TBILISI, DFWatch–The newly created Finance Supervisory Agency is still not operational because the National Bank refuses to fund it. The agency has now asked parliament to provide direct financing.
The agency was split from the National Bank a few months ago but is still not operational due to a decision by the Constitutional Court in October which suspended a legislative amendment to separate the new body from the National Bank.
The finance agency has since then remained subordinate to the National Bank, which refuses to provide it with financing.
Thursday, the Finance Supervisory Agency appealed to the speaker of parliament demanding to have proper working conditions. It is hard to say what decision parliament will make. Speaker Davit Usupashvili will first have to listen to the recommendations from the finance budget committee.
The National Bank issued a statement the same day which said that it doesn’t plan to allocate any financing for the new agency, considering it is illegal, as the agency doesn’t really function yet and the National Bank is carrying out supervision of the finance sector.
The statement also reads that the agency introduced documentation describing budget needs for the agency. According to the National Bank, the agency is increasing supervising staff by 67 employees compared to the staff which the Bank used to employ for this purpose. In total, the agency plans to spend ten million laris more than bank used to spend.
“It would have been unreasonable and illegal for us to spend such an amount of money from the budget, considering that the agency doesn’t really function and the National Bank fulfils the duties of supervising the finance sector,” the statement reads.
The Constitutional Court has scheduled a hearing for February 5 about the finance agency case.
Tamaz Mechiauri, head of the finance budget committee in parliament, believes that the finance agency has a reasonable demand and its staff should have a proper salary, but he thinks that legal experts should decide.
The National Movement, which is the parliamentary opposition, saw the new agency’s request as a form of pressure on the National Bank. Speaking on Rustavi 2, MP Zurab Melikishvili advised the government to give up its fight with the National Bank.
The Free Democrats, an opposition party which was part of the ruling coalition until November 2014, thinks that the National Bank should be free of any pressure and should remain independent.