Published on Ceylon Today
The failure of the executive to adhere to the governing fiscal law significantly undermines the overall credibility of the government, says the Colombo-based think-tank Verité Research.
In addition, parliament has a responsibility to ensure that the executive is held accountable for such transgressions, it notes in its latest ‘Public Report on the 2022 budget.’
While the Fiscal Management (responsibility) Act (FMRA) of 2003 was enacted to ensure that the principles of responsible fiscal management are entrenched within the legislative discipline, the budget deficit as a share of GDP has consistently remained above the set limit of 5 percent of GDP, the report points out.
Even for 2022, the proposed budget deficit is 8.8 percent of GDP, which is well above the legally allowed limit.
The report goes onto say that the FMRA essentially provides for measures to enable the public to actively investigate, scrutinise, and oversee the country’s fiscal policy and its performance.
The regular violations of the law and changes to the law to accommodate fiscal profligacy are an erosion of the credibility of the executive.
Furthermore, these violations and changes also undermine the credibility of the very institutions that are meant to provide credibility, the Verite Research report adds.
Last modified: October 29, 2023