Contrary to the prevailing belief that Aboriginal people were not even counted until the success of the 1967 referendum, Knibbs had set out as best he could to count them. The resultant 1911 Commonwealth Census must have been one of the more ambitious in the history of the world. With the advent of nationwide age and invalid pensions, the Treasury was entrusted with paying them. The first federal banknotes were printed in 1913; Allen signed them and his department issued them. Already the Commonwealth government had imposed its first tax – on big landed estates – and it was the Treasury that collected the tax, thus creating what became our Taxation Office. World War I soon called for a federal income tax.

It is not easy to grasp how simple was the administration centred on parliament house, then in Melbourne. Until 1911 there was not even a prime minister’s department. That gap was barely noticed when Andrew Fisher, the former Gympie gold miner, led his strong pre-war Labor governments, for he was both the treasurer and prime minister. Such a concentration of power in the same hands was again preferred by Joseph Lyons in the 1930s and, for the last time, by Ben Chifley, who finally lost office at the federal election of 1949.

Tilley’s readable book concentrates on the post-Menzies era. By the mid-1960s, Sir Roland Wilson, memorable for his electric car, had become second only to George Allen in his long tenure as secretary. By then the economic disciples of the long-dead John Maynard Keynes were influential even in this conservative department. The idea of balancing the budget was no longer the first commandment.

In its heyday, Treasury was a remarkable department. It almost monopolised the presenting of economic advice and analysis to the government. More than perhaps any other federal or state department, it recruited talented university graduates and tried to promote the best. On Friday evening, after work, its staff ‘drink’ parties at Hotel Canberra were much talked about, especially by those who did not attend. Hailed as normally the sole Fountain of Sound Advice, Treasury had just moved to a grand headquarters, where Norma Redpath’s exotic bronze fountain could be seen and heard.

Treasury was better prepared than Gough Whitlam for the massing of rain clouds. Whitlam’s government, elected in 1972, resolved to be Father Christmas. His sacks full of toys for the nation were breathtaking as well as widely welcomed at first. After he had held office for less than two years, his new budget predicted that annual expenditure would increase by a mammoth thirty-two per cent. In fact the year’s increase proved to be thirty-nine per cent. There was no likelihood that higher taxation and other sources of income would match the expenditure. Inflation was high and unstoppable, for Canberra’s spending spree coincided with the surge in international energy prices.

By the end of the year, it was hoped that Dr Jim Cairns, as the new treasurer, might throw overboard the next sack of Christmas toys, but he had no intention of doing so. He told businessmen he must look after the unemployed – their numbers were increasing rapidly – and ignore inflation and debt.

According to Tilley, Cairns’s personal office was ‘chaotic, he did not deal well with paperwork, and he appeared to have no consistent policy framework’. Cairns and a few colleagues began to organise overseas loans that would not only keep the government afloat but speed it along. Cairns himself worked through his friend George Harris, president of the Carlton Football Club, who would receive a commission if he raised overseas loans. An illegal transaction, it ended Cairns’s political career.

Meanwhile, the government tried to raise a loan through Tirath Khemlani, who might be described as ‘a gentleman of Middle Eastern appearance’. On learning that he was raising the money through a Swiss bank, two Australian public servants went to Zurich where they learned that the bank had not even heard of Khemlani. In the collapse of the Whitlam government, John Stone and other senior members of the Treasury played a large part; and in Tilley’s view their part was justified.

An early and unexpected effect of the brief Whitlam era was the formation in 1976 of two separate departments, Finance and the Treasury. Sir Fred Wheeler, a big gun of the 1970s, is described as ‘perhaps the last of the old-style public servants who effectively ran much of the business of government behind the scenes’. When he retired as head of the shrunken Treasury, he assured his Christmas party that the ministers – he called them ‘bastards’ – rarely understood ‘the system over which they preside’. Not knowing that a journalist was listening, Wheeler must have been both dismayed and proud when his accusation appeared in The Canberra Times.

Tilley writes at length, and mostly appreciatively, about two of the most influential treasurers in our history, Paul Keating and Peter Costello. Thereafter come the tumbling years marked by a high turnover of governments and of treasury secretaries and the frequent failure of budget forecasts. Policy, too, is a victim. The reality, writes Tilley, is that, ‘policy development has been dominated by political manoeuvring’.