Bill, providing for budget rules change, passed in first reading

At today’s plenary session of the Milli Majlis, draft amendments to the law “On the budgetary system” were adopted in the first reading, Report informs, adding that they provide for changes in the budgetary rule, which is an integral part of the law “On the budgetary system”.

Commenting on the relevant draft law, the Accounts Chamber stated that it provides for the removal of restrictions on the upper limit of total budget expenditures and spent oil revenues, the preservation of one restriction that exists in the previous rule (the ratio of the basic non-oil deficit to non-oil GDP), as well as the establishment of a new limit for the ratio of public debt to GDP.

“If the proposed amendments are adopted, the risk is eliminated that the previous component of the fiscal rule - spent oil revenues will be influenced by procyclical policies in the event of high oil prices, which can be regarded as a positive feature of the new rule. At the same time, the new draft budget rule takes into account the oil price factor, the significance of which was commented on in the conclusions of the Accounts Chamber on the draft state budget for previous years.”