Finance minister hails Fiscal Responsibility Act 'a milestone'

Finance Minister hails Fiscal Responsibility Act 'a milestone'

The government has enacted a Fiscal Responsibility Act to ensure accountability and transparency in how taxpayers' monies are spent.

Hailing it a "milestone in the responsibility of public spending", Finance Minister Edward Scicluna said the government was now legally obligated to enhance its accountability with the taxpayers.

"Before we had the Public Accounts Committee and the Auditor General who scrutinised entities. These two institutions will be further enhanced with the setting up of a Fiscal Responsibility Council," Scicluna said.

The government is now legally bound to publish its fiscal strategy for the medium term while a fiscal responsibility statement, issued every year, must be signed by the Prime Minister and the Minister for Finance.

"This law will provide deeper control on government spending, increase efficiency, monitor expenditure ceilings and give taxpayers the comfort that the government and entities must control their expenditure," Scicluna added.

The government's economic and fiscal forecast must be endorsed by the Fiscal Responsibility Council, an independent entity whose chairman must be appointed and removed by Parliament. The council must endorse the government's fiscal position and issue yearly reports. It will also be answerable to Parliament.

Meanwhile, the Finance Minister said there were no plans to review the cost of living adjustment (COLA) mechanism while there was no consensus among members of the MCESD for a review.