Essential notions of Public finances

INTRODUCTION

The " term; Public finances " indicate finances of the public people, namely them public purses, finances of the territorial collectivities, but also finances of the public corporations. " finances publiques" also get along for finances of the individuals, like finances of the organizations of the security services social or finances of some of the state enterprises.

1st part: Theory general of public finances

TITRATE I: PUBLIC FINANCIAL TRANSACTIONS

Section 1: BUDGETARY OPERATIONS AND COMPATBLES

In public finance as in private finances; the operations can be classified in two categories, the receipts on the one hand and the expenditure on the other hand.

§1: Public receipts

The receipts answer the following definition: they constitute public resources. They are the taxes and social security deduction and nonobligatory carried out with the profit of a public person with an aim of general interest.

1: Nonobligatory taking away

These taking away constituted the financial resources of the state for a long time. They are carried out either spontaneously by an individual with the profit of a public person, or of the taking away due in against part of the use of a service of payment of service or use of a public work.

2: Taxes and social security deduction

They can be defined like the whole of the obligatory contributions carried out without against part to the profit of a public person of the public administrations and instituted Community European.

Two categories of taxes and social security deduction:

- Tax - > National insurance contributions

- Nontax - > Tax and taxes

§2: The public expenditure

The expenditure obeys three strict rules, which are the authorization, the execution and control according to particular rules.

A: an authorized expenditure

One cannot authorize certain expenditure. This requirement relates to it natural of the expenditure. Those are authorized which meet an aim of general interest. The public expenditure can be the subject of classifications: the prohibited expenditure obligatory and expenditure. As well as functional classification and legal classification.

The expenditure necessary to the payment of the exigible debts, and the expenditure are obligatory which the law expressly required. This classification is obligatory because for a long time made up the base of the budgetary nomenclature of the State.

Functional classification distinguishes the expenditure according to their finalities and their functions. Certain expenditure is envisaged by legal texts.

B: an expenditure carried out

ADMINISTRATIVE PHASE = Directing: Liquidation, Scheduling, Engagement

COUNTABLE PHASE = Countable: Requisition of payment, Withdrawal (payment), Control

C: A controlled expenditure

The implementation of the expenditure is supervise by political authorities, administrative and jurisdictional. This control is posed in articles 14 and 15 of the Declaration of the Human rights and the Citizen.

Section 2: OPERATIONS OF TREASURY

They can be defined like the whole of the operations with short, average and tong term returned daily necessary to ensure the cover of exceeding budgetary loads.

§1: Financing of the deficit of the State

According to article 25 of the LOLF, the resources and it loads of the State result from the following operations:

Movement of the availabilities of the State

Discount and cashing of any nature to the profit of the State

Management of funds deposited by correspondents

Emission, conversion, management and refundings of the loans and other national debts.

§2: The national debt

The issue of loans generates an important debt for the State. This debt is classically financed by new loans. This is why cases intended appear to finance the debt by final receipts.

CONTAIN II: BUDGETARY PRINCIPLES

The budgetary and countable principles can be defined like the principles applicable to the development, the implementation and the control of the budget of the public people.

Section 1: THREE TRADITIONAL GREAT PRINCIPLES

They say " classiques" because of their date of appearance. It are about the yearly recurrence, unit and universality budgetary and take their rise with the restoration.

§1: The principle of the budgetary yearly recurrence

This principle is relating to the periodicity of the parliamentary authorization. Under the terms of this principle the authorization of the members of Parliament or that of the authority deliberating for the territorial collectivities must be given each year. Thus there is an authorization to spend and perceive receipts.

Within the framework of the ordinance of January 2nd, 1959, the budget is defined for the calendar year.

Three significances with the principle of yearly recurrence:

a finance law must be authorized each year

the finance law opens authorization only with the title of the year considered

the finance law must be carried out in the year

The implementation of the principle generates certain consequences:

From a point of view of the parliamentary procedure: The finance law must be adopted and voted before the beginning of the year for which it applies. It is the rule of anteriority.

From a countable point of view: One applies the system of prolonged management.

From a tax point of view: The yearly taxation supposes an authorization tax to perceive the taxes.

§2: The budgetary principle of unit

The budgetary unit implies that the whole of the loads and the financial resources of the state appears in the project subjected to the authorization of the Parliament. The document must be single.

This principle has a legal justification: Because of the time of adoption of the finance law by the Parliament.

Policy: The Parliament can decide correctly only with the sight of a single document

Technique: this principle is the only means of knowing if the budget is in balance.

The exemptions from the principles are the additional budgets and the separate accounts. The attack with the principle are the autonomous budgets.

§3: The budgetary principle of universality

This principle has a constitutional value. It consists of the meeting of all the receipts and all the national expenditure in its budget and the absence on the one hand of assignment of a receipt to a given expenditure and the absence on the other hand of a contraction between the amount of these two operations.

The exemptions from this principles are the additional budgets and the separate accounts. The LOLF lays down a condition which is that of the setting in direct relationship by nature, of the receipts affected with the expenditure concerned.

There are the particular procedures:

basic procedure of contest

allotment procedure of product

Re-establishment of appropriations

Section 2: OTHER PRINCIPLES BUDGETARY

§1: The budgetary principle of speciality

It is a principle which wants that the appropriations of finance law are not open in block but are open for a category of given expenditure. The appropriations of the budget of the State are broken down and voted by the ministry and title.

Benjamin Constant: " When you dimension the necessary one, one will employ it for the superflu".

The law of January 29th, 1931 allows the vote of the appropriations of the State by ministry.

One distinguishes specialization from the vote and the specialization of execution of the appropriations.

The budgetary nomenclature allows that the recipients appropriations which they are well individualized in the budget of the State.

The discussion of the appropriations of the general budget gives place to missions. They can be interdepartmental, since it contribute to the same objective.

The definite program under the terms of large article 7 1 subparagraph 5 of the LOLF.

The appropriations are fungible. The exception to the restrictive principle of the appropriations are the appropriations évaluatifs.

§2: the principle of balance in the budget

The LOLF made evolved/moved this concept by distinguishing the balance in the budget and financial and the economic equilibrium. The passage to the single currency has constrained the Member States of the European Union to rationalize the management of their public finance and to harmonize their deficit. This rule is essential on all the countries European Union. The decree of July 13rd, 2004, has to confirm this obligation to preserve a budgetary discipline.

§3: the budgetary principle of sincerity

The creation of this principle results from the jurisprudence of the constitutional council in the years 1990.

Decision " n° 93-330 cd. of December 29th, 1993 " => the sincerity of the evaluations of the rules of privatization is not ignored.

Decision " n°96-395 cd. of December 30th, 1997 " => dedication of the principle.

The principle is envisaged in article 27 subparagraph 3 of the LOLF.

2nd part: Public purses

Contain 1: Establishment of the budget of the State

Section 1: Development of the budget of the State

§1: Governmental preeminence

The budget is primarily a political act. In fact the political authorities of the executive are in responsibility of prepare the budget of the State.

A/ The budgetary calendar

The preparation of the bill of one year finance NR proceeds over the previous year i.e. the N-1 year. The services of the State profit from the statistical tools which they use since the year N2 and which they refine during the N-1 year.

The procedures of preparation of the finance law are primarily fixed by budgetary way of circular .

January of the N-1 year = phase of budgetary framing

Between February and Mars = examination of the budgetary prospects

April = restitution with the 1st Minister for the results of the process

In June and May = is sent the letters ceilings

Between July and September = meeting of distribution and finalization of the budgetary documents

B/ Budgetary documents

With resulting from the development process of the project of the finance law, various documents are deposited known the office of the National Assembly and will be examined by the Parliament under the terms of the constitutional time specified by the organic law.

a/ The bill of finance

This project is the future finance law, it is this project which will be examined and amended by the members of Parliament.

This project breaks up into two parts:

first is entitled: " general terms of balance financier"

second is entitled: " means of the services and provisions spéciales"

b/ Documents whose deposit is obligatory and who make run the constitutional times

The project of the finance law is accompanied by a certain number of document under the terms of article 39 of the LOLF.

Budgetary blue: Two great types of document (economic, social report/ratio and financier+ additional explanatory)

These documents are obligatory, their deposit must be made at the latest 1st Tuesday of October of the year which precedes that by the implementation of the budget.

c/ Informative documents whose deposit is obligatory but which does not make run the constitutional times

Appendices general of yellow color: they are intended for the information and the control of the Parliament.

The deposit of these documents is obligatory but like it does not make run of constitutional time, the deposit can be later.

§ 2: The limited association of the Parliament

A/ The budgetary policy debate

This debate makes it possible to the members of Parliament to be informed main trends budgetary of the government.

B/ The debate on the taxes and social security deduction

Under the terms of article 52 of the LOLF this report/ratio must be presented in the sight of the examination and of the vote of the project of the finance law and the finance bill of the social security, it must recalled the whole of the taxes and social security deduction existing like their evolution.

Section 2: The vote of the initial finance law

This vote is subject to very strict rules.

§ 1: The priority examination by the National Assembly

A/ The justification of the priority given to the National Assembly

The bills of finance are submitted in 1st place to the National Assembly under the terms of article 39 of the Constitution.

This priority is justified by the principle of the assent to the tax , it is the room elected directly by the people, the taxpayers who examines in 1st place the bill of finance.

B/ The time of examination by the Parliament

This time is envisaged by article 47 of the Constitution. The Parliament has 70 days to adopt the bill of finance and the computation of this time starts with counted 1st Tuesday of October.

C/ Course of the examination of the bill of finance

One starts with a work in committee.

the committee of supply of the National Assembly is immediately recipient of the bill of finance.

the general reporter has as a role to present a report/ratio in plenary session.

This rapporteur will be then carries it word of the commission.

Ensuite is held the debate in plenary session.

takes place then the vote of the text.

§ 2: Protection against the late adoption of the budget

When the National Assembly does not adopt the budget in times, the government can declare the urgency. This can occur on 3 assumptions:

- when the National Assembly did not decide within 40 day.

- when the Parliament did not decide within 70 day.

- when the deposit of the finance law is not in good time made a kind allow the perception of the taxes for the following year.

§ 3: The protection of the balance in the budget

In the aim of protection the balance in the budget a certain number of constitutional and organic provision come to limit the capacities of the members of Parliament.

A/ Fields of application of article 40 of the constitution

According to this article the proposals and the amendments formulated by the members of the Parliament are not admissible when their adoption would have as a consequence either a reduction in the public resources or the creation or the aggravation of a public office.

B/ Fields of application of article 47 of the LOLF

It supplements article 40 of the Constitution. The amendments must be justified and accompanied by the developments of the means which justifies it. The LOLF points out the constitutional requirements and allows preserved balance in the budget.

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