A few days ago, Parliament approved the final version of the Unified Finance Law, a draft law that was submitted by the government for the purpose of updating the laws regulating the process of preparing and discussing the general budget.
– The new law is a law that combines the general budget law and the government accounting law, and it is a very important law because it is at the heart of budget procedures, which is the most important document that the government makes every year.
What is important in the new law? What are the pros and cons? How can we have a better financial law?
What is important in the new law?
The law is mostly related to the procedures that the various government agencies take in the process of reporting needs, collecting resources, and others, and procedural with regard to transactions between different government agencies.
– It is very important in the procedural part because it sets easy and simple definitions for almost all needs and facilitates the process of monitoring credits and others in a manner that is appropriate, meaning the process of digitization and the change that is taking place in the government.
– But the amendment that passed through traffic, which unfortunately did not provide any good press coverage, except for the coverage of Mada Masr, which is distinguished, as usual, from the law.
– The unified finance law approved by Parliament stipulated for the first time the constitutional benefits that were included in the 2014 constitution regarding education, health and scientific research, which is Article 18 which stipulates spending on health at a rate of no less than 3% of the gross national product, and gradually escalates to conform with the rates International, and in Article 19 which stipulates allocating 4% for education, and Article 20 which stipulates allocating a percentage of no less than 2% for university education and 1% for scientific research.
– But in recent years, as we have written more than once, the government has been doing more than one manipulation to evade this constitutional text, such as merging spending on Azhar education as part of spending on education and integrating sanitation as part of spending on health and other manipulations.
– This time, the government in the unified finance law legalized these manipulations and did not use fraud, but it remained within the law. In other words, the law gave legal legitimacy to the government’s controversial view regarding spending on health, education and scientific research.
– The government’s view is to add everything that is being spent directly or indirectly to the expenditure on health and education, and thus spending on health, for example, is not only what the Ministry of Health does in public hospitals, but army and police hospitals, university hospitals, and hospitals affiliated with Al-Azhar and its hospitals. Trade unions and even sanitation and infrastructure projects in the health sector that are not directly spent by the Ministry of Health.
Likewise, for example, in education, spending on Azhar education and spending on national cultural institutions will be included in spending on education, although neither the Ministry of Education nor Higher Education is responsible for this spending.
The most dangerous of all is to charge interest on debts that these bodies and ministries borrow on spending on education and health items.
– Legalizing government manipulations with the constitutional ratios related to education and health by changing the definition of government spending in the law so that the new definition remains that “government spending is all that is spent from the budgets of all administrative agencies and state-owned companies according to the percentage of ownership, not in the general budget and economic bodies only.
– Therefore, even with the new broad definition of government spending, the House of Representatives cannot adequately monitor the extent to which the constitutional ratios are adhered to, because in budgets these do not infringe on Parliament in the first place.
The law also included an important amendment proposed by the Senate and approved by the House of Representatives, which is to include the House of Representatives and the Senate among the entities that receive an exception from the maximum imposed on total appropriations.
– This total appropriations are a percentage of the expenditures that are allocated from the budget for any party in the government. The maximum limit for this total appropriations is 5% of expenditures. This means that it is not possible to transfer more than 5% of the allocations of the House of Representatives or the Senate between one item and the other in spending without the approval of the Ministry Finance.
The parties that were previously excluded from the issue of transferring credits between the various items were the Ministry of Defense and the Constitutional Court, and after the law, the Senate and the House of Representatives will also remain.
– Therefore, the House of Representatives and the Senate have the right to transfer appropriations from item to item without a maximum, and of course the deputies, according to Abdel Moneim Imam, a member of the Plan and Budget Committee, defended this that this is important because how is parliament monitoring the Ministry of Finance and has no freedom in transferring these appropriations, Thus, from their point of view, this means that it reduces Parliament’s freedom of oversight over the Ministry of Finance.
– Far from even this justification, which if we leave out factors such as the security services’ choices of parliamentarians or the method of election, which actually leaves doubts about this issue of oversight, but even with this logic, even if we consider that the House of Representatives is the master of its decision, I mean, this exception is not a requirement of oversight or It is necessary. Rather, Parliament puts its clothes like the Ministry of Defense and the Constitutional Court in an exceptional and strange situation, meaning that the two parliaments (MPs and sheikhs) strive for an exceptional situation as well.
This is because oversight in any government in the world is a process that belongs to the legislative authorities, but it is always in the margins of the executive body in expressing opinion and implementation, especially if the executive body is the ministry that looks forward to appropriations and spending, which is the Ministry of Finance.
How can we have a better financial law?
In order to achieve the standards of transparency and effective oversight of Parliament, many procedural reforms must be made to the current law. These amendments must include:
1- Strengthening transparency in the public budget, that it is an open budget available to all citizens for perusal. We have seen good needs such as the citizen’s budget, but transparency is still absent from the budget’s one-line entities and it is still absent from the budgets of economic bodies such as the General Petroleum Corporation and others.
The law must stipulate the principle of participatory budgeting and that it is based on the actual needs of local units, whose role is almost absent due to the absence of localities and the lack of clarity when it will be possible in local elections.
The new law must include the principle of budget unity, meaning that every penny spent by the government must be the subject of the general budget.
There must be more linkage between the budget and the appropriations in it and the development plans that the government makes every four years, and it is assumed that the Ministry of Planning is responsible for it, which sets goals that are not achieved, and we basically find these investment appropriations that are not in the budget.
There must be real oversight by Parliament over the budget. Discussing the budget in Egypt is always carried out according to security instructions and interferes in approving the appropriations in which the security services have chosen parliamentarians. Sovereign ministries like the interior, defense and justice in light of a financial crisis.
Unfortunately, all of this cannot happen without lifting the hands of the security services from Parliament. Unfortunately, this cannot happen in the current context, which does not have the minimum requirements for political or democratic openness.
– The state’s general budget is what says our money goes where, and prepares it transparently and in a sound manner in the interest of every Egyptian, so that we can know and account for our taxes, where do they go and act in any way.
– When we say that there are problems in education and health because your son and son work and get treatment well, this was always associated with the proposal to increase spending on the two sectors strategically, but what we see in the unified finance law is a deliberate intention to circumvent the constitution, which means that we will prefer a little in crises Health and education for lack of spending.