Fiscal councils as watchdogs—how loud do they bark?

IMPACT

Civil servants are often heavily involved in fiscal policy. These actors have a keen understanding of institutional reforms, enabling them to point to dynamics that cannot be easily captured by quantitative analysis. It is important to tap into this knowledge in order to understand the extent to which governments are truly influenced by institutional mechanisms such as fiscal councils.

ABSTRACT

This paper examines the impacts of fiscal councils in Ireland, Portugal, and Austria. The authors focus on how key fiscal policy actors perceive the impacts of fiscal councils in their country. In all three countries, the fiscal councils were viewed as making significant contributions to public debates about fiscal policy, improving the rigour of forecasting, and strengthening the position of finance ministries. However, the fiscal councils were not successful in getting governments to take the longer term perspective on public finances more seriously.

KEYWORDS:

• Fiscal councils
• fiscal institutions
• fiscal policy
• fiscal rules
• forecasting
• ministries of finance

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by the Estonian Research Council [grant number PUT-1142].