KUALA LUMPUR, Oct 10 — The Public Finance and Fiscal Responsibility Bill 2023 (RUU KATF 2023) is expected to improve the legal framework for public finance and complement the Financial Procedure Act 1957 (ATK 1957).
Deputy Finance Minister I Datuk Seri Ahmad Maslan said RUU KATF 2023 will focus on the government’s policies and strategies on fiscal management, while ATK1957 emphasises public finance control and management.
“The Bill is important to ensure responsibility and transparency in the country’s fiscal and economic policies,” he said at a press briefing in Parliament today.
The Ministry of Finance (MOF) plans to implement the Bill after its second reading in Parliament tomorrow so it can be one of the main topics in the tabling of Budget 2024 on October 13 (Friday).
The RUU KATF 2023 contains six clauses and two schedules based on responsible fiscal management principles similar to fiscal responsibility legislation in many countries.
These fiscal principles include ensuring macroeconomic stability, achieving and maintaining a prudent debt level, and establishing effective fiscal risk management.
In line with these principles, Ahmad said the government has set a target of annual development expenditure as a percentage of gross domestic product (GDP) of at least 3.0 per cent and fiscal deficit as a percentage of GDP of -3.0 per cent or less within three to five years.
These targets will also ensure the debt level as a percentage of GDP will be at 60 per cent or less within three to five years, and financial guarantees as a percentage of GDP do not exceed 25 per cent.
He said emphasis will also be given concerning MOF’s accountability to Parliament in its duty to enact fiscal policies and manage public finances.
“This includes ensuring the sustainability of revenue policies, effective spending and prudent management of debts and fiscal risks,” Ahmad said.
Several new reports will be published to improve the government’s transparency in financial reporting.
“The function and role of the Fiscal Policy Committee will be strengthened to ensure fiscal policies are implemented in line with responsible fiscal management principles,” he said.
The government will also continue fiscal renewal initiatives, including the Medium-Term Revenue Strategy, reviewing public spending, and introducing a Government Procurement Act to ensure long-term financial sustainability.
— Bernama
