Case 2. Austria The Austrian federal government is a relatively late mover in implementing a MTEF, and its current reforms are still in progress. Until the mid-1990s budgeting was ‘very traditional, cash-based, highly legalistic and input-oriented’ and initial forays into strategic budget reform, which included top-down budgeting and the piloting of new forms of budget flexibility, were quite tentative (Steger 2010, 2). It was only in 2004 that the Austrian Federal Ministry of Finance (BMF) commenced the development and negotiation of fundamental reform of budget systems. A comprehensive package, comprising a medium term expenditure framework, global budgets, performance budgeting, accrual reporting, and financial management incentive mechanisms, is currently being implemented in two stages (BMF 2010; BMF 2011a; Steger 2010). Stage 1 of budget reform Stage 1 of budget reform commenced in 2009 and is based on amendments to the was to shepherd reform implementation by entrenching new constitution. BMF’s strategy budget principles and a timetable for their completion (by 2012) in the constitution (Steger 2010, 6-8). Following a protracted multi-party policy development process, in 2007 Parliament unanimously passed two reform bills one to amend the constitution and a second – detailed reform bill. Amendments to the constitution (Article 51 of the Constitution) focused on budget principles of economy and regularity ‘budgeting principles’, replacing traditional with four principles outcomes, efficiency, transparency and and ‘outcomes-oriented’ – ‘true to commence in 2013. The detailed reform bill (the Federal Organic Budget Law fair view’ – 2009) introduced both a MTEF and budget flexibility for spending ministries. The MTEF contains for headings four years in advance legally binding expenditure ceilings on a rolling basis (i.e. t+4 is added annually). The MTEF budget structure comprises (which are equivalent to policy sectors) and (which are equivalent to ‘headings’ ‘chapters’ ministries or smaller units), although budget chapters are used to structure the annual budget law. Budget chapters are binding for the budget year. There are currently five headings, each of which is a group of chapters; and each chapter is assigned to a specific ministry. For example, the and groups six chapters that align with the ministries of ‘law security’ heading justice, interior, defence, foreign affairs, finance and chancellery.
Case 2. Austria The Austrian federal government is a relatively late mover in implementing a MTEF, and its current reforms are still in progress. Until the mid-1990s budgeting was ‘very traditional, cash-based, highly legalistic and input-oriented’ and initial forays into strategic budget reform, which included top-down budgeting and the piloting of new forms of budget flexibility, were quite tentative (Steger 2010, 2). It was only in 2004 that the Austrian Federal Ministry of Finance (BMF) commenced the development and negotiation of fundamental reform of budget systems. A comprehensive package, comprising a medium term expenditure framework, global budgets, performance budgeting, accrual reporting, and financial management incentive mechanisms, is currently being implemented in two stages (BMF 2010; BMF 2011a; Steger 2010). Stage 1 of budget reform Stage 1 of budget reform commenced in 2009 and is based on amendments to the constitution. BMF’s strategy was to shepherd reform implementation by entrenching new budget principles and a timetable for their completion (by 2012) in the constitution (Steger 2010, 6-8). Following a protracted multi-party policy development process, in 2007 Parliament unanimously passed two reform bills – one to amend the constitution and a second detailed reform bill. Amendments to the constitution (Article 51 of the Constitution) focused on ‘budgeting principles’, replacing traditional budget principles of economy and regularity with four ‘outcomes-oriented’ principles – outcomes, efficiency, transparency and ‘true and fair view’ – to commence in 2013. The detailed reform bill (the Federal Organic Budget Law 2009) introduced both a MTEF and budget flexibility for spending ministries. The MTEF contains legally binding expenditure ceilings for headings four years in advance on a rolling basis (i.e. t+4 is added annually). The MTEF budget structure comprises ‘headings’ (which are equivalent to policy sectors) and ‘chapters’ (which are equivalent to ministries or smaller units), although budget chapters are used to structure the annual budget law. Budget chapters are binding for the budget year. There are currently five headings, each of which is a group of chapters; and each chapter is assigned to a specific ministry. For example, the ‘law and security’ heading groups six chapters that align with the ministries of justice, interior, defence, foreign affairs, finance and chancellery.
938950WP0P12150ractices0000English.docx