Institutional measures in the concept of the public budgets reform

This article deals with institutional measures proposed in the concept of the public budgets reform presented by the Czech Ministry of finance in December 2002 and it analyses its capability to improve the budget performance of the Czech Republic. First the performance budgeting and preconditions for its functioning are characterized. In the second part the multi-annual expenditure framework is discussed including analysis of its role in the budgetary process. A simple model shows that introduction of various steps in the budgetary process can alter the final budget. This model has proven that the multi-annual expenditure framework can limit the impact of the fiscal illusion. In the last part a new budget calendar that includes the new measures is proposed.

Keywords: public budget, performance budgeting, budgetary policy, budgetary rules, budgetary process, fiscal reform, multi-annual budgetary framework