"Fact" daily writes:
The Ministry of Finance proposes to make amendments and additions to the Law "On the Budgetary System of the Republic of Armenia".
The government has implemented a number of legislative and institutional changes in the public investment management (PIM) process following the IMF's 2018 Public Investment Management Assessment (PIMA).
The procedure for the selection, development, assessment and prioritization of Public Investment Programs established by the Government Decision N 175-Н of February 9, 2023 provides a solid regulatory basis for the development and assessment of investment programs, but the relationship between budgeting and implementation is still not properly implemented. Both in the legislative framework and in practice, certain legal problems persist, which do not allow to align and harmonize the HNC framework and the budget process.
In particular, the law on the budget system lacks the definition of an investment program, and the classification of program budgeting does not establish an appropriate regulation for budget programs and investment projects.
This discrepancy allows public investment projects to be included in the state budget outside the GNI process, undermining its full implementation of the GNI reform. The 2023 GNI Resolution institutionalizes the GNI process and creates a Public Investment Committee to oversee project preparation.
The lack of appropriate definitions in the Law "On the Budget System", as well as the requirement to maintain the evaluation process before inclusion in the budget, leads to slow and incomplete progress of GNI reforms.
There are cases where capital expenditure proposals that meet the definition of a public investment program are classified as part of an existing budget plan, leaving out the comprehensive evaluation process of Public Investment Programs.
The purpose of this project is to regulate the relationship between the procedure for the selection, development, evaluation and prioritization of Public Investment Programs with the processes regulated by the Law on the "Budget System" and to strengthen the requirement to follow the evaluation and selection procedure in accordance with the procedure for public investment programs.
The concepts of "Public investment" and "Public investment program" were defined by the project.
