AIReF participates in the first workshop organized by the European Fiscal Board
The Independent Authority for Fiscal Responsibility (AIReF) has participated today in a workshop in Brussels where the role of independent fiscal institutions (IFIs) within the European Union (EU) fiscal framework has been analyzed. During the seminar, the first organized by the European Fiscal Board, participants discussed about how IFIs have become an integral part of the EU fiscal framework to improve the control of budgetary policy. The overall goal of the workshop was to learn relevant lessons from the different institutions and to exchange the best practices to increase the effectiveness of IFIs.
The chair of AIReF, José Luis Escrivá, has participated in the panel moderated by the president of the European Fiscal Board, Niels Thygesen. He has discussed with members of other European fiscal institutions, such as the Italian or French, the best way to improve compliance with the recommendations issued by IFIs to the administrations of each country. Also, he pointed outthe strengths of different institutions that can be exported to other European institutions.
Escrivá has recommended to any new fiscal institution, from a strategic point of view, that they have to be determined in order to ensure its independence and functional autonomy. In his view, the initial stages of the new fiscal institutions are key to defining his personality, establishing a solid reputation and being credible institutions and leaders in the public debate on fiscal policy. Therefore, it is necessary that IFIs use all the tools at their disposal to ensure a good resource endowment and access to information.
About compliance recommendations, Escrivá has assured that the answer of the Spanish administrations has improved over the years thanks, in part, to the effort that AIReF has made to enhanced the dialogue. A strengthening of the legal basis of the comply or explain principle has been promoted and captured in a concrete manner in the reform of AIReF’s statute, approved last year.
In addition, AIReF is monitoring recommendations with the aim of improving the application of this principle and the quality of the dialogue with the administrations. However, the president of AIReF pointed that there is still room for improvement,as the institution is making an effort to be more selective in issuing recommendations.
On the other hand, the director of the economic analysis division of AIReF, Carlos Cuerpo, has participated in another session in which three working documents prepared by different IFIs (Spain, Sweden and a joint work of the Netherlands and Latvia) for this seminar have been presented..
AIReF’s working document makes a proposal to reform the national fiscal framework, based on two pillars; the sustainability of debt as a a long term pillar and a reinforced role for the Spanish independent fiscal institution (AIReF).
First of all, debt acquires a central place in the framework. It serves as a long-term bechmark to establish a dynamic of the primary balance consistent in the medium term (four years or electoral cycle horizon) and an annual evolution of public expenditure in the budget. Secondly, the framework must be updated from an institutional point of view by reinforcing AIReF’s competencies It should allow a reduction of the degree of discretionality in the definition and implementation of fiscal rules, taking
The workshop has also dedicated a session to fiscal discipline, which has included the participation of academics such as the head of the tax policy department of the IMF, Xavier Debrun, Professor Charles Wyplosz or the member of the Fiscal Council of Ireland, Sebastian Barnes. You can consult all the documentation in the seminar on this link.