Bills Digest 108 1996-97 Commonwealth Authorities and Companies Bill 1996


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

Commonwealth Authorities and Companies Bill 1996

Date Introduced: 12 December 1996
House: House of Representatives
Portfolio: Finance
Commencement: On the same day as the Financial Management and

Purpose

The Commonwealth Authorities and Companies Bill 1996 (the CAC Bill) forms part of a package of four Bills and associated measures designed to modernise controls on Commonwealth finances and over businesses owned or operated by the Commonwealth.

The other Bills in the package are:

  • the Auditor-General Bill 1996 (the Auditor-General Bill);
  • the Audit (Transitional and Miscellaneous) Amendment Bill 1996 (the Transitional Provisions Bill); and
  • the Financial Management and Accountability Bill 1996 (the FMA Bill).

The Auditor-General Bill, amongst other things, provides for the re-establishment of the Office of Auditor-General under the proposed new financial accountability regime replacing the Audit Act 1901 (the Audit Act); and styles the Auditor-General as an 'independent officer of the Parliament'.This Bill also re-creates the Australian National Audit Office (ANAO) as an independent statutory body employing staff under the Public Service Act 1922 but with a capacity to contract out work where considered appropriate by the Auditor-General.Together with the Transitional Provisions Bill, the Auditor-General Bill makes provision for a wider role for Parliament (through what will be the Joint Committee of Public Accounts and Audit) in selecting the Auditor-General and in monitoring the performance of that Office and the ANAO. The Auditor-General Bill also re-establishes the Office of Independent Auditor who is the Parliament's auditor of the ANAO.

The Transitional Provisions Bill formally repeals the Audit Act, proposes consequential changes to enabling legislation affecting Commonwealth authorities so as to link those bodies to the CAC Bill, and provides for the Auditor-General in office at 30 June 1997 to see out the remainder of their 10 year term.The Public Accounts Committee Act 1951 is to be amended to enlarge the powers and functions of the Parliamentary Joint Committee of Public Accounts (JCPA).

The FMA Bill seeks to establish a regulatory framework for Commonwealth instrumentalities which financially are agents of the Commonwealth, that is, those bodies which do not 'own' their funds but operate squarely within the provisions of sections 81 and 83 of the Commonwealth Constitution.Such bodies include the Departments of State, the Parliamentary Departments and many Statutory authorities and government agencies which manage public money or property on behalf of the Commonwealth.The Bill also specifies the powers and responsibilities of the Minister for Finance with regard to their duties as custodian of the Treasury of the Commonwealth under the Constitution.

The principal object of the CAC Bill is to bring a greater degree of uniformity and clarity to financial reporting standards applying to Commonwealth authorities and to establish standards of conduct for those engaged in the management of those entities.In doing so the CAC Bill repeals Part XI of the Audit Act and, together with the Transitional Provisions Bill, replaces a multitude of specific legislative provisions contained in the enabling legislation establishing many Commonwealth authorities. The CAC Bill also extends the mandate of the Auditor-General to all Commonwealth authorities and Commonwealth companies although slightly different rules will apply in respect of wholly-owned and partly-owned Commonwealth companies and in relation to Government Business Enterprises (GBEs).

Background

The present Bill and the associated measures are similar but not identical to a package of Bills introduced by the previous Government in June and December 1994.(1) The earlier Bills were subject of a JCPA Report(2) and debated in both Chambers. However, the legislation was not passed before the Parliament was prorogued on 29 January 1996 for the General Election of 2 March 1996.

Terminology

As the Senate Finance and Public Administration Legislation Committee noted in preparing its most recent List of Commonwealth Bodies, there is no general agreement or commonly applied standard in relation to the definition of the various types of Commonwealth body.(3)The FMA and CAC Bills, if passed, would go some way to addressing this problem.

The audit Bills collectively set up a reporting and accountability framework for the full range of Government bodies.That classification is based not on the type of functions performed by each those bodies but is applied according to their legal personality and, in particular, the source or degree of control they exercise over their funding. Under this schema, budget dependent agencies such as the Government Departments generally are dealt with under the FMA Bill whilst independent 'self-funded' bodies including many Commonwealth authorities and Commonwealth companies are dealt with under the CAC Bill.

As most readers know, where a term is defined in the Bill, the meaning given to it in the legislation prevails over the 'dictionary meaning' and any popular or current usage given that expression.(4) For example, GBEs for the purposes of the CAC Bill will be any Commonwealth authority or Commonwealth company that is prescribed by the regulations to be a GBE. Hence, it is possible (but unlikely) that some of the 13 entities which are now commonly regarded as GBEs may not be treated as such for the purposes of this legislation.(5)

The more important terms defined in the CAC Bill are discussed in the Main Provisions section of this Digest.

Coverage

According to the Senate Standing Committee on Finance and Public Administration, as at June 1993 there were 1236 Commonwealth bodies outside the departmental framework of administration. These comprised:

  • 358 Statutory authorities and statutory offices;
  • 327 non-statutory bodies; and
  • 551 companies/associations.(6)

In its 1996 Report, the Committee used a slightly different approach to classification but the results are (unsurprisingly) not dissimilar:

Commonwealth Bodies by Type and Total

June 1996

Associated  Company  Controlled  Incorporated    Non      Statutory  Statutory   Chief    
 Company   Limited    Company                -Statutory  Authority    Office   Company   
              by                 Association     Body                                     
           Guarantee                                                                      

                                                                                          
    49        57         287         140         457         307        51         24     


Perhaps the most significant change in the make-up of government bodies was the reduction in the number of GBEs. In 1993, there were 19, as previously noted there are presently only 13.(7)

A non exhaustive list of Statutory authorities which will be subject to the CAC Bill forms Attachment A to this Digest.

Government Accounting Framework

Whilst many Statutory authorities and Commonwealth companies enjoy a degree of independence from ministerial direction and some are relatively free from public service staffing controls, they are subject to government control and supervision either by way of:

  • their own enabling legislation;
  • the provisions of Part XI of the Audit Act(8); or
  • specific reference to the general provisions of the Audit Act.

Moreover, Statutory authorities and Commonwealth companies are from time to time required to seek special appropriations or else pay dividends into consolidated revenue. More fundamentally, Commonwealth authorities and companies can never be said to be entirely divorced from the constraints imposed by the Constitution which sets the parameters for the Government's accounting framework.

The accounting framework of the Commonwealth is broadly defined by the Constitution.

Section 51 provides that the Parliament has power to make laws for taxation and borrowing money on public credit. Parliament also has the exclusive right to impose customs and excise duties (section 90).

Money raised or revenue received by the Executive Government must form part of one Consolidated Revenue Fund (CRF) which may be appropriated (drawn on) for Commonwealth purposes (section 81).

No money can, however, be drawn from the Treasury of the Commonwealth except under an appropriation made by law (section 83).

Public money may only be appropriated on the initiative of the Executive Government (section 56) as a message from the Governor-General to the House of Representatives recommending an appropriation is required.

Since federation, the defining elements of day to day Commonwealth financial administration have been section 81 and 83 of the Constitution and the Audit Act, which, as has been frequently noted, was the fourth piece of legislation enacted by the Commonwealth.

The Audit Act establishes the framework for financial administration of the Executive Government and the roles, powers and duties of Commonwealth officers responsible for financial administration. Three tiers of subordinate (delegated) legislation prescribe these powers and functions in more detail.They are:

  • the Finance Regulations - made on the authority of the Governor-General
  • the Finance Directions - given on the authority of the Minister for Finance; and
  • Secretaries' Directions - given on the authority of the Secretary of a Department to the staff of that Department.

Commonwealth Authorities and Companies and Audit Controls

Many Commonwealth/Statutory authorities and government companies are not subject to the standard controls imposed by the Audit Act but are subject to specific measures contained in the enabling legislation under which they operate.

In 1979, the Audit Act was amended by inserting Part XI to establish some basic financial provisions relating to the operations of Statutory authorities and certain other bodies. This was a first step towards standardisation of reporting, accounting and ethical requirements of Statutory authorities to which Part XI applied. The 1979 amendments did not, however, subject the authorities affected to the other provisions of the Audit Act.

Part XI of the Audit Act currently sets out financial provisions for bank accounts, the keeping of proper accounts, investment, audit by the Auditor-General, annual reports and financial statements of prescribed authorities that operate outside the obligations and safeguards provided by the public account. Division 2 of Part XI applies to commercial authorities; Division 3 applies to non-commercial authorities.

In addition, the Department of Finance has (since 1983) issued a special publication,'Guidelines for Financial Statements of Public Authorities and Commercial Activities'. These guidelines seek to 'facilitate the preparation of general purpose financial reports of public authorities and commercial activities that convey relevant and reliable information to users and enable management to discharge their accountability in an effective manner.'(9)

The Guidelines apply to the financial statements of:

  • Commonwealth public authorities required by an Act to comply with the Guidelines;
  • Commonwealth public authorities that are referred to in an instrument of the Minister for Finance approving the forms of those statements as set out in Part II of Schedule 2 of the Guidelines;
  • Departmental trust accounts that are required by a determination of the Minister pursuant to section 41D of the Audit Act to prepare financial statements in the form set out in Part II of Schedule 2 of the Guidelines.

The Guidelines do not apply to companies owned or controlled by the Commonwealth.(10)

Standardisation

In 1986(11) and 1987(12), the Government indicated its intention to standardise reporting arrangements for incorporated authorities.

In April 1989, the Parliamentary Joint Committee of Public Accounts (JCPA) presented its Report No. 296, The Auditor-General: Ally of the People and Parliament - Reform of the Audit Office, which recommended that the Audit Act be repealed and replaced with more modern and flexible financial management.(13) This recommendation was accepted by the Government in November 1989.(14)

In November 1989, the Senate Standing Committee on Finance and Public Administration recommended that general provisions for formation, reporting audit and disposal of government companies be set out in a Government Companies Act.(15) The report also gave added weight to the recommendations made by the JCPA in its 1989 Report cited above.

In June 1990, a new national scheme for the regulation of companies generally (the Corporations Law) was agreed by the Commonwealth and the States and Territories. This move to greater uniformity also added impetus to the push treating Commonwealth owned companies in a like manner to their private sector counterparts.

The above developments, and the drive for greater efficiency and accountability in public enterprises and undertakings generally, have also added weight to proposals for standardising financial and reporting requirements for Commonwealth authorities if for no reason other than to simplify the task of monitoring their activities.

Ministerial Responsibility

The pursuit of more uniformity and enhanced accountability has not been entirely free of controversy although the underlying elements of that controversy have not always been clearly articulated. In the context of the present package, accountability and standardisation are seen as fundamental goals.

A theme running through the submissions to the JCPA Enquiry into the 1994 audit Bills was that relations between Ministers and Commonwealth authorities and businesses do not readily conform to any fixed set of principles or a convenient 'one-size-fits-all' approach. (Subsequent amendments have sought to address a number of specific concerns raised with the JCPA.)

Attempts to lay down hard and fast rules, particularly those designed to bolster 'traditional' notions of ministerial responsibility or extend them to all Statutory authorities, must circumvent a number of hazards. For example, there is a myriad of rules governing the financial relations of Commonwealth authorities and companies because there is a myriad of authorities and companies serving myriad purposes. These corporate objectives and functions are not always clearly defined or integrated into policy formulation. Indeed as the Department of Finance itself observed,'([in some instances] Statutory authorities have grown up through a series of ad hoc government decisions, without prior careful consideration of the national benefits and costs of their establishment.'(16)

To impose a standard set of requirements on such an array of interests is an ambitious step but one which has not been explicitly challenged to date.

This is not, however, to say that efficiency and accountability are mutually incompatible. In May 1994, the Industry Commission supported the fundamental tenets of accountability in relation to GBEs, concluding that:

Boards should be accountable to parliaments through the relevant minister(s). Accountability is supported by the preparation of a corporate plan, annual report and indicators of financial and non financial performance as well as external audit.(17)

The fundamental question is one of degree. How to minimise the costs of responsible management without unduly inhibiting managerial initiative or opening the door to political interference in decision-making. One starting point is to recognise that Statutory authorities and government companies exist outside departmental structures for the very purpose of extricating them from day to day control by Ministers. Another is to acknowledge that the absence of day to day control should not lead to an abrogation of responsibility so that at the minimum, Statutory authorities can be legitimately expected to comply with Government policies and should endeavour to meet performance targets set for them by Government.

In attempting to balance the above considerations the Hawke Government enunciated what may still be a useful set of 'ground rules' for determining the relationship between a Minister and any given statutory body or government enterprise:

The responsibility of a Minister for an authority derives from sections 61 and 64 of the Constitution, and is shown by the assignment of the enabling Act by the Administrative Arrangements Order.The following factors have a bearing upon the role a Minister may be called upon to take and the extent of the responsibility to be borne in relation to an authority's affairs:

  • Authorities are accountable to the Parliament through the responsible Minister.
  • The degree of autonomy of an authority from Ministerial control will depend upon the nature of the functions which justified its establishment and for which independence is specifically warranted. However, outside areas of specific autonomy of an authority, general government policies should be adhered to. Appropriate Ministerial controls, including powers of approval or direction, should normally be provided in the legislation.
  • Areas of independence and those subject to Ministerial controls (and the nature of those controls) should be clearly and precisely specified in enabling legislation, including activities for which specific Ministerial approval must be sought.
  • Where an authority is required by statute to perform a function independently of Ministerial direction or superintendence, it is the authority which must take responsibility for day-to-day discharge of the function and for reporting to Parliament, through the responsible Minister, accordingly. The authority's annual report will be the normal means for rendering this account.
  • Even where independence is stipulated, the activities of an authority will normally be monitored by the Minister to ensure satisfactory observance of the requirements of the existing charter, the adequacy of that charter, and the general quality of performance, including assurances that the conduct of business by an authority conforms to appropriate public standards of propriety and probity. In meeting these obligations, the Minister needs to be kept regularly advised of the activities of an authority.If suitable procedures do not exist for this purpose they should be established, if necessary on a statutory basis.
  • The nature and extent of a Minister's role and responsibilities in each particular case vary according to the specific legislative provisions relating to the respective functions and responsibilities of the Minister and the statutory authority.(18)

The CAC Bill

The present CAC Bill closely resembles the Commonwealth Authorities and Companies Bill 1994 as read a third time in the House of Representatives, i.e. the 1994 Bill as amended in response to JCPA Report No. 331 (see below).

A earlier version of the CAC Bill was introduced on 29 June 1994 by the Minister for Finance, the Hon Kim Beazley and referred, on his motion, to the JCPA for review with an advisory report to be presented by 23 August 1994. Extensive public hearings were held and on 23 August 1994 the House agreed to extend the reporting deadline till 22 September 1994.

The JCPA presented its Report No. 331, entitled, An Advisory Report on the Financial Management and Accountability Bill 1994, the Commonwealth Authorities and Companies Bill 1994 and the Auditor-General Bill 1994, and on a Proposal to Establish an Audit Committee of Parliament, in September 1994, which generally welcomed the introduction of the CAC Bill noting that:

  • it would enable Parliament to view the accountability requirements of the vast range of Commonwealth authorities and companies as a whole;
  • it would ensure that the accountability requirements are explicit and consistent for each class of Commonwealth entity;
  • it would strengthen and clarify the mandate of the Auditor-General; and
  • the task of amending one Bill to reflect contemporary best practice standards will be far easier than amending individual enabling Acts, company memoranda and articles.(19)

JCPA Report No. 331, was, however, critical of a number of aspects of the Bill and the Committee made a series of recommendations for improving the legislation.

When the CAC Bill was debated, the Government moved a series of 20 amendments which in part addressed the concerns raised by the JCPA. The Bill was passed by the House on 8 December 1994 and introduced into the Senate on 6 February 1995. An amendment moved by the Australian Democrats was passed(20) and the Bill returned to the House of Representatives which rejected the Democrat amendment on 29 March 1995. As noted above, the 1994 audit Bills failed to pass during the life of the previous Parliament.

Main Provisions

It should be noted that the substantive provisions of the Bill do not represent a complete code for the regulation of Commonwealth authorities and companies.Importantly, the audit package will also include general policy statements issued by the Government [refer clauses 28 and 43] and Finance Minister's Orders to be issued under clause 48 of the CAC Bill.

Definitions

In a generic sense, most the bodies dealt with under this Bill may be termed 'Statutory authorities'.A 'Statutory authority' is an organisation established by an Act of Parliament to provide services to the community. These come in many functional types including:

  1. trading
  2. adjudicatory
  3. regulatory
  4. public advisory and research functions
  5. educational, cultural and media functions
  6. investigation of and reporting on executive action
  7. inter-governmental functions.

Whilst Statutory authorities generally derive little or no revenue from the services they deliver, there are exceptions in the form of two special types of Statutory authorities:

  • 'Statutory Marketing Authorities' (SMAs); and
  • 'Government Business Enterprises' (GBEs).

The term 'statutory authority' is not defined in the CAC Bill as separate operating rules and reporting requirements are intended to apply to different types of entity coming within the scope of the legislation.

SMAs and GBEs

SMAs are financed through levies paid by growers or from sale of produce.

GBEs sell their services and derive a substantial proportion of their revenue from those sales. Although the absolute amounts of Budget funding can be large, Budget funding usually represents a much smaller proportion of total funding of GBEs than is the case with ordinary Statutory authorities. Some GBEs are completely independent of the Budget. GBEs may be established either as Statutory authorities or companies.

The Explanatory Memorandum to the CAC Bill notes that:

  • In general, 'GBEs' should satisfy three criteria: they are commercial, trade outside the public sector, and are not primarily regulatory bodies.
  • 'SMAs' generally are Commonwealth authorities whose operations are funded significantly from levies (or similar charges) paid by primary producers for whose benefit the authority performs marketing functions.(21)

What is, and what is not, a SMA or a GBE for the purposes of the Bill is left to be determined by regulation [clause 5].

'Commonwealth authority'

Clause 7 sets out the bases for determining whether a body is a 'Commonwealth authority' for the purposes of the Bill. A 'Commonwealth authority', as defined, is either:

  • a body corporate established for a public purpose by an Act; or
  • a body corporate incorporated for a public purpose by regulation under an Act or under an Ordinance of a Territory (other than Norfolk Island) or regulations under such an Ordinance and are prescribed as Commonwealth authorities under the CAC Act.

The expression 'Commonwealth authorities' does not, however, include:

  • bodies incorporated under the Corporations Law of a State or Territory;
  • Aboriginal associations incorporated under Part IV of the Aboriginal Councils and Associations Act 1976; and
  • trade unions within the meaning of the Workplace Relations Act 1996.

Subclause 7(3) provides that all money held by a Commonwealth authority is held on its own account unless it is specifically defined as public money for the purposes of section 5 of the FMA Bill.This provision seeks to address any possible ambiguity in relation to money held by a Commonwealth authority on trust.

'Commonwealth company' and 'wholly-owned Commonwealth company'

Clause 34 defines the expression 'Commonwealth company' to be a body corporate that is incorporated, or taken to be incorporated, under the Corporations Law of a State or Territory and in which the Commonwealth has a direct controlling interest.Corporations controlled by the Commonwealth but through a one or more intermediaries that are themselves Commonwealth authorities or Commonwealth companies do not come within the definition of 'Commonwealth company'.

The expression 'wholly-owned Commonwealth company' means any Commonwealth company, which are beneficially owned by a person other than the Commonwealth.

'Subsidiary'

The expression 'subsidiary' is used in the Bill to mean an entity that is controlled by an Commonwealth authority or Commonwealth company [clause 5].

'Director'

The term includes not only members of governing bodies of Commonwealth authorities but also persons who are directors of Commonwealth companies within the meaning of the Corporations Act 1989[clause 5].

'Officer'

As defined in the Bill, an 'officer' in relation to a Commonwealth authority means not only a director of an authority but also any person who takes part in the management of the authority [clause 5].

Role of Auditor-General

The Auditor-General must audit each Commonwealth authority and must also audit the financial statements of each subsidiary of every Commonwealth authority [clause 8] except certain subsidiaries operating outside Australia [subclause 12(4)].

In relation to Commonwealth companies and their subsidiaries, the Auditor-General is to be the auditor for the purposes of the Corporations Law or, if someone else is the auditor, the Auditor-General is to prepare a report on the company's financial statements and give it to the responsible Minister [clause 35 and subclauses 36(2) and (3) and subclause 37(3)]. As with subsidiaries of Commonwealth authorities, subsidiaries of Commonwealth companies operating outside Australia may be exempted from being audited by the Auditor-General [subclause 37(4)].

Clauses 16 and 17 of the Auditor-General Bill provides that the Auditor-General may at any time conduct a performance audit of a Commonwealth authority or company which is not a GBE.For GBEs, the Auditor-General may only conduct a performance audit where:

  • the Finance Minister; or
  • the responsible Minister; or
  • the Joint Committee of Public Accounts and Audit (JCPAA)

requests such an audit.(22)

Reporting Requirements

Annual Reports

Clause 9 provides that the directors of a Commonwealth authority must prepare an annual report each financial year and that that report must be given the responsible Minister by the 15th day of the 4th month after the end of the financial year, i.e. presently October 15. Subclause 9(3) provides that the responsible Minister must table the report in each House as soon as practicable.

Clause 36 provides that at least 14 days before each annual general meeting, a Commonwealth company must give the responsible Minister a copy of the company's annual report.There are, however, differing tabling requirements for Commonwealth companies and those entirely owned by the Commonwealth.Subclause 36(4) provides that in respect of wholly-owned Commonwealth companies the responsible Minister must table the documents in each House as soon as practicable.In other cases, where shares or an interest in the company are held by private interests, the responsible Minister must table the documents but not until the company has held its annual general meeting.

Clause 30 further provides that the annual accounting period for subsidiaries of Commonwealth authorities should be brought into line with those of the parent body except where the Finance Minister grants an exemption [clause 31].

Interim Reports

Clause 13 provides that the Finance Minister may require a particular Commonwealth authority or class of authority to provide regular interim reports to the responsible Minister. Such a report must include a report on operations prepared by the directors in accordance with the Finance Minister's Orders [refer subclause 13(2) and clause 48]. Under clause 15, Commonwealth authorities and their subsidiaries must also inform the responsible Minister where they propose undertaking any significant restructuring activity (e.g. form a company or participate in the formation of a company or undertake a new business venture) as detailed in the clause. Clause 16 also imposes a general duty on all Commonwealth authorities to keep both their Minister and the Finance Minister informed on their activities.

Subclause 38(1) provides that the Finance Minister may require a particular wholly-owned Commonwealth company or class thereof to provide regular interim reports to the responsible Minister. The responsible Minister must table any such interim report in each House as soon as practicable. Under clause 40, wholly-owned Commonwealth companies and their subsidiaries must also inform the responsible Minister where they propose undertaking any significant restructuring activity (e.g. form a company or participate in the formation of a company or undertake a new business venture) as detailed in the clause. Clause 41 also imposes a general duty on all wholly-owned Commonwealth companies to keep both their Minister and the Finance Minister informed on their activities.

All Commonwealth authorities and Commonwealth companies (other than GBEs) must also prepare budget estimates for each financial year and for any other period directed by the responsible Minister [clauses 14 and 39].

GBEs

As already indicated, the Bill makes specific provision for GBEs.

Clauses 17 and 43 severally provide that GBEs which are either Commonwealth authorities or wholly-owned Commonwealth companies must prepare corporate plans at least once a year and give them to the responsible Minister.Such plans must cover a period of at least 3 years. The responsible Minister must also be kept informed of significant changes to the plan.

As noted above, GBEs which are wholly-owned Commonwealth companies or are Commonwealth authorities must prepare budget estimates each financial year.

Clause 19 provides for special conditions to apply to GBEs and SMAs that are Commonwealth authorities in relation to banking and investment.The significant difference between the requirements imposed on Commonwealth authorities generally and those imposed on GBEs and SMAs (that are authorities) is that the latter may invest 'surplus money' in any manner that is consistent with sound commercial practice [paragraph 19(3)(d)]. Other Commonwealth authorities do not enjoy such discretion and are confined to defined forms of deposit accounts and securities and other methods 'approved by the Treasurer' [paragraph 18(3)(d)].

Miscellaneous

Clause 21 makes provision for dealing with possible conflicts of interest involving directors of Commonwealth authorities.

Clause 22 provides that anyone involved in the management of a Commonwealth authority must act honestly and exercise due care and diligence.

Clause 23 provides that officers of Commonwealth authorities must not make improper use of information gained from their holding their office.

Clause 32 provides that each Commonwealth authority must establish and maintain an audit committee to help the authority and its directors comply with their obligations under the Act. It appears that the rules governing the operation of such committees are to be established by regulation. Wholly-owned Commonwealth companies are also required to establish and maintain audit committees [clause 44].

Endnotes

  1. The Auditor-General Bill 1994, the Commonwealth Authorities and Companies Bill 1994, the Financial Management and Accountability Bill 1994 (introduced June 1994) and the Audit (Transitional and Miscellaneous) Amendment Bill 1994 (introduced December 1994).
  2. The Bills were referred to the JCPA by then Finance Minister, Kim Beazley, on 29 June 1994.
  3. June 1996: 4.
  4. For a slightly different approach to the meaning of key terms to that taken in the audit Bills, see the introduction to the 1996 Report of the Senate Finance and Public Administration Legislation Committee, List of Commonwealth Bodies.
  5. Provisionally these are: the Australian Postal Commission, Telstra, the Defence Housing Authority, Australian Defence Industries, the Australian Industry Development Corporation, the Export Finance Insurance Corporation, the Australian Technology Group Ltd, Snowy Mountains Hydro-Electric Authority, Airservices Australia, the Federal Airports Corporation, the Australian National Railways Commission, ANL Ltd, and the Housing Loans Insurance Corporation.
  6. Senate Standing Committee on Finance and Public Administration, List of Commonwealth Bodies, June 1993:v-vi.
  7. There were 7 'casualties', being: Aerospace Technologies of Australia Ltd, Commonwealth Funds Management Ltd, the Pipeline Authority, Qantas Airways Ltd, Civil Aviation Authority, Australian Maritime Safety Authority, and Commonwealth Bank of Australia. The one addition is Airservices Australia.
  8. Approximately 80 Statutory authorities are required to meet the reporting requirements of Part XI. Refer JCPA, Report No. 331: 25.
  9. Department of Finance, Guidelines for Financial statements of Public Authorities and Commercial Activities, January 1994: 1.
  10. ibid.
  11. Minister for Finance, 'Statutory authorities and Government Business Enterprises', Discussion Paper, AGPS, June 1986: 13-14.
  12. Minister for Finance, 'Policy Guidelines for Commonwealth Statutory authorities and Government Business Enterprises', A Policy Information Paper, AGPS, October 1987: 14-15.
  13. JCPA, Report No. 296, The Auditor-General: Ally of the People and the Parliament - Reform of the Audit Office, 1989, AGPS, Canberra: 240.
  14. Minister for Finance, Senator the Hon Peter Walsh, Government Response to JCPA Report No. 296, 1 November 1989.
  15. Senate Standing Committee on Finance and Public Administration, 'Government Companies and their Reporting Requirements', Report, AGPS, November 1989: 18-19.
  16. Department of Finance, Policy Discussion Paper, op cit, 1986: 2.
  17. Industry Commission, 'Improving the efficiency of GBEs', Information Paper, May 1994: 11.
  18. Minister for Finance, Policy Information Paper, op cit, 1987: 8-9.
  19. JCPA, An Advisory Report on the Financial Management and Accountability Bill 1994, the Commonwealth Authorities and Companies Bill 1994 and the Auditor-General Bill 1994, and on a Proposal to Establish an Audit Committee of Parliament, Report No. 331, September 1994: 23.
  20. Senate, Hansard, 23 March 1995: 2000.
  21. Department of Finance, Explanatory Memorandum, Commonwealth Authorities and Companies Bill 1996: 3-4.
  22. Refer Bills Digest No. 104, 1996–97: 15.

ATTACHMENT A

Commonwealth authorities and Commonwealth companies for the purposes of the

Commonwealth Authorities and Companies Bill 1996

Aboriginal and Torres Strait          Aboriginal and Torres Strait          
Islander Commercial Development       Islander Commission                   
Corporation                                                                 

Aboriginal Councils                   Airservices Australia                 

Australia Council                     Australian Broadcasting Authority     

Australian Dairy Corporation          Australian Dried Fruits Board         

Australian Film Commission            Australian Film, Television and       
                                      Radio School                          

Australian Fisheries Management       Australian Hearing Services           
Authority                                                                   

Australian Heritage Commission        Australian Horticultural Corporation  

Australian Industry Development       Australian Institute of Aboriginal    
Corporation (AIDC)                    and Torres Strait Islander Studies    

Australian Institute of Criminology   Australian Institute of Family        
                                      Studies                               

Australian Institute of Health and    Australian Institute of Marine        
Welfare                               Science                               

Australian Maritime College           Australian Maritime Safety Authority  

Australian Meat and Livestock         Australian Military Forces Relief     
Corporation                           Trust Fund                            

Australian National Maritime Museum   Australian National Railways          
                                      Commission                            

Australian National Training          Australian National University (ANU)  
Authority                                                                   

Australian Nuclear Science and        Australian Pork Corporation           
Technology Organisation                                                     

Australian Postal Corporation         Australian Securities Commission      
                                      (for public monies see also FMA Act)  

Australian Sports Commission          Australian Sports Drug Agency         

Australian Telecommunications         Australian Tobacco Marketing          
Authority (Austel)                    Advisory Committee                    

Australian Tourist Commission         Australian Trade Union Training       
                                      Authority (ceased operation 1 July    
                                      1996)                                 

Australian War Memorial               Australian Wheat Board                

Australian Wine and Brandy            Australian Wool Research and          
Corporation                           Promotion Organisation                

Civil Aviation Safety Authority       Coal Mining Industry (Long Service    
(CASA)                                Leave Funding) Corporation            

COMCARE                               Commonwealth Scientific and           
                                      Industrial Research Organisation      

Companies and Securities Advisory     Construction Industry Development     
Committee                             Agency (ceased 1 July 1995)           

Cotton Research and Development       Criminology Research Council          
Corporation                                                                 

Dairy Research and Development        Defence Housing Authority             
Corporation                                                                 

Director of National Parks and        Employment Services Regulatory        
Wildlife (aka Australian Nature and   Authority                             
Conservation Agency)                                                        

Energy Research and Development       Export Finance and Insurance          
Corporation                           Corporation                           

Federal Airports Corporation          Fisheries Research and Development    
                                      Corporation                           

Forest and Wood Products Research     Grains Research and Development       
and Development Corporation           Corporation                           

Grape and Wine Research and           Great Barrier Reef Marine Park        
Development Corporation               Authority                             

Health Insurance Commission           Horticultural Research and            
(Functions - Medibank, Medicare,      Development Corporation               
Pharmaceutical Benefits, Child care)                                        

Housing Loans Insurance Corporation   Indigenous Land Corporation           

Land and Water Resources Research     Land Councils                         
and Development Corporation                                                 

Law Reform Commission                 Meat Industry Council                 

Meat Research Corporation             National Food Authority               

National Gallery of Australia         National Library of Australia         

National Museum of Australia          National Occupational Health and      
                                      Safety Commission                     

National Registration Authority for   National Standards Commission         
Agricultural & Veterinary Chemicals                                         

Nuclear Safety Bureau                 Pig Research and Development          
                                      Corporation                           

Pipeline Authority                    Private Health Insurance              
(wound-up August 1996)                Administration Council                

Private Health Insurance Complaints   Reserve Bank of Australia             
Commissioner                                                                

Royal Australian Airforce Welfare     Royal Australian Navy Relief Trust    
Trust Fund                            Fund                                  

Rural Industries Research and         Snowy Mountains Hydro-Electric        
Development Corporation               Authority                             

Special Broadcasting Service          Stevedoring Industry Finance          
Corporation                           Committee                             

Sugar Research and Development        Tobacco Research and Development      
Corporation                           Corporation                           

Torres Strait Regional Authority      University of Canberra                

Wool International                    Wreck Bay Aboriginal Community        
                                      Council                               


Note: Some Statutory authorities have not been included in the list because they are specifically exempted from its application - for example, authorities established by Commonwealth-State agreements.

Contact Officer and Copyright Details

Bob Bennett
25 February 1997
Bills Digest Service
Information and Research Services

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

IRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1323-9031
Commonwealth of Australia 1996

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 4 April 1997



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