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This is a Bill, not an Act. For current law, see the Acts databases.
New South Wales
Fiscal Responsibility Bill 2012
Contents
Page
Part 1 Preliminary
1 Name of Act 2
2 Commencement 2
3 Object of Act 2
4 Application of Act 2
5 Definitions 2
Part 2 Fiscal targets and principles
6 Fiscal targets 4
7 Principles of sound financial management 4
8 Budget reporting in relation to fiscal targets and principles 4
Part 3 Miscellaneous
9 Effect of Act 6
10 Regulations 6
b2012-031-33.d11
Fiscal Responsibility Bill 2012
Contents
Page
11 Acts not affected by this Act 6
12 Repeal of Fiscal Responsibility Act 2005 No 41 6
13 Review of Act 7
Schedule 1 Amendment of Public Finance and Audit
Act 1983 No 152 8
Contents page 2
New South Wales
Fiscal Responsibility Bill 2012
No , 2012
A Bill for
An Act relating to fiscal responsibility in the management of government finances;
to repeal the Fiscal Responsibility Act 2005; and to make consequential amendments
to the Public Finance and Audit Act 1983.
Clause 1 Fiscal Responsibility Bill 2012
Part 1 Preliminary
The Legislature of New South Wales enacts: 1
Part 1 Preliminary 2
1 Name of Act 3
This Act is the Fiscal Responsibility Act 2012. 4
2 Commencement 5
This Act commences on the date of assent to this Act. 6
3 Object of Act 7
(1) The object of this Act is to maintain the AAA credit rating of the State 8
of New South Wales. 9
(2) The purpose of that object is: 10
(a) to limit the cost of government borrowing, and 11
(b) to enable access to the broadest possible investor base for 12
government borrowing, and 13
(c) to maintain business and consumer confidence, thereby 14
sustaining economic activity and employment in the State. 15
4 Application of Act 16
This Act applies to and in respect of the State budget. 17
5 Definitions 18
(1) In this Act: 19
budget papers means the budget papers of the Government tabled in 20
Parliament in connection with the annual Appropriation Bills. 21
long-term average general government revenue growth of the State 22
means the average annual growth rate of general government revenue 23
over a sufficiently long previous period to smooth out the influence of 24
transient factors. The regulations may prescribe the relevant rate. 25
long-term fiscal gap means the change in the primary balance of the 26
general government sector as a share of gross state product, calculated 27
on the basis of no policy changes: 28
(a) from 2009-10 to 2050-51, or 29
Page 2
Fiscal Responsibility Bill 2012 Clause 5
Preliminary Part 1
(b) after a re-assessment under section 8--over a similar sufficiently 1
long period to assess fiscal pressures associated with the ageing 2
population and other long-term trends. The regulations may 3
prescribe the relevant period. 4
For the purpose of this definition, the primary balance is revenue less 5
expenditure, including net capital expenditure but not including interest 6
transactions. 7
the State's unfunded superannuation liability means the total net 8
employer liabilities of the State under defined benefit superannuation 9
schemes for the total state sector. 10
(2) Expressions used in this Act (to the extent they are not otherwise 11
defined in this Act) have the same meaning as similar expressions used 12
by the Australian Bureau of Statistics in the preparation of government 13
finance statistics. 14
(3) Notes included in this Act do not form part of this Act. 15
Page 3
Clause 6 Fiscal Responsibility Bill 2012
Part 2 Fiscal targets and principles
Part 2 Fiscal targets and principles 1
6 Fiscal targets 2
The fiscal targets for achieving the object of this Act are as follows: 3
(a) The annual growth in general government expenses of the State 4
is less than the long-term average general government revenue 5
growth of the State. 6
(b) The elimination of the State's unfunded superannuation liability 7
by 2030. 8
7 Principles of sound financial management 9
(1) The policy objectives of the Government should be pursued in 10
accordance with the principles of sound financial management set out 11
in this section in order to support the object of this Act. 12
(2) Principle No 1 is responsible and sustainable spending, taxation and 13
infrastructure investment, including: 14
(a) aligning general government revenue and expense growth, and 15
(b) stable and predictable taxation policies, and 16
(c) investment in infrastructure that has the highest benefit for the 17
community. 18
(3) Principle No 2 is effective financial and asset management, including 19
sound policies and processes for: 20
(a) performance management and reporting, and 21
(b) asset maintenance and enhancement, and 22
(c) funding decisions, and 23
(d) risk management practices. 24
(4) Principle No 3 is achieving intergenerational equity, including ensuring 25
that: 26
(a) policy decisions are made having regard to their financial effects 27
on future generations, and 28
(b) the current generation funds the cost of its services. 29
8 Budget reporting in relation to fiscal targets and principles 30
The Treasurer is to include the following in the budget papers: 31
(a) a statement of the Government's fiscal strategy having regard to 32
the object of this Act and the fiscal targets and principles 33
provided by this Act, 34
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Fiscal Responsibility Bill 2012 Clause 8
Fiscal targets and principles Part 2
(b) a report on the Government's performance against that object and 1
those targets and principles, 2
(c) the reasons for any departure from that object and those targets 3
and principles, together with the action planned to achieve that 4
object and those targets and principles within the forward years 5
of the budget, 6
(d) an assessment of the impact of the measures in the budget on the 7
State's long-term fiscal gap, 8
(e) in the case of the budget papers for 2016-17 and for each 5 years 9
thereafter--an updated report on long-term fiscal pressures and a 10
re-assessment of the State's long-term fiscal gap. 11
Note. Section 10 of the General Government Liability Management Fund Act 12
2002 requires the Management Committee (constituted under that Act to advise 13
the Secretary of the Treasury on the management of the Fund) to review from 14
time to time the long-term fiscal target of eliminating total State sector unfunded 15
superannuation liabilities by 2030. 16
Page 5
Clause 9 Fiscal Responsibility Bill 2012
Part 3 Miscellaneous
Part 3 Miscellaneous 1
9 Effect of Act 2
(1) Nothing in this Act places on any person any obligation enforceable in 3
a court of law or administrative review body. 4
(2) Without limiting subsection (1), a failure to comply with a provision of 5
this Act: 6
(a) does not prevent the introduction of any Bill in, or the passage of 7
a Bill through, a House of Parliament or prevent assent being 8
given to any Bill, and 9
(b) does not affect the validity of any legislation, and 10
(c) does not affect the validity of any action taken by any public 11
official or agency, and 12
(d) does not expose any person to civil or criminal liability. 13
(3) Accordingly, no court or administrative review body has jurisdiction or 14
power to consider any question involving compliance or 15
non-compliance with this Act. 16
(4) This section does not apply to the other provisions of this Part or to 17
Schedule 1. 18
10 Regulations 19
The Governor may make regulations, not inconsistent with this Act, for 20
or with respect to any matter that by this Act is required or permitted to 21
be prescribed or that is necessary or convenient to be prescribed for 22
carrying out or giving effect to this Act. 23
11 Acts not affected by this Act 24
This Act does not affect the provisions of any of the following Acts: 25
Annual Reports (Departments) Act 1985 26
Annual Reports (Statutory Bodies) Act 1984 27
Public Authorities (Financial Arrangements) Act 1987 28
Public Finance and Audit Act 1983 29
State Owned Corporations Act 1989 30
12 Repeal of Fiscal Responsibility Act 2005 No 41 31
The Fiscal Responsibility Act 2005 is repealed. 32
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Fiscal Responsibility Bill 2012 Clause 13
Miscellaneous Part 3
13 Review of Act 1
(1) The Treasurer is to review this Act to determine whether the policy 2
objectives of the Act remain valid and whether the terms of the Act 3
remain appropriate for securing those objectives. 4
(2) The review is to include an assessment of the State's long-term average 5
general government revenue growth. 6
(3) The review is to be undertaken as soon as possible after the period of 7
5 years from the commencement of this Act. 8
(4) A report of the outcome of the review is to be tabled in each House of 9
Parliament within 12 months after the end of the period of 5 years. 10
Page 7
Fiscal Responsibility Bill 2012
Schedule 1 Amendment of Public Finance and Audit Act 1983 No 152
Schedule 1 Amendment of Public Finance and Audit 1
Act 1983 No 152 2
[1] Section 27AA Content of Budget Papers 3
Omit section 27AA (2) (a). Insert instead: 4
(a) a Budget policy statement that includes the following: 5
(i) the matters required to be included in the Budget 6
Papers by section 8 of the Fiscal Responsibility Act 7
2012, 8
(ii) 4-year projections (being for the Budget year and 9
3 forward years) of all major economic and 10
financial variables, 11
[2] Section 63F Status of Workers Compensation Insurance Fund 12
Omit "Fiscal Responsibility Act 2005" from section 63F (b). 13
Insert instead "Fiscal Responsibility Act 2012". 14
Page 8
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