Kazakhstan's New Budget Code Aims to Streamline Financial Management


The draft of the new Budget Code was considered at the Government session under the chairmanship of the Prime Minister of the Republic of Kazakhstan Alikhan Smailov, DKNews.kz reports.

As noted by the Minister of National Economy Alibek Kuantyrov, all reforms and trends of recent years, instructions of the President, recommendations of international organizations, the Supreme Audit Chamber and the expert community were taken into account in the preparation of the document. The new draft code is aimed at simplifying budgetary processes, improving inter-budgetary relations and improving the quality of public finance management in general.

The introduction of the block budget in the pilot mode will increase the flexibility and autonomy of state bodies. At the same time, a norm prohibiting the opening of a second or third budget program for the same purpose will be introduced. At the same time, the volume of reallocation of funds between budget programs will increase from 10% to 15% through adjustment.

The new code also strengthens the transparency and accountability of participants in the budget process. The main criterion here is responsibility for the quality and results of the work carried out. Accountability will be ensured through hearing officials in representative bodies when defending the draft budget and the report on its execution, publishing and discussing documents, conducting state audits, as well as establishing the responsibility of officials.

Prime Minister noted that since 2004 a number of significant and consistent reforms had been carried out in the sphere of budgetary policy. Thus, budget legislation was streamlined and systematized, transition to result-oriented budgeting was carried out. 

"Thus, an integral system of regulation of budgetary legal relations has been created. Unified principles of the budget system have been established and the scheme of inter-budget relations has been built. A mechanism for saving oil revenues has been introduced" Alikhan Smailov

At the same time, the new economic course outlined by the Head of State in his Address to the Nation requires actualization of approaches to the formation and implementation of budget policy. In this regard, the new code ensures consolidation of all financial flows of the state, strict compliance with budgetary rules and accountability of subjects of the quasi-public sector.

"The Budget Code will be a framework and flexible document that defines the basis for the distribution of public finances. One of the novelties is the pilot introduction of block budgeting, which contributes to increasing the independence and responsiveness of state bodies" Alikhan Smailov

As for the National Fund, in accordance with the instructions of the Head of State, the funds from it will be allocated only for the financing of critical infrastructure and strategic projects.

"The new Budget Code should become a key instrument of state economic policy. It will contribute to the realization of the tasks set by the President on socio-economic development. The Code meets the demands of the present time and realizes the course of lean and responsible budget policy" Alikhan Smailov

After the voting procedure on the document, the Head of Government instructed to ensure its submission to the Parliament of the Republic of Kazakhstan.

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