Posted 08/07/2021 by Philip Hamilton
The Bill was introduced in the House of Representatives on 16 June 2021. This FlagPost has been published in lieu of a Bills Digest.
Purpose
The main purpose of the Australian Organ and Tissue Donation and Transplantation Authority Amendment (Governance and Other Measures) Bill 2021 (the Bill) is to reverse certain governance arrangements implemented in July 2017. It proposes amendments to the Australian Organ and Tissue Donation and Transplantation Authority Act 2008 (the Act).
The Australian Organ and Tissue Donation and Transplantation Authority (the OTA) is an independent statutory agency within the Health portfolio. It delivers a national program to improve organ and tissue donation and transplantation outcomes in Australia. The OTA works with states and territories, clinicians, the community sector and the general public.
The current governance arrangements for the OTA were implemented by the Australian Organ and Tissue Donation and Transplantation Authority Amendment (New Governance Arrangements) Act 2016 (the 2016 Act). The Bill for this Act was outlined in a FlagPost in November 2016 (in lieu of a Digest).
Key measures in brief
The OTA’s current ‘accountable authority’ under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) is the governing Board. The Bill will make the Chief Executive Officer (CEO) the ‘accountable authority’. This was the arrangement prior to July 2017. The Bill will also increase the CEO’s maximum term of appointment from four years to five years.
The current governing Board of eight members (seven appointees, and the CEO ex officio) will be replaced by an Advisory Board (proposed section 28 of the Act at item 24 of Schedule 1 to the Bill). Unlike the Advisory Council which operated until July 2017:
- the proposed Advisory Board will have five to seven members (the Advisory Council had 10 to 16 members)
- if requested by the Minister, the proposed Advisory Board will provide strategic advice about the performance of the OTA.
Reason for changes in governance arrangements
A 2015 Review by EY recommended changes to the governance of the OTA, which prompted the changes introduced in the 2016 Act intended to:
- improve operational efficacy and
- ensure that the strategic and policy objectives of the OTA were effectively integrated in day to day operations and activities. (November 2016 Minister’s Second Reading Speech)
In July 2020 an internal review undertaken by the OTA Board indicated Board members’ preference for:
- increased time and capacity to contribute to the organisation's strategic direction and
- to provide advice and support to the CEO. (June 2021 Minister’s Second Reading Speech)
The report of the 2020 internal review has not been made public. The specific shortcomings of the arrangements in place since 2017 have not been identified.
Background: OTA governance arrangements 2009 to July 2017
The OTA was established in 2009 by the Australian Organ and Tissue Donation and Transplantation Authority Act 2008 (the Act as made) with the CEO having the pre-eminent role in functions such as developing policy, declaring standards, and making grants on behalf of the Commonwealth (section 11 of the Act as made). From the commencement of the PGPA Act in 2014, the CEO was the ‘accountable authority’ for the purposes of the PGPA Act. The CEO was advised by an Advisory Council, whose 10 to 16 members were appointed by the Commonwealth Minister after consultation with relevant state and territory ministers (sections 32 and 34 of the Act as made). In addition, expert advisory committees could be established by the CEO (section 44 of the Act as made).
Background: OTA governance arrangements since July 2017
From 1 July 2017 the Advisory Council was replaced by a governing Board that became the ‘accountable authority’ and assumed many responsibilities previously assigned to the CEO. This appears to be the first time a governing board, rather than an individual, had been designated as the ‘accountable authority’ for a non-corporate Commonwealth Entity under the PGPA Act.
The current Board comprises eight members (seven appointees, and the CEO ex officio) (section 13E of the Act). The Act requires the Minister to consult state and territory ministers on the appointment of a Deputy Chair, but not the Chair (section 13G of the Act). The Act also provides that when making other appointments to the Board the Minister receives advice from the COAG Health Council, which no longer exists (section 13G of the Act). (A new body, the Health Council, was established following National Cabinet’s decision to reform federal relations architecture). In making Board appointments, the Minister is not obliged to follow advice from the Council or individual state and territory ministers. Expert advisory committees may be established by the Board (section 44 of the Act).
Measures proposed by the Bill
The CEO
The Bill will largely restore the arrangements in place prior to July 2017. The CEO will become the ‘accountable authority’ under the PGPA Act (item 12 of Schedule 1 to the Bill), responsible for:
- determining the OTA’s objectives, strategies and policies
- ensuring the proper, efficient and effective performance of the OTA and
- managing the administration of the OTA (proposed section 14B of the Act at item 18 of Schedule 1 to the Bill).
The Bill will increase the CEO’s term of appointment from ‘up to four years’ to ‘up to five years’ (item 20 of Schedule 1 to the Bill). The four-year term of the current CEO expires on 3 October 2021. The requirement for the Minister to consult the Chair of the Board about the appointment of the CEO will be repealed (item 19 of Schedule 1 to the Bill). There is no change to the provision that the CEO may be reappointed. Expert advisory committees may be established by the CEO (item 25 of Schedule 1 to the Bill).
The Advisory Board
Proposed Part 4 of the Act, at item 24 of Schedule 1 to the Bill, deals with the Advisory Board. The proposed Advisory Board will consist of the Chair, the Deputy Chair, and at least three but not more than five other members (proposed section 30 of the Act at item 24 of Schedule 1 to the Bill). Before appointing a person as an Advisory Board member (other than the Chair), the Minister would be required to consult state and territory health ministers, and ‘such other persons (if any) as the Minister considers appropriate’ (proposed subsection 31(4) of the Act at item 24 of Schedule 1 to the Bill). The requirement to involve the former COAG Health Council will be repealed (item 16 of Schedule 1 to the Bill).
The qualifications for appointment to the Advisory Board are different from those for the current Board in section 13F of the Act. The differences are fairly minor, but the current option to appoint a person who is only qualified as a consumer of health services (paragraph 13F(4)(d) of the Act) is not included in proposed section 31.
There are no changes to provisions that Board members are to be appointed on a part-time basis for terms that do not exceed four years. Following the expiry of their terms on 30 June 2021, the terms of the Chair and Deputy Chair were extended to 30 June 2023 and 30 September 2021, respectively. The terms of the other four members expire on 3 October 2021. There is no change to the provision that appointed Board members may be reappointed.
The function of the original Advisory Council was to provide advice to the CEO. In addition to this role, the proposed Advisory Board would also provide strategic advice to the Minister about the performance of the OTA, if requested to do so by the Minister (proposed paragraph 29(1)(b) of the Act at item 24 of Schedule 1 to the Bill) .