Introduction

The Charter of Budget Honesty Act 1998 (the Charter) outlines arrangements under which the Secretaries to the Treasury and the Department of Finance and Deregulation (the Secretaries) may be requested to cost election commitments during the Caretaker Period prior to a general election. The Charter also allows for the Secretaries to jointly issue written guidelines recommending approaches or methods to be used in the preparation of such costings.

Following the establishment of the Parliamentary Budget Office (PBO) and its ability to prepare policy costings, the Secretaries consider it timely to issue these updated guidelines. They reflect the PBO's mandate and functions, as well as details of the amendments that were made to the Charter when establishing the PBO (Part 2), including allowing minority parties with at least five members to request election costings from Treasury and Finance. Parts 3 to 5 provide information relating to the processes and conventions used in preparing policy costings. These guidelines should assist in promoting consistency, transparency and comparability of the costings performed by the Departments and the PBO.

This document has six parts:

• Part 1 outlines the main statutory provisions for costing election commitments in the Charter;
• Part 2 provides details of the mandate and functions of the PBO, including information relating to the associated changes that were made to the Charter;
• Part 3 outlines the process by which Treasury and Finance update the economic and fiscal estimates;
• Part 4 outlines the aims of the Secretaries in undertaking policy costings and the broad methods to be followed;
• Part 5 specifies how requests for costings should be made, including the information required for a costing to proceed and the processes for dealing with requests; and
• Part 6 deals with issues relating to the content and timing of public reports on policy costings released by the Secretaries.

Appendices Aand B provide further details on estimate updates and costing conventions. The methodology used to cost policies is under constant review to ensure it remains appropriate. The guidelines will be updated where the methodology significantly changes.

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