The Reality of Budgetary Reform in OECD Nations

The Reality of Budgetary Reform in OECD Nations

Trajectories and Consequences

Edited by John Wanna, Lotte Jensen and Jouke de Vries

The Reality of Budgetary Reform in OECD Nations investigates the impacts and consequences of budgetary reform through a comparative assessment of advanced Organisation for Economic Co-operation and Development (OECD) democracies that have undertaken budget reforms over the past two to three decades.

Chapter 4: Australia After Budgetary Reform: A Lapsed Pioneer or Decorative Architect?

Lewis Hawke and John Wanna

Subjects: economics and finance, public finance, public sector economics


Lewis Hawke and John Wanna Australian governments were early pioneers of budgetary reform at the national level, commencing with an ambitious reform program dating from around 1982 (see Wanna et al. 2000). Over some two decades Australia’s budgetary systems were transformed and its internal budgetary practices became more managerial, outcomes-focused and businesslike. Arguably, budgetary reform drove broader public sector reform and was used to underpin a wide agenda of new public management (NPM) across government. Budget discipline improved at the center, while departments imposed internal budgetary discipline so that they came in ‘under budget’. Devolution and resource flexibilities meant that various traditional impediments to effective resource management were removed. Prior to the financial crisis, annual budget outcomes improved so that regular deficits became regular surpluses year after year. Budgetary documentation, fiscal plans and financial reports increased in scope, volume and regularity. As a pioneer, Australia pushed ahead with budgetary reforms, at times at breakneck speed. But of late, Australia’s momentum has waned, and its enthusiasm for carrying through the reforms to deliver more meaningful performance information has diminished, despite repeated calls for change. Australia appears now to be either a lapsed pioneer searching for direction, or a jurisdiction complacent with its own investment in decorative architecture. According to some measures, the Australian budgetary reform story appears relatively successful. Prior to the 2009 budget, the Australian budget had been in surplus for ten out of the previous 11 years. Total receipts for the national government have remained stable at between 25...

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