Hello dear participant !

Welcome to our training workshop on drawing up and updating commitment plans.

Today we’re going to take you through Sequence 1, which deals with ‘budgetary regulation’.

The commitment plan, which is the subject of this training course, is one way of implementing budgetary regulation.

In this sequence, we will begin by defining the concept of budgetary regulation, then present the various tools that enable its implementation, and finally show the shortcomings of current budgetary regulation practice that have made commitment plans necessary.

Budgetary regulation consists of modifying the rate of consumption of commitment or payment appropriations, or cancelling the necessary appropriations. If necessary, it can lead the State to adjust the budget during implementation, in order to take on new priorities.

The Minister of Finance is responsible for budgetary regulation. According to the Law on the Fiscal Regime of the State and Other Public Entities, which we shall refer to as RFE-AEP, the Minister of Finance has the power to regulate the budget, enabling him to program the rate at which appropriations are consumed in line with the State’s cash position. If the cash situation or outlook so requires, he may temporarily suspend the use of certain credits or cancel others during the year.

Budgetary regulation can be implemented in several ways.

These include, but are not limited to:

• – suspension of appropriations: this takes the form of an instruction to the financial controller of the administration concerned.
• – cancellation of appropriation: this takes the form of a cancellation order, a copy of which is sent to Parliament.
• – budgetary modification ordinance: this is used when favourable or unfavourable events necessitate the passing of an amending finance bill during the course of the year.
• – precautionary measures (blockages): these enable the Minister of Finance, as part of the budget execution circular, to secure appropriations for the purchase of goods and services by certain government departments.
• – quarterly quotas: these set the ceiling on current expenditure appropriations for all government departments except constitutional bodies.
• – the cash position plan: its purpose is to assess the rate at which resources are expected to be collected in order to meet the volume of expenditure to be incurred during the year.
• – the commitment plan: plans the consumption of budget appropriations for the year, in line with the State’s cash position.

In current practice, budgetary control is based essentially on precautionary blocking and quarterly quotas.

Precautionary blockages, when applicable, is deducted from appropriations. The remaining appropriations are divided into three equal parts, representing the quarterly quotas. Only three quarters are considered, given the technical constraints of opening and closing a budget year.

This practice has failed to curb the accumulation of payment arrears, which is the ultimate objective of budgetary regulation. This is due to:

Failure to take into account the actual availability of resources: expenditure is committed without any assurance that the necessary funds will be available.

Failure to take into account the distribution of administrative needs over time: the division of appropriations into 3 identical parts does not take into account, for example, the fact that some administrations may have severe constraints as the dry season approaches to maintain roads, while others will need most of their resources as the rainy season approaches to launch the agricultural season.

The commitment plan, which is part of the cash position plan, was set up to overcome these shortcomings and make budget regulation more efficient.

From this sequence, you should remember that budgetary regulation consists in modifying the rate of consumption of commitment or payment appropriations, or in making the necessary cancellations of appropriations. And that it can be implemented in several ways.

You will also remember that several shortcomings in current practice have led to the adoption of commitment plans in budgetary regulation.