In other economies of the former Soviet Union enterprise costs for these services have also been found to be higher because of the substantially higher salaries paid to employees who provided these services. Whether most of those benefits should still receive public subsidies or preferential tax treatment is debat-able. A case can be made for some government funding of public health and kindergarten services. It is also essential to find alternative sources of housing and public utility services. As much as 25 percent of unemployment in transition economies has been attributed to labor immobility arising from lack of housing.
Local infrastructure is clearly a responsibility appropriate to local governments.
In Belarus assigning services such as education and health care to local governments is more debatable. Methods of financing local services also need to be addressed. The central government shares its revenues with local governments based on the area where the revenues are collected, but such revenue sharing inherently leads to more resources going to wealthier regions. Moreover, the subnational share of government revenues has declined, from 70 percent in 1992 to 48 percent in 1996. The earmarked taxes levied on enterprises to pay for housing maintenance and kindergartens are not justified because no close link exists between beneficiaries and payments.