Last week, a Canberra public servant reminisced about a trick his department once used to get rid of leftover funds in a hurry.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
A report was commissioned (it wasn't strictly needed). After it was written, it had be printed. Black and white? No, full colour: it's much costlier that way.
How many copies? Too many. Because then, before June 30, the department would need to pay to pulp the excess.
Tales of this ilk abound in this city. Some may be apocryphal; some may be told with a dash of extra colour ink.
Yet it is undeniable that many government agencies spend more than they need to in the last months of the financial year.
By no means is all spending at this time illegitimate. Most purchases in these months will be useful; some will be good value for money.
There are a few sound reasons, too, why public servants may be more likely to finalise a short-term contract in May and June.
Agency budgets are allocated to specific years. Some staff may be so busy during the rest of the year that they put off essential purchases to do other work. Only the looming date of June 30 – and its threat of taking away program funds – prompts them to arrange the spending.
Yet no commendable reason can explain the staggering findings of the analysis above: of the almost $5 billion worth of short-term contracts we examined, 40c in every $1 related to spending signed off in May or June.
Do you know more? Send your confidential tips to ps@canberratimes.com.au
One obvious cause is the gaming that underlies government budgeting.
Two years ago, Centre for Policy Development researcher Jennifer Doggett described the problem thus: "It's unofficial and it's not explicit ... You add 20 per cent to your actual costs and the Finance Department will cut it back."
Distrust is entrenched and widespread: agencies second-guess Finance, and Finance is reluctant to believe agencies' cost estimates.
As a result, too much emphasis is placed on how much was spent in the previous year: any underspending becomes a sign that an agency, or a program, may be ripe for a budget cut.
What's the solution? Well, admitting there's a problem is a start.
Alas, Finance Minister Penny Wong seems intent on pretending there's nothing wrong with end-of-year spend-ups, even though her predecessor, Lindsay Tanner, freely acknowledged the failing. Clearly, the senator is in campaign mode.
Of course, it would also help if public servants reflect very carefully on their legal and ethical obligation to "use Commonwealth resources in a proper manner" – and report misspending rather than ignore it.
