This presentation was made by Helmut Berger, Austria, at the 9th Annual Meeting of the OECD network of Parliamentary Budget Officials and Independent Fiscal Institutions held in Edinburgh, Scotland, on 6-7 April 2017.

1. 9th ANNUAL OECD–MEETING OF
PARLIAMENTARY BUDGET OFFICIALS
AND INDEPENDENT FISCAL INSTITUTIONS
Breakout Session B -
Managing multiple institutions
EDINBURGH, April 6th, 2017
Helmut Berger
Austrian Parliamentary Budget Office

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FUNDAMENTAL TASKS OF FISCAL INSTITUTIONS
• Provide oversight of fiscal performance
• Monitor compliance with fiscal rules/targets
• Prepare or assess macroeconomic and fiscal forecasts
• Perform budget and fiscal analyses
• Ex-post or ex-ante evaluation of fiscal policy
• Assess long-term fiscal sustainability
• Prepare policy costings or provide independent oversight of policy costings
• Provide public advice on budget and fiscal issues
• Enhance fiscal transparency and public discourse

3. SETTING THE CONTEXT:
THE AUSTRIAN POLITICAL
AND FISCAL SYSTEM
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• The Republic of Austria is a federal state and is composed of nine autonomous
federal provinces, the so called “Laender”
• Legislative and executive powers are shared by the federal and provincial
parliaments and governments; however, legislative fiscal powers are highly
centralised
• Laender and municipalities spend approx. 1/3 of general government expenditure
• On the local level the 2,100 municipalities have the right to self government
• Social partners play an important role in policy making

4. Federal Government
Fiscal
Council
Ministry of
Finance
Parliament Court of Audit
Line Ministries
Institute of
Economic
Research
Austrian
Treasury
European Union (Council and Commission)
MAIN ACTORS OF FISCAL GOVERNANCE
Federal States
Municipalities
Statistics
Austria
PMO
Budget
Office
Austrian
National
Bank

5. BACKGROUND OF INSTITUTIONAL MIX
5
• Long-term well established institutions with a traditional set of tasks and new tasks
of monitoring and judging fiscal coordination between layers of government:
 Court of Audit, Statistics Austria, FISK
• Independent institutions for applied empirical economic research with a long
tradition especially in economic forecasting and analyses:
 WIFO, IHS
• Well established watchdog for fiscal policy analysis and monitoring:
 Government Debt Committee established in 1970, renamed Fiscal Advisory
Council and entrusted with new EU tasks
• New institutions as a result of comprehensive budget law reform:
 Parliamentary Budget Office (PBO), Performance Management Office (PMO)
• Traditionally high economic and fiscal expertise and research capacity of social
partner organisations (Chamber of Labour, Federal Economic Chamber)
• Young applied research institutes with clear political agenda
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6. AUSTRIAN INSTITUTE FOR ECONOMIC RESEARCH
(WIFO)
• Founded in 1927 by Friedrich August von Hayek and Ludwig von Mises
• The Austrian Institute for Economic Research (WIFO) is an independent
institution for applied empirical economic research and objective political
consulting
• WIFO prepares macroeconomic forecasts and produces all macroeconomic
assumptions used in the federal budget process.
 Short-, medium- and long-term forecasts for the Ministry of Finance
 Economic assumptions for the annual budget, the mid-term expenditure
framework and the annual stability programme submitted to the European
Commission
• WIFO is funded by the federal government, the state governments, the
Austrian National Bank, the social partners and private institutions, as well as
by specifically funded research
• It has a professional staff of about 100 persons
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7. FISCAL ADVISORY COUNCIL (FISK)
7
• Established as Government Debt Committee in 1970, Fiscal Advisory
Council as of 2013
• Tasks:
 Monitoring government compliance with EU and national fiscal rules
 Recommendations on fiscal policy to Government and Parliament
 Carrying out fiscal policy studies
 Shaping public opinion on public finance matters
• 15 independent expert members appointed by: Federal Government (6),
Federal Economic Chamber in agreement with Chamber of Agriculture (3),
Federal Chamber of Labour (3) – members with voting rights,
Austrian Association of Municipalities, Association of Austrian Towns and
Cities and Conf. of Provincial Governors (1 each) – no voting rights
• Austrian National Bank and PBO take part in an advisory capacity
• Austrian National Bank supports Council by running its Bureau
(6 professional expert staff members)
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8. FISCAL ADVISORY COUNCIL (FISK)
8
Products and Services:
• Annual Public Finance Report on Austria’s deficit and debt performance
and sustainability of its debt management, covers federal, regional and
local governments
• Forecast for general government budget for the current and upcoming year
(each spring and autumn) including costing information on important
discretionary measures (i.e. tax reform, refugees)
• Fiscal Rules Compliance Report on compliance of federal and local
governments with national fiscal rules and EU’s fiscal rule framework (in
May and December)
• Fiscal Advisory Council addresses expert community, Parliament and in
particular also the wider public, holds press conferences and provides
press releases
• The annual report is submitted to the Minister of Finance, who presents it to
Parliament where it is discussed in the Parliamentary Budget Committee
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9. PARLIAMENTARY BUDGET OFFICE (PBO)
• Established in 2012
• Main Tasks:
 Support the Budget Committee in form of written expertise, analysis and short
studies on budgetary matters presented by government according to budget
law
 Prepare brief information and short analysis upon request of Members of the
Budget Committee
 Support other Parliamentary Committees regarding impact assessment of
new legislation
 Consult Parliament on performance and gender budgeting
• Currently 8 headcounts (6 academic experts);
part of Parliamentary Administration (with independent direct access to MPs)
• PBO provides direct support especially for Budget Committee and
Government independent expertise to Parliament
• Head of PBO always participates in meetings of Budget Committee and may
be consulted in his expert role

10. PBO CATALOGUE OF PRODUCTS & SERVICES
• Analysis on all budget-relevant draft documents presented by
Government, which are on the agenda of regular Budget Committee
meetings
 Medium Term Expenditure Framework and Annual Federal Finance Act
 Reports on budget controlling, investment controlling (public enterprises),
performance/outcome controlling, subsidies and financial debt
• Analysis upon request of Budget Committee or its members
• Analysis of impact assessments of new legislation, in particular those
assigned to Budget and Finance Committee or those causing substantial
financial impacts
• Recommendations on development of organic budget laws and
improvement of budget reports
• Consultation services on performance and gender budgeting
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11. MANAGING MULTIPLE INSTITUTIONS
• Clear and differentiated mandates allow “division of labour” and
specialisation in functions, tasks and “clients”:
 FISK has specific tasks as an independent body according to EU-
regulation, aims at directly addressing the public and shaping public
opinion, includes a broad view of opinions, has longer processes of
decision making
 PBO was a new kid on the block in a well established institutional
environment with traditional functions in respect of the budget process
 PBO is an instrument of Parliament, provides government independent
expertise, is closely linked to parliamentary work and the needs of
members of parliament
 WIFO has a longstanding tradition of forecasts for budget process and
uses very elaborated macroeconomic models
 Statistics Austria aggregates and submits national accounts according to
the European System of Accounts
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12. MANAGING MULTIPLE INSTITUTIONS
• Austrian Fiscal Governance System is characterized by “well-established”
formal and informal working relations;
Examples:
 Legal provision for role of PBO in FISK consultation (advisory capacity)
 Director General of Statistics Austria represented in the FISK
 FISK represented in macroprudential supervision board
(Finanzmarktstabilitätsgremium)
 FISK is involved in monitoring process of national fiscal rules
 Statistics Austria and Court of Audit are involved in the sanction
mechanism of the Austrian Stability Pact (fiscal coordination and national
fiscal rules)
 WIFO presentation/consultation of macroeconomic forecasts
 Parliamentary Budget Advisory Council on Budget Law Reform
 Statistics Austria Professional Advisory Board on Economics
 “Jour fixe on budget and tax policy” at the WIFO
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13. MANAGING MULTIPLE INSTITUTIONS
• Local institutional environment is characterized by a “small” Expert
Community
 FISK and PBO are both rather “small” institutions with a small number
of professional staff
 Personal contacts often allow fast and effective cooperation, but
sometimes also impede cooperation
 Multiple networks of information exchange between relevant
institutions of fiscal governance
 Rather frequent staff exchange and mobility between institutions
 Mutual professional support and inherent quality control
 BUT: International perspective and networks are important inputs to
the fiscal Governance system to avoid inflexibility
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14. MANAGING MULTIPLE INSTITUTIONS
Preconditions to be effective and enduring:
• Procedures for budget preparation and execution are still heavily focused on
Ministry of Finance and Government
• Information asymmetries allow for multiple independent institutions to
challenge and scrutinize Government
• Division of labour can be efficient, good working relationships are important
• Clear legal mandate is helpful to structure and develop formal cooperation
• All results must be mutually accessible and publically available
• Limited overlap of tasks can spur competition and serve as quality control,
duplication however needs to be avoided
• IFI functions and issues to be addressed should fit into local institutional
environment, small institutions however are more vulnerable, mandate and
access to information should be guaranteed in legislation
• Good relationship with “Clients/audience” and responsiveness to their
demands
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THANK YOU FOR YOUR ATTENTION
Contact:
Helmut Berger
Head of Parliamentary Budget Office
Parliament, A-1017 Wien, Dr. Karl Renner-Ring 3
Tel. +0043 1 40 110-2889; +0043 676 8900-2889
E-mail: helmut.berger@parlament.gv.at