COMPENSATION SUBVENTION AND ITS ROLE IN EQUALIZING COMMUNES’ INCOMES (EXAMPLE OF SELECTED COMMUNES OF MAZOVIAN PROVINCE)

Abstract

The article deals with the issue of compensation subvention and its role in equalizing communes’ incomes. Three elements constitute general subvention in Poland, these are: compensation subvention, education subvention, balance subvention. The compensation subvention should allow to equalize the level of incomes generated by all communes in Poland. However, there appear some nuances which cast doubt on subvention’s effectiveness. The first part of the article covers the theoretical aspects of allotting the basic sum of compensatory subvention and changes made through analysed years (2006–2008). The second section, divided into two subsections, describes the income situation in chosen communes before granting a compensation subvention and, later, it shows the change of the income-level, when the subvention is included. The analysis lead to the conclusion that the compensatory sum of the subvention does not compensate the incomes of communes sufficiently.