Election promises to be costed by independent Parliamentary Budget Officer

The Victorian Coalition Government is today bringing legislation to Parliament to establish an independent Parliamentary Budget Officer to undertake costings of political parties’ election promises.

Minister for Finance, Robert Clark, said that the PBO would help ensure Victorians have full and impartial information about the costs of political parties’ election promises.

“The PBO will provide authoritative, independent and credible information about election policy costings to the Victorian community and will help ensure the focus of election debate can be on the merits of competing policies rather than on disputes about costings,” Mr Clark said.

In the past, various Australian governments have conducted Treasury-run election policy costing systems in the lead up to general elections. These systems have been criticised because of the way they risk politicising the Treasury and its public servants, and fail to provide non-government parties with an assurance of independence from government.

“The scheme run by the previous Labor government in the lead-up to the 2010 state election is a stark illustration of these failings,” Mr Clark said.

“The PBO will overcome these failings by providing an independent and authoritative source of information about the costs of election policy commitments.

Like the Auditor-General and the Ombudsman, the Parliamentary Budget Officer will be an independent officer of the Parliament.

Under the legislation, Parliamentary party leaders and any independent MPs seeking re-election will be able to request the PBO to cost their election policies from 1 September in the election year.

Costings will be published by the PBO following announcement of the policy by the relevant party or independent MP.

The PBO will also publish a Budget Impact Statement for each parliamentary party and independent MP, showing the total impact on the State Budget of all of the party’s or MP’s costed and announced policies.

Importantly, political parties will not be required to have committed to policies before having them costed, nor will they face having costings made public by the PBO whether or not the party wishes to proceed with the policy after receiving the costing.

“This will be far fairer for opposition and minor parties than the scheme established by the previous Labor government in 2010, which sought to force parties to commit to having their policies made public before they even knew what the result of the costing would be,” Mr Clark said.

“Thus the PBO will allow for a far more sensible and informed approach to policy announcements, and hopefully therefore facilitate better formulated policy options from parties and candidates for the community to consider.”

Mr Clark said the Bill introduced to Parliament had taken into account a range of submissions received in response to the discussion paper the Government had issued in early October.

Based on the feedback received, the Parliamentary Budget Officer will now be appointed in a similar manner to the Auditor-General, on the recommendation of the bi-partisan Public Accounts and Estimates Committee of the Parliament.

As well, the Officer’s appointment can now commence from 1 May each election year, to allow for the Officer to have additional time to set up the office, recruit staff and establish costing protocols, prior to commencement of costings from 1 September.

However, the Government did not accept calls for the PBO to be established on an on-going basis.

“The Government’s policy commitment was to establish an office to independently verify election policy costings, not to do the Opposition’s homework for them. In this regard, the Victorian PBO is similar to the NSW PBO that has been established for some years,” Mr Clark said.

“The Government had also decided not to bring forward the commencement of the time from which the PBO receives policies for costing. Receiving policies from 1 September should allow ample time for parties to have their policies costed, given that in 2010 the Labor Party did not submit their first policy for costing under their costing scheme until 5 November.

“With this legislation now being introduced to Parliament, it is time for the Labor Party to tell the community whether or not they are willing to submit their election policies to fair and independent costing scrutiny.

“The Government will certainly be submitting its election policy costings to the PBO. Labor need to make clear whether they are going to continue to make announcements like their unfunded transport wish list that simply don’t add up and that confirm Labor can never be trusted to manage money.”