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ADMINISTRATIVE ARRANGEMENTS
Statement by the Prime Minister,
The Rt. lion. Malcolm Fraser, M. P.
I wish to announce measures being taken to effect
a major re-shaping of elements of the central Commonwealth
departmental machinery.
The changes are essentially designed to provide for
more effective management of the business of Government, and
to strengthen the Government's decision making processes.
Particular emphasis is being laid on improving capacity to
service the Government's requirements for forward planning,
priority setting and the strategic planning of Government
initiatives. Given the complexity of modern democratic government,
and the comparatively short term which Commonwealth governments
are allowed between elections, it is crucial that there should
be more orderly and effective scheduling of Government business
through the various stages of research, objective setting and
policy formulation, program design and the evaluation of
program effectiveness. The new arrangements involve separation of the
financial management and control activities of the existing
Department of the Treasury from its role in broad economic
policy analysis and advice to Government. For the future,
the financial management and control functions will be
performed by a newly created Department of Finance.
2.
The new departmental arrangements are designed to
help make more manageable the heavy work load of economic and
financial expenditure management which necessarily falls to
the Treasurer and senior officials. In addition, it will be
possibl under the new arrangements for more concentrated
attention to be given at the departmental level to the functions
of financial budget management and the development of forward
estimating, as well as to the analysis of economic issues and
the formulation of economic strategy proposals for consideration
C by Government. Outline statements of the functions approved for
the Department of the Treasury and the Department of Finance
are available. I ask leave to incorporate them in Hansard.
As a result of a decision by the Cabinet this afternoon,
C Sir Frederick Wheeler is to be recommended for appointment
as Secretary to the Department of the Treasury. Mr R. W. Cole,
presently the Australian Statistician, is to be recommended for
C appointment as Secretary to the Department of Finance.
The President of the Executive Council has indicated
his agreement to the announcement of these recommendations.
My colleague, the Treasurer, will have Ministerial
responsibility for the new Department of Finance. As Treasurer,
he will also retain responsibility for the Department of the
Treasury. This will help ensure proper co-ordination of the
activities of both Departments. The Minister for Aboriginal
Affairs will be an additional Minister Assisting the Treasurer.
Formal action will be taken to give effect to
these changes within a short period.
3.
In association with these changed administrative
arrangements, there will be a strengthening of the existing
resources available in the Department of Prime Minister and
Cabinet for the evaluation of the effectiveness of
Government programs. Regular evaluations will be undertaken
of major sectors of Government services. Where appropriate
these evaluations will be followed by detailed reviews
and the development of modified or new programs.
The Government has also taken steps to develop
further already established capacity within the Department
of Prime Minister and Cabinet to advise the Government on
forward programming, priority setting and the strategic
planning of Government initiatives.
The intensified policy and program assessments which
will thus be possible will be closely associated with
accelerated development of the forward estimates system.
The closest co-ordination will be maintained between relevant
areas of the Department of the Prime Minister and Cabinet
and the Departments of the Treasury and Finance.
The Government is convinced that the new arrangements
will assist it materially in dealing effectively with the
major issues which currently face the nation. .4
Careful consideration has been givcnto the
recommendations of the Royal Commisiion on Australian
Government Administration headed by Dr Coombs, to the
work of consultants which reported to the Royal Commission
on relevant aspects and in particular to the report of
the Royal Commission's Task Force on Economic Policy.
In deciding the nature of the new arrangements, the
Government has been aware of the differing expert views
which found expression through the Royal Commission regarding
the appropriate central administrative machinery which should
be developed. The Government's decisions also reflect the outcome
of its consideration of the reports of the Administrative
Review Committee, which emphasised the importance of
improved financial and program planning and control. The
range of approaches to improving the organisation of the
Government's administrative resources which these various
reports have canvassed has been of great value in helping
to stimulate and clarify thinking in this respect.
SUMMARY OF FUNCTIONS OF THE
DEPARTMENT OF THE TREASURY
The Department will be responsible for advice on or
administration of:
economic, fiscal and monetary policy. Its main
responsibility will lie in the field of general
C economic management and it will be involved in a
continuous assessment of current and future economic
conditions and the provision of advice on appropriate
policies including those relating to resource allocation.
These policies include:-
budgetary policy matters relating to
expenditure, revenue and deficit/ surplus and
C means of achieving overall budgetary objectives.
monetary policy matters relating to the control
C of the money supply, official interest rates, etc.
-taxation policy matters relating to the structure
and level of taxation in relation both to budgetary
needs and effects on resource allocation.
incomes and prices matters providing advice on
trends in income and price levels and on their
bearing on broad economic objectives.
external economic relations i. e. matters relating to
external financial and economic policy issues, including
the balance of payments, overseas reserves, the working
of the international economic and monetary systems,
Australia's role in international financial affairs,
Australia's membership of various international organisations.
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Commonwealth/ State financial relations including the
provision of financial assistance to the States and
local authorities and the sources of State and local
authority revenue.
* matters relating to the raising, redemption or conversion
I of Australian Government loans in Australia and overseas,
administration of the Financial Agreement and the
Gentlemen's Agreement, and the operations of the National.
Debt Commission.
* financial and economic aspects of policy matters concerning
the structure and functioning of the banking system and
other financial institutions in the Australian capital
market, Australian capital investment abroad, exchange
control,. coinage, and aspects of company law bearing on
company structures and financing.
. matters relating to foreign investment in Australia.
* SUMMARY OF FUNCTIONS OF THE DEPARTMENT OF FINANCE
This Department will be responsible for advice on, or
administration of:
The Public Account ( Consolidated Revenue Fund,
Trust Fund, Loan Fund), which also includes prescribing
rules for central and departmental accounting within
the requirements of the Audit Act and other related
legislation; research into management accounting
techniques, accounting policy and arrangements, operation
of Commonwealth accounting systems.
The collection, preparation and financial analysis
of forward estimates of departmental expenditure;
The preparation of Appropriation Bills.
Expenditure Review
The general oversight of the finances of departments
and authorities financed from the budget
Participation in evaluations of the effectiveness of
expenditure programs in meeting Government determined
objectives.
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Financial evaluation of expenditure proposala and
programs in the fields of social services, veterans'
affairs, health, education, housing, immigration,
science, recreation, arts and culture, aboriginals, the
( 7 environment, employment and Australian Government
employment;
Finanaial evaluation of expenditure proposals and programs
relating to air, land and sea transport and internal
and international communications, assistance to
manufacturing, mining, rural, fishing and tourist
industries for example, by way of reconstruction
schemes, payment of bounties and subsidies and assistance
to research and promotion.
Financial aspects of the legislation and operation of
statutory authorities of the Australian Government;
Financial evaulation of expenditure propoaals and
programs relating to defence, budgetary aspects of
the Defence Five Year Rolling Program, and Services pay
and conditions, defence works, civil works and related
programs, foreign aid and mainland and external territories.
Financial evaluation of expenditure proposals and
programs relating to urban and regional development,
irrigation, transport and other developmental projects.
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General and life insurance
Actuarial services
Royal Australian Mint