Legislative Assembly for the ACT: 2003 Week 5 Hansard (8 May) . . Page.. 1792 ..
MR STEFANIAK (continuing):
days of a more enlightened and less frightened government which will have the confidence to say clearly what it wants done and then leave it to its officials to carry out the tasks to the best of their ability, without being told how to suck eggs.
MS DUNDAS (8.52): The Australian Democrats have always sought to ensure that governments are accountable in the transparency and operation of their financial activities. This bill makes a number of minor alterations to the Financial Management Act, which is a key piece of legislation in keeping the government honest in its financial dealings. I understand that this bill attempts to clarify certain sections of the act, including the ability to amend the budget to reflect departmental changes, a result of the confusion with the budget last year when changes were made to the departmental structure as the budget papers were being handed down. The bill will allow the government to make the necessary adjustments in the budget papers to allow comparability with the financial statements.
It is a pity that that Treasurer did not use this opportunity to clarify the other major issue of last year concerning the Financial Management Act, being the use of the Treasurer's Advance. A need was identified last year for a more stringent definition for the use of the Treasurer's Advance, and a clearer definition would be eminently more useful in determining its correct usage.
This bill also deals with a number of provisions in terms of territory investments, including the welcome addition of clauses requiring that investments are only undertaken to protect or increase the financial wealth of the territory. This helps avoid the situation where governments use investment funds towards, for example, subsiding a business and claim that it is an investment opportunity when there are clearly more beneficial and less hazardous investments available.
The bill makes clear that funds held by the territory may only be invested in a limited number of ways. However, given the breadth of the investment in the financial management guidelines, which includes stocks, bonds, bills of exchange, derivatives, Australian property and other securities, it means that the restrictions of section 56 of the FMA probably have little effect on the make-up of the government's investment portfolio, but they are welcome as they at least ensure a minimum level of prudence in investments.
Obviously, this is not always going to prevent losses, as our recent superannuation investments attest, but overall I do welcome this legislation and will continue to monitor the application of this act to the financial management of the ACT.
MS TUCKER (8.54): This bill picks up some more recommendations of the Auditor-General made in the wake of the Bruce Stadium caper. The first change made by this bill is to define investment more tightly as having a purpose of wealth creation or protection, to avoid passing off as an investment things such as the Bruce Stadium redevelopment.
Wealth creation or protection could potentially include investment in property from housing to Nara House. The main Bruce prevention measures were added to the FMA a couple of years ago, but this is a further tightening. Bruce Stadium could not be argued to be wealth creation, nor protection, given that it carried such high risks of loss, risks which were realised and which I believe the territory is still paying for.