The Government of Montenegro has proposed 23 amendments to the proposal for the Law on Budget and Fiscal Responsibility introducing more precise fiscal rules, budget reallocation procedures and accountability measures for public spending.
Under the proposed changes, the general government deficit, calculated under ESA methodology, should not exceed 3% of GDP, while public debt should remain below 60% of GDP. Annual growth in net expenditure would also have to comply with the spending path determined by the Fiscal Strategy.
Temporary deviations from these rules would be allowed in exceptional circumstances, such as major economic disruptions, natural disasters, epidemics, national security threats or increased defence spending linked to international obligations, provided medium-term fiscal sustainability is not jeopardised.
The government could reallocate up to 10% of planned funds between spending units, subject to a prior opinion from the Finance Ministry. Certain exemptions would apply to EU funds, donations, loans and reserves.
The amendments introduce fines ranging from €600 to €6.000 for employees responsible for unlawful or improper use of budget funds, excessive commitments or failure to submit required financial information.
Some provisions would be phased in, with full implementation at the level of individual spending units beginning on January 1, 2028.
The draft law, intended to replace the 2014 legislation, has been submitted to Parliament under an urgent procedure. MPs are expected to debate it at an extraordinary session on August 24.
