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Rwanda Parliament Approves New Budget Law

by Daniel Sabiiti
10:39 pm

The chamber of Deputies’ plenary session today

The Rwanda Parliament has passed a revised budget law which will bridge loopholes in public accountability by strengthening public finances management including giving the Auditor General more power to properly manage state finances.

The draft bill proposal had been submitted to parliament in May 2022 but was not looked into due to many urgent bills on the floor including the budget paper.

Parliament Budget Committee chairperson, MP Omar Munyaneza who presented the draft on August 3, 2022 said the draft law was prepared in order to eliminate gaps identified in the Law December 2013 regarding public finance and property.

The issues included; accountability, especially the inflexible and insufficient way of defining the Chief Budget Officer and his responsibilities, because there is no Board of Directors to deal with public financial management issues, budget management, risks to public sector budgets as well as risks to public and private sector partnership budgets.

In strengthening public finances management, the provisions of the law have been expanded to include all public institutions and public sectors (such as RSSB, BNR) among others that the Auditor General is now tasked to supervise in order to improve the good management of public finances.

This bill will give the Chamber of Deputies power to summon officials including the chairpersons of the board of directors, of councils, to provide explanations on the use of public funds.

The bill also empowered the Accountant General and the Internal Auditor General to monitor and coordinate the activities of the accounting department and to monitor the performance and management of private auditors in government institutions and in decentralized institutions.

In order to strengthen the management of budget challenges and to promote the principle of transparency in financial management, this draft law includes a budget challenge committee.

Regarding increasing the power of public institutions in terms of financial accountability, in this draft law, the responsibilities of the board of directors in terms of financial management are clearly defined in this law in Articles 22 and 23.

Budget related issues resolved

With the experience of Rwanda being caught off guard and surprised by the epidemic of Covid-19 leaving budget constraints and a need to put up a recovery fund ($300million), the draft law proposed reforms of the emergency aid budget in order to find a solution to similar circumstances.

The new law allows transfer of funds provided for in the budget to pay off debts at the end of the year, while the amount of money transferred between different programs has been reduced from 20% to 10%.

The amount of tax refunds approved must be paid from the Tax and Rwanda Revenue Authority but Ministry of Finance has the authority to order the government agencies and enterprises use of electronic signatures and documents to process payments.

The draft law submitted to the Chamber of Deputies consists of 90 articles contained in eight (8) chapters.

The House approved the draft bill and asked the committee to work on a few corrections in wording, and phrasing that were raised by MPs before it is gazetted.

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