Fiscal Discipline Council (hereinafter - the Council) is an independent collegial body established to monitor the compliance with the rules of the fiscal discipline.
The Council has the responsibility for the following:
- monitor the compliance with the Fiscal Discipline Law (hereinafter - FDL) provisions in the budget framework law and the annual state budget law during their preparation, execution, and amendment;
- verify, if the fiscal balance and the expenditure growth provisions have been properly applied, including an independent assessment of the potential GDP and nominal GDP, and the calculation of the structural balance;
- monitor the compliance with the FDL conditions with the estimated summary fiscal indicators during the execution of the annual state budget law, the consolidated local government budget, and derived public person budgets;
- prepare opinion regarding the major departures from the balance condition permitted during a severe economic downturn;
- prepare an opinion on the fiscal safety reserve to counter the prevailing fiscal risks for the state;
- prepare a monitoring report for fiscal discipline and, if necessary, an irregularity report;
- prepare and submit to the Saeima and the Cabinet of Ministers opinions regarding issues of fiscal policy and macro-economic development, as necessary to ensure the compliance with the FDL;
- prepare the reports stipulated by FDL to assess and analyze the fiscal policy sustainability of the country.
Last modified : 20 November 2014
Fiscal council chairman Jānis Platais participates in the public discussion "To save or not to save" at Saeima. More information available in Latvian here.
The Council press release is available in Latvian.
A meeting of the Fiscal Risks Working Group of the Fiscal Discipline Council took place on 11 May 2016. The meeting was attended by representatives from the Ministry of Finance. The main items of discussion were the risks included in the Statement of Fiscal Risks and the procedures for their assessment. The possibility of including hitherto undescribed risks was also discussed, as this would provide a more complete understanding of the factors that can negatively affect the budget balance.
In accordance with the Fiscal Discipline Law the Council monitores the implementation of the annual State budget law from the revenues side, taking as the source State Revenue service revenues data and the implementation of the annual State budget law from expenditures side, taking as the source Treasury data. Once in a quarter the Council prepares a quarterly report on the implementation of the revenues and expenditures side and a quarterly report on the resource allocation from "Funds for Unforeseen Events".
The Council carried out a self-assessment at the beginning of 2016, based on Organisation for Economic Co-operation and Development (OECD) guidelines for independent fiscal institutions. It was concluded that the Council broadly conforms to OECD criteria, but a consistent approach to communication with the media and the public could strengthen the Council’s influence on public debate and an assessment by an external observer could improve the Council’s work.