Chapter 2

Transparency of government debt and expenditure

2.1        This chapter examines how information related to government debt and expenditure is currently available to taxpayers, and the views on improving awareness and access to this type of information.

Information released during the Budget process

2.2        Figures associated with proposed government expenditure, and headline figures relating to the government's fiscal position, are widely reported in the media after the Budget is announced in May each year.

2.3        The documents associated with the Budget are also published online by the government, with the current practice being that they are published on a dedicated website (www.budget.gov.au). Links to alternative versions of this website, or mirrors, are also prominently published on other relevant government websites, particularly at Budget time.

2.4        Updated figures related to government expenditure by function and net debt are published in the Mid-year Economic and Fiscal Outlook (MYEFO) each year. In recent years this has been published in November.

2.5        The government's current approach to providing this information to the public was discussed when officials from Treasury gave evidence to the committee:

Senator PRATT—How do the government and the agencies currently provide publicly available information about expenditure? What might the tax office and the Treasury be doing to improve that?

Mr Parker—As I have said, there is a range of information published at almost any level of detail you could wish for about expenditure, including the portfolio budget statements of each portfolio. In terms of accessibility and digestibility, the so-called budget overview, the glossy, is now part of the lexicon. Most people will go to that before any other document. That provides a summary. In line with the general move into the electronic medium, all of that information is available online from Treasury and other websites.

Senator PRATT—As simple as you might like it, or to drill down—there are quite good pie charts that are pretty good representations, and then you can drill right down into as much complexity as you could possibly bear.

Mr Parker—Yes. It is all online, including the monthly Department of Finance financial flow statements.[1]

2.6        However, the officials from Treasury acknowledged that it is likely that this information is accessed by very few taxpayers:

CHAIR—I have one follow-up question to that. Do you have any understanding or estimate of what percentage of Australian taxpayers would actually access that information?

Mr Parker—I expect it would be a small number.

CHAIR—Probably a small proportion of one per cent of taxpayers, I would venture to suggest.

Mr Parker—Possibly.[2]

2.7        The evidence given by the officials from Treasury also indicated that, although information providing an overview of government expenditure is available in a simple format, it may still be difficult to find easily:

We publish probably the most digestible and high-level cut at that every year in the ‘budget glossy’, so called. It is at page 38, I think—a couple of pie charts of revenue and expenditure.[3]

2.8        For the 2010–11 Budget, while information on net debt is discussed in the Budget Overview document in terms of GDP, a dollar figure is not given. The dollar figure is first reported in Budget Paper No. 1 on page 22 of Statement 3.

2.9        While this inquiry received relatively little interest from taxpayer associations or individuals involved in taxation issues, all of the evidence received by the committee acknowledged that taxpayers should be able to see how their tax payments are spent. Mr David Parker, the then Executive Director of the Revenue Group at Treasury, noted that the general principle 'goes to the issue of democracy and consent, I think, to be governed'.[4] In his submission to the committee, Professor John Quiggin of the University of Queensland stated that '[t]he general idea of informing members of the public how their tax dollars are spent is a good one', although in order for tax assessments to remain as simple as possible he suggested a website may be a better means of achieving this.[5] This proposal is discussed in more detail in Chapter 5.

Committee view

The committee acknowledges the efforts undertaken by Treasury to ensure the public can access information related to government expenditure and debt. However, the committee considers that certain measures, such as a tax receipt, could significantly improve taxpayers' ability to access this information, resulting in increased understanding of government functions and further transparency of government expenditure and debt.

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