An Act Instilling Fiscal Discipline in the Public Sector by Establishing Principles of Responsible Financial Management and Promoting Full Transparency and Accountability in Government Revenue, Expenditure And Borrowing Programs (“Fiscal Responsibility Act”)

• Prescribes principles of responsible fiscal management that will direct the country’s macroeconomic policy settings
• Highlights the importance of transparency and accountability on the government’s fiscal operations
• Establishes a medium term fiscal accord and an annual budget strategy
• Adopts a formal debt policy in the form of a debt cap to ensure overall macroeconomic stability and long term sustainable growth such that by end of 2016, the consolidated non-financial public sector debt should be reduced to below 60% of GDP
• The tax incentives resulting in tax breaks shall in no case be equal to or lower than collection costs
• Introduces a deficit neutral measure designed to address the proliferation of unfunded laws by mandating that all increases in NG expenditures except for debt service & COLA for government employees must be offset by a permanent increase in revenue or permanent reduction in other expenditures
• Provides a personal services cap or PS cap which is set at forty-five percent (45%) of net current revenue beginning 2016 and which shall likewise be imposed on GOCCs
• As a general rule, savings from appropriations of the department/agencies shall be reverted to the unappropriated surplus at the end of the fiscal year.

Download PDF