By Guilhem Blondy and Vianney Bourquard
A central government expenditure rule that has been in place in France for twenty years has been assessed by the Court of Audit in a report that was recently submitted to the Parliament. According to the Court, the rule has reduced the growth of central government expenditure, while loopholes in its coverage and poor in-year reporting have weakened the rule’s influence on budgetary policy. The full report (in French) is available at : Le budget de l’État en 2015 (résultats et gestion) / Publications / Publications / Accueil / Cour des Comptes - Cour des comptes.
The report notes that 17 EU member countries have implemented budget rules covering all or part of their public expenditure, using budgetary accounting, financial accounting, or government financial statistics as a measuring tool. France chose two such rules - a central government expenditure rule (“norme de dépenses de l’État”) created in 1996 and a healthcare expenditure rule (“objectif national des dépenses d’assurance-maladie”) established in 1997. The report mentions that France was at that that time engaged in a difficult fiscal consolidation exercise to qualify for membership of the Economic and Monetary Union. These rules were supplemented in 2014 by a local government expenditure target (“objectif d’évolution de la dépense publique locale”), but this rule is less binding than the others. Both the central government and healthcare expenditure rules use accounting data rather than statistical data to improve the timeliness of reporting expenditure outcomes.
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