the ranking were the local governments with the lowest Perkal index values, i.e., Uchanie (0.2426), Radziejów (0.2403), and Braniewo (0.2396). These are rural communes of a typically agricultural nature, with no significant industrial plants. Residents’ primary income source is either work on farms or in service, or trade establishments in nearby towns. Another development barrier is the location far from large urban centres, and in the case of Uchanie and Braniewo, an additional element is the proximity of the state border. The first commune is located close to the border with Ukraine, and the second directly borders the Kaliningrad Oblast of the Russian Federation.

This study shows that a lower level of sustainable development was characteristic of most rural communes (Figure 1). The average Perkal index value determined for this group in the years 2012–2022 was 0.3019, while in urban–rural communes it was 0.3175, in urban communes 0.3482, and cities with district rights 0.3744.

The Kruskal–Wallis test analysis showed that the commune type significantly differentiates sustainable development in individual years (p < 0.001). It can be observed that the higher the degree of urbanization of the commune, the higher the sustainable development indicator in the years from 2012 to 2022. The differences in the results of almost all compared pairs based on exact comparisons corrected using the Bonferroni method are statistically significant (p < 0.001). Only in 2012, 2013, 2018, 2020, and 2021 can the differences between the urban commune and the city with county rights be considered in terms of a statistical trend (p < 0.10).

In the period under review, the situation of most communes (93.5%) improved. In this group, the Perkal index increased from 0.02% (the rural commune of Platerów) to 37.2% (the rural commune of Regnów). In turn, a decrease in development (by 19.8%) occurred in the urban–rural commune of Nowe Warpno. The main reason for the improvement in the result for the Regnów commune was intensive increases in input variables, especially x₅ (commune budget expenditure on physical culture per capita) by 761%, x₆ (commune budget expenditure on health care per capita) by 948%, x₁₇ (commune budget revenue from personal income tax per capita) by 817%, x₁₉ (commune budget investment expenditure per capita) by 562%, x₂₂ (share of employed persons in the working-age population) by 640%, and x₂₃ (commune budget expenditure on transport and communication per capita) by 837%. These changes resulted from the intensive investment activity of the commune, including thermal modernization of the school and the commune office, construction of a complex of modern sports fields, thermal modernization and replacement of the heat source in the health centre, and numerous road investments. The implemented projects improved residents’ quality of life and brought specific savings related to a significant reduction in heating costs [86]. As a result, the commune advanced in the rankings prepared based on the Perkal index from position 2231 in 2012 to 291 in 2022. The opposite situation occurred in the Nowe Warpno commune, where as many as half of the indicators were reduced. The increases in the remaining ones could not compensate for this loss; as a result, the commune moved from 6th place in 2012 to 388th in 2022.

Considering all the communes together, the Page test for trends indicates that sustainable development scores increased over the years (p < 0.001). In turn, the analysis taking into account the types of communes showed that the highest changes in the Perkal index value occurred in rural communes (the average for the group was 9.7%), and the lowest occurred in cities with county rights (2.6%).

According to information obtained during the survey from the commune offices, for the majority of local governments (84.9%), striving for sustainable development means simultaneously focusing on all aspects of this concept, i.e., the environment and ecology (natural capital), residents (human and social capital), economic entities and infrastructure (economic capital), and space. Only a small group approached this issue selectively, including 7.5% of communes prioritizing the development of human and social capital, 5% economic capital, 1.7% natural capital, and 1% spatial order as the most important. Boguszewski et al. reached slightly different conclusions [39]. Their study (on a sample of 718 municipalities) showed that local governments attached the most significant importance to the socio-economic aspects of sustainable development, primarily infrastructure development and the provision of educational services. Environmental protection issues were also important, and sustainable development was most often implemented through “green” investment projects. In turn, the research by Wang et al. [46] showed that the most popular sustainable development practices in cities included tree protection, the use of alternative fuel vehicles, the promotion of bicycle use, water-saving education, the construction of new buildings in the LEED (Leadership in Energy and Environmental Design) standard, and the use of renewable energy.

4.2. The Financial Gap Arising from the Local Government’s Educational Tasks and Its Impact on the Sustainable Development of Municipalities

The financial gap resulting from implementing educational tasks is due to the predominance of expenditure on educational tasks over the revenues obtained by local governments. In the survey, as many as 89.4% of municipalities considered that the funds transferred from the state budget for educational tasks and the expenditure incurred by local governments for this purpose are definitely too small. Another 9.3% assessed them as relatively too small. In turn, the secondary data analysis showed that in the entire period under review, only the Koneck commune achieved a positive result of USD 102,369.70 (converted at the exchange rate of USD 1 = PLN 4) once (in 2020). In the remaining cases, the balance was negative and, on average, amounted to 13.3% (rural commune Kleszczów) to 231.8% (rural commune Wojcieszków) of the own revenues of the surveyed units.

The local government that showed the most significant deficit in each year covered by the analysis was the capital city of Warsaw (the shortfall in funds for educational tasks in 2012–2022 amounted to an average of USD −954,630,072.80). In turn, when it comes to the local government with the smallest financial gap, it was a different rural commune each year, and the average determined for this set was USD −327,427.27.

The Kruskal–Wallis test analysis showed that the type of commune statistically significantly differentiates the financial gap in individual years (p < 0.001). It can be observed that the higher the degree of urbanization of the commune, the more significant the financial gap in the years 2012–2022. Precise pairwise comparisons corrected by the Bonferroni method indicate that statistically significant differentiation applies to all types of communes. In rural communes, the excess of expenditure over revenues from the implementation of educational tasks amounted on average (in the years 2012–2022) to USD −2,458,268.56, in urban–rural communes USD −4,582,714.00, in cities USD −7,734,427.52, and cities with county rights USD −92,988,004.36 (Figure 2).

According to the survey participants, the main reason for the imbalance between funds transferred from the state budget for the implementation of educational tasks and the expenditure incurred by municipalities for this purpose was the high costs of maintaining schools (energy, heating, current renovations) (79.3%), as well as teachers’ salaries (79%). The respondents also indicated the investment needs of schools (61.6%), the incorrect construction of the algorithm for determining the educational subsidy (52.3%), and too many educational tasks transferred to municipalities for implementation (47.7%). Slightly less often, they considered the lack of a long-term educational policy of the central authorities, which would be implemented regardless of the current political situation (33.2%); purchases of materials, equipment, and teaching aids (33.2%); too low a level of earmarked subsidies for the reported needs (30.9%); and too many schools to the number of students (24.5%) as determinants of the financial gap (Figure 3).

Insufficient transfers from the state budget force municipalities to cover shortfalls from their own resources or use alternative sources of financing. This study shows that only 11% of local governments could finance educational expenditure using their own resources. Another 35.1%, wanting to avoid using external financing, tried to increase their own revenues, e.g., by increasing taxes and local fees. On the other hand, the remaining local governments received external financing, mainly European Union funds (46.5%) and commercial funds (credits, loans) (23.9%). A small role was also played by extra-budgetary funds collected in separate accounts (inheritances, bequests, donations to the school/facility, revenues from services, penalties and compensations, lease and sale of assets, various fees) (12.2%) and the issue of securities (11.2%) (Figure 4).

The secondary data analysis showed that almost the entire population of local governments in Poland (except for a small group of 25 communes) experienced a deepening financial imbalance in 2012–2022 due to the implementation of educational tasks. It was due to several main reasons that Kotlińska et al. [13] divided into two groups: i.e., dependent on local authorities (which showed diversity across the country) and systemic (more uniform in nature). The first group included capital expenditure and subsidy expenditure, and additionally, in cities with county rights, expenditure on materials and services for schools and facilities. In turn, the second group included expenditure on salaries (regulated by the central government) and school reforms (causing increased costs due to changes in teachers’ employment and adaptation of infrastructure and its further maintenance). In the analyzed period, the most significant increase in the financial gap occurred in the rural commune of Komorniki (+321%). It was caused by an increase in current expenditure (+341.8%) and capital investment (+322.5%) related to expanding and modernizing schools and facilities.

Considering all municipalities together, the Page test for trends showed a financial gap increase over 2012–2022 (p < 0.001). In rural communes, the surplus of expenditure on educational tasks over the revenues obtained for this purpose increased on average by 58.8%, in urban–rural communes by 61.1%, in urban communes by 71.9%, and in cities with county rights by 70.7%.

Sekuła et al. [10] point out that the fiscal imbalance of the sources of financing for educational tasks may disrupt the possibilities of economic development and pose a challenge to implementing the concept of sustainable development for local governments. Survey studies confirmed this, as 63.1% of respondents stated that the imbalance between funds transferred from the state budget for the implementation of educational tasks and the expenditure incurred by the commune for this purpose negatively affects the sustainable development of local government. A small percentage of respondents (19.3%) did not see such a connection, and 16.6% had no opinion.

The statistical analysis of secondary data showed that as the financial gap increased in individual years, the sustainable development indicators decreased. The determined correlation coefficients are statistically significant (p < 0.05). The strongest correlations determined by Spearman’s rho coefficient occur in all communes combined and cities with county rights. The weakest correlations between the financial gap and sustainable development occur in urban communes (

Table 2. Spearman’s rho correlation coefficients between the financial gap and the sustainable development of local governments.

Municipalities	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022
Total	−0.502	−0.515	−0.510	−0.525	−0.565	−0.566	−0.568	−0.568	−0.567	−0.582	−0.448
Rural	−0.292	−0.320	−0.330	−0.363	−0.418	−0.422	−0.441	−0.441	−0.429	−0.451	−0.298
Urban–rural	−0.412	−0.402	−0.402	−0.405	−0.457	−0.466	−0.455	−0.463	−0.463	−0.478	−0.384
Urban	−0.184	−0.202	−0.172	−0.247	−0.250	−0.288	−0.234	−0.244	−0.192	−0.211	−0.147
City with country rights	−0.456	−0.477	−0.499	−0.518	−0.519	−0.525	−0.511	−0.499	−0.392	−0.393	−0.401

).

The consequences of filling the financial gap with own revenues are visible, among others, in the investment policy of local governments, which is a crucial instrument for implementing sustainable development. Only 27.4% of the communes participating in the survey admitted that despite the need to co-finance educational tasks with own revenues, all planned investments that fit into the concept of sustainable development are implemented on time. The remaining communes most often postponed the implementation of projects in the field of transport infrastructure and maintenance of communal roads (47.1%), as well as in sewage infrastructure and sewage treatment (37.8%) and water supply infrastructure and water treatment (34.6%). The respondents also mentioned investments in the areas of culture (28.8%), physical culture and tourism (26.8%), and energy transformation and thermal modernization (20.1%) (Figure 5).

However, the analysis of data from 2014 to 2018 conducted by Czudec [75] shows that the need to co-finance education expenditure from local governments’ own revenues did not significantly affect their ability to implement investment tasks or worsen their financial situation, measured by the ratio of liabilities to the total amount of budget revenues. It was possible thanks to the rapid growth of the municipalities’ own revenues, which resulted from the good economic situation and the dynamic growth of revenues from personal and legal persons’ taxes.

5. Conclusions

Currently, the right to education is one of the fundamental rights of every person, and knowledge and skills acquired in the education process are essential factors in economic growth [87,88]. Stiglitz [89] points out that employees who have been educated for more extended periods achieve higher wages and higher labour productivity, which benefits the entire society and individuals. Johnes et al. [90] treat the occurrence of these positive effects as a justification for the state’s involvement in offering educational services.

In Poland, responsibility for educational tasks has mainly been transferred to local governments, but the state still plays a decisive role. Its financial contribution is necessary because compulsory education is subordinated to the principles of universal and free access [91]. Because funds transferred from the central budget do not fully cover the costs incurred by local governments, they need to co-finance the implementation of these tasks from their own revenues. Such a situation (due to the limited resources of municipalities) poses a threat to the proper implementation of other tasks, which may ultimately harm the sustainable development of these units. With this in mind, this article focused on determining the impact of the financial gap resulting from implementing educational tasks on the sustainable development of municipalities and cities with county rights. The implementation of the research objective required measuring the sustainable development of local governments, then determining the scale of the imbalance between the revenues and expenditures of municipalities related to educational tasks, and finally comparing both categories to establish the strength and direction of the relationships between them.

The linear ordering method (Perkal index with unitarization) was used to assess the level of sustainable development. Its results showed the diversity of the studied set at an average level of 11%. The maximum value of the aggregate measure occurred in 2015 (0.5943), while the minimum occurred in 2017 (0.2163). The highest values of the sustainable development index were recorded in communes with a favourable economic situation (Kleszczów, Podkowa Leśna, and Warsaw), while the lowest were in peripherally located rural communes (Uchanie, Radziejów, and Braniewo). In-depth analysis revealed that the level of sustainable development of communes depends on several factors, including, among others, the degree of urbanization (confirmed by the results of the Kruskal–Wallis test). Urban communes and cities with county rights achieve higher development indicators than rural communes, but they show a slower growth rate. The increase in the aggregate measure value in rural communes amounted to 9.7% on average in 2012–2022, while in cities with county rights, it was only 2.6%.

The analysis of the expenditure coverage for educational tasks using revenues obtained by local governments showed an imbalance in all units of the studied set. Objective data confirmed the opinion of the representatives of the communes, who almost unanimously stated that the funds transferred from the state budget were insufficient to finance the costs of educational tasks fully. Once again, the type of commune was a factor differentiating the obtained results, as indicated by the results of the Kruskal–Wallis test. The most significant financial gap appeared in cities with county rights, while the smallest was in rural communes. The representatives of local governments primarily justified the existing situation by the high costs of maintaining schools, the need to cover teachers’ salaries, the investment needs of schools, the improper construction of the algorithm for determining the educational subsidy, and the excessive number of educational tasks transferred to the communes. A worrying phenomenon is the deepening of the financial gap, which affected 99% of the communes. Urban communes recorded the highest increase (+71.9%), while the lowest increase was recorded by rural communes (+58.8%).

More than half of the survey participants admitted that the imbalance between funds transferred from the state budget for the implementation of educational tasks and the expenditure incurred by the commune for this purpose negatively affects the sustainable development of local government. The correlation analysis led to a similar conclusion. It showed a negative, inversely proportional relationship between the categories studied. The highest values of Spearman’s rho coefficient occurred in all communes combined and cities with county rights. The weakest links between the financial gap and sustainable development were observed in urban communes. The obtained results positively verified the adopted hypothesis, assuming that the shortage of funds transferred to communes and cities with county rights for educational tasks negatively affects their sustainable development.

The excessive involvement of local governments in financing basic educational tasks weakens development and limits the ability to implement pro-development projects in other areas critical to residents. It also negatively impacts the quality of education (forcing, for example, a reduction in extracurricular activities and additional programmes), the ability of teachers to improve their qualifications, and the modernization and expansion of facilities and equipment. It also makes it more difficult for local governments to access European Union funds, which require securing co-financing. Particularly concerning are the size and pace of the growth of the financial gap in cities with county rights, which are responsible for two levels of education: primary and secondary. Since teacher salaries are the leading cause of the imbalance in education budgets, it would be a significant relief if the state budget took over their financing. Additionally, in the context of a deepening demographic decline, municipalities and cities with county rights should have statutory support for rationalizing the school network when the number of students is too low. Without a top-down definition of the “profitability threshold” for creating classes and divisions (in the form of a minimum number of students), implementing decisions to close schools is extremely difficult due to resistance from key stakeholders, i.e., parents, teachers, and education superintendents. As a result, local governments maintain classes with only a few students, which is economically inefficient. An alternative solution could be to modify the algorithm for calculating the education subsidy by allocating funds not per student but per class.

This research constitutes a voice in the debate on the scale and consequences of excessive involvement of local governments’ resources in implementing educational tasks. It is all the more critical because, as Kubalski [92] points out, the need for more financing of educational expenditure incurred by local government units is currently the fundamental problem of the education management system. Further research should diagnose the specific causes of the financial gap in education to propose ways to reduce it. It would also be worthwhile to focus on local governments’ benefits in implementing educational tasks and determine how municipalities’ education expenditure contributes to achieving sustainable development goals.