Andrew Murray (WA, Australian Democrats) Share this | Hansard source

I rise to speak on the Appropriation Bill (No. 3) 2005-2006 and the Appropriation Bill (No. 4) 2005-2006, which I shall discuss concurrently. The Appropriation Bill (No.3) appropriates sums additional to those sought through the Appropriation Act (No. 1) 2005-2006 for the ordinary services of the government. Similarly, the Appropriation Bill (No. 4) appropriates sums additional to those sought through the Appropriation Act (No. 2) 2005-2006 to fund unbudgeted administered expenses and non-operating costs.

The additional amounts to be appropriated are valued at approximately $2.6 billion, with this amount split more or less equally between both bills. In isolation, $2.6 billion sounds like a large sum of money to be appropriated but, with respect to the funds appropriated through the government budget for each portfolio represented in these two bills, the additional appropriations only represent less than five per cent in additional funding requirements. Moreover, the money bills in totality—that is, all annual appropriation bills—as a category only represent as a rough rule approximately 20 per cent to 25 per cent of annual Commonwealth spending. Thus, to extend my funding analogy, the $2.6 billion that we are discussing here today represents a tick over one per cent of the total funding needs for this government for the 2005-06 fiscal year.

Now that we have some perspective on these additional appropriations, there are a couple of points that I wish to make which repeat some of the points I have made before but which I think are necessary to emphasise on a regular basis. Firstly, we are here today under the guise of good governance to approve an extension of budgetary spending by the government. That is very proper. However, these two bills only offer a semblance of that good governance because, as I have already remarked, between 75 per cent and 80 per cent of government funding, which is the critical mass, bypasses parliamentary approval and oversight as it is channelled via standing appropriations in the various bills that have gone through the parliament over time. Standing appropriations mean that the funding is permanently enshrined for the period designated in the various acts.

This government’s use of standing appropriations is not unique—it follows a long trend of other governments. And that use of standing appropriations, in preference to annual appropriations via parliamentary money bills, is overall the antithesis of good governance principles—although I must stress that there are occasions when the case for a standing appropriation is validly made. One such seems to have been the recent aged care bills where the case was put that the nature of the call upon bonds in aged care required a particular form of standing appropriation to insure that the response could be prompt and to the point.

In general, there is no administrative or other merit in seeking to exempt the use of public funds from regular parliamentary scrutiny and approval. Yet standing appropriations have this very consequence and they have, to this date, continued to grow unchecked in Australia and are at a far greater extent, it seems, than in other like jurisdictions. Fortunately, the parliament is growing more alert to this danger and there is greater reporting of the matter and reaction to these occurrences. The numbers of special appropriations and special accounts and the amounts of expenditure involved have steadily grown over the 100 years of the life of the Commonwealth. Sometimes we find ourselves in the ridiculous situation of participating in a parliament where its historical prime power, which is the power to deny a government its funds, is actually completely emasculated or hamstrung.

The due process of parliament approving additional government expenditure is a significant and important occasion, but today we are reviewing just one per cent of annual government funding. As one per cent, of course, it is not significant; as $2.6 billion it is extremely significant. So there you get the alternative views.

Other countries, some of our close peers, acknowledge and understand the undermining effect of standing appropriations. In the United Kingdom, for example, standing appropriations are reported to amount to only one-third, as a percentage, of that experienced here in Australia. So the government of the day is still largely accountable to the parliament in the United Kingdom for its annual budget.

More concerning still, in a report on the financial management of special, standing, appropriations in November 2004, the Australian National Audit Office found widespread illegalities and lack of accountability and control in the management of these appropriations. These were largely described as technical offences by many people. There is no evidence, and hopefully none will ever emerge, of corruption or fraud, but there is certainly evidence of mismanagement and bad process. More than half of those appropriations were not properly reported by departments and agencies in their annual financial statements, according to the Audit Office. From my interactions with the Department of Finance and Administration I know that DOFA were not at all pleased about that matter.

As I have already stated, these two bills seek to appropriate an additional $2.6 billion in funding. Items of note include: $104 million for business assistance for the fishing structural adjustment package to support the sustainability of Australian government managed fisheries; $110.7 million for the workplace relations reform package—there will be lots more coming there, I am sure; and $111.8 million for the Department of Defence to fund operations in Afghanistan. I should say in passing that I think it is very important Australia continues to commit itself to Afghanistan and to helping that country recover from its past. There is also $304.3 million to support primary producers eligible for exceptional circumstances assistance, and $346.3 million in GST compensation payments to the states and territories—for which they can thank the coalition and the Democrats for passing that secure and growing funding source.

I hope that the increasing attention the parliament is giving to matters of standing appropriations, and concern that appropriations should revert to an annually supported basis, will give the government pause in this area. We hope that they do not continue to try and advance standing appropriations above the percentage that presently applies of between 75 and 80 per cent. In fact I hope it falls back somewhat, because of the dangers when funding is not subject to the kind of scrutiny that an opposition can provide, supported by the cross-benches when they are able to do so. A government that is not accountable to its people will not be able to claim to govern with a mandate, and a government that governs without a mandate will be nothing but a parliamentary dictatorship which is sourced by funds pre-established under other guises.

In closing, I must say that we do support these appropriation bills. The Democrats have no reason to question these allocations and we have long held the belief that funding for the ordinary services of government should not be blocked, although obviously we have regularly in the past opposed new measures for new appropriations. Therefore, these bills should pass.