This is the most important budget reform, on which the Ministry of Finance worked for three years.
The Verkhovna Rada on Thursday, October 18, adopted on second reading and in whole draft law No. 8044 on the legal basis for the medium-term budget planning.
Voted 238 deputies.
The transition to a three-year plan – the most important budget reform, on which the Ministry of Finance works over the last three years.
“We have been working to legislate a comprehensive approach to budget planning in the state. In pilot mode, he successfully worked with 2017. This is a major reform in the area of public Finance. It is necessary in order to protect all the reforms that we have already begun to implement to provide financial resources to the strategic priorities of our state, spending budgets, that there are people in the government become really responsible and accountable to citizens for how effectively they spent taxpayers ‘ money taxes,” – commented the decision of the Parliament, the Minister of Finance Oksana Markarova. Her comment published on the Ministry’s website.
The reform envisages the introduction of three-year Budget instead of an annual Declaration of the Main directions of the budget policy. This new strategic planning document will determine fiscal policy for the medium term. At the local level will be the local three-year financial plans.
The Ministry of Finance will develop a Budget Declaration, subject to the provisions of the documents of state strategic planning for five years or more, in particular, sectoral policies and strategic plans of the main managers of budgetary funds. In turn, the strategic plans of managers will be specified on the basis of the Budget Declaration.
In the Budget Declaration will specify not only the volume of public and publicly guaranteed debt and main tasks of tax policy, but also the ceiling of expenses and the provision of loans.
The government will be obliged to submit the Declaration of the Budget and the macroeconomic forecast not later than 1 June. Parliament will have to take it until July 15.
Medium-term budget planning is one of the priorities of the government and the Ministry of Finance that was envisaged by the coalition agreement, medium-term government action plan to 2020, the Memorandum with the IMF and the reform strategy of public Finance management in 2017-2020 years.
The law also enacts new budget rules. In particular, government debt and government guaranteed debt cannot exceed 60% of GDP and the state budget deficit – 3% of GDP. State guarantees will not exceed 3% of the revenues of the General Fund budget. The maximum volume of deficit of the state budget law on state budget cannot be more than the amount of the deficit in the budget Declaration.
Associated bill No. 8043 deputies have not yet adopted.