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Need to come out of the Cabinet on TAA

MEMBERS of Geoff Gallop’s Cabinet are rather sensitive about issues like economic management and accountability. Understandably so.

Several, including Dr Gallop, were closely linked as advisers, powerbrokers, or MPs, with WA’s last encounter with a State Labor Government.

Those weren’t exactly illustrious years – huge losses of taxpayer funds on doubtful business ventures and a less-than-candid approach towards Parliament; the State’s supreme governing body.

Some Labor ministers still don’t seem to have fully grasped this, believing Cabinet is the supreme authority.

Under our system, Cabinets must account to Parliament since Cabinets are simply executive committees of all the representatives West Aussies have elected to govern them for just four-years.

Cabinets operate in secrecy, Parliaments in the open.

Accountability, essentially, means disclosure of secretly made decisions on how taxpayers’ funds are expended.

Labor certainly knows all this. Why else did it issue before the last election a policy document titled; “Labor – Accountability”?

“A Gallop Labor Government will aim for the highest standards of openness and accountability. The public has a right to know how their money is being spent,” the document says.

Bold and admirable words. On reading them I decided to wait and see how new Treasurer Eric Ripper would handle certain money matters.

This month he introduced the Treasurer’s Advance Authorisation Bill, the Gallop Government’s first major piece of fiscal legislation.

Readers of State Scene (March 1-7: “Liberal Triumvirate Called to Account on Fund”), will recall that governments of both sides of politics were ticked-off in the Auditor-General’s Second Public Sector Performance Report 2000 on the significant overuse of the Treasu-rer’s Advance Account. (TAA).

For those not aware, a brief recap.

The TAA is governments’ rainy day account – the one they can dip into to cover items Parliament hasn’t appropriated money for or hasn’t appropriated enough, meaning it allows governments to spend money without prior Parliamentary approval.

The only limitation is that such money must be spent on “extra-ordinary or unforeseen” purposes, things like natural disasters or sudden increases, fluctuations in exchange or interest rates, or some brief bridging items.

Each year, treasurers go to Parliament and ask it, in the terms set out in the TAA Bill, to authorise whatever was spent over the previous year and to set a new limit for the next year.

Parliament invariably agrees, but it can – and should – take to task any government abusing its trust.

Last year, the Auditor-General’s report took a 20-year view, and this revealed sizeable blowouts in the TAA.

The first was in the Burke era, thanks to the bailouts of Laurie Connell’s Rothwells lending house and the Swan Building Society.

More recently there were two further blowouts – both in the Court-Barnett Liberal era.

The first was in 1995-96, which the Auditor-General’s report linked to funding of the State Government Insurance Commission and delays in selling the Government’s vehicle fleet.

The second was in 1997-98 and 1998-99, with payments for the Perth Convention and Exhibition Center, computers in schools, and “large payments” to Western Power, Health, and Education.

What made both possible, accor-ding to the Auditor-General, was that the words “extraordinary or un-foreseen” aren’t “defined and there-fore open to broad interpretation.”

He consequently recommended development of guidelines “that clearly defined the circumstances of use of the TAA” to ensure potential for Parliamentary scrutiny.

Along comes Mr Ripper who tells us there was an even bigger third blowout – for $300 million on top of the $300 million already approved by Parliament – in the TAA in 2000-2001 because of the “spending excesses of the previous Govern-ment since its last budget”.

“This irresponsible financial management has put the State’s credit rating at risk,” Mr Ripper said.

So what does he suggest to prevent future overuse and the risking of WA’s credit rating?

“The new Labor Government is committed to a stricter program of expenditure management,” he said.

“The Expenditure Review Comm-ittee (ERC) will ensure that the systematic abuse of the Treasurer’s advance will not occur in future.”

But the ERC is a sub-committee of Cabinet, the very body that has failed so consistently to restrain itself from dipping into the TAA whenever it wished, rather than for “extra-ordinary and unforeseen” purposes.

Mr Ripper never suggested tight definitions in the purposes for which payments and advances may be made. Instead he wants us to trust his Cabinet’s ERC, which conducts its business in secret, to do the proper thing.

Not good enough, Mr Ripper. If the Government was dinkum about its accountability platform this is what should have been done.

The definition of “extraordinary and unforeseen” purposes should be tightened and the rules changed to require the Government to report to Parliament every three months on what was happening – and why – with the TAA.

Mr Ripper, so far you’re no better than your conservative predecessors who, like you, sound off about accountability in opposition, but sidestep it when gaining executive power.

Tragically, the Gallop-Ripper era is off to a disappointing start.

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