ORGANIC BUDGET LAW

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ORGANIC BUDGET LAW

• POLAND

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What is an Organic Budget Law?

• A law specifying the schedule and procedures by
  which the budget should be prepared, approved,
  executed, accounted for, and final accounts
  submitted for approval.

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Aims of Organic Budget Law

• creation of legal framework regulating the budget
  process,
• adjusting budget procedures to country legal,
  cultural and political conditions,
• strengthening the transparency of budget
  information,
• clearly indicating division of responsibilities.

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Sources of Organic Budget Law in Poland

• The Constitution of the Republic of Poland
• Act on public finance
• Decrees of the Council of Ministers and Finance
  Minister

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Limitations set by the Constitution

• possibility of changing the draft of the State
  Budget in the Parliament,
• ban on covering a budget deficit by way of
  contracting credit obligations to the State's
  central bank,
• exclusive right to introduce legislation
  concerning a Budget,
• restrictions concerning a national public debt.

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Limitations set by the Act on public finance

• expenditures set in the State Budget constitute
  limit for public expenditures,
• State Budget cannot embrace regulations changing
  other acts,
• State Budget can determine expenditure limits for
  multiannual programs,
• multiannual programs are set by the Council of
  Ministers.

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Cautions procedures connected with public debt

• Cautions procedures are based on the relation
  public debt to GDP. They are activated, if they
  reaches on the following ratio
• (50,55)
• (55,60)
• (60,60n).

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I stage - preparation

• The Council of Ministers submits the preliminary
  forecast of macroeconomic indexes,
• Finance Minister submits to the Council of
  Ministers assumptions to the draft of the State
  Budget,
• Budget disposers are responsible for preparation
  tasks plans,
• Finance Minister prepares a draft of the State
  Budget and submits it to the Council of
  Ministers,
• The Council of Ministers approves the draft of
  the State Budget and submits it to the Seym not
  later than the 30th of September.

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II stage passing the State Budget

• The Seym has to pass the State Budget within 4
  months,
• Senate has 20 days to amend Budget,
• The President has to sign Budget within 7 days,
• Possibility of reference to the Constitutional
  Tribunal.

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III stage State Budget execution

• The Council of Ministers
• supervise the implementation of the State Budget,
• pass a resolution on the closing of the State's
  accounts.

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IV stage State Budget control

• The Council of Ministers present to the Seym a
  report,
• The Seym passes a resolution on whether to grant
  or refuse to grant approval of the financial
  accounts submitted by the Council of Ministers,
• The Council of Ministers is politically
  responsible for State Budget execution.

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Internal Audit

• independent examination of management and control
  systems in a unit
• - conformity of activity with binding internal
  procedures and law,
• - efficiency and economy of decisions made
  within management and control systems,
• - credibility of financial statement and budget
  execution report, 
• consultancy.

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General rules

• Possibility of being constitutionally accountable
  to the Tribunal of State,
• Exclusive right to submit to the Seym the draft
  of the State Budget,
• Discontinuation legislative procedures does not
  apply to the draft of the State Budget,
• Justification of the State Budget according to
  the defined requirements,
• The content of the State Budget is exactly
  defined,
• There is no veto in case of State Budget,
• Limitations of changing the State Budget during
  its execution.

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Thank you for your attention. We are pleased to
answer all questions.