WARNING:
This Digest is prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments.
This Digest was available from 12 September 1996.
CONTENTS
Appropriation (Parliamentary Departments) Bill
1996-97
Date Introduced: 20 August 1996
House: House of Representatives
Portfolio: Finance
Commencement: Royal Assent
To appropriate $137.2 million for the recurrent and capital
expenditure of the five Parliamentary Departments for 1996-97.
(1)
The appropriation represents less than 50% of total outlays for
all services provided to Members and Senators. The figure for total
outlays for 1996-97 (excluding superannuation benefits for Members
and Senators) is estimated at $343.6 million.(2)
(a) Glossary of Terms
Appropriation - is the setting apart, assigning or
applying to a particular use or to a particular person a sum of
money. In the budget context an appropriation usually refers to an
authorisation by Parliament to draw on funds from the Consolidated
Revenue Fund (CRF).
Budget Outlays - refer to the net cost to the taxpayer
of providing government services. Appropriations/payments out of
the CRF are adjusted to take account (for example) of many
government receipts. Hence a hypothetical government program 'XYZ'
may have a total appropriation of $600 million but this may only
represent budget outlays of $500 million if the 'XYZ' receives
income of $100 million from other (non budget) sources.
Running costs - are the full current and minor capital
costs incurred by a department or agency in providing government
services for which the department or agency is responsible. For
many departments, staff salaries will represent the largest
proportion of such costs.
(b) Overview
Since 1982, the appropriations for the Parliamentary Departments
have been effected by a separate Bill. This followed the Fraser
Government's consideration of the Report of the Senate Select
Committee (the Select Committee) on Parliamentary Appropriations
and Staffing tabled on 18 August 1981.
Under current arrangements, the executive government maintains
control over the contents of the Bill as introduced. In theory
however, as the Appropriation (Parliamentary Departments) Bill is
not for the ordinary annual services of the government, it may be
amended by the Senate.
The Public Service Act 1922 provides that the
administration of the Parliament is undertaken by five
Parliamentary Departments - the Department of the Senate, the
Department of the House of Representatives, the Joint House
Department, the Department of the Parliamentary Reporting Staff
(DPRS) and the Department of the Parliamentary Library.
The Department of the House of Representatives and the
Department of the Senate are responsible for the provision of
procedural, information and administrative services to Members and
Senators respectively. The Joint House Department performs building
management, maintenance and catering functions associated with
Parliament House. DPRS provides reporting, information technology,
telecommunications and broadcasting services to the Parliament
through Hansard, the Parliamentary Information Systems Office
(PISO) and the Sound and Vision Office (SAVO). The Department of
the Parliamentary Library is responsible for the provision of
library, reference and research services to the Parliament.
Funding across the Parliamentary Departments is to be reduced in
1996-97 by the 2% across the board cut to government agencies, the
1% annual efficiency dividend and a one-off cut of $10 million to
the Parliament.
Excluding provisions for borrowings and various advances(3) to
the Speaker and the President, the sum appropriated for the
Parliamentary Departments falls from $142.7 million in 1995-96 to
$135.3 million for 1996-97. Allowing for inflation, in real terms
this is a cut of approximately 7.5%.
(c) Impact on Departments
House of Representatives
Total outlays rise from $41.6 million in 1995-96 to $41.9
million in 1996-97 and to $43.0 million in 1999-2000. Staffing is
to decline from 263.2 staff years in 1995-96 to 241 staff years in
1996-97.(4)
The Department notes in its 1996-97 Portfolio Budget Statements
that:
The Government's decisions to reduce parliamentary outlays (this
department contributing $0.3 million in 1996-97), to reduce
departmental running costs in 1996-97 by 2% in addition to the 1%
efficiency dividend, and not to provide additional parliamentary
committee funding, have required the department to implement a
number of savings measures to achieve efficiencies and to reduce or
eliminate lower priority activities. In particular, the department
introduced a new staffing structure to support parliamentary
committees, reduced expenditure on parliamentary security functions
whilst maintaining security of the building, and achieved savings
through efficiencies including the printing of documents.
While the department anticipates that it will have the capacity
to operate within the reduced level of funding for 1996/97, the
situation remains extremely tight with little scope to absorb any
additional expenditure requirements. Any similar reductions by the
Government to the department's running costs over the coming years
will place it in a most difficult situation.(5)
Department of the Senate
Total outlays rise from $32.6 million in 1995-96 to an estimated
$34.2 million in the current year but are estimated to fall to
$32.5 million by 1999-2000. Staffing falls from 260 to 257 in the
current financial year.(6)
The Department notes in its 1996-97 Portfolio Budget Statements
that:
The year ahead will require more than the usual careful
financial planning and management. In 1995-96 there were
significant across-the-board permanent cuts in the department's
running costs. In 1996-97 further and greater cuts have been
planned. These will have a significant impact on departmental
funding, committee funding and Senate staff. . . .
Progressively effective from 1 July 1996, the department will
shed 28 positions, having shed 11 positions progressively from 1
July 1995 (including previously vacant positions intentionally left
unfilled for budget reasons). Salary savings equivalent to $855,000
will be made (including some possible provision for voluntary
redundancies). Administrative savings equivalent to over $1m will
be achieved. These will include savings in recruitment, training,
computers, newspapers, printing, microfilming and hospitality. The
cuts will affect all programs and will be evident in reduced
services, abolition of functions and restrictions on external and
temporary recruitment. Services to Senators will be
affected.(7)
Joint House Department
Total outlays are to rise from $38.8 million in 1995-96 to $39.1
million in 1996-97 but are estimated to fall to $35.2 million in
1997-98 and $34.4 million by 1999-2000. Staffing levels are to
decline from 346 staff years to 336 staff years in the current
financial year.(8)
Department of Parliamentary Reporting Staff
Total outlays decline from $40.5 million in 1995-96 to $33.5
million in 1996-97 with a fairly constant budgetary outcome
estimated for the following three financial years. DPRS staffing is
to decline from 283 to 271 staff years in the present financial
year.(9)
The Department notes in its 1996-97 Portfolio Budget Statements
that:
The appropriations for DPRS for 1996-97 have been reduced by
$7.052 million as against the department's 1995/96 funding. The
reductions compromise $1.127 million in running costs as a result
of the Australian Public Service wide reductions ($947,000 in
efficiency dividends and $180,000 whole of government
telecommunications savings) and $5.925 million as DPRS's
contribution to a Parliament-specific further reduction of $10
million from the combined appropriation of the five parliamentary
departments. This latter amount is made up of a $4.675 million
reduction in asset replacement funds and $1.250 million in running
costs.
The department is examining all areas of its operations to
identify ways of absorbing this very substantial reduction (17.4%
of 1995/96 appropriations) while continuing to give priority to
services to Senators and Members.(10)
Department of the Parliamentary Library
Total outlays are to fall from $16.1 million in 1995-96 to $15.3
million in 1996-97 and an estimated $14.4 million in 1999-2000.
Actual staff years are to decline from 214 in 1995-96 to 207 in the
current financial year.(11)
The Department notes in its 1996-97 Portfolio Budget Statements
that:
The Parliamentary Library's running cost base has been reduced
as a consequence of the Government's decision to reduce
departmental running costs across the Australian Public Service by
2%, in addition to the previously scheduled 1% annual reduction by
way of the efficiency dividend. The department's running costs base
has been further reduced by $572,000 as DPL's share of the $10
million parliamentary specific savings imposed by the Government.
The total reduction of $1.036 million in DPL's running costs base
represents a 6.9% cut against the permanent base. Including once
only items, the 1996-97 appropriation is 7.6% less than the
appropriation for 1995-96.
The Parliamentary Library is reviewing all areas of its
operations to manage these reductions whilst giving priority to
maintaining services to Senators and Members.(12)
Clause 4 and Schedule 1 provide that the
Minister for Finance is authorised to appropriate a total of $137
191 000 from the Consolidated Revenue Fund for the purposes listed
in Schedule 3 of the Bill. These funds equate to
the anticipated cost of the services provided by the Parliamentary
Departments in 1996-97.
Clauses 3 and 4 make it plain that the Bill
subsumes funds already appropriated for the provision of
parliamentary services under the Supply (Parliamentary
Departments) Act 1996-97. However, that earlier appropriation
is to be reduced by a sum of $95,000. This measure in effect cuts
funding previously appropriated under the Supply Act for capital
expenditure by DPRS in 1996-97 (clauses 4 and
10).(13)
Part 2 foreshadows certain technical amendments
to the Act contingent on the passage of the Government's proposed
public sector financial management reforms. The necessary
legislation will, amongst other things, replace the Audit Act
1901. The Bills that will give effect to these proposals have
not yet been introduced. The financial management reform package is
likely to be similar to the measures debated but not passed by the
last Parliament.
Remarks
A number of the Portfolio Budget Statements comment on the
implications of proposed and recently implemented budget reductions
for the operations of the Parliament.
The Department of the Senate takes the trouble to observe that
'[t]he workload of the Department of the Senate is determined
almost entirely by the level of activity of the Senate and its
committees.'(14) This remark highlights the difficulty of budget
preparation in the parliamentary environment where the demand for
additional funding and resources frequently is generated by the
vicissitudes of politics.
In relation to staffing, the Department of the Senate notes
that:
There is a view that reducing the number as (sic) people working
in organisations and saving their salaries for non-salary
allocation elsewhere is an inherently good thing for those
organisations. Whatever its applicability elsewhere, such a view
has little application to an organization like the Senate
Department. In essence, the department (and the budget that funds
it) provides senators with the skills, knowledge and expertise of
its officers.(15)
The Department of the House of Representatives Portfolio
Statements draw attention to the comparatively low rates of growth
in its running costs for the Department over the 1990-91 to 1995-96
period when compared with the rise in running costs for rest of the
Australian Public Service between 1987-88 and 1993-94.(16)
These comments may be juxtaposed with what has been a lively
debate about the structure and size of the parliamentary
departments and to the cost of services provided to the parliament
and to individual Members and Senators.
On 20 May 1996, the Hon Stephen Martin introduced the Public
Service (Parliamentary Departments) Amendment Bill 1996 providing
for the amalgamation of the three service departments (Joint House,
DPRS and the Parliamentary Library). The former Speaker observed
that:
In a period of increasing emphasis on micro-economic reform,
when the Public Service is being called upon to increase
efficiency, it is impossible to justify the pinnacle of the
democratic system, the legislature, being served by a system the
origins of which are in the beginning of this century and which has
not kept pace with the demands of modern times. This bill will send
a streamlined structure into the next century.(17)
The cost of servicing the parliament continues to attract a
degree of unfavourable press comment.(18)
The National Commission of Audit Report also remarked on the
provision of services to Senators and Members, suggesting that:
The current arrangements in relation to the parliamentary
departments involve a significant duplication of corporate
functions and are an inefficient way of delivering these support
services to Parliament.(19)
Whilst the methodologies employed by the Audit Commission(20)
and of other commentators may be flawed, such criticisms are less
easily ignored in the present fiscal environment. In facing
increasing pressures to provide value for money, the parliamentary
departments (as opposed to the democratic institution of 'the
parliament') arguably have only a tenuous claim to being treated as
special cases.
Similarly, whether funding cuts to parliamentary appropriations
are justified is not a question which can be addressed in isolation
or by simply comparing existing funding with that provided in
previous years. Such an approach may serve only to divert attention
from the issue of whether the existing means of servicing
parliament, parliamentarians and the electorate are both as
efficient and effective as they might be.
On the other hand, sensible consideration of funding decisions
in most organisations will attempt to accommodate other core
organisational values as well as that of 'efficiency'.
Staff of the parliamentary departments are engaged under the
provisions in the Public Service Act 1922 and the five
departments are subject to the provisions of the Audit Act
1901 and other APS-wide accountability mechanisms. Thus,
despite the existence of a separate Appropriation Bill for the
Parliament, the five departments largely mirror APS managerial and
financial practices. The Appropriations (Parliamentary Departments)
Bill, as presented, also reflects the budget priorities of the
current Government, particularly the expectation that all or most
public sector organisations should bear a portion of the pain in
reducing the underlying Commonwealth budget deficit. As such, any
debate on this Bill may well cover issues of relevance to the
public sector and public finance in the broad.
Of perhaps more immediate interest to Member and Senators, if
the Bill passes without substantial changes, is that there may be
added pressure for a re-structuring of the parliamentary
departments as well as for further changes to the provision of
parliamentary services. Reductions in funding to the parliament of
the relative size projected in the forward estimates for the next
three years may, as some Departments seem to imply, be too large to
absorb merely by a further 'thinning out' of current programs and
services.
- With the exception of one sum of $95 000, the Bill incorporates
funds previously appropriated Supply (Parliamentary
Departments) Act 1996-97.
- Budget Paper No.1, 1996-97: 3-48.
- Monies which may only be called on in unforseen
circumstances.
- Department of the House of Representatives, Portfolio
Budget Statements 1996-97: 6-7.
- ibid: 2.
- Department of the Senate, Portfolio Budget Statements
1996-97: 8-9.
- ibid: 5.
- Refer Joint House Department, Portfolio Budget Statements
1996-97: 5-6. These, however, do not contain the same extended
commentary on appropriations and staffing matters as those prepared
by the other parliamentary departments.
- Department of Parliamentary Reporting Staff, Portfolio
Budget Statements 1996-97: 4.
- ibid: 2.
- Department of the Parliamentary Library, Portfolio Budget
Statements 1996-97: 7-8.
- ibid: 5.
- See Department of Parliamentary Reporting Staff, op cit:
23.
- op cit: 3.
- ibid: 6.
- op cit: 5.
- Parliamentary Debates: 799.
- Alan Ramsay, 'Prime cuts in pampered MPs', Sydney Morning
Herald, 10 July 1996; and 'A failure on two counts',
Sydney Morning Herald, 24 August 1996. Fia Cumming, 'Our
$2.2 million MPs', Sun-Herald, 14 July 1996. 'Pampering
Politicians', Sydney Morning Herald Editorial, 8 July
1996.
- National Commission of Audit, Report to the Commonwealth
Government, June 1996: 110.
- Denis James, 'More of the Same or Brave New World?: The
National Commission of Audit, Current Issues Brief No.23
1995-96, Parliamentary Research Service, 1996: 25-27.
Bob Bennett Ph. 06 277 2430
8 September 1996
Bills Digest Service
Parliamentary Research Service
This Digest does not have any official legal status. Other
sources should be consulted to determine whether the Bill has been
enacted and, if so, whether the subsequent Act reflects further
amendments.
PRS staff are available to discuss the paper's contents
with Senators and Members and their staff but not with members of
the public.
ISSN 1323-9032
© Commonwealth of Australia 1996
Except to the extent of the uses permitted under the
Copyright Act 1968, no part of this publication may be
reproduced or transmitted in any form or by any means, including
information storage and retrieval systems, without the prior
written consent of the Parliamentary Library, other than by Members
of the Australian Parliament in the course of their official
duties.
Published by the Department of the Parliamentary Library,
1996.
This page was prepared by the Parliamentary Library,
Commonwealth of Australia
Last updated: 5 September 1996
Back to top