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Tuesday, 14 August 2012
Page: 8605

Department of the House of Representatives: Portfolio Budget Statement 2012-13

Mr Robb asked the Speaker, in writing, on 27 June 2012:

In respect of the Portfolio Budget Statement 2012-13 for the Department of the House of Representatives,

(1) What areas of service delivery and support provided by the Department of House of Representatives are being adversely affected by the 2.5 per cent efficiency dividend.

(2) In respect of funding restraints, can he provide a list of services (a) not affected, (b) that are subject to funding restraints.

(3) Can he confirm whether the efficiency dividend will result in an operational funding reduction of $1.7 million over the budget forward estimates.

(4) Can he confirm whether the work of House of Representatives committees and the support they receive will be unaffected; if not, in what areas are services and support to committees likely to be reduced.

(5) Has any assessment been conducted to gauge the impact that funding reductions may have on the department's statutory obligations.

(6) Is the department at risk of not meeting its statutory obligations as a result of the efficiency dividend.

(7) In respect of the House of Representatives Standing Committee of Appropriations and Administration finding that the department's budget will be under pressure due to the absence of an agreement to fund core services, can he confirm whether an agreement will be sought in order to protect jobs and the work undertaken by the department.

(8) Can he confirm whether funding levels will be restored to pre-efficiency dividend levels.

MR SPEAKER: The answer to the honourable Member's question is as follows:

(1) Before addressing your question specifically, it is necessary to provide some historical context as it is relevant to the current circumstances.

The Department's funding has been adversely affected over many years from the continuation of the current Commonwealth funding model applying to Budget funded agencies. This includes application of an ongoing efficiency dividend and the need to fund pay increases without supplementation. The lack of any successful new policy proposals until very recent years has substantially eroded the Department's funding base in real terms.

For example, over the twelve years from end June 2001 to end June 2013, there has been only very modest growth in the Department's budget in absolute terms (14.85%). If the budget papers' forecast CPI figure for 2012-13 of 3.25% comes to pass, the real reduction in the Department's appropriation over this period will be approximately 16.7%. To ensure that the Department has remained within budget, staffing and administrative expenses have been reduced over the years through efficiencies and some reduction in services.

Since the establishment of the House of Representatives Standing Committee on Appropriations and Administration, the Department has briefed the Committee on its budgetary outlook. Following the 2012 - 2013 Budget, the department reviewed activities to identify savings.

The Clerk of the House informed Members on 27 June 2012 of a list of savings proposals, for 2012-2013 of the order of $483,000. The savings proposals had been discussed with the Appropriations and Administration Committee. In his letter the Clerk also advised that it may be necessary to look at further savings in future years.

(2) During 2012 - 2013, the Department will continue its role as an advisory and service department for the Parliament, supporting the work of the House of Representatives including its Members in their parliamentary duties, its committees, and some joint committees. The Department will continue its focus on assistance to the House and the Parliament in their relations within Australia and internationally, and on the provision of information about the work of the House to the community.

A copy of the Clerk's letter to Members of 27 June 2012, including the list of proposed savings proposals referred to in (1), is attached. The department intends that other activities and commitments will be maintained at normal levels and standards.

(3) The additional 2.5% efficiency dividend will result in a funding reduction of $2.197m over the Budget and three out-years.

(4) The specific savings measures relating to the department's support for committees are as follows:

Director, Committee Support - amalgamate with the Director, Clerk's Office from 1 January 2013 — this will impact on the implementation of project work in the Committee Office

reducing centralised advertising of committee inquiries in the Australian

tightening of committee report printing and catering expenditure.

(5) No specific assessment has been conducted; however, the department plans to continue to discharge its statutory obligations.

(6) Not at present.

(7) The House of Representatives Standing Committee on Appropriations and Administration notes in its most recent report 'Budget Estimates 2012-2013 - Department of the House of Representatives' that 'The extent to which the department's [Department of the House of Representatives] budget will be under pressure, however, is much greater, as there is no agreement to fund core services that the department is continuing to provide'. The Committee's comment followed a paragraph in the report on the outcomes of the Budget process. Not all additional funding requested by the Department for certain services had been provided. The issue of future funding for the Department will be raised in the first instance with the Appropriations and Administration Committee.

(8) No.

The letter read s as follows

27 June 2012

ALL MEMBERS

DEPARTMENT OF THE HOUSE OF REPRESENTATIVES BUDGET OUTLOOK AND PROPOSED REDUCTIONS IN DEPARTMENTAL COSTS

The purpose of this note is to brief you on the budget outlook for the Department of the House of Representatives and to advise you of areas in which it is proposed to make savings in 2012-13. Unfortunately, some of these areas involve a reduction in services that will affect Members and I wanted to bring them to your attention as soon as possible.

Background to the Department ' s budgetary position

In June 2009 the then Clerk advised Members of the Department's tight budgetary position and of a number of areas in which the Department proposed to make savings. The savings measures were implemented successfully and took considerable pressure off the Department's budgetary position in the short term.

In 2011-12 the Department, with the assistance of the new House Standing Committee on Appropriations and Administration, was successful in obtaining additional funds for new committees and the extra sitting hours of the House and the Federation Chamber. This also eased the pressure on the Department's budgetary position in the short term.

In the most recent Budget (2012-13), additional funding of $0.487m has been provided over the Budget and three out-years to support the JCPAA's oversight of the PBO. More details on funding proposals for 2012-13 can be found in Report No 3 of the Standing Committee on Appropriations and Administration.

Nevertheless, consistent with overall government policy, our department's funding for 2012-13 was reduced by the usual efficiency dividend (1.5%) and the one off additional efficiency dividend (2.5%). The impact of the one off efficiency dividend alone has been to reduce the Department's budget by $2.197m over the Budget and three out-years, more than offsetting the additional funding for the JCPAA. It also permanently reduces the Department's base budget.

The Department has briefed the House Standing Committee on Appropriations and Administration on its budgetary outlook. The outlook for next financial year and future budget years is of concern. On a business as usual basis the Department is projecting losses in 2012-13 and the out years, which would become increasingly serious unless sizeable savings measures are implemented. I believe therefore that action is necessary immediately to implement some expenditure reductions to keep spending within budget.

Savings proposals

The Department has identified savings proposals for next financial year of the order of $483,000. The savings proposals have been discussed with the House Standing Committee on Appropriations and Administration. Of the proposals, two will have a direct effect on services to Members. These are:

Members ' newspapers - (savings of $30,000 per annum approx)

The provision of newspapers and magazines other than to senior parliamentary office holders and the shadow ministry will be discontinued from 1 July 2012. Members who will no longer receive newspapers from the commencement of the sittings in August will be advised shortly. This decision has been made in the knowledge that Members now have access to a comprehensive electronic clippings service provided by the Parliamentary Library.

Cease hard copy provision of routine Chamber documents - (savings of $40,000 per annum)

The Department will no longer produce hard copy of the Daily Program (the 'Blue') and the Notice Paper for general distribution. Small stocks will be provided for use in the Chamber. The documents are available online and Members or their staff could print individual copies in their offices, as required.

Additional measures

In addition to these specific measures, the Department proposes to achieve savings of around $413,000 per annum through implementing changes and efficiencies in other areas. These include:

reducing centralised advertising of committee inquiries in The Australian;

reducing expenditure on incoming official and unofficial delegations;

reducing printing and distribution costs of the About the House magazine;

amalgamating the Director, Clerk's Office and Director, Committee Support positions from 1 January 2013;

holding the Inter-Parliamentary Study Program for visiting parliamentary staff every two years instead of annually;

offsetting some staff expenditure for the Pacific Parliamentary Partnerships Program which provides assistance to parliaments in the Pacific;

reducing the number of attendants by one position, to be achieved by not filling a part-time sessional vacancy. Rosters will be reorganised to ensure that services to Members will not be adversely affected; and

tightening of committee report printing and catering.

I am conscious that a number of these measures will have an impact on Members and I am sorry that it has become necessary to implement them. I would be happy to receive the views of Members on these matters or any other suggestions for ways in which the Department can make savings.

Unfortunately, the Department's budget projections are such that it may well be necessary to look at further savings in future years. I cannot guarantee that those savings will not also affect services for Members, the Chambers, committees or other areas.

Finally, I should say that the Department understands that for many years, and for reasons that can be understood, Governments of both sides have applied the same basic approach to the funding of the parliamentary departments that they have applied to government departments.

Yours sincerely

BERNARD WRIGHT

Clerk of the House