The 2018 OECD Budget Review of Greece had three main objectives: 1) to present Greece's budgetary reforms over the last decade, 2) to receive feedback from peer countries on Greece's new budget framework, and 3) to identify priority areas for further reforms. The review found that Greece had made remarkable progress in aligning its budgetary framework with most OECD recommendations, particularly in multi-annual fiscal planning, budget monitoring, and the creation of new fiscal institutions. However, it identified three key priority areas for further reform: prioritizing and improving the effectiveness of government spending, ensuring a unified budget, and maintaining fiscal discipline going forward.

1. BUDGET REVIEW OF GREECE
Peer review of findings and recommendations
Delphine Moretti
Senior Policy Analyst
Budgeting and Public Expenditure Division
Public Governance Directorate

2. • OECD Budget Reviews assess the member countries’ practices against
OECD’s 10 Recommendations on Budgetary Governance.
• Previous OECD Budget Review of Greece in 2008.
• Objective of 2018 Budget Review of Greece:
 Present the last decade’s reforms;
 Receive feedback from peer countries on the new framework;
 Identify priority areas for further budgetary reforms in Greece.
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Objectives for the 2018 Budget Review of Greece

3. THE CONTEXT
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4. 4
Economic and fiscal revival
Government primary balance and GDP growth (2006-2017)
-12
-9
-6
-3
0
3
6
9
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Government primary balance GDP growth
% of GDP
Source: OECD National Accounts Statistics (database) of 21 December 2018.

5. 5
Decreasing but above OECD average spending
OECD countries: General government expenditure (2016)
Source: OECD National Accounts Statistics (database) of 21 December 2018.

6. 6
A redesigned budget cycle

7. FINDINGS AND
RECOMMENDATIONS
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8. • Greece’s framework aligned with most OECD Recommendations on
Budgetary Governance.
• Most remarkable progress is in the following areas:
 Clear and credible multi-annual fiscal policy.
 Effective monitoring of budget formulation and execution across
General Government.
 Monthly reporting on key fiscal aggregates.
 Creation of the Hellenic Fiscal Council and Parliamentary Budget
Office.
• Important reforms are on-going or just started (cash management,
accounting, etc.)
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Progress in all areas compared to 2008

9. • The formulation of the MTFS should involve collective and evidence-based
decision-making by the Government on policy priorities and resources
allocations.
• Enabling factors involve:
 More reliable and detailed policy costing;
 Legible performance information;
 Availability of spending reviews’ results ahead of the MTFS formulation.
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Priority areas for budgetary reform
Prioritisation and effectiveness of Government spending

10. • The budget and accounts should show all resources allocated to ministries
and government programmes for good decision-making, effective
monitoring of execution and accountability towards Parliament.
• Enabling factors involve:
 Harmonised budget nomenclature for PIB and ordinary budgets (from
2019);
 Integrated budget submissions and decision process on resource
allocations;
 Fully integrated IT systems for in-year monitoring.
• Recurrent under-execution of public investment budget calls for an in-
depth review of the framework and processes.
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Priority areas for budgetary reform
Unicity of the budget

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Priority areas for budgetary reform
Maintaining fiscal discipline
• Budgetary institutions should be sound enough to maintain fiscal
discipline in a surplus environment.
• Enabling factors involve:
 Strong “watchdogs” (HFC, HPBO, HCA), with a capacity to support a
fiscal responsibility agenda;
 Greater understanding and reporting on short-term and longer-term
sustainability risks faced by Greece to explain how the fiscal policy
stance is calibrated;
 Communication efforts towards citizens, with a “citizens’ budget” as a
first step.

12. http://www.oecd.org/gov/budgeting/
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