"State Fiscal and Financial Disciplines Act, 2018: Role of SAI - PowerPoint PPT Presentation

"State Fiscal and Financial Disciplines Act, 2018: Role of SAI Thailand in Strengthening Public Debt Management" Pitikhun Nilthanom, Head of International Development Division Orapan Limriantong, Auditor, Professional Level State Audit Office of the Kingdom of Thailand

Presentation Outline • State Fiscal and Financial Disciplines Act (SFDA), 2018 at a Glance • Role of SAI Thailand in Strengthening Public Debt Management • Challenges and Way Forward

SFDA at a Glance link to According to Organic Act Constitution of on State Audit the Kingdom 2018 of Thailand 2017 Holistic Approach of PFM

SFDA: Rationale & Expected Results No Legislation in Required by Place Constitution Lack of Fiscal Innovation Comprehensive Fiscal Situations

SFDA: Structure Chapter 1 General Provisions Chapter 2 Fiscal & Financial Policies Chapter 3 Fiscal & Financial Disciplines - Revenue, Expenditure - Acquisition of Assets & Public Asset Management - Creation of Public Debts and Administration of Public Debt - Non-Budgetary Funds & Revolving Funds - Local Finance Chapter 4 Accounting, Reporting & Auditing State Audit Chapter 5

SFDA: Public Debt Management Source: Excerpt from Recent Development of the Thai Budgeting System by Mutita Somana, Budget Bureau

Role of SAI Thailand in Strengthening Public Debt Management: Overview  As pillar of National of Integrity System (NIS), SAO play a key role in promoting transparency, accountability and disciplinary in Public Financial Management (PFM) in accordance with: 1. Constitution; 2. State Fiscal and Financial Disciplines Act (SFDA); 3. Organic Act on State Audit (OASA).

Role of SAI Thailand in Strengthening Public Debt Management: Legal Framework Constitution “The State Audit Commission (SAC) shall Section 240 have the duties and powers as follows: (5) to order an administrative penalty in the case of a violation of the law on financial and fiscal discipline of the State (SFDA Law). The proceedings under paragraph one shall be in accordance with the Organic Act on State Audit (OASA Law).”

Role of SAI Thailand in Strengthening Public Debt Management: Legal Framework (Contd.) “The State audit shall be conducted on the SFDA basis of integrity, circumspection, Section 80 transparency, fairness and courageousness and without bias and shall be in compliance with the principles of good governance, in accordance with the organic law on State audit (OASA Law). In the case of breach of State fiscal and financial disciplines as provided in this Act, the infliction of administrative penalties shall be in accordance with the organic law on State audit (OASA Law).”

Role of SAI Thailand in Strengthening Public Debt Management: Legal Framework (Contd.) OASA SAC has power to impose administrative penalties to; 1) Head of Audited agencies who absent to comply with recommendations without reasonable cause (In case that damage occurred to the agency). • 2) Officials intentionally violate SFDA Law.

Role of SAI Thailand in Strengthening Public Debt Management: Legal Framework (Contd.) Constitution State Fiscal and Financial Disciplines Act Organic Act on State Audit Role of SAI Thailand in PFM

Role of SAI Thailand in Strengthening Public Debt Management: Auditing Process (SFDA Sec. 75) Ministry of Finance State Audit Ministry of (MoF) Office (SAO) Finance Cabinet Parliament Prepare Complete a (MOF) State Fiscal Audit Report Report

Role of SAI Thailand in Strengthening Public Debt Management: Auditing Process (In the case of breach of SFDA) Ministry of State Audit State Audit Supreme Finance (MoF) Office Auditor- Audited Commission Administrative Prepare State Complete a General (AG) Agency (SAC) Court Fiscal Report Audit Report

Sanction : Administrative Penalties (OASA Chapter 7 (Financial and Fiscal Discipline)) • 1) Head of Audited agencies who absent SAC exercises to comply with recommendations “Quasi -Judicial without reasonable Power” cause (In case that damage occurred to to impose the agency). Administrative • 2) Officials intentionally violate Penalties to SFDA Law

Sanction : Administrative Penalties (Contd.) (OASA Sec. 98) Remit Punishment Administrative Penalties Administrative Publicly Fine Condemn

Sanction : Administrative Penalties (Contd.) (OASA Sec. 103) Supreme Administrative Appeal • Can be made within Court 90 Days

Challenges &Way Forward Strengthen NIS & PFM using Financial and Fiscal Discipline Measures Add Value and Benefit to Citizens Increase Cost of (ISSAI 12) & Contribute Corruption to SDGs Play a key role to enhance Institutional Capacity transparency, Development accountability and Increased discipline in PFM Professional Staff Organizational System Capacity Development Capacity Development is needed and in is underway progress; e.g. Training

THANK YOU

 For more info please visit;  https://cdc.parliament.go.th/draftconstitution2/download/article/article_2 0180829093502.pdf - Constitution of the Kingdom of Thailand 2017  http://www.krisdika.go.th/wps/wcm/connect/4dc30b804739164c93dbfbe9 2e48054f/STATE+FISCAL+AND+FINANCIAL+DISCIPLINES+ACT%2C+B.E.+2561+ %282018%29.pdf?MOD=AJPERES&CACHEID=4dc30b804739164c93dbfbe92 e48054f – State Fiscal and Financial Disciplines Act 2018  Please contact: pitikhun_n@oag.go.th, pitikhunnilthanom@gmail.com, "Orapan L" <orapan_l@oag.go.th>