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Chapter 16 - Committees
Estimates committees
Estimates committees no longer exist
as a separate category of committee, but the estimates scrutiny functions they
performed are carried out by the legislative and general purpose standing
committees. When performing those functions the committees are still commonly
referred to as estimates committees. Like legislative and general purpose
standing committees, estimates committees came into existence on 11 June 1970 as part of the
modern committee system in the Senate. The estimates scrutiny role of the
committees is provided by standing order 26, under which the
old estimates committees used to be established.
Estimates scrutiny
is an important part of the Senate’s calendar and a key element of the
Senate’s role as a check on government. The estimates process provides the major
opportunity for the Senate to assess the performance of the public service and
its administration of government policy and programs. It has evolved from early
efforts by senators to elicit basic information about government expenditure to
inform their decisions about appropriation bills, to a wide-ranging examination
of expenditure with an increasing focus on performance. Its effect is
cumulative, in that an individual question may not have any significant impact,
but the sum of questions and the process as a whole, as it has developed, help
to keep executive government accountable and place a great deal of information
on the public record on which judgments may be based.
Procedures
currently applying to the consideration of estimates are as follows. Twice each
year, particulars of proposed expenditure and tax expenditure statements are
referred to the committees. The particulars are derived from the two sets of
appropriation bills normally introduced twice each year. Portfolio Budget
Statements, tabled in May, and Portfolio Additional Estimates Statements,
tabled in February, assist the committees in their examination of the
particulars. Statements of expenditure from the Advance to the Minister for
Finance are also referred to the committees. For the consideration of
additional estimates in February, committees also have access to other budget
statements tabled with the particulars. Annual reports of agencies,
required to be tabled by 31 October, are also available for consideration
in the context of an agency’s performance over the previous financial year.
Committees hold initial hearings at which the responsible minister, or
representative, and officers appear to answer questions on their respective
programs. (For membership arrangements, see below.) Although the Senate
permitted parliamentary
secretaries to appear before estimates committees in the past, an increase in
the number of ministers in the Senate following the 1993 election led the
Senate to agree to an order ending this practice (sessional order 6/5/1993,
J.100; permanent order 11/11/1998, J.54). This prohibition was subsequently
relaxed to allow parliamentary secretaries to represent ministers other than
Senate ministers in relation to the latter’s own responsibilities (6/2/2001, J.3860). Although
it is desirable that a minister be present at the
hearings, it is not required by standing orders.
Days are set aside for examination of the estimates and on such days
the Senate usually does not sit (in earlier years it adjourned early) to enable
the committees to meet. On occasions committees considering estimates have been
authorised to meet while the Senate was sitting (29/5/1973, J.208; 23/3/1994, J.1474). When the
Senate was “recalled” under standing order 55 on 3 November 2005, scheduled
estimates hearings were authorised to proceed (3/11/2005, J.1300-1).
The committees are free to set additional times for estimates hearings
if they so choose. Any such additional hearings would have to occur before the
time set by the Senate for the committees to report. As there is no requirement
for the committees to report after the supplementary hearings (see below) such
additional hearings could be held at any time up to the next round of regular
hearings. Thus, in the supplementary hearings in early November 2006, the
Economics Committee decided to hold an additional hearing later in November.
Committees have been directed by the Senate to hold supplementary
hearings on estimates (č7/2/1995, J.2895-7; 4/11/1996, J.836; 10/4/2000, J.2582-3, 2585; 28/6/2000, J.2958; 28/11/2000, J.3594-5; 12/3/2002, J.154-6; 25/11/2003, J.2709-10; 16/6/2004,
J.3473).(See Supplement)
The committees have
power to call for persons and documents and may also move from place to place,
although no committee considering estimates has yet done so.
Estimates hearings
are required to be in public and the committees when considering estimates are
not empowered to receive confidential material in the absence of a specific
resolution of the Senate to that effect. All such material received by a
committee is automatically published. (See also below, under Power to take
evidence in private.) Although the Senate in 1981 agreed to consider whether
estimates committees should be able to take evidence in camera (11/3/1981,
J.142-3; 28/4/1981, J.214), the Procedure Committee has on several occasions recommended
against such a change, and the Senate has accepted those recommendations
(Standing Orders Committee, report of March 1980, PP 50/1980, p. 3; Procedure Committee, 1st report
of 1995, PP 171/1995, pp 4-5; 2nd report of 1997, PP 460/1997, p.
1).
Similarly, because estimates hearings are required by standing order 26 to proceed by way
of calling on items of proposed expenditure and seeking explanations from
ministers and officers, the committees are not empowered, in the course of
estimates inquiries, to adopt inquiry techniques which are available to them in
their other activities, such as showing
video recordings or undertaking on-site inspections.
No more than four committees may meet in public simultaneously. This
provision is intended reasonably to accommodate the interests of senators in
the estimates of several departments.
At each hearing, the committee chair calls on the items of proposed
expenditure, usually by reference to the programs and subprograms for which
funding is described in the Portfolio Budget Statements or Portfolio Additional
Estimates Statements. The estimates are then open for examination (SO 26(4)). Committees
may also consider the annual reports of departments and
budget-funded agencies in conjunction with their consideration of estimates.
Most questions are
answered at the hearings, but witnesses may also choose to take questions on
notice and provide written responses after the hearing. Members and
participating members may also place questions on notice. Such questions are
lodged with the secretaries of the committees, and are distributed to members
of the committees and to relevant departments (SO 26(14)). As any senator may participate in estimates
proceedings, any senator may place questions on notice. Once questions are
lodged they are in the possession of the committees and cannot be withdrawn by
the senators who lodged them. There
is limited time for estimates questions on notice to be lodged, and the
withdrawal of questions after they are lodged could deprive other senators of
the right to have the questions answered.
Questions may be
lodged only while there are estimates proceedings in process, that is, from the
time of the reference of the main or additional estimates to the committees to
the time when the committees report, or, in the case of the supplementary
hearings on the main estimates (see below), from the expiration of the deadline
for the notification of matters to the time when the committees conclude their
hearings or report if they present reports. Questions lodged during the
supplementary hearings must relate to matters notified for consideration in
those hearings.
A senator, on any day after question time in the Senate, may seek an
explanation of, and initiate a debate on, any failure to answer an estimates
question on notice within 30 days after the deadline set by the committee for
answering such questions (SO 74(5), as amended on 9 November 2005).
In November 2004 the Senate adopted a special procedure whereby
questions on notice were substituted for supplementary estimates hearings (18/11/2004, J.78).
The committees when
considering estimates are authorised to ask for explanations from ministers in the
Senate, or officers, relating to the items of proposed expenditure. Usually the
committees leave it to the minister to determine which witnesses attend,
although they have the power to call particular witnesses if they so choose. On
many occasions in the past, however, ministers have cooperated with committees
in agreeing to the attendance of particular witnesses.
Although the reference in standing order
26(5) to ministers or officers might be taken to limit estimates hearings to public
bodies and office-holders, non‑government bodies in receipt of public
funds have appeared by agreement to answer questions.
The only substantive rule of the Senate
relating to the scope of questions is that questions must be relevant to the
matters referred to the committees, namely the estimates of expenditure. Any
questions going to the operations or financial positions of departments or
agencies are relevant questions. The Senate on 22 November 1999
endorsed the views of the Procedure
Committee on the relevance
of questions at estimates hearings. This followed earlier disputes between
committee members and ministers about relevance of questions. The Procedure Committee adopted advices provided to those
members by the Clerk of the Senate (22/11/1999, J.2008-9; supplementary estimates report of the Rural and
Regional Affairs and Transport Legislation Committee, 30/6/1999,
PP 154/1999; for further developments in this case, see 6/4/2000,
J.2567; 13/4/2000, J.2637-9; 19/6/2000,
J.2802). As the estimates represent departments’ and agencies’ claims on the
Commonwealth for funds, any questions going to the operations or financial
positions of the departments and agencies which shape those claims are
relevant. Annual reports are statements to Parliament of the manner in which
departments use the resources made available to them, and therefore references
to annual reports are relevant. When the budget cycle was changed so that the main
estimates were presented in May instead of August, this necessarily involved
the most relevant annual reports not being available at the time of the main
estimates hearings but becoming available at the time of the additional
estimates hearings. It was therefore accepted that annual reports would be
referred to during the additional estimates hearings. In effect, annual reports
disclose the financial positions of departments and their activities leading to
their financial positions at the very time when departments are seeking
additional funds as a result of their financial positions.
An important factor is the availability of audit reports
and the participation of officers of the Australian National
Audit Office (ANAO) in committees’ examination of programs which have been
subject to efficiency and project audits by ANAO. Guidelines for provision of
assistance by the Auditor-General to committees considering estimates were
drawn up in 1986 following a meeting between the Auditor-General and the
President and chairs of the former estimates committees. The Auditor-General
produces regular reports on departments and their financial statements, on
individual efficiency and project audits, and special audits. The chief
assistance provided by the Auditor-General is by way of briefings for
committees on reports, and throughout the estimates process if required.
Although ANAO staff do not attend estimates hearings as a matter of course, it
is open to committees to invite the Auditor-General to provide comment, or
nominate ANAO officers to provide comment, on matters relevant to audit reports
raised during committee hearings. On three occasions, this assistance has taken
the form of ANAO officers appearing as witnesses before committees considering
estimates, to provide comment on audits conducted within the relevant program.
During its consideration of the 1993 Budget estimates, Estimates Committee A
invited ANAO officers to give evidence on two separate organisations, the
Australian Quarantine and Inspection Service and the Aboriginal and Torres
Strait Islander Commission, both of which had been subject to recent audits. In
its report to the Senate, tabled on 7 October 1993, the committee
commented that the provision of public evidence by ANAO officers had been
helpful to the consideration of the proposed estimates. On another occasion, in
1989, ANAO officers gave evidence to Estimates Committee E on audits conducted
on the Aboriginal Development Commission and Department of Aboriginal Affairs
(Estimates Committees Debates, 3/5/1989, pp E201-20).
After initial hearings have been completed, the committees present
reports to the Senate. They are also required to set a date for receipt of
answers to questions taken on notice prior to and at the hearings. In relation
to the annual estimates, but not the additional estimates, the committees are
required to set a date or dates for supplementary hearings to consider answers
to questions on notice or any other matters relating to the proposed
expenditure of which members and participating members have given notice that
they wish to pursue. The date set for the commencement of supplementary
meetings must not be less than 10 days after the date set for receipt of
answers to questions taken on notice. In practice in recent years, the Senate
has set the dates for supplementary hearings. Senators must give notice of
matters they wish to pursue not less than three working days before the date
for commencement of the supplementary meetings. (For a resolution
of the Senate criticising delay in answering questions on notice, see
29/4/1999, J.809.)
Matters considered at supplementary hearings are confined to those
matters of which notice has been given. Committees may present further reports
to the Senate containing recommendations for further action by the Senate,
although they are not required to do so. There is no limit to the number of
supplementary hearings a committee may hold, but after the time for giving
notice of matters to be raised at supplementary meetings has expired, there is
no further opportunity to give notice of additional matters. In a report on its
supplementary meetings in November 1993, Estimates Committee F recommended that
the Procedure
Committee examine a system for giving notice of matters in respect of a
particular portfolio not less than three days before the commencement of
supplementary hearings on that portfolio. The recommendation was adopted by the
Senate after it had been moved as a second reading amendment to the
appropriation bills by the chair of Estimates Committee F (18/11/1993, J.821). The Procedure
Committee declined to recommend a change to the procedures on the grounds that
the existing arrangements offered clarity and simplicity and the proposed
change would make programming of supplementary meetings more difficult (3rd
Report of 1993, PP 450/1993, p. 4).
In 2001, on the
recommendation of the Procedure Committee, supplementary hearings were confined
to the annual appropriation bills, and abolished in respect of the additional
appropriation bills. The rationale of this change was that, as the budget cycle
had developed, the supplementary hearings for the additional appropriation
bills were occurring very near to the main round of the annual appropriation
hearings, when unlimited questioning of departments and agencies is possible.
Procedures
applying to Senate committees generally apply to estimates hearings in so far
as those procedures are consistent with standing order 26. For example, the
procedures for the protection of witnesses in Senate Privilege Resolution
No. 1 (see Chapter 17, Witnesses, under Protection of witnesses) apply to
estimates hearings, but as standing order 26 requires that estimates hearings
be held in public, the provisions in those procedures relating to taking
evidence in camera cannot apply to estimates hearings. (See Supplement)
It is not necessary
for the committees to have completed their supplementary hearings before debate on
the appropriation bills resumes, or, indeed, before the bills are passed.
Normally, however, the hearings are completed before the bills proceed.
Supporting
documentation provided by departments is significant to the estimates scrutiny
process, and has evolved with the process. From the early 1970s, departments
provided explanatory notes to the committees examining estimates. These notes
were rudimentary at first and were provided informally to members of estimates
committees. As a result of pressure from committees the documents were formally
tabled in the Senate from 1976. The introduction of program budgeting in the
public sector in the 1980s saw the documents transformed from explanatory notes
to program performance statements which provided explanations according to the
new program structure and which were also promoted by the Department of Finance
as an accountability tool, used for improving program management and
evaluation, as well as for providing information to the Senate. Documentation
underwent a further change in 1994, when the movement of the Budget from August
to May meant that documentation provided for Budget estimates (Portfolio Budget
Statements) could not provide the extent of performance information that the
Senate was used to. Performance information is now found in annual reports of agencies, required to be
tabled by 31 October each year, and which may be examined by the committees
when considering estimates. The move to
output-based accrual budgeting reinforced the requirement for detailed
explanatory material on departmental activities. The committees considering
estimates have thus encouraged improvements in the quality, nature and
transparency of information presented to Parliament. (See also below, under
Referral of Matters to committees – estimates.)
For the history of changes to the estimates scrutiny process, see
Chapter 13, Financial Legislation, under History of expenditure scrutiny.
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