MTBF and Nationale Expenditure Rule in the Netherlands Eugene Verkade MTBF workshop Roma , Sept 7 2017 CPB Netherlands Bureau for Economic Policy Analysis
Summary MTBF cycle MTBF rules Annual budget cycle Recent developments CPB Netherlands Bureau for Economic Policy Analysis
The MTBF cycle (1) Before elections CPB provides a medium term scenario • MLT 30/3/2016 • Working group of high ranked civil servants prepares advice on budgetary policy for next 4 years SGB 1/7/2016 • Political parties publish their election manifesto • CPB provides political parties, on a voluntary basis, the opportunity to calculate the impact of their manifestos • elections KiK 15/2/2017 CPB Netherlands Bureau for Economic Policy Analysis
The MTBF cycle (2) After elections CPB updates the medium term scenario (mts) • • Political parties negotiate a coalition agreement • CPB calculates the impact on mts • CPB update again mts, taking into account the coalition agreement • New government formulates budget rules for the next 4 years CPB Netherlands Bureau for Economic Policy Analysis
MTBF rules • Current practice – expenditure rule for 3 sectors (centr.government, social security, health care), ceilings in real terms – interest payment, non tax revenues outside ceiling – additional measures, only in extraordinary circumstances (signalling margin) – windfall revenues can not be used for additional spending • Relationship with annual budget – CPB reports deviations in spring forecast – deviations eliminated in autumn budget/ forecast • Relationship with EU semester – End of April : Stability Program sent to European Commision – By Oct 15th : Draught budgettary Plan is sent to European Commission CPB Netherlands Bureau for Economic Policy Analysis
Annual budget cycle (1) – Budget notice sent by MoF to ministries (Oct/ Nov) – Policy letters sent by ministries to MoF with priorities (Feb/ Mar) – Framework letter sent by MoF (Mar) ◦ Publication of CPB Spring forecast – Council of Ministers decide on main outlines of the budget (Apr) ◦ Formal report of MoF – Initial draught budget (Jun/ Jul) – Final decisions on budget (Aug) CPB Netherlands Bureau for Economic Policy Analysis
Annual budget cycle (2) – On Sep 1 budget has to be sent to Council of State for advise – First half of Sep response by ministers to the Council of State – 3rd Tuesday of September : 1. King delivers Kings speech 2. MoF presents budget in parliament 3. CPB publishes MEV – Parliamantary vote on the budget in nov/ dec (in both chambers) CPB Netherlands Bureau for Economic Policy Analysis
Recent developments • Existing government prepares the 2018 budget – no expenditure ceiling – no new policy initiatives – upward revised growth forecast increases revenues • New government will start… … • New government may still revise 2018 budget this year – ministerial budgets has te be approved before january • New MTBF will be formulated – advise budget working group will probably be followed – timing? CPB Netherlands Bureau for Economic Policy Analysis
Recommend
More recommend
