Overview
2.1
In 2017–18, the Joint Standing Committee of Public Accounts and Audit (the Committee) tabled nine reports, including Report 466: Annual Report 2016–17. The Committee held 19 meetings, all of which were in Canberra. Ten public hearings were held during the period. Table 2.1 shows some key measures of the Committee’s activities.
2.2
In 2017–18, the Committee received 63 responses to recommendations it had made as part of eight inquiries (see Appendix A). The Committee sought and received clarification on some of those responses. It also received updated information at a later period as requested in some of the recommendations. The responses are published on the Committee’s website, on the webpages of the relevant inquiries.
2.3
The Committee expects—and the government has committed —that Commonwealth entities will respond to the Committee’s recommendations within six months. In 2017–18, 87 per cent of responses were submitted on time.
Table 2.1: The Committee’s inquiry activities in 2017-18 can be compared to previous years according to some key measures
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Number of sitting weeks
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16
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17
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18
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Committee reports tabled in Parliament
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10
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4
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9
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|
Recommendations made
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50
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17
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57
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Government responses received
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27
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39
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63
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Government responses submitted on time
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85%
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92%
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87%
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Recommendations agreed to by agencies
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24
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38
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53
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Auditor General’s reports selected for detailed inquiry
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12
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18
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15
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Total meetings held
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17
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19
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19
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Public hearings held
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12
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8
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10
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Submissions received
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56
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111
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110
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Source: Committee secretariat
Reviews of Auditor-General’s reports
2.4
In 2017-18, the Committee tabled eight reports into matters raised in 16 ANAO audit reports, as summarised below.
2.5
The Auditor–General tabled 48 performance audit reports in Parliament in 2017-18. The Committee considered all of these reports. The Committee commenced ten inquiries into matters raised in fifteen ANAO audit reports. These inquiries are summarised below.
2.6
The Committee reviewed four performance audit reports by correspondence: Pesticide and Veterinary Medicine Regulatory Reform (No. 56 of 2016-17); Efficiency of the Australia Council’s Administration of Grants (No. 7 of 2017-18); Decision-making Controls for Sustainability - National Disability Insurance Agency (No. 13 of 2017-18); and Administration of the National Broadband Network Satellite Support Scheme (No. 16 of 201718‑
). Responses by relevant agencies to these reviews are available on the Committees website.
Report 463 – Commonwealth Financial Statements
2.7
The Committee tabled this report on 5 September 2017. The report examined the findings reported to Commonwealth entities as a result of the 2016–17 financial statement audits.
2.8
The Committee conducted this inquiry based on the Auditor-General's Report No. 33 (2016–17): Audits of the Financial Statements of Australian Government Entities for the Period Ended 30 June 2016.
2.9
A total of 245 findings were reported to Commonwealth entities as a result of the 2015–16 financial statement audits, comprising four significant, 32 moderate and 209 minor findings.
2.10
The Committee reviewed the significant and moderate findings reported by the ANAO. The National Disability Insurance Agency and the Department of Education and Training both had significant audit findings, and the Department of Defence and the Australian Taxation Office both had multiple moderate audit findings. The Committee recommended that, if the next year’s financial statement audits for these agencies result in any significant or moderate findings, entities should report back on their progress in responding to such findings.
2.11
The Committee noted two significant legislative breaches reported to the Northern Land Council during 2015-16, and recommended that the Council report back on progress in responding to these breaches, and any such breaches reported in the next financial year.
2.12
The inquiry further examined the financial reporting requirements associated with executive remuneration. The Committee recommended that the Department of Finance re-establish transparent disclosure of senior executive remuneration as a formal requirement of financial statement reporting, to be reflected in the relevant legislation and guidance.
2.13
The Committee proposed several matters be considered as part of the independent review of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) including reporting on contracts, contractors and consultancies under the annual report provisions of the PGPA Rule 2014 and the PGPA Financial Reporting Rule 2015; bringing forward the delivery and publication of Commonwealth entity annual reports; and further enhancing the effectiveness of entity audit committees.
Report 464 – Commonwealth Grants Administration
2.14
The Committee tabled this report on 5 September 2017. The report applied a thematic approach across four audits, focusing on grant program mechanisms, design and implementation.
2.15
The Committee conducted this inquiry based on the following Auditor-General's reports: Delivery and Evaluation of Grant Programmes (No. 25 of 2015–16); Award of Funding under the 20 Million Trees Programme (No. 4 of 2016–17); The Design of, and Award of Funding under, the Living Safe Together Grants Programme (No. 12 of 2016–17); and Indigenous Advancement Strategy (No. 35 of 2016–17).
2.16
The inquiry focused on the following areas: application and assessment processes; advice to decision-makers to approve funding; and evaluation and implementation of lessons learned.
2.17
The Committee found that granting departments continue to deliver grant programs contrary to the requirements of the Commonwealth’s framework, Commonwealth Grants Rules and Guidelines. Significant administrative issues remain across granting departments—in particular, grant application and assessment processes, advice provided to Ministers, and program evaluation. The Committee concluded that departments must give immediate attention to, and remedy, the shortcomings identified through the inquiry, including through training to assist in shifting cultures and behaviours.
Report 465 – Commonwealth Procurement
2.18
The Committee tabled this report on 14 September 2017. The report applied a thematic approach across three audits, focusing on Commonwealth entity procurement processes and business practices.
2.19
The Committee conducted this inquiry based on the following Auditor-General's reports: Procurement of the International Centre for Complex Project Management to Assist on the OneSKY Australia Program (No. 1 of 2016–17); Delivery of Health Services in Onshore Immigration Detention (No. 13 of 2016–17); and Offshore Processing Centres in Nauru and Papua New Guinea: Procurement of Garrison Support and Welfare Services (No. 16 of 2016–17).
2.20
The inquiry focused on the following areas: implementation of ANAO recommendations; adherence to procurement policies and procedures; achieving value for money; and probity management.
2.21
The Committee reviewed Airservices’ problematic approach to the procurement of the International Centre for Complex Project Management (ICCPM) to assist on OneSKY Australia (OneSKY). The Committee noted that Airservices agreed to all of the Auditor-General’s recommendations and had made progress in implementing these recommendations. However, to demonstrate the requisite organisational cultural change, the Committee recommended that Airservices provide a post-implementation progress report for each of the audit recommendations. The Committee also recommended that Airservices report back on the findings of its independent probity audit, and that the Department of Finance and the ANAO consolidate procurement guidance for corporate Commonwealth entities to ensure more strict application of the Commonwealth Procurement Rules. The Committee recommended that the ANAO consider conducting a third stage audit into the conduct of the OneSKY tender and any associated matters.
2.22
The Committee noted several problematic areas in the management by the Department of Immigration and Border Protection (DIBP) of its contract with International Health and Medical Services (IHMS) to provide health services for onshore immigration detention. The Committee recommended that DIBP report back on these areas and the performance of the department’s Health Services and Policy Division in the ongoing administration of the contract with IHMS.
2.23
In its review of the audit of procurement of Garrison Support and Welfare Services in Offshore Processing Centres in Nauru and Papua New Guinea, the Committee noted the ANAO’s finding that there were significant deficiencies in all three phases of the procurement activity. The Committee also noted the ANAO’s finding of ongoing issues related to DIBP’s record keeping practices, including conflicts of interest, assessments and performance management of contracts. The Committee recommended that DIBP provide a post-implementation progress report on the ANAO recommendations, and that the ANAO consider conducting a performance audit of the department’s next procurement process in this area.
Report 467 – Cybersecurity Compliance
2.24
The Committee tabled this report on 25 October 2017. The focus of the report was on the cyber resilience of three agencies and respective implementation of the mandatory Australian Signals Directorate Top Four strategies.
2.25
The Committee conducted this inquiry based on the Auditor-General's Report No. 42 (2016–17): Cybersecurity Follow-up Audit.
2.26
The Committee noted that of the three agencies assessed, the Department of Human Services was found by the ANAO to be compliant and cyber resilient. The Australian Taxation Office (ATO) and the Department of Immigration and Border Protection (DIBP) remained not compliant. The Committee recommended that all entities should achieve compliance with the Top Four mitigation strategies as soon as possible and that the ATO and DIBP report back to the Committee on their progress towards achieving full compliance, including advice as to barriers and timelines to complete outstanding actions.
2.27
The Committee made 10 recommendations aimed at strengthening the cybersecurity posture of Government entities, including making it mandatory for all Commonwealth entities to: comply with the Essential Eight cybersecurity strategies; join the Internet Gateway Reduction Program; and participate in the Australian Signals Directorate’s annual cybersecurity survey. The Committee also recommended that both the Attorney-General’s Department and the Australian Signals Directorate report annually to the Parliament on the Commonwealth’s cybersecurity posture.
Report 468 – Defence Major Projects Report (2015-16)
2.28
The Committee tabled this report on 26 October 2017. The 2015-16 Major Projects Report (MPR) is a consolidated review of 26 selected major defence acquisition projects (Major Projects) being managed by the Department of Defence (Defence).
2.29
The Committee conducted this inquiry based on the Auditor-General's Report No. 40 (2016-17): 2015-16 Major Projects Report. This inquiry also included analysis of ANAO Audit Report No. 11 (2016-17): Tiger - Army’s Armed Reconnaissance Helicopter.
2.30
The Auditor-General’s qualified audit finding was a significant issue to the Committee in its review of the MPR. The ANAO report found that the Tiger Helicopters (hereafter ‘Tiger’) Project Data Summary Sheets had not been prepared on the basis of guidelines and did not address significant caveats, capability deficiencies and obsolescence issues identified when Final Operational Capability (FOC) was declared in April 2016. Accordingly, the Committee agreed to continue to monitor the Tiger project and related issues in future MPRs.
2.31
The Committee made four recommendations aimed at continuing to drive improvements in transparent reporting of Defence major project expenditure, recommending that Defence: reviews the way it develops expected capability estimates; works with the Australian National Audit Office to update the way Project Maturity Scores are calculated; examines guidelines and methodology used to report on major projects in the United Kingdom; and develops a single methodology to calculate the cost per flying hour for fixed wing aircraft and helicopters.
Report 469 – Commonwealth Performance Framework
2.32
The Committee tabled this report on 6 December 2017. The report applied a thematic approach across three audits, focusing on the requirement under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) that Commonwealth entities produce corporate plans, Portfolio Budget Statements, annual reports and annual performance statements.
2.33
The Committee conducted this inquiry based on the Auditor-General's reports: Implementation of the Annual Performance Statements Requirements 2015-16 (No. 58 of 2016-17); Corporate Planning in the Australian Public Sector (No. 6 of 2016-17); and Administration of Higher Education Loan Program Debt and Repayments (No. 31 of 2015-16).
2.34
The Committee has a long-term focus to ensure a clear line of sight between the use of public resources and the outcomes achieved by Commonwealth entities. In Report 453, Development of the Commonwealth Performance Framework, the Committee made several observations relevant to this inquiry, specifically supporting consistency in the presentation of performance information and the importance of establishing clear criteria that performance information should satisfy. It remains the view of the Committee that performance reporting must be supported by strong and sustained leadership and effective performance monitoring, reporting and evaluation regimes.
2.35
The Committee recommended that, to provide the necessary incentive for entities to ensure quality reporting and assurance, the Australian Government amend the PGPA Act to enable mandatory annual audits of performance statements by the Auditor-General. The Committee also recommended that amendments include improved clarification of the audit committee functions and charter to reflect the appropriateness and assurance of performance reporting.
2.36
The Committee supported the Auditor-General’s position that the ANAO continue to build on its audit methodology so that the organisation is positioned to conduct the audit of annual performance statements of Commonwealth entities in a similar way to the audit of financial statements. Additionally, the Committee recommended that the ANAO consider conducting an audit of one complete Commonwealth performance reporting cycle. The Committee further recommended that the four audited Commonwealth entities from Audit Report No. 54 (2016-17) report back to the Committee on how their senior management teams are working to further embed the corporate planning requirements in future cycles.
2.37
Noting that performance framework implementation remains a ‘maturity process’, the Committee recommended that the Australian Public Service Commission conduct a review on whether non-financial performance reporting and evaluation requires strengthening as a training and research discipline.
2.38
Furthermore, the Committee recommended the Department of Finance (Finance) undertake a more comprehensive monitoring and evaluation program for the ongoing implementation of the Commonwealth performance framework and report back on implementation by Commonwealth entities of a more mature approach to risk management and ‘joined up’ government.
2.39
In its report, the Committee also concluded that the Department of Education and Training could improve its performance reporting for the Higher Education Loan Program. The Committee endorsed the ANAO finding that the department and the Australian Taxation Office should broaden the range of program information reported publicly, making a recommendation on this matter.
Report 470 – Defence Sustainment Expenditure
2.40
In 2015 when reviewing the Defence Major Projects Report, the Committee noted the size of sustainment expenditure at $5 billion per annum, and recommended that following the implementation of the Department of Defence’s First Principles Review, that the department improve how it reports on sustainment. In November 2016, the Committee readopted a lapsed inquiry into Defence Sustainment Expenditure, and on 21 June 2017 resolved to also inquire into Auditor-General’s Report No. 2 (2017-18): Defence’s Management of Materiel Sustainment.
2.41
The Committee tabled this report on 20 March 2018. The Committee made six recommendations aimed at continuing to drive improvements in transparent reporting of Defence sustainment expenditure, recommending that Defence: report on the progress of various matters, including reforms arising out of Defence’s First Principles Review, the Systems Program Offices review, the whole-of-life costing model, and selecting a candidate to run the Major Projects Office; report on behavioural changes that have accompanied improvements in internal performance reporting; ensure a ‘clear read’ of financial and descriptive performance information across its Corporate Plan, Portfolio Budget Statements, Portfolio Additional Estimates Statements, and Annual Report; consolidate this information online to allow for easy scrutiny of expenditure; and direct hard copy or PDF Defence Annual Report readers to the presence of further information available online.
2.42
The Defence sustainment budget is expected to grow year on year across the forward estimates, to over $11 billion in 2020-21. The percentage of sustainment budget to acquisition budget will average 77 per cent across the forward estimates.
Report 471 – Security of Overseas Missions
2.43
The Committee tabled this report on 8 May 2018. The Committee conducted this inquiry based on the Auditor-General's Report No. 5 (2017–18): Protecting Australia’s Missions and Staff Overseas: Follow-on.
2.44
The report highlighted that rigorous planning and monitoring, supported by sound capability, are essential for protecting Australia’s missions and staff overseas. The Department of Foreign Affairs and Trade’s (DFAT) diplomatic network comprises 106 posts across more than 80 countries which are staffed by several thousand personnel.
2.45
The Committee made eight recommendations aimed at improving DFAT’s governance of post security and aspects of staff training, recommending that the department: provide details on the effectiveness of the Departmental Security Framework; report back on the department’s progress in implementing recommendations from previous audit and review coverage; review current independent assurance arrangements and take action accordingly; ensure consequences for non-compliance are adequate to embed a strong security compliance culture; update the Committee on the status of the department’s cyber resilience and compliance with the ‘Essential Eight’; provide further information on systems improvements to facilitate assurance that staff receive the required security training; review the level of support provided to staff regarding post security, particularly the security training program, implementing improvements as necessary; and mandate cyber security training for locally engaged staff and provide further information on how the security communications program addresses cybersecurity.
Current inquiry – Australian Government Contract Reporting
effectiveness of Commonwealth procurement policy and guidance
use of consultancy and non-consultancy services in the Australian Public Service
transparency of reporting Commonwealth procurement
Australian Public Service capability and capacity
jurisdictional comparison and lessons
2.47
Audit Report No. 19 sought to provide greater transparency on procurement activity in the Australian public sector. This information report is neither an audit nor an assurance review. No conclusions or opinions were presented.
2.48
Audit Report No. 19 covered a range of themes and analysis of the Australian Government's centralised publication of contract notices, including the following areas:
the volume and value of Government procurement contracts by entity, product/service categories, and other characteristics
entities' procurement contract behaviour in regards to the timing of procurements during each financial year, their use of procurement methods and confidentiality clauses, and amendments to contracts
accuracy and timeliness of entities' procurement contract reporting;
reporting on the number and value of procurement contracts undertaken with Small to Medium Enterprises (SMEs)
Current inquiry – Commonwealth Procurement – second inquiry
2.49
The Committee commenced an inquiry based on the Auditor-General’s reports:
No. 12 (2017-18): Management of the Contract for the Telephone Universal Service Obligations
No. 9 (2017-18):Management of the Pre-construction Phase of the Inland Rail Programme
2.50
Audit Report 12 found that key aspects of the Telstra USO Performance Agreement (TUSOPA) does not reflect value for money principles. The ANAO concluded the TUSOPA contract term of 20 years, with a fixed annual fee based on 2009–10 costs does not reflect the demonstrated decline in demand for standard telephone and payphone services over the relevant period. The ANAO found that existing performance reporting under TUSOPA provides limited transparency as to whether contract services are achieving the stated policy objective. More specifically, because reporting provides no information on the quantity of standard telephone services that Telstra supplies solely on the basis of its universal service obligations, it is not possible to determine the extent to which the TUSOPA contributes to Australians having reasonable access to such services on an equitable basis. The ANAO concluded while the TUSOPA has played a role in facilitating the involvement of Telstra in the rollout of the NBN, there is a lack of clear evidence that a net public benefit has been realised as a direct result of the introduction of the TUSOPA.
2.51
Audit Report No. 9 found that in managing the pre-construction phase of the Inland Rail programme, the Australian Rail Track Corporation (ARTC) could have had a greater focus on achieving value for money in procurement activities. The ANAO found that governance arrangements for the pre-construction phase of the Inland Rail programme were appropriate, although there was not timely implementation of the Minister’s decision that a funding agreement be developed between the Department of Infrastructure and Regional Development and the ARTC. The Australian Government’s longer term intent with regard to the delivery and full construction of the Inland Rail was considered, including through the administration of grant funding. The ANAO found ARTC’s established Information and Communications Technology (ICT) systems and procurement and document management processes and practices were well short of the needs of the Inland Rail programme.
2.52
Audit Report No. 61 found that the Department of Health complied with the Commonwealth Procurement Rules effectively managing an open tender process and considering value for money. However, the effectiveness of the procurement had been reduced due to inadequate consideration of risk during planning and poor management of probity and conflicts of interest. The ANAO reported that the objectives of the Government had not been achieved in the agreed timeframe and additional costs had been incurred as a result.
Current inquiry – Commonwealth Financial Statements
2.53
The Committee commenced an inquiry based on the Auditor-General’s Report No. 24 (2017-18): Audits of Financial Statements of Australian Government Entities for the Period Ended 30 June 2017.
2.54
The Committee’s inquiry will particularly focus on: equity investment, concessional loans and contingent liabilities, and the applicable budget, accounting and valuation rules; significant and moderate findings for NDIA; and the management of IT controls.
2.55
A total of 222 findings were reported to entities as a result of the 2016–17 financial statements audits. These comprised two significant, 20 moderate and 200 minor findings. Six legislative breaches were also reported to entities during 2016–17.
2.56
The ANAO found that 78 per cent of significant and moderate findings were in the areas of: management of IT controls, particularly the management of privileged users; compliance and quality assurance frameworks supporting program payments; revenue, receivables and cash management; and the management of non-financial assets.
Current inquiry – Defence First Principles Review and Naval Construction
2.57
The Committee commenced an inquiry based on the Auditor-General’s reports:
2.58
Audit Report No. 34 found that Defence has implemented a substantial number of the recommendations of the First Principles Review—relating to building a strong strategic centre within Defence and reforming the capability development process. The implementation of other important recommendations—including the reform and consolidation of Defence’s Systems Program Offices and enabling services—remain a work in progress. The report found that Defence has established sound governance arrangements for the implementation of the First Principles Review; however the ANAO concluded that full implementation and all intended outcomes would require several more years of continued focus.
2.59
Audit Report No. 39 found that, whilst Defence continues to work towards effective planning and mobilisation to deliver the Australian Government’s Naval Shipbuilding Plan, successful implementation will depend on actively managing the high to extreme levels of associated risk. The ANAO reported that Defence has identified key elements and enablers of success for the program, but suggested that at this early stage governance arrangements are still evolving and thus, their effectiveness cannot be established.
Current inquiry – Australian Government Funding—Schools and Indigenous Health
2.60
The Committee commenced an inquiry based on the Auditor-General’s reports:
No. 50 (2017-18): Primary Healthcare Grants under the Indigenous Australians’ Health Program
2.61
Audit Report No. 18 found the arrangements established by the Department of Education and Training to monitor the impact of Australian Government school funding do not provide a sufficient level of assurance that funding has been used in accordance with the legislative framework, in particular the requirement for funding to be distributed on the basis of need.
2.62
Audit Report No. 50 found the Department of Health’s design and implementation of the primary healthcare component of the Indigenous Australians’ Health Program (IAHP) was partially effective as it has not yet achieved all of the Australian Government’s objectives in establishing the program. The ANAO found the department has not implemented the planned funding allocation model, with shortcomings in performance monitoring and reporting arrangements. Furthermore, the majority of IAHP primary healthcare grant funding had not been reflective of the intended needs based model originally put forth.
Current inquiry – Australian Government Security Arrangements—Personnel Security and Domestic Passenger Screening
2.63
The Committee commenced an inquiry based on the Auditor-General’s reports:
2.64
Audit Report No. 38 found the effectiveness of the Australian Government’s personnel security arrangements for mitigating insider threats is reduced by: the Australian Government Security Vetting Agency (AGSVA) not implementing the Government’s policy direction to share information with client entities on identified personnel security risks; and all audited entities, including AGSVA, not complying with certain mandatory Protective Security Policy Framework controls.
2.65
Audit Report No. 43 found that the Department of Home Affairs (Home Affairs) had implemented one and partially implemented four of the five recommendations made in ANAO Audit Report No.5 (2016–17): Passenger Security Screening at Domestic Airports. While Home Affairs has made progress, the ANAO concluded it is not yet well placed to provide assurance that passenger screening is effective and that screening authorities comply with the Regulations.
Current inquiry – Mental Health in the Australian Federal Police
2.66
The Committee commenced an inquiry based on the Auditor-General’s Report No. 31 (2017-18): Managing Mental Health in the Australian Federal Police.
2.67
The report found the Australian Federal Police (AFP) lacks a comprehensive and consolidated organisational health and wellbeing framework to enable effective management and support of employee mental health. While the AFP offers a variety of mental health support services, there is no evidence that these services are effective and they are not supported by sound governance, risk management, evaluation or an articulated business rationale. Based on the findings, the ANAO recommended that reform of the portfolio of services available should be made in the context of available data on employee access, areas of high stress and risk, gap analysis, organisational culture and employee preferences.
Current inquiry – Foreign Investment Obligations in Residential Real Estate
2.68
The Committee commenced an inquiry based on the Auditor-General’s Report No. 48 (2017-18): Management of Compliance with Foreign Investment Obligations in Residential Real Estate.
2.69
The ANAO report found that Australian Taxation Office (ATO) management of compliance with foreign investment obligations for residential real estate is becoming effective as the ATO progressively implements more sophisticated approaches to encourage compliance and detect and address non-compliance. Populating the ATO’s register with reliable data and implementing a compliance and enforcement strategy remain key challenges in ensuring and assessing compliance with foreign investment obligations.
Overseeing the Defence Major Projects Report
Current Inquiry into the 2016-17 Defence Major Projects Report
2.70
The Committee commenced an inquiry into any items, matters or circumstances connected with Auditor-General’s Report No. 26 (2017-18) 2016-17 Defence Major Projects Report. The Defence Major Projects Report (MPR) is a joint report of the Auditor-General and the Department of Defence, and aims to improve the accountability and transparency of Defence acquisitions for the benefit of Parliament and other stakeholders.
Endorsing the 2017-18 MPR Guidelines
2.71
Every year the Committee endorses the guidelines within which the MPR is drafted. The ANAO submitted draft 2017-18 MPR Guidelines on 31 August 2017. The draft guidelines included an indicative timeline for tabling the MPR in November 2018 and a prospective list of 26 projects for consideration.
2.72
The Committee endorsed the guidelines for the 2017-18 MPR on 13 September 2017. The guidelines will be published as part of the final MPR.
Review of the annual budget of the ANAO
2.73
Under section 8(1) of the Public Accounts and Audit Committee Act 1951, the Committee is required to ‘consider the draft estimates for the Audit Office’ and ‘make recommendations to both Houses of Parliament, and to the Minister who administers the Auditor-General Act 1997’ on the draft estimates. The Auditor-General Act 1997 requires the Auditor-General to comply with a request from the Committee to submit draft estimates in time to allow the Committee to consider the draft estimates and make recommendations on them before the budget.
2.74
The Auditor-General submitted the ANAO’s 2018-19 draft budget estimates on 2 February 2018, for the Committee’s consideration.
2.75
The Chair of the Committee made a statement to the Senate on 8 May 2018 and a corresponding statement was delivered by the Deputy Chair in the House of Representatives.
2.76
On 10 May, the Auditor-General submitted an updated 2018-19 budget submission to the Committee. The update was provided as a result of changes to the ANAO’s budget prior to the release of the Federal Budget. At their first opportunity, the Chair and Deputy Chair updated the Parliament by making statements on 18 June 2018 and 21 May 2018 to their respective Houses. At the request of the Committee, the Auditor-General presented his updated budget submission at Senate Estimates proceedings on 21 May 2018. The Committee will be undertaking further inquiries into the matter in the following year.
Review of the annual budget and work plan of the PBO
2.77
The Parliamentary Service Act 1999 requires the Committee to consider the budget estimates and draft work plans of the Parliamentary Budget Office (PBO). The Committee must make recommendations to both Houses and the Presiding Officers on the draft estimates before the budget. The Parliamentary Budget Officer submitted the PBO’s 2017–18 draft budget estimates on 5 February 2018, for the Committee’s consideration. The Chair of the Committee made a statement to the Senate on 8 May 2018 and a corresponding statement was delivered by the Deputy Chair in the House of Representatives.
2.78
On 13 September 2017, the Parliamentary Budget Officer provided the PBO’s draft work plan 2017-18 for the Committee’s consideration. Following a briefing from the PBO, the Committee endorsed the draft work plan and the PBO’s work plan 2017-18 was published on 27 September 2017.
Consultation on conduct of PGPA Act Independent Review
2.79
The Committee plays an ongoing role in scrutinising the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and its operations, which provide a new resource management, planning and performance framework for the Commonwealth.
2.80
In accordance with section 112, the PGPA Act required that the Finance Minister, in consultation with the Committee, cause an independent review of the operation of the PGPA Act and Rule as soon as practicable after 1 July 2017. The requirement for the review was included in the PGPA Act on the recommendation of the Committee.
2.81
The review has been undertaken by two independent reviewers. Following the consideration of submissions, interviews and discussions with a number of entities and stakeholders, a draft report, containing 46 recommendations, was developed and published for comment on 31 May 2018.
2.82
It is expected that the Independent Reviewers’ final report will be published in late 2018. The Committee will be interested to monitor implementation of the recommendations, as part of its oversight of the PGPA Act.
External Engagement
2.83
In February 2018, the Committee met with a delegation from Kenya. The delegation included the Kenyan Auditor-General, as well as representatives from the Kenya Law Commission, Public Service Commission and Office of the Controller of Budget.
2.84
Also in February 2018, the Committee met with a delegation from Bangladesh, which included the Chairman of the Standing Committee on Public Accounts and the Auditor-General.
Australasian Council of Public Accounts Committees (ACPAC) Conference
2.85
The Australasian Council of Public Accounts Committees (ACPAC) engages the international parliamentary community in the activities of Public Accounts Committees and aims to facilitate the exchange of information and opinion and to discuss matters of mutual concern. Membership of ACPAC includes Public Accounts Committees of all jurisdictions in Australia and New Zealand, Papua New Guinea, Fiji and the Solomon Islands. The Chair of the Committee, Senator Dean Smith, attended the mid-term meeting of ACPAC in Melbourne on 6 April 2018.
2.86
The next biennial conference is due to be hosted by the Committee in Canberra in August or September 2019.
Commonwealth Association of Public Accounts Committees (CAPAC)
2.87
The Committee was accepted as a full member of Commonwealth Association of Public Accounts Committees (CAPAC) in December 2017. CAPAC supports the work of Commonwealth Public Accounts Committees in promoting good governance. There are currently 23 members of CAPAC, including the United Kingdom, Canada, Kenya and Sri Lanka. On 7 December 2017, Senator Dean Smith, Chair of the Committee, was elected to the Executive Committee of CAPAC.
Audit priorities of the 45th Parliament for 2018–19
2.88
On 28 May 2018, the Committee advised the Auditor–General of the audit priorities of the 45th Parliament for 2018–19 (see Table 2.2). The Committee determined these priorities following consultation with all other parliamentary committees, with reference to the ANAO’s draft Audit Work Program for 2018–19.
2.89
The Parliament identified 37 audits as priorities that were proposed in the ANAO’s draft Audit Work Program for 2018–19. The Parliament also identified three audit priorities that were not in the ANAO’s draft Audit Work Program for 2018–19.
Table 2.2: Audit priorities for the 45th Parliament for 2018-19
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Attorney-General’s
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Case management efficiency of Office of the Commonwealth Director of Public Prosecutions
Statements of Compatibility with Human Rights
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Australian Taxation Office
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Addressing Superannuation Guarantee non-compliance
Aggressive tax planning
Tax Avoidance Taskforce: Meeting Budget commitments
The regulation of charities by the Australian Charities and Not-for-profits Commission
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Communication and the Arts
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Oversight and Governance of the National Broadband Network Hybrid Fibre-Coaxial (HFC) rollout (suggested addition)
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Defence’s procurement and management of Offshore Patrol Vessels Project
Defence’s Sustainment Performance Management System (SPMS)
Effectiveness of the implementation of Defence’s new capability life cycle
Management of Defence’s estate
The management of Housing Australia
Defence’s management of the SEA1000 (Future Submarines) Project (suggested addition)
Defence’s management of the maintenance and upgrading of the Collins Class submarines (suggested addition)
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Education and Training
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Australian Research Council’s administration of grants
Design and implementation of the Child Care Package
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Foreign Affairs and Trade
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Effectiveness of the Export Finance and Insurance Corporation
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Health
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Funding model for the indigenous Australian’s Health Program
Management of cyber security risks in MyHealth
National Ice Action Strategy
Reforms to the Prostheses List
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Home Affairs
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Border Intelligence Fusion Centre
Procurement of garrison support and welfare services
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Human Services
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Administration of the Disability Support Pension
Human Service’s system redevelopment strategy
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Industry, Innovation and Science
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Implementation of the Northern Australia White Paper
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Infrastructure and Regional Development
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Efficiency of the Airport Mater Plan approval process
OneSky contractual arrangement
Regional Jobs and Investment Packages
|
|
Jobs and Small Business
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Investigating compliance with workplace laws
Youth Jobs PaTH (Prepare, Trial and Hire): design monitoring
|
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Parliamentary Departments
|
Security works to Parliament House
|
|
Prime Minister and Cabinet
|
Administration of Indigenous schooling initiatives
|
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Social Services
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Decision-making controls for financial sustainability – National Disability Insurance Scheme participant plans
National Disability Insurance Agency’s management of outsourced Partners in the Community
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Cross Entity Audits
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Commonwealth performance reporting and the clear read principle
Cyber resilience of corporate Commonwealth entities and government business enterprises
Cyber resilience of non-corporate Commonwealth entities
Implementation of ANAO and Parliamentary Committee recommendations
Panel procurement
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Source: Committee secretariat
Senator Dean Smith
Chair
10 August 2018