Philip Hamilton
Last year’s Budget introduced the Government’s Smaller
Government agenda, which was characterised as a three-stage process for
reducing the size of government through closures, mergers and consolidations of
functions of government organisations. The first stage comprised
the Machinery of Government changes following the 2013 election, and
initiatives in the Mid-Year Economic and Fiscal Outlook (MYEFO) 2013–14
statement, with measures such as the amalgamation of AusAID and the
Department of Foreign Affairs and Trade. The second stage was the 2014‒15
Budget, and the third was the MYEFO statement of December 2014.[1]
With the fourth round of the agenda in the 2015‒16 Budget, Smaller
Government appears to have become an ongoing ‘business as usual’ function,
expanded to include a number of other efficiency-related objectives in addition
to reducing the size of government.
For example, the Government has commenced
Functional and Efficiency Reviews to determine whether the functions of
departments and large agencies are aligned with the Government’s policy priorities,
and whether they are working as efficiently as possible. Two such reviews have
examined the departments of Health and Education and Training. The Government
estimates that, including savings from the Health and Education reviews and
further efficiencies in the Attorney-General’s Department and the Department of
Immigration and Border Protection, Smaller Government announcements in the 2015‒16
Budget will deliver $497 million in savings, and will take total savings from
the Government’s Smaller Government agenda to $1.4 billion.[2]
In 2015–16, Functional and Efficiency Reviews will be undertaken of the
departments of Agriculture, the Environment, Foreign Affairs and Trade,
Treasury, Attorney-General’s and Social Services, as well as the Australian
Taxation Office and the Australian Bureau of Statistics.[3]
A fifth stage of Smaller Government measures has been
foreshadowed for the MYEFO statement due around December 2015.[4]
Reducing the size of government
In the 2015‒16 Budget the Government announced a
further reduction in the number of government bodies by 35, which brings
planned reductions to 286 since the 2013 election.[5]
In general, the current round of changes can be characterised as ‘mergers and
transfers’ (where bodies will be consolidated, or where functions will be
performed by another body), and ‘abolitions’ (where a body will cease). In some
cases, for example the Defence Materiel Organisation (DMO) and the Bureau of
Resource and Energy Economics, both a transfer of function and an abolition are
involved.
Mergers and transfers
Mergers and transfers of function have occurred, or will
occur, in the following portfolios:
-
in Defence, the core functions and funding of the DMO will be
transferred to the Department of Defence.
-
in Immigration, the Australian Customs and Border Protection
Service and the Department of Immigration and Border Protection (DIBP) will be
consolidated into a single department; the Office of the Migration Agents
Registration Authority function will be consolidated into DIBP; and the Office
of the Migration Agents Registration Authority Advisory Board will be replaced by
a non-remunerated independent reference group.
-
in Industry and Science, the functions of the Bureau of Resource
and Energy Economics are now being performed by the Department of Industry and
Science (DIS); the CSIRO Marine National Facility Steering Committee will
become a subcommittee under the CSIRO Board; the function of the CSIRO
Environment Strategic Advisory Committee has been reallocated by CSIRO; IIF
Investments Pty Ltd and its assets have been transferred to DIS; and the functions
of the Consumer Advocacy Panel have been transferred to Energy Consumers
Australia (established by the South Australian Government on behalf of the
Council of Australian Governments’ Energy Council).
-
in Education and Training, the Office for Learning and Teaching
Strategic Advisory Committee will be replaced with a program to be administered
by the university sector.
-
in Agriculture, the Freshwater Invertebrate Pests Subcommittee
will merge with the Invasive Plants and Animals Committee.[6]
Abolitions
The table below lists, by portfolio, bodies to be abolished.
Any residual functions will be managed or performed by a relevant body that is
not being abolished, such as the portfolio department.
Table: Bodies to be abolished, by portfolio
* Bodies marked with an asterisk have already ceased.
|
Agriculture
Aquaculture
Committee
Community
Consultative Committee
Industry
Liaison Committee
National
Decision Making and Investment Working Group
Statutory
Fishing Rights Allocation Review Panel
SCAHLS
Point-of-Care Tests Working Group*
Sub-committee
on National Forest Health*
Attorney General’s
Administrative
Review Council
Communications
ABC Splash
Strategic Advisory Group
Defence
Defence
Materiel Organisation
Education and Training
Aboriginal and
Torres Strait Islander Higher Education Advisory Council
ANU Section 68
Pty Ltd*
Data and
Performance Measurement Principal Committee
National
Partnerships Implementation Working Group*
Office for
Learning and Teaching Strategic Advisory Committee*
Online
Assessment Committee*
Teacher
Education Ministerial Advisory Group*
Workforce
Development, Supply and Demand Principal Committee
|
Environment
Emissions Reduction Fund Expert Reference Group*
River Murray Water Committee*
Water Act Review Expert Panel
Finance
Albury-Wodonga Development Corporation Hume Garden Estate
joint venture*
Health
National Lead Clinicians Group
Industry and Science
Bureau of Resource and Energy Economics*
Consumer Advocacy Panel*
CSIRO Environment Strategic Advisory Committee
IIF investments Pty Ltd*
Prime Minister and Cabinet
Indigenous Investment Trust
Indigenous Property Trust
Scarborough House Investment Trust
Scarborough House Office Trust
National Indigenous Participation Trust
National Indigenous Property
|
Source: compiled by the
Parliamentary Library from Australian
Government, Budget measures: budget paper no. 2: 2015–16 and M
Cormann (Minister for Finance), Smaller government—transforming the public sector, media release, 11 May 2015.
Scoping studies into government
business ownership options
In addition to merging and abolishing agencies, the
Government has commissioned scoping studies into future ownership options for a
number of government businesses.[7]
Following previously-announced scoping studies, the Government
will retain ownership of the Royal Australian Mint in its current form, but will
consult further before making a decision on Australian Hearing. Defence Housing
Australia (DHA) will not be sold ‘at this time’, but DHA’s accounting, IT and
business reporting systems will be reviewed to improve the transparency of the
cost of providing services.[8] A competitive tender
process will be undertaken to test private sector capacity to upgrade and
operating the registry services of the Australian Securities and Investments
Commission.[9] However, the Government
will maintain ownership of the base data.[10]
In 2015‒16, scoping studies will make recommendations on
the future ownership of the Intra-Government Communications Network (ICON) and
the Australian Rail Track Corporation Ltd.[11]
Property portfolio and lease
holdings
Observing that there are significant maintenance and
opportunity costs associated with continued ownership of surplus properties, the
Government will progress divestment ‘where appropriate’.[12]
Following a scoping study, the Government will retain
ownership of the John Gorton Building and the Treasury Building ‘at this time.’[13]
However, investor interest will be sought in four other properties in Canberra’s
Parliamentary Triangle: East Block (currently tenanted) and West Block
(recently vacated), both near Old Parliament House; and, across Lake Burley
Griffin, Anzac Park East (vacant for decades) and Anzac Park West (currently
tenanted).[14] All four of these
properties, together with a separate Anzac Park West cafeteria building, are on
the Commonwealth Heritage List.[15] The Department of
Finance will be provided with $4.8 million over two years from 2015‒16 to
implement these measures.[16]
Following last year’s Budget measure to establish the Australian
Emergency Management Institute as a virtual institute, Finance will be provided
with $0.5 million over two years from 2015‒16 for the divestment of the
Institute’s property at Mount Macedon. For commercial confidentiality reasons, the
Budget papers do not include the overall financial impact of selling the Canberra
and Mount Macedon properties.[17] The Government will also
dispose of up to 23 properties across regional Western Australia, Queensland,
South Australia and the Northern Territory that are surplus to the service
delivery requirements of the Department of the Prime Minister and Cabinet
(PM&C). In this case, the Budget papers anticipate a return of $10 million
over four years from 2015–16.[18]
In addition to divestment, large vacant legacy leases, which
have previously been regarded as problems for individual agencies, will be
handled through a whole-of-government approach that is estimated to save up to
$200 million over 10 years. Priority will be given to reducing surplus
office space in the ACT by tenanting with agencies that have similar
requirements and upcoming lease expiry dates.[19] Pre-Budget media
coverage noted concerns that a large and long-term Belconnen tenant, the
Department of Immigration and Border Protection, would move to another part of
Canberra as part of its merger with the Australian Customs and Border
Protection Service.[20] Just before the Budget
the Minister for Finance stated that the ‘long-term accommodation needs of the
Department of Immigration and Border Protection and local impacts will be
considered’.[21]
Streamlined and targeted program
delivery
The Government is also focussed on ‘eliminating wasteful fragmentation
in service delivery and removing unnecessary complexity in rules.’[22]
The 2015–16 Budget states that the skilled migration and temporary activity
visa program will be simplified by consolidating the number of visa categories.[23]
Examples of measures undertaken prior to the 2015–16 Budget include, in the
Social Services portfolio, the consolidation of 18 grants programs into
seven and, under the Indigenous Advancement Strategy (IAS), the reorganisation
of over 150 programs into five broad program categories.[24]
In addition, grants administration in the Department of Health has been consolidated
into a single division.[25] In a related measure, funding
of $106.8 million over four years has been allocated to the Digital
Transformation Office to establish streamlined grants administration processes.[26]
[1].
M Cormann (Minister for Finance), Smaller
and more rational government 2014–15, Ministerial paper, May 2014, p.
2.
[2].
Australian Government, Agency resourcing: budget paper no. 4: 2015–16, p. 2.
[3].
Ibid.
[4].
M Cormann (Minister for Finance), Smaller
government—transforming the public sector, media release, 11 May 2015.
[5].
Agency resourcing: budget paper no. 4: 2015–16, op. cit., p. 2. Not all of the previously
announced abolitions have been fully implemented. For example, the Government has
decided not to proceed with the abolition of the National
Security Legislation Monitor, and bills to abolish the Clean
Energy Finance Corporation, the Office
of the Australian Information Commissioner, the Australian
Charities and Not-for-profits Commission and the Australian
Renewable Energy Agency are currently under consideration by Parliament.
[6].
Australian Government, Budget measures: budget paper no. 2: 2015–16, pp. 56–57, 74, 79, 125, 127, 130–31.
[7].
Agency resourcing: budget paper no. 4: 2015–16, op. cit., p. 4.
[8].
M Cormann (Minister for Finance), Smaller government – transforming
the public sector, op. cit.
[9].
Budget measures: budget paper no. 2: 2015–16, op. cit., p. 93.
[10].
M Cormann (Minister for Finance), Smaller government – transforming
the public sector, op. cit.
[11].
Ibid. ICON is a secure network connecting 97 government agencies in
Canberra. The network is 882 km long, comprising approximately 160,000 km of
fibre optic cables. ICON is provided by the Department of Finance on a
cost-recovery basis, reportedly at ‘about a tenth of the cost of commercial
cable.’ Senate Finance and Public Administration Legislation Committee, Official
committee Hansard, 24 February 2015, p. 97.
[12].
Agency resourcing: budget paper no. 4: 2015–16, op. cit., p. 4.
[13].
M Cormann (Minister for Finance) and M McCormack (Parliamentary Secretary
to the Minister for Finance), Getting best value from Commonwealth properties, media release,
11 May 2015.
[14].
Ibid.; Budget measures: budget paper no. 2: 2015–16,
op. cit., p. 10.
[15].
Department of Finance (DoF), ‘Heritage
Register’, DoF website.
[16].
Budget measures: budget paper no. 2: 2015–16, op. cit., p. 10; M
Cormann (Minister for Finance) and M McCormack (Parliamentary Secretary to the
Minister for Finance), Getting best value from Commonwealth
properties, op. cit.
[17].
Budget measures: budget paper no. 2: 2015–16, op.
cit., pp. 10–11.
[18].
Ibid., p. 200. The PM&C sales appear as Capital
measures, whereas the Canberra and Mt Macedon sales on pp. 10–11 are Revenue
measures—the reason for this apparent inconsistency is not clear from the
Budget papers.
[19].
Agency resourcing: budget paper no. 4: 2015–16, op. cit., p. 4.
[20].
P Thomson, ‘Belconnen impact study before Immigration HQ decision welcomed,’
Canberra Times, 12 May 2015, p. 4; Editorial, ‘Consult ACT over offices,’ Canberra Times, 11 May
2015, p. 2.
[21].
M Cormann (Minister for Finance) and M McCormack (Parliamentary Secretary
to the Minister for Finance), Getting best value from
Commonwealth properties, op. cit.
[22].
Agency resourcing: budget paper no. 4: 2015–16, op.
cit., p. 5.
[23].
Ibid.; Budget
measures: budget paper no. 2: 2015–16, op. cit., p.
126.
[24].
Agency resourcing: budget paper no. 4: 2015–16, op.
cit., p. 5. The Senate’s Finance
and Public Administration Committee is currently inquiring into the
implementation of the IAS.
[25].
Agency resourcing: budget paper no. 4: 2015–16, op.
cit., p. 5.
[26].
Budget
measures: budget paper no. 2: 2015–16, op. cit., p.
68; see also Interim Digital Transformation Office (DTO), ‘Better grants administration’, DTO website.
All online articles accessed May 2015.
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