Although the legal conditions for the formation of the Fiscal Council were created in February of last year, that independent body that will supervise the implementation of the fiscal policy and make proposals and measures for its improvement has not been formed to date because two public competitions for the selection of council members failed due to low interest of candidates.
The Parliamentary Committee for Economy, Finance and Budget, which implements the procedure for the election of three members of the Council, should determine the text for the third public competition today.
In February of last year, the Assembly adopted amendments to the Law on Budget and Fiscal Responsibility, which prescribed the establishment of the Fiscal Council and it was planned to start functioning on January 1, 2024. Last year in April, the first public call was announced, to which only two candidates applied, one of whom gave up. Then, due to current political events (dissolution of parliament and parliamentary elections), this work was not completed.
Then, at the end of last year, amendments were made to the Law on Budget and Fiscal Responsibility, according to which the deadline for its functioning was extended by one year, i.e. to January 1, 2025. In May of this year, the board announced a second call where there were three applications and two candidates withdrew again (one in July and the other in September), so it was decided to announce a third public call.
If the Fiscal Council is not elected by the end of this year, the Law on Budget and Fiscal Responsibility will have to be changed again in order to move the deadlines.
The Fiscal Council will take over part of the tasks related to the implementation of the fiscal policy from the State Audit Institution (DRI), from which it should take over the documentation, software solutions and other acts that are now with the DRI.
The formation of this body is also a request of the European Commission (EC). In addition, its formation was one of the obligations from the loan agreement of 60 million euros, which was intended for the EU to help Montenegro limit the economic consequences of the coronavirus pandemic. That contract was signed by the Prime Minister's Government Duško Marković, and the money was paid out in two tranches. This money was part of the EU Macroeconomic Assistance Program for ten countries from the enlargement process and the European neighborhood, worth a total of three billion euros.
The law defines that the Assembly elects a council that will have three members, one of which will be proposed by the Committee for the Economy, the President of the State and the Government at the proposal of the Ministry of Finance. All candidates are appointed from a previously established list after a public call.
The mandate of a member of the Council will last six years and the same person can be appointed a maximum of two times.
"The president of the Fiscal Council will be elected by the members of that body for a period of two years, and the same person can be elected again as president. The Fiscal Council decides at a session if at least two members are present. Members are obliged to perform tasks within the scope of the Council professionally and impartially in accordance with the law and may not participate in political activities or publicly express political beliefs", the law specifies.
The coefficient for the salary of the president of the Fiscal Council is determined at the level of the coefficient for the salary of the president of the Senate of the SAI, and the coefficient for the salary of a member of the Fiscal Council is determined at the level of the salary of a member of the Senate of the SAI.
In this year's budget, 250.000 euros were planned for its formation from the budget reserve, and when it is officially appointed, it will be a special spending unit in the budget.
At the ministerial meeting held on May 25, 2018 in Brussels, on the occasion of the evaluation of the economic reform program of Montenegro for the period from 2017 to 2019, the EC recommended that Montenegro prepare a document on the options for establishing an independent body for fiscal supervision.
The Ministry of Finance told "Vijesta" in December 2021 that the recommendations of experts and international practice regarding the establishment of these bodies will be the basis for proposing changes to the Law on Budget and Fiscal Responsibility, which will formally create the prerequisites for the establishment of the Fiscal Council.
"According to the plan, it is expected that the final proposal for amendments to the Law on Budget and Fiscal Responsibility, which will contain provisions related to the Fiscal Council, will be adopted by the Government by the end of the second quarter (June) of 2022. The Ministry is already preparing everything and is working dedicatedly on it, in order to establish a monitoring mechanism like this as soon as possible, which was previously only in announcements", they said in this department.
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