Objectives of the session
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1 Objectives of the session At the end of the session the participants will: Understand the phases of budgeting process. UNDESA/ PPFI February
2 Who are the main participants in the budgeting process? The Parliament is the representative body of all the citizens, it keeps a check on the executive (the government) and is the legislative body of the country. The parliament discusses the government s fiscal policy in parliamentary commission meeting and parliamentary debate. Only upon the parliament s approval, expenditures and policies for revenue collection become part of the coming year State Budget. UNDESA/ PPFI February
3 Who are the main participants in the budgeting process? The Government executes the policies approved by the Parliament. The role of the government in the budgetary process is to propose fiscal policy and define the national Budget policy within the context of economic, social and political objectives that have been laid down. UNDESA/ PPFI February
4 Who are the main participants in the budgeting process? The Ministry of Finance is in fact one of the beneficiaries of the national Budget. However, the Ministry of Finance also has an important role in the budgetary process. It does all the work for r the government with respect to collecting resources for the budget and a paying them out. The Ministry of Finance, through its agencies, draws up and checks -the execution of public revenue and expenditure. -the amount of resources available in the budget -providing expertise relating to beneficiaries capital investment; t; -drawing up budgetary documentation; UNDESA/ PPFI February
5 Who are the beneficiaries of the budget The beneficiaries of the national Budget are all the institutions, ministries, state agencies and companies that are financed out of the national Budget. This group includes the Parliament, ministries and all the institutions that operate with public money. UNDESA/ PPFI February
6 Who are the beneficiaries of the budget The people.. We live in a political community in which we elect our representatives in the government. They make the decisions about all the important questions in the country, and thus about the Budget as well. In the Budget, large amounts of money are put together, but then they are spent as well. How money is collected, and still more how h it is spent, is not just the concern of our representatives in the t government, Parliament, the Finance Ministry and other ministries. s. The Budget is too important to be left to individual politicians and the interest groups they might represent. The people and various governmental and non-government establishments and organizations may be actively involved in the budgetary process... UNDESA/ PPFI February
7 Basic phases of the budgetary process Preparation, Adoption, Execution and Control UNDESA/ PPFI February
8 What is MTEF? MTEF ensures a preliminary estimation of budget resources and sets expenditure priorities for the next three years and is presented to the Government before the preparation of the annual budget. UNDESA/ PPFI February
9 MTEF Objectives: To ensure a fiscal discipline for a midterm period and improve the predictability of the budgeting process; To improve effectiveness of public expenditures by creating a framework that links government policies with public expenditure plans, in particular those included in NSSED; To improve the efficiency of the budget resources utilization. UNDESA/ PPFI February
10 Main Elements of MTEF Review the revenue estimates and the framework of resources on the basis of which are planned expenditures; Analyze the interconnected and inter-sectoral issues of public expenditures and their implication in the budget planning; Develop sectoral expenditure strategies related to sectoral policies and strategies of public expenditure distribution; Develop sectoral expenditure plans in line with the macro and fiscal framework and sectoral expenditure strategies. UNDESA/ PPFI February
11 Skema e procesit buxhetor fq 74 UNDESA/ PPFI February
12 Budgeting processes 1. Preparation of budget, when the budget is prepared by executive, either in horizontal way the same level of budgetary institutions or vertical way bottom up preparation up to ministry level. This phase is about 6 months. 2. Budget Discussions and Approval, when budget is discussed in parliamentary groups, media, business, and civil society. This phase is about months 3. Budget Implementation, which includes the implementation, and internal control of budget. The main responsibility is of budgetary institutions. This phase is one year. 4. Budget Audit, which includes the external control by General Audit Institutions. This phase lasts months UNDESA/ PPFI February
13 Preparation of the budget first step Proposal for the fiscal policy for the coming fiscal year Ministry of Finance prepares the report on the macroeconomic and fiscal situation of the current fiscal year, and proposes the objectives in relation to fiscal policy of that year. Ministry of Finance presents the report to the Council of Ministers for approval. (within June) UNDESA/ PPFI February
14 Preparation of the budget second step Guidelines for the preparation of the Budget Proposal Ministry e Finance forecasts expenditures for the next year and delivers to line ministries the Guideline for the preparation of budget proposal for xxxx year. The guidelines also included the projections for the level of revenues and expenditures for the coming year and the way in which the budget submissions should be presented. UNDESA/ PPFI February
15 Preparation of the budget third step Negotiations and adjustments to the budget submissions. Ministry of Finance analysis the budget submissions presented by budgetary institutions. In this phase budgetary institutions and Ministry of Finance negotiate this budget submissions and make the necessary adjustments. Ministry of Finance prepares the draft budget and sends it for review and approval to the Council of Ministers. UNDESA/ PPFI February
16 Proposal and approval of the state budget As regulated by national budget laws, Council of Ministers reviews the draft budget and sends it for approval to the Parliament. By the end of year, Parliament discusses and approves the State Budget. UNDESA/ PPFI February
17 Execution of state budget January 1 st - December 31 st Budgetary institutions get and spend the budgetary sources in line with the plan and report to the Ministry of Finance following the standards and deadline advised on the Budget Guideline. July Ministry of Finance presents to the Council of Ministers a report on the status of the State Budget implementation. Later this report is send to Parliament. UNDESA/ PPFI February
18 Budget execution Before the end of fiscal year, Ministry of Finance issues a Guideline on the closure of revenues and expenditure accounts of all budgetary institutions UNDESA/ PPFI February
Budget Expenditures. UNDESA/PPFI February
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