Guidance on Prime Minister's exemption, election commitments, revenue raising measures and costing extension.
July 2023
Revenue raising and protection measures
An Impact Analysis dealing with revenue raising or revenue protection measures need only address the best means of implementing the proposed measure. This is because a full cost benefit analysis for revenue measures is not possible without also considering how the revenue will be spent. Therefore, any Impact Analysis in this category does not need to address the first two Impact Analysis Questions unless any revenue impacts are supplementary to a non-revenue policy objective. Further, the third and fourth Impact Analysis Questions can be confined to options for implementing the decision, since it is not relevant to consider a ‘do nothing’ option or the option of raising revenue through an alternative means. An Impact Analysis dealing with a measure to protect the integrity of an expenditure programme does not need to consider how it is funded or how any savings might be used.
Prime Minister’s exemptions
Only the Prime Minister can exempt a government entity from the need to complete Impact Analysis, and only then in very limited circumstances, namely:
- When there are truly urgent and unforeseen events requiring a decision before adequate Impact Analysis can be undertaken.
- Where there is a matter of Budget or other sensitivity and the development of Impact Analysis could compromise confidentiality and cause unintended market effects or lead to speculative behaviour which would not be in the national interest.
If the Prime Minister grants an exemption, the agency will not be deemed as not having met the Impact Analysis requirements. When the decision is publicly announced, it will be recorded that the Impact Analysis was subject to a Prime Minister’s exemption and the reason noted on the Department of the Prime Minister and Cabinet’s website (Published Impact Analyses | The Office of Impact Analysis ).
If the policy decision granted an exemption results in legislation, the fact that an exemption was granted by the Prime Minister needs to be noted in the explanatory material.
Where a Prime Minister’s exemption is granted, agencies are still required to quantify the compliance impacts of the proposal.
If time permits, analysis may be required to be undertaken before the decision is implemented to establish a baseline for ex post evaluation of the decision. This analysis will be provided to the OIA, but will not be publicly released.
A Post-Implementation Review must be completed within two years of the implementation of the decision for all matters covered by a Prime Minister’s exemption.
Costing exemption
The Prime Minister may grant in writing an extension of time for completing the quantification of compliance impacts for the applicable Impact Analysis. An extension may be granted if the Impact Analysis is complete apart from the costings and the agency requires additional time to complete the costings. A minister wishing to obtain an extension should write a letter to the Prime Minister explaining why an extension is required for completing the quantification of compliance impacts.
When the policy decision is announced, the Impact Analysis will be published on the OIA website noting that the Impact Analysis is not yet finalised as the costs will be quantified at a later date. When the costs are quantified, the OIA will publish the costs on the OIA website noting that the Impact Analysis is finalised.
Election commitments
Impact Analysis covering matters which were the subject of an election commitment will not be required to consider a range of policy options. Only the specific election commitment need be the subject of Impact Analysis and in this situation, the focus should be on the commitment (with reference to the status quo) and the manner in which the commitment should be implemented.