Reforming macroeconomic institutions

Comments on Michael Stutchbury “Swan hides budget risk”, 17/05/2011, http://www.theaustralian.com.au/national-affairs/budgets/swan-hides-budget-risk/story-fn8gf1nz-1226057027131

There is indeed a need for reforming macroeconomic management institutions, including not only fiscal policies and management, but also the integration of fiscal and monetary policies.

similar to the independence of the Reserve Bank, there should be an independent fiscal authority that sets important parameters within which the government and Treasury should operate and set its actual fiscal policies.

Further, there should be a joint body of that independent fiscal authority and the RBA to coordinate broad fiscal and monetary policies, operating in a similar line as macroeconomics would suggest, to have optimal combination of fiscal and monetary policies to achieve full employment/economic growth and price stability.