Experts from the Institute of Public Finance assess that there is still significant room for improvement in the openness of the central government budget, not only in terms of publishing timely and understandable information about the collection and expenditure of funds but also regarding budget oversight and public involvement in budget processes.
In the latest issue of the IJF Review, Mihaela Bronić and Josip Franić commented on the latest results of the most recent round of the International Budget Partnership’s international research on the openness of the central government budget, in which Croatia scored 67 points out of a possible 100, ranking 24th among 125 analyzed countries.
– Although this represents an increase of three points compared to the previous round of research from 2021, there is still significant room for improvement, not only regarding the publication of timely and citizen-understandable information about the collection and expenditure of budgetary funds but also concerning budget oversight and public involvement in budget processes – they emphasized on Monday from the IJF.
Although the research ranks Croatia among countries that publish ‘a significant amount of budget information’, the IJF notes that in previous years it achieved better results, ranking 21st in the world in 2019 with 68 points.
– Accordingly, it can be concluded that there has not been a significant shift recently – the IJF assesses.
Key Recommendations for Improving Budget Openness
As noted by IJF experts, in addition to budget openness, this research also measures how effectively the State Audit Office and the Croatian Parliament oversee the central government budget and the extent of public involvement in budget processes.
They presented key recommendations for improving the openness of the central government budget, including that the budget proposal should include information on tax expenditures, along with explanations of the basic objectives of each individual tax expenditure, the targeted groups to which it relates, and the estimated amount of lost tax revenue.
Furthermore, the IJF suggests that the budget proposal should include detailed information about the state’s financial assets (a list of assets and an assessment of their value) and non-financial assets (a list of assets by categories).
They also believe that the content and comprehensiveness of the budget guides for citizens published by the Ministry of Finance should be improved, establishing mechanisms to determine the information that citizens want to read in these guides, ensuring that the guides are published in more visible places on the websites, and that alongside the guides already published by the Ministry of Finance, guides on the state budget proposal and the report on the audit of the state budget should also be published.
They suggest that the Ministry of Finance should resume publishing Annual Reports and Statistical Reviews.
Global Results Do Not Provide Reason for Optimism
The IJF highlighted that on a global level, the results of the 2023 research again do not provide reason for optimism. The average value of the Index for all 125 included countries remains at 45, just as it was in the previous two rounds.
In other words, residents of the analyzed countries, on average, again have access to only 45 percent of key information about the revenues and expenditures of the central government budget. As in previous rounds, the best results were achieved by Georgia (87), New Zealand (87), Sweden (85), and South Africa (83). At the bottom are Afghanistan, Yemen, and Venezuela, whose authorities do not publish any timely information about the central government budget to their citizens, the IJF reported.
As they stated, the budget openness index is the only independent and internationally comparable indicator of the comprehensiveness and quality of online information about the central government budget. It has been published continuously since 2006 and is calculated based on responses to 109 questions assessing the availability, timeliness of publication, and exhaustiveness of eight budget documents: convergence program, budget proposal, adopted budget, budget guide for citizens, monthly reports, semi-annual budget execution report, annual budget execution report, and audit report.
