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Legislative Assembly for the ACT: 2003 Week 11 Hansard (21 October) . . Page.. 3825 ..

MR STEFANIAK (continuing):

comments made by the Premier, Mr Bracks, when he was Treasurer-comments to which I referred in full earlier. In Victoria, the Auditor-General now reviews the budget as it is developed and he reports to the parliament on budget day on matters such as consistency with state accounting principles, consistency with targets for the government's key financial measures, the appropriate use of underlying assumptions, and the use of reasonable methodologies to determine assumptions.

I emphasise that the government retains responsibility for setting out the budget, for monitoring the budget performance and, where necessary, adjusting budget policies and priorities to take into account inevitable changes in circumstances that will occur during any financial year. I foreshadow that I will move two amendments. The first small and technical amendment requires the report package prepared by the Auditor-General to become part of the package of papers that comprises the annual budget. The second amendment sets out the parameters within which the Auditor-General would work. Those parameters are: that financial statements are consistent with relevant accounting practice policies; that financial statements are consistent with targets being required by the government's new clause 11 (a); that financial statements are consistent with the assumptions used in the statement required by the government's new clause 11 (1) (b); that the methodology on which economic and other assumptions have been based is reasonable; and that the report on these matters be given to the Treasurer and be included in the budget papers.

All members would recall the ACT Treasurer making the comment that the annual budget comprises estimates that might best be considered as guesstimates. Those are all the reasons why Assembly members should support this important initiative. These amendments will enhance the integrity of the budget preparation process and the Assembly and the community will be better informed about the basis for the annual budget. I commend these amendments to the Assembly and I ask Assembly members to consider seriously supporting these most important amendments-amendments that have already worked very well in Victoria.

MS TUCKER (11.08): This amendment addresses the perception that there is no source of authority on the construction of the budget outside Treasury and cabinet. The amendment will introduce a new role for the Auditor-General-a role that was adopted by Victoria but one that I believe has not been adopted by any other jurisdiction. That role would be to make a statement in support of the construction of the budget. The Auditor-General would have to state whether the financial statements included in the proposed budget were consistent with the accounting policies on which they were based and that the statement was consistent with the targets specified in the financial policy objectives and the strategy statement under section 11 (a) for that financial year. This statement is a statement of financial policy objectives.

The Auditor-General would have to express an opinion about whether the statements were properly prepared on the basis of the economic or other assumptions contained in the newly introduced statement for the proposed budget. Finally, the Auditor-General would have to include in the report a statement to the effect that he considered reasonable the methodology that had been used to determine economic or other assumptions. The government objected to that course of action and said that that would enable the Auditor-General to access cabinet papers referring to the construction of the

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