Fiscal Councils in the Countries of Eastern-Central Europe
Professor, University of Szeged, Chairman of the Fiscal Council and President of the Hungarian Economic Association
Published in: Public Finance Quarterly 2014/3 (p. 326-345.)
Summary: Improving the efficiency of budgetary management and preventing overspending that with an adverse effect on performance are fundamental conditions of budget stability and issues of strategic importance. Rule-based budget means more than merely a stipulation that public finance managements shall observe the rules of budget planning and execution and that the real and budgetary sectors of the economy are characterised by the rule of law. Rule-based budget requires the employment of numerical and procedural regulations by institutionally ensuring their respective observance. Regarding the latter we can declare that in Eastern and Central Europe interest has grown recently in fiscal councils that have been shooting up like mushrooms and are believed to be virtually “the ultimate weapon” in fighting budgetary overspending. The demand for creating such new institutions at the same time undeniably represents criticism concerning the former processes of the planning mechanisms and their respective institutionalised solutions. This paper aspires to provide a picture as regards to what extent fiscal councils can be regarded as a new type of organisation within the family of independent fiscal institutions (IFIs) that reflect institutional development and, in the public law of the new democracies having accessed the EU following 2004, represent the best solution to be recommended, i.e. the best practice. This non-exhaustive overview deals with the course of the independent budgetary institutions of those Eastern-Central European countries that accessed the European Union in 2004, respectively their mission and concept of an institution, while it also refers to the role of these organisations in crisis management.
Keywords: fiscal policy, crisis management, debt management, budgetary stability
Journal of Economic Literature (JEL) kód: B15, E62, H15, H61, H63, L38,