[BIL024-C.HAL]

House of Assembly—No. 1

[Lapsed owing to prorogation, 12 August 2004, and restored to the Notice Paper, 15 September 2004]

South Australia

[Prepared by the Parliamentary Counsel]

PUBLIC FINANCE AND AUDIT (HONESTY AND ACCOUNTABILITY IN GOVERNMENT) AMENDMENT BILL 2002

A Bill For

An Act to amend the Public Finance and Audit Act 1987.

[OPC-82]

SUMMARY OF PROVISIONS

1.Short title

2.Commencement

3.Amendment of s. 4—Interpretation

4.Insertion of Part 1A

PART 1A

CHARTER OF BUDGET HONESTY

4A.Treasurer must prepare Charter

4B.Purpose of Charter

4C.Principles on which Charter must be based

4D.Matters that must be included in Charter

4E.Amendment or replacement of Charter

5.Amendment of s. 41—Treasurer's instructions

6.Insertion of s. 41B

41B.Under-Treasurer to report on State finances when election called

7.Amendment of s. 43—Regulations

The Parliament of South Australia enacts as follows:

Short title

1. (1) This Act may be cited as the Public Finance and Audit (Honesty and Accountability in Government) Amendment Act 2002.

(2) The Public Finance and Audit Act 1987 is referred to in this Act as "the principal Act".

Commencement

2. This Act will come into operation on a day to be fixed by proclamation.

Amendment of s. 4—Interpretation

3. Section 4 of the principal Act is amended by inserting after the definition of "Deputy Auditor-General" in subsection (1) the following definition:

"general election" means a general election of members of the House of Assembly;.

Insertion of Part 1A

4. The following Part is inserted after section 4 of the principal Act:

PART 1A

CHARTER OF BUDGET HONESTY

Treasurer must prepare Charter

4A. (1) The Treasurer must from time to time prepare a Charter of Budget Honesty (the "Charter") for the State in accordance with the requirements of this Part.

(2) The first Charter must be prepared within three months after the commencement of this section.

(3) A new Charter must be prepared within three months after each general election.

(4) The Treasurer must, within six sitting days after preparing a Charter under this section, have copies of the Charter laid before both Houses of Parliament.

(5) A Charter takes effect when it has been laid before both Houses of Parliament (and will then supersede a previous Charter).

Purpose of Charter

4B. The purpose of a Charter is—

(a)to state the broad fiscal objectives of the Government; and

(b)to establish a framework for assessing the Government's performance in achieving those objectives.

Principles on which Charter must be based

4C. The following are principles to which the Treasurer must have regard in preparing a Charter:

(a)there must be transparency and accountability in stating, implementing and reporting on the Government's fiscal objectives based on its fiscal strategies;

(b)the Government's fiscal objectives must take into account a range of issues including tax policy and burdens, risk and service delivery requirements;

(c)consideration must be given to the whole range of Government activities, including through persons or bodies outside the public sector;

(d)both short term and long term objectives must be taken into account in order to ensure equity between present and future generations.

Matters that must be included in Charter

4D. A Charter must include the following:

(a)the Government's financial objectives and the principles on which it will base its decisions with respect to the receipt and expenditure of public money;

(b)a statement on how the Government's financial objectives and principles will be translated into measures against which targets can be set and outcomes assessed;

(c)the arrangements that will be in place to provide regular reports to the community about the Government's progress and the outcomes that have been achieved, in relation to the Government's financial objectives.

Amendment or replacement of Charter

4E. (1) The Treasurer may—

(a)amend a Charter; or

(b)replace a Charter with a new Charter.

(2) The Treasurer must, within six sitting days after amending or replacing a Charter, have copies of the Charter as amended, or of the new Charter, (as the case may be) laid before both Houses of Parliament.

(3) An amendment to a Charter, or a new Charter, takes effect when it has been laid before both Houses of Parliament.

Amendment of s. 41—Treasurer's instructions

5. Section 41 of the principal Act is amended—

(a)by inserting after paragraph (d) of subsection (1) the following paragraph:

(e)requiring that procedures, set out in the instructions, be followed in order to ensure compliance with a Charter of Budget Honesty under Part 1A.;

(b)by striking out the penalty provision at the foot of subsection (2) and substituting the following:

Maximum penalty: $10 000.

Insertion of s. 41B

6. The following section is inserted after section 41A of the principal Act:

Under-Treasurer to report on State finances when election called

41B. (1) The Under-Treasurer must prepare and publicly release a pre-election budget update report within 14 days after the issue of writs for a general election.

(2) The purpose of a pre-election budget update report is to provide an updated statement of the current and prospective fiscal position of the Government.

(3) A pre-election budget update report must contain the following information:

(a)updated State government sector fiscal estimates for the current financial year and the following three financial years;

(b)the economic and other assumptions for the current financial year and the following three financial years that have been used in preparing those updated fiscal estimates;

(c)any other information or explanation that should, in the opinion of the Under-Treasurer, be included in the report.

(4) The information in the report is to take into account, insofar as is reasonable in the circumstances, all Government decisions and announcements, and all other circumstances, that—

(a)may have a material affect on fiscal outlooks; and

(b)were made, or were in existence, before the issue of the writs for the general election.

(5) A pre-election budget update report—

(a)must, insofar as is reasonably practicable, be prepared according to the financial standards that apply to a State budget; and

(b)insofar as particular information required to be included in the report is unchanged from information previously reported on in a statement of the Treasurer under section 40, may summarise that information and state that it is unchanged from what was set out in that earlier report; and

(c)does not have to include information that the Under-Treasurer considers should not be included because—

(i)it is confidential commercial information; or

(ii)its disclosure in the report could prejudice the interests of the State.

(6) A pre-election budget update report—

(a)must be based on the best professional judgment of officers of the Treasurer's department; and

(b)must be prepared without political interference or direction.

(7) A pre-election budget update report must include a certificate from the Under-Treasurer as to compliance with the requirements of subsection (6).

(8) In order to assist the Under-Treasurer to prepare a report under this section, a public authority must, within seven days after the issue of writs for a general election, furnish to the Under-Treasurer such information as the Under-Treasurer may require by notice in writing published or distributed by the Under-Treasurer in such manner as the Under-Treasurer thinks fit.

Amendment of s. 43—Regulations

7. Section 43 of the principal Act is amended by striking out from subsection (2)(b) "$1 000" and substituting "$10 000".