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Fiscal transparency in Mongolia

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Fiscal transparency in Mongolia

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  1. Fiscal transparency in Mongolia 2015

  2. Outline 1. Fiscal transparency 1.1 Legal framework of Mongolia; 2. Implementation of the Law 3. Challenges

  3. 1. Legal framework 1.1. Budget Law of Mongolia (2011) In 2011 a revised edition of the Budget Law was approved by the Parliament of Mongolia in order to improve the legal framework of budgeting, budget relations and fiscal management by integrating the General Budget Law and Public Sector Management and Finance Law. By the Budget Law new provisions were introduced to ensure fiscal stability and transparency, enhance the efficiency and predict­ability of resource allocation, and to increase citizens participation in the budgeting process. .

  4. 1. Legal framework 1.2. Glass Account Law In 2014 The Glass Account Law (Budget Transparency Law) was approved. This law was initiated by the President of Mongolia. The purpose of this law is to make transparent budget management decision and processes and to create information system ("glass accounts") to enable public monitoring with the objective of efficient spending of state and local budget as well as state and local assets.

  5. How the transparency is implemented? One of the most important changes intro­duced by the new Budget Law is the provision of citi­zens’ participation in budget process to ensure transparency. The Budget Law has several provisions on budget transparency and civil participation. For instance, for Local Development Fund financed projects citizens’ voice plays important role on which projects will be financed by this law and citizen’s monitoring over its execution. To elaborate more on this point, the law defines that the governors of the com­munity (Bagh and Khoroo) should conduct open surveys on the investments, programs, projects and activities to be implemented by the LDF, then prioritize and select the projects and activities in the People’s Assembly (art. 63). Finally, they should be reflected in the budget proposal of the respective jurisdiction and submitted to the upper level Assembly (Soum and District Assembly). The latter would then discuss and approve the budget proposal.

  6. How the transparency is implemented? Budget Law The transparency provision has been implemented in government procurement process. Article10.2 of the Budget Law states that the Non-Permanent National Budget, Financial and Economic Council with 9 members comprised of NGOs, professional associations and sector scholars, who represent tax payers, shall be established under the Prime Minister with the purpose of improving fiscal and economic policy planning, ensuring its reporting and transparency, and exercising public oversight.

  7. How the transparency is implemented? The Glass Account Law All budget entities, fully and partly state and locally owned bodies dedicate a separate menu in their webpages named as “GLASS ACCOUNT” : The following information is disclosed in their webpages: Annual budgets, procurement plans and local development fund plans; Semi-annual and annual budget performance; Bid documents, bid procedures, tender/bid invitations, criteria for bidders, bid amount of grants and aids, and their allocation/expenditure

  8. Challenges Disclosure of budget information to public in a simple and easy to understand format; Limited access to internet. Some soums (lowest administrative unit of Mongolia) still have no access to internet. Disclosure of information in paper format is costly and time consuming. Failure to disclose information on a timely basis. As a result citizens’ participation loses its importance .