There are fears that massive reforms to government spending rules will weaken parliamentary control over the $400 billion spend each year.

There are fears that massive reforms to government spending rules will weaken parliamentary control over the $400 billion spend each year. Photo: Supplied

There are fears that massive reforms to government spending rules will weaken parliamentary control over the $400 billion spent by the Commonwealth each year.

A parliamentary committee will inquire on Thursday whether the sweeping reforms were rushed into law in June 2013 without enough scrutiny.

The Public Governance, Performance and Accountability Act 2013 and a complex set of associated rules will establish a new money management regime for all federal government departments and agencies from July 1.

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 Almost 200 organisations will be operating under the new framework, but public service veterans, and the National Audit Office, are worried. One Canberra-watcher describes the new rules as a ''power grab'' by the Finance Department.

The chairman of the joint committee on public Accounts and audit, South Australian Liberal Andrew Southcott, said on Wednesday the significance of the new framework ''should not be underestimated''.

''With such a large agenda, we want to know whether stakeholders have been properly consulted during the development of the draft rules and whether their concerns have been adequately addressed,'' Dr Southcott said.

''The committee will also be investigating whether agencies are ready to implement the changes on [July 1] and seeking to get a clear road map for future changes to achieve the significant aims of these reforms.''

A veteran bureaucrat told The Canberra Times there was disquiet about the level of power the new act gave to the Department of Finance.

He said concerns had also been raised that the act could give rogue department secretaries or even ministers scope to spend taxpayers' money outside the constitutional guarantee that all spending must be approved by Parliament.

The National Audit Office is broadly broadly supportive of the changes, the biggest shake-up to public finance rules since the Financial Management Act was introduced in 1997.

Auditor-General Ian McPhee, in his submission to the committee, said he was worried about some of the rules that were proposed to operate alongside the PGPA.

Mr McPhee was particularly concerned about the proposed rule governing ''commitment of relevant money''.

He expressed fears that it weakened the requirement for ''proper use of Commonwealth resources''.

''The proposed rule is a substantive departure from existing obligations that explicitly require an approver to be satisfied, after making reasonable inquiries, that giving effect to the spending proposal would be a proper use of commonwealth resources,'' Mr McPhee wrote.

''The [Audit Office] does not consider that the proposed rule will provide the government and Parliament with sufficient confidence that officials, in approving the commitment of relevant money, will be required in all cases to form a judgment that it represents the proper use of such money.''

The PGPA Act comes into effect on July 1, but the rules are yet to be finalised and tabled in Parliament. A second committee hearing has been scheduled for April 7.