What Is the National Budget Process?

Section 209 of the Constitution does more than require a budget. It dictates its structure, in a way designed to protect two institutions from the government of the day.

Section 209(2) — what the Budget must contain

For each fiscal year there shall be a National Budget comprising:

• (a) estimates of finance proposed to be raised and estimates of proposed expenditure by the National Government for the year; and
• (b) separate appropriations for the service of that year in respect of —
  1. the services of the Parliament;
  2. general public services; and
  3. the services of the Judiciary;
• (c) such other supplementary Budgets and appropriations as are necessary.

Section 209(2A) — what the categories cover

“The services of the Parliament” include the salaries and allowances (financial and otherwise) of members, the maintenance of the precincts of the Parliament, and the Parliamentary Service.

“The services of the Judiciary” include:

• the salaries and allowances of the Judges of the Supreme and National Courts;
• the maintenance of the Supreme and National Courts;
• the National Judicial Staff Service established under the National Judicial Staff Service Act 1987; and
• the salaries and allowances of all persons appointed under the Supreme Court Act (Chapter 37), the National Court Act (Chapter 38) and the Sheriff Act (Chapter 55).

Section 209(2B) — the 30 September rule

These are the estimates that matter later. Under section 210(3), if Parliament considers the proposed expenditure for either service is below the submitted estimate and insufficient adequately to meet the requirements of that service, Parliament may increase it — up to the original estimate — notwithstanding the general rule that Parliament may reduce but not increase proposed expenditure. Section 210(4) allows re-allocation for that purpose.

Section 209(3) — consultation with a committee

Before any Budget or appropriation is prepared for submission to the Parliament, the National Executive Council shall consult with any appropriate Permanent Parliamentary Committee — but the subsection does not confer any right or impose any duty of consultation after the initial stages of preparation.

The obligation is real but front-loaded: consultation belongs to the early design of the Budget, not to the final negotiation of numbers.

The cycle in outline

1. Before 30 September — Speaker and Chief Justice submit their estimates to the Prime Minister (s 209(2B)).
2. Early preparation — the NEC consults the appropriate Permanent Parliamentary Committee (s 209(3)).
3. Recommendation — taxation, loans and expenditure are proposed on the recommendation of the Head of State on NEC advice (s 210(1)).
4. Parliament — may reduce, but not increase or re-allocate, except for the Parliament’s and the Judiciary’s own services (s 210(2)–(4)).
5. Appropriation Acts — certified under section 110.
6. Execution and accounting — under section 211 and the Public Finances (Management) Act 1995.
7. Audit and scrutiny — the Auditor-General reports at least once a year to Parliament, and the Public Accounts Committee examines and reports.

Supplementary budgets and interim spending

Section 209(2)(c) expressly contemplates supplementary Budgets and appropriations. Section 212 deals with the position where Parliament has not made provision by the start of a fiscal year — the Constitution provides a controlled interim arrangement rather than allowing government to stop or to spend at large.