Legislative procedures for the allocation of public funds for culture in the Republic of Azerbaijan is defined by the Constitution, the Law on the Budget System, annual laws and Presidential decrees on the state budget, and annual laws and Presidential decrees on the execution of the state budget. In addition, the Cabinet of Ministers’ Rules of Preparation and Execution of the State Budget and The Unified Budget Classification of the Republic of Azerbaijan are instruments of these procedures for state bodies.
The competence of the Milli Majlis (parliament) includes approval of the state budget upon the submission of the President and supervision over its implementation. An annual law on the state budget approves the amount of revenues and expenditures for the following year, including centralised and local. Tax revenues of the state budget are directed towards the corresponding purposes at the level of sections and subsections of the functional classification, including activities in culture, arts, and related fields.
After adopting the annual law on the state budget, the President signs a special decree on several issues related to applying this law, which approves the order of financing of organisations and events from the state budget. The decree defines the distribution of the budgetary funds for culture between the central and local institutions, activities and events. The costs of education in culture and art, regulation of wages and other social measures, charges for improving the technical base, and extra-budgetary expenditures of budgetary organisations are also specified in this legal act. Finally, the Ministry of Finance specifies incomes and expenditures of sources based on approved indicators of the state budget of the next budget year and delivers it to the Ministry for Culture.
In general, the proposals for the allocation of public funds for culture are based on the estimation of forecasts of the country’s economic and social development for the next and following three years. Targeted programmes and evaluation of the results of the cultural activity are collected during the preparation process of the draft state budget, which starts 11 months before the next budget year. All budgetary cultural institutions participate in this process, submitting their budget requests and forecasts to the Ministry for Culture through the administrative hierarchy, integrating them into a single application.
In case a necessity arises for review of the state budget in the execution process, and it was impossible to consider the need during the preparation and approval of the state budget of the current year, a question can be raised before the Milli Majlis (parliament) in the manner of legislative initiative. Also, the Ministry for Culture may apply to the Ministry of Finance in the second half of the year if required to transfer already allocated funds between paragraphs of the approved indicators of the current state budget year.
The procurement of goods, works and services by budgetary institutions and organisations is based on the Law on Public Procurement. The procurement of goods, works and services by budgetary institutions and organisations is based on the Law on Public Procurement. However, if the amount of the specified public procurement is equal to or exceeds AZN 50 thousand, a compulsory public tendering for funds is announced based on the Law on Tenders.
All budget proposals are prepared under the new Unified Budget Classification, which was approved on October 11, 2018.