Political Constitution of Colombia (1991)

The amount of the General System of Shares of the Departments, Districts and Municipalities shall be increased annually by a percentage equal to the average percentage variation that the current revenues of the Nation have experienced during the four (4) preceding years, including the one corresponding to the estimate for the budget in execution.

For the purpose of calculating the variation of the current revenues of the Nation referred to in the preceding subparagraph, the taxes resulting from State of Exception measures shall be excluded, unless Congress makes them permanent in the following year.

Seventeen percent (17%) of the resources of the General System of Shares for spending purposes shall be distributed among the municipalities with a population inferior to 25.000 inhabitants. These resources shall be spent exclusively on investment, in accordance with the competences assigned by statute. The distribution of these resources shall be based on the same criteria of population size and poverty as defined by the Act on the Shares for General Purposes.

The municipalities classified in the fourth, fifth and sixth categories in accordance with the rules in force may freely spend up to forty-two percent (42%) of the resources they receive from the General System of Shares for General Purposes for investment and other expenses inherent in the functioning of the municipal administration, with the exception of the resources distributed in accordance with the preceding section.

When a territorial entity achieves universal coverage and meets the quality standards established by the competent authorities in the sectors of education, health, and/or public services concerning drinking water and basic sanitation in the home, according to certification by the competent national entity, it may spend the surplus resources on investment in other sectors within its competence. The National Government shall regulate the matter.

The amount of the General System of Shares, GSS, of the Departments, Districts and Municipalities shall increase by taking as its base the amount dished out during its previous period of application. During the years 2008 and 2009 the GSS shall increase at a rate equal to the inflation rate, with an additional increase in real terms of 4%. During the year 2010, the increase shall equal the inflation rate, with an additional increase in real terms of 3.5%. Between the year 2011 and the year 2016 the increase shall equal the inflation rate, with an additional increase in real terms of 3%.

If the rate of real growth of the economy (Gross Domestic Product, GDP) certified by DANE for the respective year is superior to 4%, the increase of the GSS shall equal the inflation rate, with an additional increase in real terms as indicated in the Transitional Paragraph 1 of the present Article, plus the difference in percentage points which results from a comparison of the real growth of the economy certified by DANE and the 4%. These additional resources shall be spent on comprehensive care for small children. The increase of the GSS resulting from higher economic growth which is the object of the present section shall not constitute the basis for the funding of the GSS in subsequent years.

The General System of Shares, GSS, shall receive an increase in funding in addition to the increases referred to in the preceding transitional paragraphs with regard to the education sector. This additional increase shall take place in the following stages: in the years 2008 and 2009, it shall equal one point three percent (1.3%), in the year 2010 one point six percent (1.6%), and during the years 2011 to 2016 one point eight percent (1.8%). In each of these years, the additional increase shall not constitute the basis for the funding of the System in the subsequent period of application. The resources shall be spent on coverage and quality.

The National Government shall define a number of criteria and transitional arrangements in the application of the results of the last census with the objective of avoiding negative effects resulting from the variations in the census data on the distribution in the General System of Shares. The System shall direct the necessary resources in such a way as to avoid under all circumstances a reduction in the level of funding which the territorial entities currently receive for reason of diminishing population size.