Fundo de reserva e regra anticíclica

Reserve fund and counter-cyclical rule

Purpose

Revenues fluctuate; commitments to members do not. A polity without reserves must cut services or raise levies exactly when members can least afford it. This rule builds a reserve in good years, defines when it may be drawn on, and, from version 1.2, sets up a permanent fund whose earnings support the budget across generations.

Article 1. Reserve fund

1. The polity keeps a reserve fund separate from its operating accounts.
2. The target size of the fund is six months of average operating spending over the previous three years.
3. Until the target is reached, at least 5% of each year's revenue is paid into the fund before any other spending.

Article 2. Investment

1. The reserve fund is held in low-risk, liquid assets that can be realised within 30 days.
2. Fund assets may not be lent to office-holders, their relatives or businesses they control, or used as collateral for other borrowing.
3. The treasurer reports the balance and holdings to the assembly every quarter.

Article 3. Drawing on the reserve

1. The reserve may be drawn on only when revenue in a year falls at least 5% below budget, or when an emergency has been declared under the emergency powers rule.
2. A drawing requires a decision of the assembly by majority of its members, stating the amount and purpose.
3. Drawings in any one year may not exceed half the balance at the start of the year.

Article 4. Accounts and audit

1. The reserve fund's accounts are audited every year by an auditor who is independent of the treasurer and of the council, and the audit report is published in full.
2. Every drawing, every payment in and the balance at the end of each month are recorded in a public ledger.
3. If the balance falls below half of the target in Article 1, the treasurer must report to the assembly within 30 days with a plan to restore it, and the plan is debated at the next meeting.

Article 5. Counter-cyclical rule

1. Each budget is set on the basis of expected normal revenue: the average of actual revenue over the previous five years, adjusted for changes in rates.
2. When actual revenue exceeds expected normal revenue, the excess is paid into the reserve until it reaches 150% of the target in Article 1; any further excess goes to repayment of debt or, where one exists, to the permanent fund.
3. When actual revenue falls short, the shortfall is covered from the reserve without a separate vote, up to the limit in Article 3(3).
4. After any drawing, the reserve is refilled over no more than five years, at a pace published in each budget.

Article 6. Order of cuts

If a shortfall exceeds what the reserve can cover, the assembly decides on cuts, but must first protect, in this order: payments for subsistence and care; the maintenance needed to keep shared infrastructure safe; and debts already incurred. The order is published with every budget, so that it is known before a crisis.

Article 7. Permanent fund

1. Revenue from the sale of non-renewable resources, the sale of common land and one-off windfalls is paid into a permanent fund. Its principal may not be spent.
2. Each year the budget may draw no more than 4% of the average market value of the fund over the previous five years.
3. At least half of the annual draw is paid out as an equal dividend to every resident member; the remainder supports the general budget.
4. The fund is managed by trustees appointed for staggered terms and bound by a published investment policy, which excludes investments in the polity's own bonds and in businesses controlled by office-holders.
5. Any change to Article 7(1) or 7(2) is subject to a mandatory referendum.