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Minister Explains Need To Repeal Budget Law

State Minister for Investment Gabriel Ajedra has said the integration of financial management laws under the Public Finance Bill will help address the distortions within the existing legal framework and streamline the sector.

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State Minister for Investment Gabriel Ajedra has said the integration of financial management laws under the Public Finance Bill will help address the distortions within the existing legal framework and streamline the sector.

 

The Members of Parliament had invited Ajedra to explain to them why the Ministry of Finance wants to repeal the Budget Act among other laws and incorporate the provisions into the Public Finance Bill. The MPs argued that the revocation of the Budget Act will weaken the powers of Parliament in as far as their oversight role in the budget process is concerned.

 

The minister, however, emphasised that there is need to bring the different laws that govern budget planning and financial management under one consolidated law arguing that it will strengthen the sector and cater for the issues that are not addressed in the existing laws.

 

While presenting the ministry’s submissions to the Budget Committee, the deputy Secretary to the Treasury Patrick Ocailap said the current legal framework has encouraged budget delays, local government borrowing and over spending which they hope to be addressed with the new bill.

 

Ocailap told the committee that in order to cure the contradictions within the existing legal framework and to ensure completeness, there is need for a single law that covers all the elements of the entire public finance management cycle.

 

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Ocailap added that the bill addresses issues that are not addressed in any of the existing laws saying that this bill only seeks to strengthen the system, not to weaken it. Some of the issues that are integrated in the bill, Ocailap says are micro economic management, treasury and accounting management, administration arrangement and budget preparation.

 

The MPs first insisted that the Budget Act should not be repealed suggesting that if there are any amendments needed in the budget process they should be made in the Budget Act not in a new law.

They accused the Executive of aiming at clipping parliament’s powers saying that the proposed law will undermine the role of parliament in the whole process.

 

But Ajedra told MPs that the 75 amendments that have been introduced into the bill should allay the fears of the MPs since they address the concerns of parliamentary oversight that the MPs have been raising.

 

Ocailap told the MPs that the 85 percent of the amendments emphasize the role of parliament in preparation, approval and management of the budget.

 

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The MPs agreed to first study the new amendments to confirm if they enhance the role of parliament in the budget process and to ensure that the public finance bill will cater for all the provisions of the Budget Act.

 

The Public Finance Bill was introduced in parliament early last year with a view to amend the existing public finance accountability Act to provide for fiscal and macroeconomic management. It was also meant to provide for the charter of fiscal responsibility which the ministry of finance says will be best done if all the principles of budget planning and financial management are catered for under one bill.  

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