Government of Timor-Leste

The Government Decree 1/2021, of January 8^th, which establishes the rules for the execution of the 2021 General State Budget (GSB), approved by Law 14/2020, of December 29^th, was published last Friday, allowing the execution to begin today, January 11^th, 2021.

This Government Decree applies to the Central Administration bodies and service’s budget, to the Special Administrative Region of Oekuse Ambeno (RAEOA)’s budget and to the Social Security’s budget, and aims to ensure an effective and rigorous budgetary control and, simultaneously, aims at simplify the procedures for budget execution, continuing the changes initiated in 2020, with the objective of facilitate  the 2021 General State Budget’s execution by the bodies and services of the Public Administrative sector.

Amongst the main changes when comparing to the Government Decree that defined the rules for the 2020 GSB implementation, the following points stand out:

• There are now only two financial schemes, Services Without Financial Autonomy (SWFA) and Autonomous Bodies, Services and Funds (ABSF), instead of the three schemes previously existing. The RAEOA and Social Security have their own financial schemes, but send information on budget execution to the Ministry of Finance.

• Budget execution now includes the implementation of program budgeting. Changes that impact targets set out in the annual plan require the opinion of the Planning, Monitoring and Evaluation Unit (UPMA). Quarterly performance reporting is carried out on the Dalan ba Futuru system.

• The closing dates for the budget year have been amended. Commitments will be able to be registered in  the Financial Management Information System (FMIS) until December  17^th,2021. Payment requests can be submitted until December 23^rd, 2021 and Payments can be made until December 31^st,2021.

• There is an increase in budgetary execution flexibility, with greater flexibility in defining the expenditure authorization notification’s amounts, with the elimination of authorization to establish Operating Fund and to approve bank guarantees for execution and quality, and with the elimination of some quantitative limits (direct contracting, advance payments and budget changes).

• There is also an increase in reporting obligations, which is to be monthly, on budget execution, quarterly, on public programs and grants’ performance and half-yearly on non-financial debt and assets’ information. The Ministry of Finance draws up a list of non-performing bodies and services, and publishes, quarterly, a budget’s execution report, and monthly, a Public Administrative Sector budget’s execution summary. END