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The parliamentary Budget and Finance Committee has rejected and returned to the caretaker government the draft budget for the 2023 fiscal year that the Council of Ministers had approved on August 16 and sent to Parliament for ratification.
The parliamentary Budget and Finance Committee rejected the draft budget for the 2023 fiscal year, which the Council of Ministers had approved on August 16 and sent to Parliament for ratification.
The parliamentary blocs were already reluctant to discuss the bill, which was submitted outside the constitutional deadlines.
At a meeting devoted to the examination of this bill on September 18, some parliamentarians deemed the project “outdated” and proposed to the Cabinet that the necessary points be included in the 2024 budget.
Reasons for rejection
Chairman of the Finance and Budget Committee MP Ibrahim Kanaan presented his final report on the 2023 budget bill, in which he highlighted the reasons for the bill’s rejection, to the Speaker of Parliament on Thursday.
Firstly, he explains that the MPs received the draft 2023 budget nine months after the constitutional deadline had expired, and nine months after the implementation date, so at the end of the fiscal year. This renders the budget meaningless, according to Article 5 of the Public Accounting Act, which defines the budget as an authorization for the government to collect and spend.
According to the Constitution, the budget should have been sent out a year ago and voted on before the end of 2022 or by January 2023.
“What is the purpose of a budget when the government has already spent the money and later sent a budget for Parliament to legislate on what it has done, without any financial account?” he asked.
Furthermore, Kanaan expressed regret that the draft budget had been conceived without any vision toward a reform or rescue plan. On the contrary, the current draft, like its predecessors before and after the crisis, is based on accounting logic and “fictitious figures” established on the basis of revenue increases that are neither proven nor possible in the current financial and economic reality, through the increase of certain taxes and levies.
Furthermore, the government has announced the completion and approval of the draft budget for 2024. “So why encumber Parliament with the study of two budgets, one of which has expired and was finalized at the close of the fiscal year as a fait accompli?” he asked.
Kanaan reiterated in his report the need to return the draft budget for 2024 on time, in accordance with constitutional and statutory norms. The same applies to the cutting of the previous year’s audited accounts in accordance with Article 87 of the Constitution.
It should be recalled that the preliminary draft budget for the 2024 fiscal year, prepared and submitted by the Ministry of Finance at the end of August, was examined and approved on September 12 by the Cabinet and sent to Parliament for ratification.
No closing balance
Commenting on the budget rejection, MP Ghassan Hasbani (Lebanese Forces) asserts that “the 2023 finance bill was tabled during the ninth month of the current year, which is far too late for it to be discussed when almost all the expenditure has been made, in addition to the fact that it is unconstitutional.”
Hasbani adds that it is more productive to discuss the 2024 budget than the 2023 one.
He also points out that the closing balance required by the constitution has not been presented for the 2023 budget.
It should be noted that the budget is not just an accounting text calculating state expenditure and dividends. It is an act by which citizens, through their MPs, give the government the right to govern public funds. According to the Lebanese Constitution, the bill must be presented between October and December of the current year for the following year.
The main text on which successive governments have based their spending without a budget since the early 2000s is a law passed in February 2006. This allows revenue to be collected and expenses to be paid in accordance with the provisional twelfth rule.
