IV. SPAIN

report includes: an analysis of the accounts of the State and the public sector; a view on the financial management of the State and the public sector; comments on observance of the Constitution, legislation and regulations governing public sector economic activity; compliance with the provisions of the budget (local, regional and national); the efficiency and economy of public spending; the activities of the State corporations and also the application of other public subsidies; and a statement of the COA’s jurisdictional proceedings during the year in question (United Kingdom National Audit Office, 2001).

4.5.6. Enforcement of findings

The recommendations of the report are enforced by parliamentary consideration, whose role is delegated to the Joint Committee for the relationship with the COA, consisting of 48 members of both houses. For the report on the General Account of the State, Parliament considers and resolves to accept the accounts and can ask for more information. The COA does not issue a separate report but expects the government to act on the recommendations made by the COA. Follow-up work is carried out by the COA in the most significant cases. Reports of the COA appear in the Official Gazettes and attract considerable media attention (United Kingdom National Audit Office, 2001).

The enforcement of the report’s recommendations is strengthened by the COA’s jurisdictional functions. These are confined to passing judgment on those responsible for managing public funds. Actions are aimed at determining the damage caused to the public treasury and demanding compensation but without the possibility of imposing any fines or penalties (OECD, 2003b). The COA examines cases referred to it by three sources: the prosecutor, the public administration affected or by a public petition, and makes judgments on referred cases. Where an individual public official is directly liable because he has willfully acted in a way that has resulted in loss or waste, he must repay the full amount of the loss. The liability for loss or waste of public money is personal (Art. 42, OACA). Where it is not feasible to prosecute the person directly liable, it may be possible to prosecute the person who could have prevented the act (Art. 43, OACA). This is known as secondary liability and arises particularly where the second person was negligent in carrying out supervisory duties (United Kingdom National Audit Office, 2001).

Notes

1.The Constitution has 169 articles, including several on budget-related issues; the General Budgetary Act 47/2003 has 182 articles; and the Standing Orders for the Congress of Deputies and the Senate have 206 articles and 196 articles respectively.

IV. SPAIN

2.Organic laws are a specific type of statute regulated by the Constitution and are different from general legislation in two ways. First, matters relating to the implementation of fundamental rights and public freedoms, the Statutes of Autonomy and the general electoral system and other laws provided for in the Constitution must be legislated for by an organic law [s. 81(1)]. Furthermore, the approval, amendment or repeal of organic laws requires an overall majority of members of the Congress of Deputies in a final vote on the bill as a whole (s. 82(2)].

3.See also the Statement of Purpose of the GABS written by Parliament in 2001.

4.According to constitutional provisions, the State has exclusive competence over matters concerning the basic rules and co-ordination of general economic planning (13) and the basic rules of the legal system of public administrations and the status of their officials which shall, in any case, guarantee that all persons under the said administrations will receive equal treatment and the application of common administrative procedures, without prejudice to the special features of the SGCs’ own organisations (18).

5.See the Statement of Purpose of the GBA written by Parliament in 2003 for further information.

6.Budgetary stability is defined as “a balanced or surplus situation in terms of financing capacity pursuant to the definition set out in the European System for National and Regional Accounts and the terms established for each State administration (for the public sector in Art. 2.1 of the GABS)”.

7.The State sector also is divided into three categories by the GBA (Art. 3): the administrative public sector (for example, the general State administration, autonomous bodies); the semi-commercial public sector (for example, semicommercial public enterprises, State commercial entities); and the public foundation sector (for example, foundations in the State sector).

8.State debt is defined in the GBA as the entirety of capital borrowed by the State through public issues, agreements for loan transactions, subrogation to the debts of a third party, and any other transaction that finances State expenses (Art. 92).

9.Spending includes expenditures for staff, current and capital transfer, capital investment and debt servicing (this type of spending is called “non-financial spending” in the Spanish budget). Financing items (known as “financial spending”), such as the purchase of financial assets and payment of financial liabilities, are excluded.

10.For the audit of SGCs, a distinction should be made as to whether they have their own external controlling body (a regional COA). Regional COAs established in nine out of 17 SGCs, without prejudice to the competence of the COA, certify the accounts of SGCs and present a report to the local councils. For the remaining SGCs, this task is carried out by the COA. The COA therefore carries out less direct work in the SGCs that have their own COA but it still has oversight and can carry out follow-up work. The COA can delegate some of its jurisdictional functions to a regional COA, but only the actions related to accountancy responsibility, never the audit itself. See United Kingdom National Audit Office (2001) and Kraan (2004) for more information on this matter.

11.The COA’s structure comprises: the President, the Full Session, the Ruling Committee, the Auditing Section, the Trial Section, the Board of Audit, the Prosecutor’s Office, and the General Secretariat (Art. 19).

IV. SPAIN

Bibliography

Cabrero, Olga (2002), A Guide to the Spanish Legal System, Law Library Resource Xchange, www.llrx.com/features/spain.htm.

Daban, Teresa, et al. (2003), Rules-Based Fiscal Policy in France, Germany, Italy, and Spain, IMF Occasional Paper No. 225, International Monetary Fund, Washington DC.

Kraan, Dirk-Jan (2004), “Off-budget and Tax Expenditures”, OECD Journal on Budgeting, Vol. 4, No. 1, pp. 121-142.

OECD (2001), OECD Economic Surveys: Spain, OECD, Paris.

OECD (2002), Budget Practices and Procedures Survey, OECD and World Bank, Paris, http:/ /ocde.dyndns.org.

OECD (2003a), OECD Economic Surveys: Spain, OECD, Paris.

OECD (2003b), “Case study: Spain”, unpublished paper presented at OECD expert meeting on Accountability and Control in the Public Sector, Paris, 29-30 October.

United Kingdom National Audit Office (2001), “Spain”, State Audit in the European Union, National Audit Office, London, www.nao.org.uk/publications/state_audit/st_spain.pdf.

Zapico Goni, Eduardo (2002), Budgeting for Results in Spain: Lessons learned after two decades of reform, OECD, Paris.

Zapico Goni, Eduardo, and Mario Garces (2002), “Spain”, in Distributed Public Governance: Agencies, Authorities and Other Government Bodies, OECD, Paris, pp. 161-180.

ISSN 1608-7143

OECD Journal on Budgeting – Volume 4 – No. 3 © OECD 2004

United Kingdom*

*This study has benefited from comments from several offices of H.M. Treasury, the Cabinet Office and the Debt Management Office (co-ordinated by Gary Hansman), from Simon Henderson of the National Audit Office, and from OECD colleagues including David Turner of the Economics Department.