Govt must strengthen transparency of fiscal responsibility bill, says think tank

 

IDEAS’s Sri Murniati says the Dewan Rakyat should devote extra time to ensure reform bills are given more ‘holistic consideration’, taking into account suggestions from backbenchers and the opposition. (Facebook pic)

KUALA LUMPUR: The government should look into strengthening the transparency and accountability of the Public Finance and Fiscal Responsibility (PFFR) Bill, says a local think tank.

While the Institute of Democracy and Economics Affairs (IDEAS) lauded the government’s commitment to improve public financial management through the bill, it also said the legislation should provide MPs better access to scrutinise various mid-term fiscal strategies.

The bill was approved by the Dewan Rakyat on Wednesday.

“Although the Act highlights the finance minister’s obligation to present key budget reports before Parliament for oversight, some provisions for key information do not require laying out to Parliament,” said IDEAS’s deputy research director, Sri Murniati.

“For example, there is no requirement for the mid-year expenditure performance report to be laid out in Parliament, which reduces the possibility that it would be brought to the attention of MPs for debate.

“Also, while the minister is required in Section 16 to formulate a policy on debt management, there is no corresponding requirement to disclose this policy in detail in the budget documents.”

In a statement today, Sri Murniati said the Dewan Rakyat should devote more time to ensure reform bills are given more “holistic consideration”, taking into account suggestions from backbenchers and the opposition.

She noted that the bill also includes a limit to providing guarantees to government entities, including public-private partnerships in the consideration of fiscal risk.

However, she said the entities covered by the bill only refer to statutory bodies and companies under Minister of Finance Inc and companies incorporated under the Trustee (Incorporation) Act 1952.

“These entities are required to submit financial statements to the Treasury. Other GLCs under the control of statutory bodies reporting to other line ministries are not included,” she said.

Sri Murniati said better guidelines for the management of the wider segment of GLCs are needed, possibly in a separate governing law for GLCs. - FMT