Opposition Treasury spokesman, Chris Bowen, is set to propose a new plan that would remove responsibility over key economic forecasts in the Federal Budget from the Australian Treasury and instead grant these to the independent Parliamentary Budget Office (PBO). From ABC News:
Mr Bowen will tell the National Press Club that the Coalition’s attempts to “circumvent the Charter of Budget Honesty” has been a spur to Labor considering new ways of providing transparent and independent forecasts.
He says the Abbott Government trashed the Charter, which was introduced by former treasurer Peter Costello and “recklessly politicised” its first budget update.
Mr Bowen will propose changing the PBO legislation to give it the power to prepare the macro-economic forecasts as well as the Intergenerational Report, which Treasury currently publishes every five years.
“A Government unafraid of accountability and transparency would not be afraid of outsourcing this forecasting in their budgets and economic statements,” Mr Bowen will tell the Press Club.
He will argue that if the change is made, treasurers could “no longer interfere and influence macro-economic forecasts which are the key determinants of estimates of revenue and expenditure in Commonwealth budgets”.
Labor is also proposing the PBO publish an annual report on whether the budget is in structural deficit or surplus…
“…the Australian people deserve to know the true state of the budget, free from spin and manipulation.”
Frustration over the huge revisions in the Budget estimates last December, which saw the forecast deficits over the next four years double to $123 billion – double the figure outlined in the pre-election fiscal outlook in August (during the caretaker period) – is apparently behind Labor’s plan.
In my view, any measure that reduces political interference in Budget forecasts is a positive step. It would also bring Australia into line with world’s best practice and provide the greater transparency for the electorate.
