Legislative Assembly for the ACT: 2002 Week 14 Hansard (11 December) . . Page.. 4209..
Financial Legislation (Integrity and Responsibility) Amendment Bill 2002
Mr Humphries , pursuant to notice, presented the bill and its explanatory memorandum.
Title read by Clerk.
MR HUMPHRIES (10.54): I move:
That this bill be agreed to in principle.
This is the second bill in the charter of budget honesty that the opposition is bringing forward today. Like the first, it has antecedents in other jurisdictions. The objectives are to maximise the transparency of the process being used by government to produce budgets, to have government account for its performance with respect to budget objectives and to provide clear, useful information to electors to help them judge the government's performance in these areas.
The bill is designed to improve scrutiny of the ACT's financial operations by enshrining certain principles of sound financial management in law and by updating the financial information at appropriate intervals, especially prior to ACT elections.
As I said in relation to the costings bill, the ACT has been in the vanguard of accountability mechanisms, but recently we have been overtaken by standards set in other jurisdictions. In Victoria, and in the Commonwealth, legislation has been enacted which takes these principles rather further than in the ACT. I hope that this bill will be able to redress the extent to which other jurisdictions have taken the march on us.
The structure of this bill is that it amends the Financial Management Act 1996 and the Annual Reports (Government Agencies) Act 1995. The first thing the bill does is set out principles of sound financial management. These principles underpin the government's budgeting and reporting framework. The principles themselves are outlined in section 4A (2) of the act, as it would be if passed. Those principles are that the government must:
a) manage financial risks faced by the Territory prudently, having regard to economic circumstances; and
b) pursue spending and taxing policies that are consistent with a reasonable degree of stability and predictability in the level of the tax burden; and
c) maintain the integrity of the Territory's tax system; and
ensure that it takes into account the financial impact on future generations when making its policy decisions; and
d) give full, accurate and timely disclosure of financial information relating to the activities of the government and its agencies.
The bill goes on to define "financial risks". They include:
a) risks arising from the level of the Territory's general government sector debt;
b) commercial risks arising from ownership of corporations and public enterprises;
c) risks arising from changes in the structure of the Territory's tax base;
d) risks arising from management of the Territory's assets and liabilities.