Federal cabinet will sign off on Tuesday on a commission of audit of all government spending, setting in train a process that will identify areas of duplication and waste and could lead to serious cuts in coming budgets.
With the government also committed to a full review of the taxation system, the two reviews will arm the Abbott government to undertake significant change of revenue and spending policy.
Treasurer Joe Hockey is expected to announce the Audit Commission, including its personnel, later on Tuesday.
Fairfax Media believes the commissioners have been drawn from retired senior public servants and top levels of business.
The concept of a commission of audit has been criticised by the ALP as code for planning to break election promises.
The audit has sent shock waves through Canberra where memories linger of Howard government harsh spending cuts.
Among names mentioned for the commission are former Wallis inquiry author Ian Harper and former Reserve governor Ian Macfarlane.