OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

Strengthening the Management of Public Spending in Hungary

This paper analyses the Hungarian public expenditure system and develops policy-oriented recommendations for its improvement. Despite substantial progress achieved in the management of public finances over the 1990s, the level of public expenditure and taxation relative to national income has been comparatively high while the budget process has continued to be driven by short-term considerations and remains input- rather than output-oriented. The government’s economic pre-accession programme submitted to the European Commission for the time period 2002-04 needs to be complemented by a thorough public expenditure reform in order to achieve its ambitious targets, implying significant fiscal tightening. This reform entails the development of a medium-term, output-oriented expenditure framework characterised by transparent and comprehensive budget procedures for all fiscal activities of the general government. Effective spending in areas critical for future growth performance -- ...


Keywords: extra-budgetary funds, general government, fiscal discipline, public expenditure, contingent liability, budgetary transparency, programme evaluation, multi-year budgeting
JEL: H1: Public Economics / Structure and Scope of Government; H4: Public Economics / Publicly Provided Goods; H7: Public Economics / State and Local Government; Intergovernmental Relations; H0: Public Economics / General; H5: Public Economics / National Government Expenditures and Related Policies; H6: Public Economics / National Budget, Deficit, and Debt
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