Planning and Budgeting

 Unconformity with the financial rules, and the way in which the resources stemmed from oil export are introduced into government budget are two crucial issues which has been turned to be a sever impediment with respect to stabilization of financial policy. Majority of studies demonstrate the necessity for designing the fiscal rules to prevent the oversizing of government as well as to hinder the fiscal instabilities in short term. Such rules can be set either in the form of quantitative indexes aimed to limiting political intervention or in the form of procedural rules working toward the improvement of performance of budgetary institutions and management of public sector. Foreign Exchange Reserve Account, National Development Fund, and goal setting for deficit of operational balance are major fiscal rules designed in Iran. In practice, however, they failed to restrict government in utilizing the resources from oil export. Current study addresses the existing fiscal rules and experience of other countries and then proposes three fiscal rules including setting ceiling for budget deficit without oil and its annual reduction, setting ceiling for spending Rials from oil recourses in budget and its annual adjustment and associating the expenditure increase with the growth of non-oil revenues.