Dissenting Report—Coalition Members
Public Governance, Performance and Accountability Bill 2013
Dissenting Report from Coalition Members
The Joint Committee of Public Accounts and Audit Committee
has been asked to inquire whether the creation of the Public Governance,
Performance and Accountability Bill 2013 will impose additional and unnecessary
reporting requirements on bodies subject to the Act and whether the application
of this new Act will reduce transparency or remove important oversight where
While recognising the extensive consultation that has been
undertaken as part of the broader Commonwealth Financial Accountability Review
(CFAR), Coalition members are concerned that undue haste in securing
Parliaments approval of the Bill may overshadow legitimate hesitations about
the whether the time allowed for consultation over the Bill has been sufficient
to ensure the practical implications of the new approach are fully understood.
Further, widespread concerns have been raised that none of
the proposed Rules contemplated to give effect to the principles detailed in
the Bill were able to be presented to the Committee in draft form during its
deliberations or to agencies across Government.
Coalition members note the assurances provided by the
Minister for Finance and Deregulation to the Committee regarding the
development, scrutiny and finalisation of the Rules.
Coalition members are of the view that priority should be given
to achieving precision in the Bill rather than securing a hasty approval by
Parliament and that reform of this magnitude should proceed only after
widespread endorsement for the Bill has been secured.
Coalition members believe the inquiry process has revealed
sufficient caution on the part of a number of prominent agencies directly
responsible for implementation and oversight of the administration of the
Commonwealth’s financial affairs.
In particular, Coalition members note the cautious attitude
of the Auditor-General and the Australian Public Service Commissioner (APSC)
about whether the Bill has undergone the necessary detailed review and
The Auditor General stated in evidence:
I normally appear before this Committee and give a fairly high
level of assurance with respect to the work of my office. I am saying today to
you … that is not that same high level of assurance. I am giving you what an
auditor would call limited assurance.
We would feel more comfortable with this legislation if the
Bill had been subject to a more open process, given the number of entities and
officials affected by it and because of the fundamental importance of the
legislation … We have also had no visibility of the complementary rules which,
together with the legislation, will establish the Commonwealth’s financial
management framework and contribute significantly to it. For these reasons, our
support for the legislation is more measured that it may have been under
different circumstances and with more time.
He echoed this concern at the Senate Estimates hearings the
… some more time for consultation in respect of the draft
Bill would have been, I think, helpful to increase the awareness of proposals
within it and to bring everyone on board with the new approach.
The APSC has stated in evidence to the Committee:
The Public Service Commissioner is sympathetic to the
Auditor-General’s view that it would have been preferable if the Bill had been
subject to a longer exposure process, given the number of entities and
officials affected by it and because of the fundamental importance of the
legislation. It is to be hoped that the associated draft Rules will be made
available for scrutiny at the earliest possible date.
Coalition members note the Explanatory Memorandum states
that one of the ‘long lasting benefits’ of the Bill is to deliver ‘reduced red
tape within the Commonwealth and for partners who contribute to the delivery of
Australian Government programs and services, including grant recipients’. In
this regard, Coalition members note further evidence from the Auditor General:
… The ANAO considers that the Bill provides less obvious
support for achieving reforms in other areas, particularly in the areas of
joined-up government (to better accommodate the concepts of collective
responsibility and multiple accountabilities), and reducing red tape, including
the compliance burden.
In this latter respect, it is noteworthy that one of the key
features of the Bill is that a range of duties are imposed on both accountable
authorities and officials. For accountable authorities and officials, many of
these, while not unreasonable, are additional to existing obligations reflected
in the FMA and CAC Acts.
The Coalition does not agree with comments from the
Department of Finance that delay in the passage of the Bill will result in the
benefits of the reform not being realised. Instead, a proper analysis of the
full benefits and costs of the new approach to financial management can only be
accurately understood following consideration of the Rules. To do so will
require that the Rules be released for public consultation.
Coalition members draw attention to comments of the Auditor
General that a delay in passage of the legislation would not undermine the
future benefits of the reform.
There are no glaring issues that I am aware of at the moment
that absolutely need to be dealt with in the next few months, rather than the
next 12 months.
Further, the Explanatory Memorandum clearly states ‘the
reforms will take several years to implement and integrate fully into the
practices and processes of Commonwealth entities. Gradual introduction of the
reforms will ensure they are appropriately tested and refined in light of
Coalition members are of the view that further consultation
over a defined period would significantly enhance the benefits of reform by
allowing for the refinement, enhancement and improvement of the Bill.
Coalition member recognise that successive Parliaments have
endorsed the increasing use of ‘Principles based’ legislation where the
Principles are delivered through the use of Rules and Regulations that are
often developed and scrutinised after the passage of legislation.
However, we do not accept the
statement in the Committee Report that:
Although some stakeholders may
argue that the rules should be available for scrutiny at the same time as the
legislation, the committee understands this is often impractical and sometimes
Given this Bill is designed to drive significant financial
reform across the bureaucracy, a more prudent approach would have been to adopt
a more integrated approach to the development of the Bill and its accompanying
On this point, Coalition members agree with the sentiments
of the Australian Institute of Company Directors which noted in private
When governments are considering new laws, there should be
appropriate consultation and full transparency of all aspects of the proposal,
including for associated regulations. This will ensure that issues of
principle, unintended consequences and practical problems can be identified and
Coalition members are strongly of the view that financial
reform of the magnitude proposed by the Bill should only proceed with
bipartisan support of Parliament and with the widest possible endorsement
Given the absence of bipartisan agreement on the extent of
consultation on the Bill and the reservations of the Auditor General and the
Australian Public Service Commissioner the Bill should not proceed without a
further 6 months consultation period.
During this period of further consultation, particular
attention and focus should be given to:
n drafting and
circulating as many of the Rules as is practically possible as a means of
building confidence for the new approach across government; and
n securing the unqualified
endorsement of the ANAO and the APSC.
If the Parliament passes the Bill before 30 June, Coalition
(a) the commitments made
by the Minister for Finance and Deregulation in the correspondence of 28 May
2013 be closely monitored; and
(b) a progress report on
the development and drafting of the Rules be made available to the JCPAA by
both the Department of Finance and the ANAO by 30 November.
Senator Dean Smith
Senator Anne Ruston
Mr Jamie Briggs MP
Mr Josh Frydenberg MP
Hon Alex Somlyay MP