TABLE G-1 Fiscal Projections in OECD Countriesa

Frequency fiscal projections are prepared?

How many years do fiscal projections cover?

21−30

31−40

41−50

51−60

61+

Total

Annually

 

 

Belgium, Finland, France,* Hungary, Poland, Portugal, Sweden,* United Kingdom*

Czech Republic*

Denmark, United States

11

Regularly (every 3-5years)

 

Australia, New Zealand

Germany,* Ireland, Switzerland

 

 

5

Ad hoc basis

Koreab

 

Japan,c Norway

 

Netherlands

4

Total

1

2

13

1

3

 

aAustria, Canada, Greece, Iceland, Mexico, and Turkey responded that they did not prepare fiscal projections of 10 years or more. Austria, Belgium, France, Ireland, Slovak Republic, and Spain responded that they prepare fiscal projections primarily for European Commission Stability and Convergence reporting.

bKorea: Vision 2030 was prepared in 2030 and included projection of expenditures to meet the government’s proposed policy goals.

cJapan: fiscal projections were prepared in 2007 by the Council on Economic and Fiscal Policy until 2025 and the Financial Systems Council within the Ministry of Finance until 2050.

*Countries also present fiscal projections over an infinite time horizon.

SOURCE: Anderson and Shepherd (2010).

these countries were selected on the basis of their responses to the 2007 OECD Budget Practices and Procedures Survey, particularly the question on the frequency of their projections and the length of time covered.

Countries integrate projections with other budget practices and procedures in various ways. Examples include the use of long-term projections when evaluating existing and new government initiatives, such as entitlement spending, and linking the analysis of projections through budget triggers. Budget triggers are a signal for budget restraint based on indicator of solvency (e.g., actuarial projections) or a sustainability factor (e.g,. dependency ratio). Triggers may be hard or soft. Hard triggers usually involve automatic cuts to program spending, changes in eligibility criteria or benefit formulas of mandatory spending, or tax increases. Soft triggers often involve result in further proposals to change the path of fiscal policy but are not guaranteed to produce changes (Government Accountability Office, 2008).

An overview of the fiscal futures reports from the 12 countries surveyed is presented in Table G-2.



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