Analysis of the financial economy of the Armed Forces Modernisation Fund

Abstract

The implementation of defence activities requires the allocation of specific financial resources for this purpose. The scope and quality of these activities often depends on the amount of the allocated funds. The vast majority of them come from the national budget. There are also specific organisational and legal solutions allowing for the possibility of financing defence expenditures, including financing of the Armed Forces from other sources off-budget. One of such solutions is the Armed Forces Modernisation Fund, which functions as a special purpose fund. This fund is a national special purpose fund, which has no legal personality and is one of the sources of financing of the Armed Forces Development Programme. Its main advantage is the fact that it is not subject to rigid budgetary discipline, which makes it possible to continue financing certain public services over the next few financial years. Such a solution allows for the intended accumulation of public resources which have not been used by the fund before the end of the calendar year. The aim of this study is to analyze the financial economy, i.e. the analysis of revenues and costs as well as effects of tangible property expenses incurred by the Armed Forces Modernization Fund. The analysis covers the period of the years 2016-2018.

Keywords

• defence economics
• national security
• public finance
• military finance