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08/04/2019   OECD started review of the Lithuania‘s Fiscal Institution: issues of the institution’s funding and independence discussed

This week, expert team lead by the Organisation of Economic Cooperation and Development (OECD) will visit the National Audit Office to carry out an external review of the Lithuania‘s Fiscal Institution. The aim of OECD reviews is to evaluate performance quality of fiscal institutions against the internationally agreed standards (OECD principles), to flag up the challenges and to provide recommendations for improvement.

Three independent institutions are acting under the umbrella of the National Audit Office: classical Supreme Audit Institution, Audit Authority for EU Investment and Fiscal Institution. With such an unusual structure in place, the National Audit Office makes every effort to ensure proper performance of the three entirely different functions.

“Lithuania‘s Fiscal Institution has been functioning for five years already. Its activities are organised on the basis of the best practices of OECD member states, however to strengthen the function of the fiscal institution and its quality, the National Audit Office requires legislative investment. The present Law on The National Audit Office has not been amended for 17 years. A new draft law ensuring greater independence, accountability and mandate has already been prepared, registered and awaiting for consideration in the Seimas“. – said the Auditor General Arūnas Dulkys and added that it is important for OECD experts to make sure that the institution demonstrates stability of operation: the fact that the practice of three institutions within one structure is unique not only in the EU but also among the OECD members deserves special attention of the reviewers.

In spite of such abundance of roles and responsibilities, the National Audit Office remains among the least funded institutions in the EU. Moreover, today we are facing new challenges relating to restrictions of independence: new Law on Civil Service creates an on-going conflict of interests.

“The existing centralised civil servant selection system develop relationships with the audited entities and pose reputation risks related to the objectivity and impartiality of the National Audit Office officers. We have discussed with OECD experts that it is necessary to do everything in order to ensure that our staff are protected from any outside influence”. – said Arūnas Dulkys after the meeting with OECD reviewers.

The review is planned to be undertaken within six months. The review report is due in autumn. The review of the Fiscal Institution conducted by OECD expert team will evaluate compliance of the Fiscal Institution’s activity with the OECD principles and requirements for independence, impartiality, transparency and sufficient funding. It will also assess the existing channels for communication with the public and their efficiency, and whether appropriate provisions are in place allowing the institution to obtain the required data and information, as well as other questions.

The OECD expert team will also meet representatives from the Seimas, Ministry of Finance, Bank of Lithuania, Department of Statistics, research and media representatives, and commercial banks economists.

 

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Last updated on 18 June 2019

National Audit Office of Lithuania

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