Press release: MPs to amend shortcomings of the Budget Law

The Bill on Budget and Fiscal Responsibility contains numerous ambiguities and shortcomings which need to be addressed through amendment procedure in the Parliament. Among other things, increasing transparency of the budget cycle and enabling more significant participation of the Parliament in this process was not achieved; offense liability is still vaguely defined; whereas autonomy of independent control institutions threatens to be undermined.

Institute Alternative submitted its comments to the Ministry of Finance during the public hearing, but the law drafters did not show understanding for our main suggestions.

The Bill on Budget and Fiscal Responsibility does not amend the budget calendar. Consequently, this means that the Parliament is left with the deadlines unacceptable for proper consideration of the key budget documents. MPs must not adopt the Bill which once again leaves the Parliament with less than a month for adoption of the budget bill. Furthermore, it does not impose obligation on the Ministry of Finance to report on budget execution throughout the year, while at the same time provides for the MPs to discuss the Final Account of the Budget for 2013 in October 2014. In addition, the Parliament remains excluded from the budget preparation process. This means that MPs will not be consulted during budget drafting process or be able to influence the content of important provisions of the annual budget, capital budget or the Strategy of Debt Management.

When it comes to offense liability, it is quite likely for the offenses committed to go unpunished, since the statute of limitations will probably expire until these offenses are discovered or while the transfer of responsibility for initiating criminal proceedings is shifted from one institution to another. The law drafters persistently refuse to stipulate a provision in the law entailing three-year statute of limitations for initiating and conducting criminal proceedings, which is the longest possible timeframe allowed by the Criminal Procedure Code. On the other hand, it is not clear whether the State Audit Institution, as the only institution that has so far revealed violations of The Budget Law, will be able to request initiation of criminal proceedings.

An opportunity for this new legislation to ensure financial autonomy of authorities and institutions whose main responsibility is to monitor the work of the Executive, primarily the State Audit Institution, the Protector of Human Rights and Freedoms, and the Agency for Protection of Personal Data and Free Access to Information, was not taken advantage of. Not only that the independence from the Executive of aforementioned authorities was not strengthened, but their position was leveled with any other consumer unit, providing that, under certain conditions, the Ministry of Finance has the power to temporarily suspend the use of budget funds for these authorities.

Finally, it is not clear why the Bill explanation stipulates that it is not necessary to provide funds from the budget for its implementation, although the Law provides for the establishment of the new budget inspection. MPs need to pay closer attention to these kinds of details in the process of consideration of the bill, because these details indicate the way law drafter understands the authorities whose establishment it suggests.

The Budget Bill is one of the most important legal documents the Parliament will rule on until the end of this year. Therefore, MPs need to pay close attention to it. It must not be permitted for ambiguous provisions to be adopted; the autonomy of important monitoring institutions needs to be protected; while the budget calendar finally needs to be amended in order for it to allow effective parliamentary control of the budget.

Public Policy Researcher

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