Parliament Budget Cuts - the figures, why they’re unfair

On 19 July 2006, PSA Parliament House members endorsed an industrial campaign in response to Treasury's budget cut of $2.84 million. This $2.84 million figure is made up of:

$1.4 million = Cut to Food and Beverage Services (FBS) budget

$1.44 million = Cuts to the rest of Parliament House, comprising:
$572,000 1% global savings required across the NSW public service
$496,000 Treasury's refusal to cover Parliament's 05/06 budget shortfall
$372,000 Treasury's refusal to cover Parliament's projected 06/07 budget increase.

Cut to FBS budget

This view does not acknowledge that community groups and charities make extensive use of the Parliament's facilities, and that considerable benefits flow to the people of New South Wales from this.

Budget cuts to rest of Parliament House

1% global savings

• $80 million = MPs' programs. Parliament has no control over the expenditure of this part of the budget. That is because the programs and entitlements are determined by an independent body called the Parliamentary Remuneration Tribunal (PRT). The PRT is independent from Parliament and Government. Parliament administers this budget but has no control over it. Nor does Government.

• $30 million = Parliament's operational budget, which is determined by Government in consultation with the Parliament. This budget pays for the operations of the Legislative Assembly, Legislative Council and the Joint Services, including wages ($25 million) and operating costs ($5 million).

Initially, Treasury applied this 1% cut to Parliament's total budget of $110 million, rather than exclusively to the $30 million over which the Parliament has control. Had Treasury proceeded on this basis, the cut required under the 1% global savings would have been $1.1 million, and the overall budget cut to Parliament House would have been almost $2 million rather than $1.44million.

However, Treasury reduced the amount required under the 1% global savings requirement to $572,000.

Whilst this was a welcome development, the PSA believes that Parliament is still being treated inequitably. This is because the 1% global savings should have been closer to $300,000, given that a commitment was extracted from Treasury that the savings should only have applied to the Parliament's $30 million operational budget.

The $572,000 savings required of Parliament is closer to 2% than the 1% required of other public sector agencies.

The PSA has written to the Presiding Officers requesting advice as to why the Global Savings Target is over the 1% applied to other government departments.

Parliament's 05/06 budget shortfall and projected 06/07 budget increase

We believe that Treasury's refusal to cover the 05/06 funding shortfall of $496,000, without prior warning, is unfair. Parliamentary staff should not have to bear the consequences of budget over-spending.

Treasury's refusal to fund this shortfall amounts to a decision not to pay for services already provided and received.

The refusal to fund projected funding increases of $372,000 needed to maintain an appropriate level of service to Members of Parliament, their staff and the NSW community means that there will be an inevitable reduction in the quality and scope of services provided to our elected representatives and to the community.

Because the majority of the Parliament's operational budget of $30 million is made up of staff salaries ($25 million) the majority of savings will be made through reductions in jobs across the Parliament.

However, it is important to remember that thanks to the actions of PSA members, Parliament committed to ensuring that $400,000 of the $1.44 million will be cut from non-staff related costs.

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