Further action on gender responsive budgeting will help drive equity

KPMG

If Australia is to make meaningful steps to cut its gender gap in economic participation and opportunity, then a wider use of gender responsive budgeting (GRB) presents a real opportunity for governments to drive necessary change, KPMG argues in a paper ‘Budgeting for gender equity’, published today.

Recent World Economic Forum data shows Australia was one of the countries which had eliminated its gender gap in educational attainment. But it also found that Australia ranks only 70th for narrowing the gender gap in terms of economic opportunity – a ranking that is well below that of countries like New Zealand (27th), the US (30th) and Canada (40th).

GRB is an approach which requires the gender impact of revenue-raising and spending decisions, individually or collectively, to be assessed. Both NSW and Victoria have established a platform for incorporating some elements of GRB into their decision-making processes, but this is not yet fully embedded as business as usual at either federal or state level. KPMG’s paper argues that a more widespread use of GRB will help accelerate progress towards gender equity.

Alison Kitchen, KPMG Australia Chairman, said: “Gender responsive budgeting can create a platform for a government’s overall gender equity strategy to be successfully delivered. It can create a positive framework, both in terms of direct impact on policy funding and the signal it sends to the community about the rigour that the government is applying in carrying out the strategy.

“GRB enables decision-makers and administrators both to consider and evaluate how financial policy decisions are contributing to the gender equity strategy and to communicate that better to the public. But it can only be truly effective where there is a genuine intent that the policy setting be gender-responsive – it cannot be a “tick the box” exercise, and that is down to the culture of the administration.

“Over the past four years, KPMG Australia has produced a series of papers with proposals to improve gender equity on specific issues like childcare, superannuation, tax and parental leave. But in that time, progress in cutting the gender pay gap has slowed, and we should not accept an international ranking of 70th in terms of equal economic opportunity. While we welcome the progress that has been made towards gender specific policies, we believe governments need to take a more holistic approach and underpin their gender equity strategies by adopting GRB processes across a broad range of policy areas.”

The OECD sets out three broad categories of GRB system:

  1. Gender-informed resource allocation, where a government considers the possible impact of its decisions on gender equality before it makes those decisions.
  2. Gender-assessed budgets, where a government applies a degree of gender analysis to the overall budget.
  3. Needs-based gender budgeting, where a prior assessment of gender needs underpins individual budget decisions.

KPMG believes that needs-based gender budgeting would have the greatest impact on achievement of a government’s gender equity strategy. This category of GRB would enable the identification of the highest priority policy areas on which the government could take action in order to reduce inequity. Combined with applying a gender lens over policies at the time of development – rather than trying to fix inequitable outcomes after a policy is implemented – a needs-based approach can contribute to narrowing the gender economic gap in a more efficient and effective way.

In its paper, KPMG urges Australian governments to take some practical steps towards implementation of a GRB approach:

  • Create an inventory of gender-disaggregated data and planning for future data collection – the potential of GRB to support future outcomes would be enhanced by the routine availability of gender-specific data about economic and social activity.
  • Conduct gender equality needs assessments – the knowledge gained from carrying out a needs assessment can drive the formulation of new policies that can close the gap through needs-based budgeting. Governments can consider commencing one or more pilot needs assessment programs to establish a methodology that works well with the systems and processes which exist within the government’s budgeting approach.
  • Publish gender impact analyses alongside the budget papers – to create public confidence in the processes by which a government is setting out to deliver on its gender equity strategy, the government can include in the published budget material an analysis of specific measures, or of the whole budget, in terms of the expected distributional effect of the policy decisions by gender.

In 2017, an OECD survey of 34 countries indicated half were adopting some degree of GRB. Austria has made it a constitutional requirement for GRB to occur at all levels of government, while Sweden’s budget process reports on the expected gender-related outcomes of the policy decisions that government has made. In one of several significant developments in recent years, Canada has enshrined gender budgeting in the federal government’s budgetary and financial management process.

Developments in Australia

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