Re-invigorating the accountability and transparency of the Australian government's expenditure.

Melbourne University Law ReviewVol. 32 Nbr. 3, December 2008

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Re-invigorating the accountability and transparency of the Australian government's expenditure.

[The implementation of the central concepts captured by the final arrangements in ss 81 and 83 of the Australian Constitution has evolved over decades. However, some uncertainty as to their actual content and meaning remains. Significantly, the roles of the High Court of Australia and Parliament have been major forces in the breakdown of Parliament's control of the executive's expenditures, opening the way for the adoption of the current accountability and transparency arrangements. Recent actions by Parliament show that it is re-asserting its control over appropriations. However, this article advocates that the focus should be on expenditure rather than appropriations, taking advantage of the potential accountability and transparency afforded by the recent public administration reforms.]

CONTENTS I Introduction II The Consolidated Revenue Fund III Surplus Revenue IV Appropriations A What Are the Commonwealth's Purposes? B How Precisely Must Those Purposes Be Specified? V Ordinary Annual Services VI Conclusions I INTRODUCTION

The financial transitional arrangements finally adopted in the Australian Constitution provided for the Commonwealth to take over the collection and control of state customs duties and excise, (1) and then for the Commonwealth to impose uniform customs duties within two years of its establishment. (2) In the period before the Commonwealth imposed uniform customs duties, the Commonwealth was required to pay monthly the balance of the states' customs duties less any expenditure. (3) During the five years after uniform customs duties were imposed, or 'until the Parliament otherwise provide[d]', the Commonwealth was to account to the states, (4) and thereafter make payments to the states of the surplus 'on such basis as [Parliament] deems fair'. (5) Central to this delicate compromise was the maintenance of Parliament's authority over the executive's future expenditure, the Constitution providing in part:

81 All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution.


83 No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law.

This article charts the unresolved tension in this compromise between the Constitution's apparent requirements for parliamentary control over the Australian government's (the executive's) expenditure, (6) and the roles of the High Court of Australia and Parliament in asserting Parliament's apparent constitutional paramountcy in these matters. (7) This analysis is timely as the losing parties in Combet v Commonwealth (8) who challenged various aspects of the Australian government's expenditure on constitutional grounds (9) are now Members of the House of Representatives and of the Australian government, (10) with direct involvement in Parliament's formulation of future Australian government expenditure arrangements. Further, the recently elected Australian government campaigned for much greater disclosure of government financial information, expressly citing loose appropriations and the loss of Parliament's control over expenditure. (11) The analysis presented in this article traces in detail the various decisions of the High Court to illustrate the uncertainty reflected in these decisions and the opportunity this has presented for the Australian government, with Parliament's approval, to undermine Parliament's control over the Australian government's expenditure. Although recent measures in Parliament may address some of these concerns, this article advocates that the focus should be on expenditure rather than appropriations and that this would provide enhanced accountability and transparency of the government's expenditure beyond that afforded by the recent public administration reforms.

Part II of this article considers the Constitution's Consolidated Revenue Fund ('CRF') to illustrate the ambiguous High Court conceptions of the CRF which led Parliament to give to the Australian government the details of the CRF's determination. Part III looks at the Constitution's closely related surplus revenue provisions to illustrate that Parliament, with the support and approval of the High Court, is undermining a key restriction on linking appropriations to the amounts of money actually held by the Commonwealth (and within the CRF). Part IV examines the Constitution's appropriation requirements to illustrate the High Court's apparent preference for Parliament to resolve the detail of appropriations. Part V considers the requirement that Senate amendment of appropriations is limited to those described as not for the 'ordinary annual services of the Government' and how this is now a matter for resolution entirely by agreement between Parliament and the Australian government. Part VI then concludes that ...

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