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Monday, 12 September 2011
Page: 9644


Ms O'DWYER (Higgins) (16:59): I rise to speak on the Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011 because this is a very important matter for this parliament. The creation of a Parliamentary Budget Office is something that the coalition took to the last election, noting that it was critical that we have world's best practice here in Australia. This is something that the rest of the world has embraced an independent body that can look properly and closely at budgets and provide impartial advice on them along with major policy announcements and costings. We knew it was necessary for this country, which is why we took it to the last election.

We took it to the last election and it was embraced, as we know, by the Independents, who made an agreement with the government to ensure that the government would bring forward a parliamentary budget office. The Independents understood that it was important that there be an independent body that could provide impartial advice and analysis. It would be a body through which we would be able to look very deeply at the Commonwealth budget, major policy announcements and costings; a body which would have the power to get the information to be able to provide those appropriate costings; a body which would have appropriate funding to do all of those things.

The members for Lyne, New England and Denison as well as the Greens agreed that setting up a parliamentary budget office was an appropriate course of action. Of course, the government did nothing on this even after the Joint Select Committee on the Parliamentary Budget Office delivered 28 unanimous recommendations for the implementation of a parliamentary budget office. The shadow Treasurer was forced to bring forward his own bill on this matter on 22 August, which of course then spurred the government into action.

The shadow Treasurer's Parliamentary Budget Office Bill 2011 seeks to establish a parliamentary budget office that would be:

a new body, accountable to the Parliament rather than the Executive, much like the Auditor-General or Commonwealth Ombudsman;

independent, to enhance the transparency and accountability of the budget process, and help deliver better policy and financial outcomes for Australian taxpayers;

well resourced, to ensure it is effective;

tasked with providing objective and impartial advice and analysis across the parliament on the Commonwealth budget and budget cycle, including the impact of major policy announcements; and

headed by the Parliamentary Budget Officer, who will be appointed by the presiding officers of the parliament on the advice of a committee of senior government officials, with an office of highly trained staff, whose calibre will reflect the Office's status as an independent body.

This was the bill that we brought forward, and the government then brought forward its own bill to establish a parliamentary budget office. Sadly, the government bill is not sufficient to provide an independent parliamentary budget office which has the appropriate powers to do its job.

Today I take the opportunity in the time available to go to the very heart of the key differences between the government's bill and the bill that was proposed by the shadow Treasurer.

First and foremost is the independence of the Parliamentary Budget Office. It is incredibly important that the Parliamentary Budget Office be entirely separate from and not dependent on the advice of the Department of Treasury or the Department of Finance and Administration. Under our bill it would be. We would establish a parliamentary budget office that would be very much separate from the departments of Treasury and finance.

By contrast, the government would establish a parliamentary budget office that would require the Parliamentary Budget Office when making requests for information to formalise those requests in writing in order to be able to get the appropriate information and documents. The government's bill would prevent the Parliamentary Budget Office from preparing its own economic forecasts and budget estimates. However, under our bill, the Parliamentary Budget Office would be able to prepare its own forecasts and budget estimates, and it would have the power to compel the production of the information it requires in order to do that. There is a very serious difference here in the independence of the parliamentary budget offices that are proposed. We believe that, if the aim is to have an appropriately independent budget office, our bill is superior to that of the government.

The second issue goes to the powers granted to the Parliamentary Budget Office to obtain information. The government's bill requires the PBO to stipulate what information it may require, and under it the PBO would rely on the departments of Treasury and finance in order to obtain that information. Under our bill the Parliamentary Budget Office would be able to obtain that information and not be constrained by government departments wishing to protect their positions or agreements.

Under our bill we would have the opportunity to have full, frank and fearless advice from the Parliamentary Budget Office. Under the government's bill it would not be full, it would not be frank and it would certainly not be fearless, because it would be reliant upon the Department of the Treasury and the Department of Finance and Deregulation. This would not provide the independence that a Parliamentary Budget Office would require if indeed it were to be anything other than a Parliamentary Budget Office in name only.

The government's bill restricts the functions which can be performed by the PBO. It specifically prevents the PBO from preparing economic forecasts and budget estimates. It seems at odds with what the minister himself said in his explanatory memorandum—that is, that there was an established mandate of the PBO:

… to inform the Parliament by providing independent and non-partisan analysis of the budget cycle, fiscal policy and the financial implications of proposals; …

So the government bill seems to be at odds with the explanatory memorandum that has been brought forward. There is no such problem with our bill.

The coalition's PBO would be able to provide objective and impartial advice on the Commonwealth budget and the budgetary cycle, including the impact of major policy announcements. This is critical, of course, because it goes to costings, to the announcements made by the government and to the impact on the budget bottom line.

The next point is about the confidentiality of the costings performed during an election period, after an election period and about when the issue of costings is raised with the Parliamentary Budget Office around major policy announcements. Under the government's proposal, there will be no confidentiality safeguard imposed, which means that, when the second a member requests information regarding costings, that information will be made public with no opportunity for discussion or to understand exactly how the Parliamentary Budget Office has arrived at its costings conclusion. This is important, because if we seek to have good policy in this place then it is important to understand the position that has been arrived at, to ensure that appropriate costings are brought forward and that they reflect the full policy position of the member or party that has brought forward those costings. They should be released at a time when the member or the party itself believes it is appropriate to release those policy costings. Under the government's bill, this would not be the case. Under the coalition's bill, confidentiality would be preserved, which would mean again that a full and frank exchange could take place with the Parliamentary Budget Office until such time as the costings were done in an appropriate and rigorous manner which reflected the announcements made by either the member or the party concerned.

These are a number of aspects of key differences between the proposal that has been brought forward by the government and that brought forward by the coalition. It is critical that we build on the Charter of Budget Honesty, which was a great measure brought forward by this side of the House to have full and transparent policy costings on the budget process. Indeed, we believe that the Parliamentary Budget Office will build on those very strong foundations. But the only way that it can build on strong foundations is to ensure that it is independent and has appropriate ability to obtain information—appropriate powers so that it can perform its functions—and to preserve confidentiality so that people will in fact use the Parliamentary Budget Office in the role for which it is intended. These are the reasons we support the coalition's bill rather than the government's bill. These are the reasons we will be bringing forward amendments to the government's bill. I commend the coalition's bill to the House. The government's bill has deficiencies, as I have outlined. Those deficiencies can be overcome with amendments, and we commend our amendments to the House.

Debate adjourned.