Governing the City State - Chief Minister and Treasury Directorate ...

A more significant improvement would be to mirror Commonwealth Government practiceand include an annual supplementary appropriation process in the Budget cycle. Thesupplementary appropriation has been used a number of times in recent years (2004-05,2007-08 and 2008-09), but not in an integrated way. Instituting this supplementary processwould have a number of advantages:• the Assembly would have another formal opportunity to scrutinise government activityand service delivery plans;• it would reduce pressure on, and allow a reduction in, the Treasurer’s Advance;• it would facilitate more agile government;• holding the “spending between Budgets” line would be more practical;• the option would exist for the Government to reconsider achievement of priorities andallocate, or reallocate funding as required;• certain proposals for capital works or recurrent initiatives could be considered in Apriland rather than funded in the Budget, deferred for further work and analysis andreconsideration mid-year. This would avoid the Cabinet being pressured into agreeing toa proposal because it is unwilling to delay funding decisions by 12 months; and• consideration of the supplementary appropriations could coincide with the annual prioritysetting process, further integrating the priority setting and decision making processes.Creation of another formal opportunity for consideration of new spending proposals might –perversely – encourage more bids to be brought forward than there might otherwise be. Inpart, the mitigation of this risk lies in the hands of Ministers and the Strategic Board infollowing the clear and sensible process rules set out in the Cabinet Handbook.One means of perhaps limiting the scope of any perverse outcomes would be to focus thesupplementary appropriation round principally on capital projects. This would align with theprocesses already followed by the Budget Committee of Cabinet in regularly reviewingprogress in the delivery of the capital works program, but would also reduce pressure to fundprojects in the Budget for which all necessary preparatory work may not have been settled.In an annual funding cycle, there is an understandable pressure to fund final design andconstruction through the Budget, whereas a planned supplementary process would, forexample, permit final funding decisions to be based on settled design processes.Strengthening Budget Coordination - Alignment and ConsistencyThe current Budget cycle is well understood by officials and supports delivery of the Budgetin May each year. There is clearly scope, however, for that process to be improved. Perhapsmost importantly, the process would be enhanced by more closely aligning it with theachievement of government priorities (which would also assist in reducing the inefficiencythat comes through the preparation of unnecessary budget proposals), and through theexercise of a stronger role by the Expenditure Review and Evaluation Committee in themanagement of the Budget process, as well as in the preparation of consolidated andcomprehensive briefing to support the Budget Committee of Cabinet’s decision making.Strategy, Resource Allocation and the Vacant Middle Ground: 236