Federal budget (Australia)
The Federal Budget is a document that demonstrates the Australian Government's planned financial performance, and the framework it intends to conduct its operations in the following financial year.
Table of contents |
Process
The exercise of putting together the Budget begins in November when the Accrual Information Management System (AIMS) is updated with the latest estimates, and the Senior Minister's Review, where the Prime Minister, Federal Treasurer, and Minister of Finance, meets to establish the policy priorities and strategy for the coming financial year.
The outcome of the Senior Minister's Review determines how the different portfolios will prepare their Budget Submissions for Cabinet. Agencies within each portfolio will submit request for new funding, and potential savings within the agency. After Finance has agreed to the costings, the Submissions will be circulated for coordination comments and lodged with the Cabinet Office by late February.
The Expenditure Review Committee (ERC), a committee of Cabinet meets in March to consider all Submissions. They decide which proposals will be funded and the level of funding it will recieve. At the end of the ERC, the Ad Hoc Revenue Committee will meet to make decisions on the revenue streams of the Budget. A pre-Budget review of the estimates will be conducted after all decisions have been finalised to ensure that they are reflected in AIMS.
Budget documentation will comence at the end of the ERC process. Agencies will prepare two components – the Portfolio Budget Statements and the Mid-Year Economic and Fiscal Outlook.
The Portfolio Budget Statements provide additional details and explanations of the Budget and the Statement of Risks, which is included in Budget Paper No. 1.
The final Budget will be presented and Tabled in Parliament by the Treasurer on Budget night.
Charter of Budget Honesty Act
The Budget has to be presented within the framework that has been established by the Charter of Budget Honesty Act (1998).
The Charter provides for
- sound fiscal management of the Australian economy
- open dissemination about the status of public finances
- transparency in Australia's fiscal policy
Budget Night
The Commonwealth Treasurer will present the Budget on Budget Night, which is traditionally the second Tuesday in May.
Before the presentation of the Budget, the day is spent behind locked doors briefing media and interest groups on various aspects of the budget. This is known as the Budget lock-up. Those invited to attend the briefings are not allowed access to the outside world until the Budget has been presented by the Federal Treasurer.
Reference
- "Australian Government Budget – Overview." Department of Finance and Administration. Accessed on May 12, 2005.
- "Financial management and budget frameworks." Foundations of Governance. Accessed on May 12, 2005.