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Budgeting in Australia: Peer Review

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As of 2006, no net debt. Australia is on the asset side of budget life ... other countries: MoF should have the grip on line ministries to a reasonable extent ... – PowerPoint PPT presentation

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Title: Budgeting in Australia: Peer Review


1
Budgeting in AustraliaPeer Review
  • 29th Annual SBO Meeting
  • 2-3 June 2008
  • Gerhard Steger

2
General remarks
  • Australia has a bright budget situation
  • Budget surplus for nine of past ten years
  • As of 2006, no net debt
  • Australia is on the asset side of budget life
  • Result of long lasting sound fiscal policy and
    budget reforms
  • Budget surpluses being transferred to funds for
    covering future liabilities
  • New funds disbursement of earnings AND capital
    difference to budget expenditure ?

3
Issues for discussion
  • Some questions remain
  • Fiscal rules principles versus targets
  • Accrual budgeting
  • Outcomes and outputs
  • Role of department of finance
  • Human resources management
  • Reducing red tape within government

4
Fiscal rules principles versus targets
  • Fiscal rules based on principles, not on targets
  • Expenditure in Australia has grown rapidly during
    the last years
  • Might there be a need for combining both
    principles AND targets to assist each other ?

5
Accrual budgeting
  • Introduced 1999/2000
  • Decision making almost exclusively on cash
  • Budget is enacted on accruals
  • Both aspects nearly disconnected
  • More pragmatic attitude towards detailed
    application of accruals (less orthodox focus to
    concentrate on the real advantage of accruals) ?
  • How to get stakeholders on board in favor of
    pragmatic accruals ?

6
0utcomes and Output
  • Catalyst to increase focus on results
  • Make outcomes more relevant (concrete,
    measurable) in order to use them really for
    decision making
  • Use performance information to steer budget and
    administration
  • How to get politicians (ministers and members of
    parliament) to use performance information as an
    important tool ?

7
Role of department of finance
  • Traumatic period a decade ago
  • Lesson for other countries MoF should have the
    grip on line ministries to a reasonable extent
  • Otherwise MoF lacks necessary information and
    influence to effectively exert its shadow
    function
  • How to combine merits of traditional functions
    with a reform-minded attitude of MoF ?
  • Let line ministries act freely as long as they
    stick to their obligations but watch them closely
    to intervene asap if necessary

8
Human resources management
  • Each agency makes its own arrangements
  • Lack of public service-wide collective agreements
  • Danger of increased human resources- costs as
    agencies compete for staff ?
  • Combination of collective agreements with
    performance based bonuses ?

9
Reducing Red Tape within Government
  • Very important issue to promote efficiency and
    effectiveness
  • However
  • How to prevent the rise of a new
    anti-bureaucracy bureaucracy?
  • Combine reducing red tape with budget restraints
    for all ministries to push them towards reduction
    of bureaucracy?
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