Parliamentary Budget Officer Bill 2011

It is with great pleasure that I rise today to speak on this bill that will greatly enhance the transparency and accountability of this parliament and its members. This bill does hit the mark. It best reflects the needs of the parliament and it best serves the needs of the Australian people. The Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011 will establish the Parliamentary Budget Office as a fourth parliamentary department and will establish the Parliamentary Budget Officer as an independent office of the parliament. 

It will mandate that the PBO will inform parliament by providing independent and nonpartisan analysis of the budgetary cycle, fiscal policy and the financial implications of proposals; it will establish the function by which the PBO will respond to policy costing requests from members and senators in a confidential manner—and I will come to more of that later—outside of the caretaker period and in a manner consistent with the Charter of Budget Honesty during that period; and it will enable the officer to make arrangements for access to information from other government agencies.

This bill amends other acts to enable the establishment of the office. It follows the report of the inquiry of the Joint Select Committee on the Parliamentary Budget Office. The government has agreed to all 28 recommendations of the inquiry, the first of which is that the government establish such an office. The purpose of this office will be to provide independent analysis of the budget cycle, fiscal policy and the financial implications of proposals. The committee's report states:

In attempting to deal with these issues— in terms of budget cycles— many countries have found that existing parliamentary institutions have limited resources to undertake a high level of analysis on fiscal matters. To satisfy a need for greater support, many parliaments have established specialist research and analytical units such as Parliamentary Budget Offices (PBOs) which are independent from government to varying degrees and which assist parliamentarians in their consideration of government finances and expenditure.

It goes on to say: The Organisation for Economic Co-operation and Development (OECD) has observed that in recent years, there is an international trend in establishing specialist budget research units. The OECD stated:

The growth of bodies to assist the legislature in budgetary matters is a strong trend in OECD countries. They take a variety of forms but their raison d’être is the same: Parliaments need specialised resources in order to carry out their constitutional responsibilities vis-à-vis the budget. The functions of such bodies include economic forecasts, baseline estimates, cost estimation, analysis of the Executive’s budget proposals and medium-term analysis. As such, they have the potential to improve transparency and enhance the credibility of the Government’s Budget and public finances in general.

The office will respond to requests from senators and members of this House to ensure that all have access to high-quality information and analysis. I am particularly heartened that this bill will amend the Charter of Budget Honesty so that all parties with at least five members will be able to request election costings from Treasury and Finance under the charter. Currently this service is afforded only to the government and the opposition. Access to this information by members will give an incredible degree of transparency and accountability for the Australian public . It is a matter of key importance.

Quite rightly, the issue of good financial management has become a central issue in the public policy debates of this country. As the inquiry noted, in the rationale for the establishment of the Parliamentary Budget Office, 'in Australia and internationally there has been a growing trend in examining and questioning the adequacy of fiscal management'. I believe it is appropriate that this examination continue and be enhanced through good and accurate fiscal and budgetary analysis. It is appropriate that the government of the day, its alternative on the opposition benches and those on the cross-benches have access to the best information to inform their proposals and that they be held to account for the financial impacts of those proposals. Over the last few decades there has been an unstoppable trend of reform in this area. We have seen the establishment of the National Commission of Audit and the enactment of the Charter of Budget Honesty in 1988. There have also been the reforms under the government's Operation Starlight agenda to improve the transparency of public sector budgeting. These have been landmark reforms to ensure that there is transparency in the budget and the fiscal decisions of government. It has meant an increase in the ability of the Australian public to examine the economic management of its government and to have confidence that they know how their money is being spent. However, there is more that can and should be done, and there remains a need to further enhance the ability of senators and members and, through them, the Australian people to get advice on budgetary matters. As the inquiry noted:

Despite the reforms to Budget reporting and the detail of information published in the Budget Papers and other statements and reports, submissions have raised concerns about the ability of Parliament to effectively discharge its responsibilities in relation to the Budget and other financial matters.

This legislation will be another step in addressing the concerns of the inquiry and in enhancing the transparency of financial information.

Perhaps the most significant area that this bill will amend will be to ensure that opposition members and crossbenchers will have the ability to have their policy proposals costed by this office, the PBO. Under this bill, election policy costings can be provided by either the PBO or Treasury and Finance. As is appropriate for election costings and proposals, they will be released publicly to ensure that the Australian people are appropriately and comprehensively informed about the true costs of policy agendas and the proposals being made by all members of this parliament.

This would have been particularly useful and informative during the last election, where we saw those opposite campaign on their supposed strong economic credentials while at the same time hoping to avoid the questions about where they would get the money for their proposals. They refused to have their promises costed and they refused to reveal their assumptions or any details when they had an accounting firm cost them. It was not until the conclusion of the election, at the request of members of the crossbenches, that the true nature of the opposition's policies was revealed. Only then was it revealed that their election commitments had an $11 billion black hole. Since then it has blown out to a $70 billion black hole, with no end in sight and no clear goal of how they will fix this massive gap in their spending. That is the equivalent of stopping Medicare payments for four years or stopping the age pension for two years.

The only statements that we get from the alternative Treasurer, the member for North Sydney, is for this country to obliterate entire government departments and to sack thousands of my constituents. As I have said time and again in this House, the coalition have form on this. In 1996, the Howard government sacked 12,000 public servants in Canberra and 30,000 nationwide. That sent Canberra into a recession when the rest of Australia was growing. Perhaps with the establishment of this office he can receive the advice he needs to understand that the Public Service has not grown by over 20,000 but has grown by less than half that and is the same size it was 20 years ago. Maybe then he will stop the attacks on the Public Service. Perhaps then he would not need to front the media and openly, outrageously and irresponsibly declare that he would love to sack 12,000 public servants, many of them Canberrans, and fail to provide any further detail of how this would occur. Perhaps then the people of this country could have faith that those opposite would have access to information that meant that they could understand the budget and understand the economy and not need to resort to scaremongering and just plain falsehoods to sell their message.

Their bill this morning was more of the same. While they came into this place and talked the talk about the need for transparency, openness and accountability, they failed to walk the walk. They sought to replace the openness of Treasury costings during elections with a closed process—enshrining into legislation the secrecy for which they became known during the last election. And to justify this change, they continue with their outrageous attack on the expertise and professionalism of the Australian Public Service, in particular Finance and Treasury.

There are two elements that I would like to pick up that the member for North Sydney mentioned in terms of his proposals for amendments. The first was this notion of confidentiality. I just want to clarify that the government bill already provides for confidentiality of non-election costings. It distinguishes between policy costings during elections and those done outside the caretaker period for a general election. It ensures that the election costing service of the PBO will be fully transparent and consistent with similar processes under the Charter of Budget Honesty Act. So, in terms of confidentiality, I cannot understand the concerns of the member for North Sydney.

He also raised concerns about access to information. The government bill does allow the PBO to access information from Australian government agencies through a negotiated MOU in circumstances where the release of information is consistent with other legislative requirements. The committee talked about this during the inquiry. This access to information approach is consistent with the recommendations of the committee. The committee favoured an MOU over compulsion to provide information, on the grounds that it would facilitate more productive working relations between the office and government agencies. The approach that we have proposed in this bill is for a cooperative approach, as opposed to the adversarial approach that is being proposed by those opposite. The government considers it crucial that the PBO's relationships with government agencies should be cooperative, cohesive, productive and constructive.

This bill does enhance the transparency and accountability of parliament. It does best reflect the needs of parliament. It does best reflect the needs of the Australian people. It does best serve the needs of the Australian people. It gives every member of this chamber and of the Senate access to appropriate analysis to ensure that everyone is properly informed and can debate the issues of this country correctly and truthfully. I commend the bill to the House.

Download a copy of this speech.

Tweets by @TwitterDev