The Reality of Budgetary Reform in OECD Nations

The Reality of Budgetary Reform in OECD Nations

Trajectories and Consequences

Edited by John Wanna, Lotte Jensen and Jouke de Vries

The Reality of Budgetary Reform in OECD Nations investigates the impacts and consequences of budgetary reform through a comparative assessment of advanced Organisation for Economic Co-operation and Development (OECD) democracies that have undertaken budget reforms over the past two to three decades.

Chapter 11: Budget Reforms in Spain: Anything Else Beyond Budget Discipline?

Xavier Ballart and Eduardo Zapico

Subjects: economics and finance, public finance, public sector economics


Xavier Ballart and Eduardo Zapico Spanish governments started the reform of the budgetary process during the first half of the 1980s with the introduction of program budgeting. But internal budgetary practices did not change significantly. The budgetary process remains under the control of the Ministry of Economy and Finance (Ministerio de Economía y Hacienda or MEH), the agency in charge of controlling public expenditure, setting taxes, managing borrowing and setting overall economic and fiscal policy. This main central budget actor did not pursue a policy of broad managerial reform or change the system to make it more managerial or businesslike, as some other Organisation for Economic Co-operation and Development (OECD) countries did (OECD 2001). However, Spain has been a success in terms of budget stability, comprising the imposition of fiscal discipline, the attainment of budget surpluses and the achievement of debt reduction. All this has been achieved in a decentralized system of government where more than 50 percent of public spending depends on regional and local governments. In a rather traditional, pragmatic, incremental and bureaucratic fashion, Spanish governments, including both the Socialist and the Popular parties, progressively reduced the deficit until 2005, when they achieved the first of a series of consecutive surpluses maintained over the past three years (MEH 2008). So, budget stability arrived, annual budget outcomes improved, documentation partially changed, but Spain did not change the budget decision-making process nor embrace with enthusiasm reforms to deliver meaningful information presented together with the budget. From the 1980s Spain’s...

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