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Wednesday, April 3 de 2019

Minister of Finance and the Director of the Budget Office announce improvements to the transparency of fiscal and macroeconomic data

The Public Financial Report (PFR) will be published quarterly, and the March report will incorporate information from the State Financial Management Assessment Report, which was published in July.


 
The Minister of Finance, Felipe Larraín, and the head of the Budget Office, Rodrigo Cerda, made an important announcement today regarding a new institutional structure of fiscal and macroeconomic data, with a view to advancing fiscal and budgetary transparency, the result of joint work between the Ministry of Finance and the Budget Office.
 
So far, the Budget Office delivered to Congress data in July and October, of each year, and now the periodicity will increase. Specifically, the Public Financial Report (PFR) will be published quarterly, and the March report will include the information from the State Financial Management Assessment Report, which was published in July.
 
It is a profound change of modernization and transparency in the delivery of fiscal and macroeconomic data, highlighted Felipe Larraín and Rodrigo Cerda.
 
The Minister of Finance explained that this innovation in the delivery of information will allow the fiscal authority to inform citizens, political and economic institutions both national and foreign, of recent changes in the macroeconomic scenarios in a more timely manner, as well as the medium-term financial programming of the public sector.
 
"Basically, we were up to nine months without updating our projections (between September and June), while all entities have been evolving to have quarterly updates," said Minister Larraín. The current structure was set up since the PFR was known at the end of September or beginning of October with the entrance of the Budget Law of each year, and until the delivery of the Financial Management Assessment Report known between the end of June and the beginning of July of the following year. There used to be no updates in between both reports.
 
 
The new PFR will be presented soon in the Senate Finance Committee
 
The authority added that it has already begun the efforts to present the new PFR to Congress. "This morning I spoke with Senator Ricardo Lagos Weber, who had a very favorable view of quarterly updates. We have agreed to arrange with him an upcoming date to go to present our first quarterly PFR to the Senate Finance Committee - as is the case with the Central Bank's Monetary Policy Report" said the Finance Minister.
 
The new PFR will contain an update of the fiscal information and its projection for the current year, as well as the medium-term framework with the new information available at each opportunity. Additionally, when applicable, the closing information of the previous year and the information related to the budget bill of the following year and the respective financial program will be included.
 
"The delivery of information on a quarterly basis is, in our opinion, a significant step forward in fiscal transparency, accounting for new perspectives for fiscal revenues, such as the commitments that are the result of measures taken in the past and by the present administration and that remain towards the future. For example, the presentation of new bills, which should be included in the commitments, "added the Minister.
 
The head of the Budget Office added that, given that the new PFR will contain all the information subsequent to the Budget Law, this document will consider the financial reports that were entered after the Budget Law, among them the report of the Pension Reform project.
 
 
Other advances in transparency
 
The head of the Budget Office  also gave details of other advances in fiscal transparency.
 
"As of June 2018, the Budget Office made the quarterly Human Resources Report of the Public Sector available to the public, which also includes the evolution of the salaries of civil servants of the Central Government," he explained.
 
Rodrigo Cerda added that, in the same quest to deepen the transparency of the public function and disseminate relevant and timely statistics, the Budget Office made available to the public, a new statistical product: The Quarterly State of Operations of the General Government.
 
"This data is part of the commitment with the International Monetary Fund in the adoption of the Data Disclosure Standards in terms of the government's institutional coverage and the publication gap," said the Director of the Budget Office.

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