The Court of Auditors in the new architecture of public finance — From financial legality to a magistracy of efficiency, effectiveness and economy

Abstract

This article argues that the 2024 reform of EU economic governance, built on multi-annual net expenditure paths and medium-term fiscal-structural plans, has shifted the focus of fiscal sustainability from compliance with quantitative limits to the State’s capacity to convert resources into results. The Portuguese model of financial control, however, displays a “legality bias”: it concentrates on authorisation and compliance and underinvests in planning, evaluation and institutional learning. The article proposes that the Portuguese Court of Auditors evolve from guardian of the legality of expenditure into guarantor of the quality of public spending — a “magistracy of spending quality” — without abandoning legality or financial liability. To this end, it develops the “Triangle of Good Public Spending” (legality, sustainability and performance) and distinguishes policy choice from policy performance as the boundary of supreme audit institutions’ remit. These theses are tested against Government Bill No. 72/XVII/1, and the article closes with a programme of institutional reforms.