Ley 47/2003, de 26 de noviembre, General Presupuestaria - 1a Parte - Art 1 - 25 (+ repaso C.E.)

Understanding the General Budgetary Law: Key Insights

Introduction to the General Budgetary Law

• The discussion focuses on the General Budgetary Law (Law 47/2003 of November 26), which often raises questions, particularly regarding budget modifications.

• The aim is to clarify essential articles for those preparing for administrative opposition exams within the general state administration.

Scope and Application

• Title I outlines the scope of application and state treasury, introducing Article 1, which includes five distinct sections: budget regime regulation, economic-financial regulation, accounting regulation, intervention regulation, and state financial control.

Constitutional Articles Relevant to Budgeting

• It’s crucial to understand specific Spanish Constitution articles that frequently appear in exams: Articles 131(1), 134, 135, and both parts of Article 136.

Article 131 Overview

• Article 131(1) allows the state to plan activities through law to meet collective needs and promote equitable regional development and wealth distribution. This article underpins the creation of Law 47/2003.

Importance of Article 134

• Article 134 is vital for exam preparation; it details that:

• The government is responsible for drafting general state budgets.

• Approval lies with the Cortes Generales (not Congress or Senate). This distinction is often tested in various forms during exams.

Characteristics of State Budgets

• Budgets are annual documents encompassing all public sector income and expenses starting January 1st until December 31st each year. However, they are prepared in the previous year (year -1) and executed in the current year (year zero). Control extends into subsequent years by intervention bodies.

Pluriannuality Concept

• While budgets have an annual character, they also possess a pluriannual vision extending up to three years ahead as per Law 47/2003 provisions. This dual nature can lead to confusion in examinations about whether budgets are strictly annual or if they incorporate future projections.

Submission Deadlines for Budgets

• The government must present state budgets at least three months before year-end; this aligns with constitutional requirements versus those set by Law 47/2003 (before October 1). Understanding these deadlines is critical as exam questions may vary based on which law is referenced.

Consequences of Non-Approval

Budgetary Procedures and Legislative Implications

Overview of Budget Execution

• The discussion begins with the concept of budget allocation, specifically referencing a budget line for infrastructure projects like road construction by the Ministry of Development.

• It highlights that if a project is completed but not formally approved by year-end, the initial budget line remains unaltered in subsequent years, despite its completion.

• The funds from this budget do not disappear; they remain available due to constitutional provisions ensuring total amounts are maintained without alteration.

Government's Role in Budget Management

• The government has the authority to propose laws that may increase public spending or decrease revenue within the fiscal year.

• Any proposal or amendment suggesting an increase in credits or reduction in income requires government approval, distinguishing between governmental initiatives and those from opposition parties.

• Emphasizes that only the government can approve such financial changes, underscoring its central role in fiscal policy.

Taxation and Legislative Authority

• Article 134 clarifies that while general budgets cannot create new taxes directly, substantive laws can modify existing tax structures if explicitly allowed.

• This distinction is crucial for understanding how legislative powers interact with fiscal responsibilities and taxation policies.

Stability and Fiscal Responsibility (Article 135)

• Article 135 mandates all public administrations align their budgets with principles of fiscal stability to avoid structural deficits beyond set limits established by law.

• Autonomous communities are prohibited from incurring structural deficits exceeding defined thresholds as per Organic Law 2/2012.

Emergency Provisions and Debt Management

• Under specific circumstances like natural disasters or economic recessions, limits on structural deficits and public debt can be exceeded but require absolute majority approval from Congress.

• A proposed organic law will further develop these principles regarding fiscal responsibility and sustainability.

Oversight Mechanisms (Article 136)

• Article 136 introduces the Court of Auditors as the supreme body responsible for overseeing state accounts and economic management, reporting directly to Parliament.

Overview of the Spanish Public Budget Control

Examination of Control Bodies

• The internal examination focuses on two control bodies overseeing the state budget, emphasizing the role of the Tribunal de Cuentas as the supreme auditing body dependent on parliamentary oversight.

Key Aspects of Law 47/2003

• Article 2 of Law 47/2003 outlines who constitutes the state public sector, including general administration and institutional public sector entities.

• Modifications to include autonomous agencies, public business agencies, and newly added state agencies are highlighted as significant updates relevant for examinations.

Classification of Public Entities

• Entities within the institutional public sector are categorized into three main groups: administrative public sector, business public sector, and foundational public sector.

• Article 4 specifies that economic and financial legal regimes will be governed by this law with exceptions noted in Articles 5 through 25.

State Treasury Insights

• The state treasury comprises economic rights and obligations held by its autonomous entities; these rights can be both public (like taxes) and private in nature.

• The Ministry of Finance is responsible for managing these rights; a notable point is how tax collection priorities are established among various entities.

Tax Collection Procedures

• Tax collection hierarchy indicates that if both an autonomous entity and the general administration have claims, priority goes to the latter or social security.

• Prescriptions regarding claims against state treasury highlight a four-year limit for recognizing or liquidating credits.

Interest on Delayed Payments

• Article 17 discusses interest on delayed payments which begins after voluntary payment deadlines lapse; annual adjustments are made according to budget laws.

Debt Cancellation Policies

• The Ministry may cancel debts deemed too small to pursue legally (under three euros), indicating a cost-benefit approach to debt recovery efforts.