Public sector finances and expenditure should be disclosed to the public to allow for efficiency, transparency and accountability in the use of taxpayer funds. The implementation of a Transparency Expenditure Portal (TEP) covering local, state, and federal government bodies to disclose all financial expenditure over $25,000 would allow for this.
Implementing a TEP is one of the most important and necessary reforms for Australia.
With federal expenditure now at unprecedented levels, policy makers must ensure all government expenses create value for taxpayers.
Creating a Taxpayer Expenditure Portal (TEP) will help achieve this by increasing transparency and guaranteeing accountability on matters of government spending.
Already instituted in the United States, Britain, and Europe, the TEP has proven itself as a cost effective, high impact measure that revolutionizes public access to government spending. By generating unprecedented savings for policy makers, exposing the misuse of public funds, and creating true accessibility for the public, the TEP is in practice what the Freedom of Information Act is in theory.
The benefits of a TEP
As one of the first advocates for a TEP in Australia, the Australian Taxpayers’ Alliance has been producing reports showcasing the benefits of a TEP since 2012. The following policy proposal will detail the three key arguments in favour of implementing an Australian TEP:
i. Huge budgetary savings
As international evidence shows, implementing a TEP across local, state, and federal branches of government will highlight an unprecedented number of areas, programs and costs that could be saved.
In 2012, the Texas state government implemented a TEP and found more than $8.7 million in savings in less than in one year. Policy makers in the U.S. states of Colorado, Virginia, and Oregon have implemented similar transparency programs with the same positive results. In South Dakota, a reporter was able to use transparency website information to uncover $19 million in redundancies, while in Utah, the state government’s $294,000 spent on bottled water was reduced to $85,000 after it was exposed through the TEP.
Australian Policy makers seeking to balance the budget on a federal, state, or local level should consider the vast fiscal savings and reduction in administration costs that a TEP could generate.
The U.S. state of Massachusetts, for example, has saved $3 million by eliminating costs associated with FOI requests, such as postage, paper, and printing costs. Utah has counted savings of $15,000 a year from reduced FOI requests in just two of its 300 agencies surveyed. Similarly, South Carolina witnessed a sharp drop in information requests, down to a third of what they were pre-portal, and Mississippi estimated that every information request resolved by the website saved $750 in staff time. The state of Kentucky estimates that the portal has eliminated 40 percent of the administration costs of procurement assistance requests, and could reduce the cost of FOI’s by 10 percent.
Reducing generational debt is one the highest priorities for Australian policy makers. Any and all measures to achieve this must be taken into consideration. As an evidence-based and internationally proven method of delivering savings, a TEP is of critical benefit to policy makers.
ii. Reduced incentives for political corruption.
By allowing citizens to ‘audit’ the government’s books, significant waste can be uncovered and incentives for political corruption can be reduced. Revealing all public expenditure payments over $25,000 will allow the public to know how the majority of their money is being spent.
The government shall no longer be able to hide waste from the public eye and will be forced to become accountable. Inefficient projects that deliver no substantive benefits to the majority of Australians will be under unprecedented scrutiny. Likewise, efforts to embezzle public funds will no longer be an option, with publicly available records of all expenditures from the time of payment.
By disclosing funding and expenditure to the public, major corruption scandals can be avoided, along with the lengthy investigations and expensive trials they produce. Between 2007 and 2014, senior officials in the Victorian Department of Education embezzled more than $5 million in state funding. An investigation into the allocations took three years to uncover the extent of public funds stolen. The investigation noted “a general failure of procurement controls… a widespread lack of accountability … and a failure of auditing to detect the misuse of school funds.” The investigation further recommended that the Department of Education be “required to report on a range of reforms and improvements aimed at preventing corruption.” A TEP would have uncovered unsolicited procurement from as early as 2007, compared to the current arrangement in which it has taken almost 10 years to uncover this same misuse of funds.
Public disclosure of government expenditure is critical to reducing waste and uncovering corruption. Its simplicity and efficiency will allow for true freedom of information that can improve governance on a local, state and federal level. Implementing a TEP should be a bipartisan issue that will advantage all political parties. The only opponents of greater transparency in government spending are those with something to hide.
iii. Real public access to public funding
Presently, there are only a limited number of opportunities for Australians to learn how their taxes are being spent. Despite its initial promise, the Government 2.0 Taskforce did not address this issue, and for the most part, taxpayers remain in the dark. While budget papers provide a limited overview of broad categories of spending, these documents run to hundreds of pages, and provide only a broad overview of spending by subject areas. Some departments list some spending on their websites, however these are disparate, difficult to locate, and impossible to aggregate.
The only other way to obtain information on expenditure is through submitting expensive and inefficient Freedom of Information (FOI) requests at a federal level, and Government Information Public Access (GIPA) requests at a state and local level. Although guaranteed under the Freedom of Information Act, the current process of obtaining information regarding public expenditure is inefficient, expensive and largely removed from every day Australians. A TEP will be a far more cost effective and accessible way to achieve the goals of the Freedom of Information Act.
A TEP is one of the most important and necessary mechanisms to ensure government transparency. Generating unprecedented savings for policy makers, exposing the misuse of public funds and creating true accessibility for the public, a TEP lays down in practice what the Freedom of Information Act offers in theory.