Chile stands at an important juncture in the evolution of its public financial management. The nation's commendable history of strong fiscal performance, built upon robust executive-led budget institutions, now confronts an increasingly complex and demanding fiscal environment. This context, coupled with a growing assertiveness from the National Congress in budgetary matters, presents both a challenge and a significant opportunity. The reforms outlined in this review offer a clear path to harness this opportunity, strengthening Congress's capacity to contribute constructively to fiscal discipline and the overall quality of public spending.
The current arrangements for congressional budget oversight, while allowing for some legislative influence, are hampered by institutional and procedural arrangements. This limits the depth and impact of legislative scrutiny. However, there is a clear impetus within Congress to play a more substantial and effective role.
We propose Chile consider a two-pronged approach to empower Congress as a responsible budget institution. First, the establishment of a stronger, non-partisan Joint Budget Office (JBO), serving both the Senate and the Chamber of Deputies, is paramount. Such an office, equipped with a clear mandate to provide non-partisan analysis, strengthen legislative costing, and promote expenditure quality, would provide both Senators and Deputies with the independent expertise necessary for informed decision-making. Second, procedural reforms — including implementing a top-down budget approval process, restructuring budget sub-committees, and clarifying committee roles — would strengthen the coherence, efficiency, and impact of budget oversight at Congress.
Adopting these institutional and procedural reforms represents a significant opportunity to enhance Chile's fiscal framework. By equipping the National Congress with improved analytical capabilities and more effective mechanisms for scrutiny, Chile can ensure that its legislature plays a more responsible and influential role in shaping sustainable fiscal policy. This will not only reinforce fiscal discipline but also enhance the transparency and accountability of public financial management, ultimately contributing to better outcomes for the nation. The commitment to these reforms will be instrumental in navigating future fiscal challenges and solidifying Chile's record for sound economic and fiscal stewardship.