ABSTRACT
Malcolm fraser announced the splitting of Treasury on 18 November 1976. This decision arguably remains the most profound in the history of public expenditure management in Australia. The option of splitting Treasury, in part to end its dominance over economic advice and expenditure policy, had been debated at length by Royal Commission on Australian Government Administration (RCAGA). Treasury was typically single-minded, if not decidedly ideological, in its approach to economic policy advice. It jealously guarded vital information on the economy and used the budgetary role to impose its own opinion on the policy proposals from other departments and even upon governments. Bypassing Treasury, the proposed loan moved the government outside accepted loan raising mechanisms. In May 1975, Treasurer Cairns secretly instructed RCAGA to examine the possibility of splitting the Treasury. The change of government appeared to improve the relationship between Treasury and the government.
