Albania’s 2025 State Budget: Supreme Audit Institution Finds 12.3 Billion Lek in Negative Financial Effects

 Albania’s Supreme State Audit Institution (KLSH) has identified numerous irregularities and shortcomings in the implementation of the 2025 state budget, issuing a qualified conclusion on the management of public finances.

 

According to the audit report, inspections uncovered 171.9 million lek in economic damage and 12.3 billion lek in negative financial effects. Among the main concerns were public procurement procedures launched without sufficient funding, financial commitments exceeding approved budgets, and investment funds allocated without being linked to specific projects, local media reports.

The audit found that 44 procurement procedures, with a combined value of 16.8 billion lek, had been initiated without adequate financial coverage. In addition, financial commitments across 39 projects exceeded approved funding by 4.28 billion lek. A further 5.26 billion lek in investment funds had been released without being broken down into concrete projects.

Tax Debt Reaches 256.27 Billion Lek

The report also highlights significant problems in revenue collection and expenditure management.

By the end of 2025, outstanding tax and customs liabilities had reached 256.27 billion lek, representing an annual increase of 44.61 billion lek.

Financial information systems also continued to operate without the necessary technical support, forcing public institutions to submit physical documentation to Treasury offices. The audit identified thousands of invoices and contracts registered late, as well as revisions to the 2025 budget plan made as late as February 2026, after the financial year had already ended.

One-Fifth of Annual Payments Made in December

Another issue identified by the auditors was the concentration of public spending towards the end of the year. In December alone, payments amounted to 162.54 billion lek, equivalent to 20.3% of total annual expenditure.

At the same time, capital investment spending fell 25.45 billion lek short of the final budget plan. A total of 188 projects, for which 3.59 billion lek had been allocated, recorded no implementation at all.

According to the Supreme State Audit Institution, these findings point to shortcomings in budget planning, financial management and internal controls. The institution warns that such weaknesses increase the risk of accumulating unpaid obligations and using public funds inefficiently.

The findings raise questions about how public resources were planned, committed and spent during 2025, particularly given the significant gap between allocated investment funds and the projects actually implemented.