The Government has effectively rejected a radical proposal from the Productivity Commission which could have opened up the Budget process to non-governmental organisations.
The previous National Government in 2017 asked the Commission to examine productivity in the state sector.
Predictably the Commission produced a report which drew heavily on private sector market-driven ways of improving performance.
It particularly suggested that the Minister of Finance should set aside money in the Budget dedicated to “high impact initiative” proposals that had a high probability of making a significant impact on social wellbeing.
These would need to be evidenced through robust business cases, and returns on investment and then the Government would progressively increase the share of the budget allowance devoted to that portion.
“The Minister of Finance should restrict access to the “high-impact initiative” portion of future budget operating allowances to those departments that can credibly demonstrate productivity gains from existing baselines,” the report said.
But even more controversially it proposed that the process be opened up beyond the state sector.
“The Minister of Finance should allow non-government organisations to make budget bids directly to the Treasury for the “high- impact initiative” portion of the operating allowance,” the report said.
In other words, NGOs would be able to bid for Budget funding on the same basis as a Government Department like Social Development or Education.
That’s a great idea. It could make a huge difference. Very sad the Government has rejected it. I love the idea of NGOs being able to do direct budget bids.