Introduction
1.1
The Senate Education and Employment Legislation Committee's (the
committee) report on annual reports provides an overview of the committee's
examination of annual reports referred to it for the 2018–19 financial year,
tabled between 1 May and 31 October 2019.
1.2
This is the first of two reports on annual reports that the committee is
required to produce in 2020.
Terms of reference
1.3
Under Senate Standing Order 25(2), annual reports of departments and
agencies shall stand referred to the legislation committees in accordance with
an allocation of departments and agencies in a resolution of the Senate. Each
committee is required to:
- Examine each annual report referred to it and report to the Senate
whether the report is apparently satisfactory.
- Consider in more detail, and report to the Senate on, each annual report
which is not apparently satisfactory, and on the other annual reports which it
selects for more detailed consideration.
- Investigate and report to the Senate on any lateness in the presentation
of annual reports.
- In considering an annual report, take into account any relevant remarks
about the report made in debate in the Senate.
- If the committee so determines, consider annual reports of departments
and budget-related agencies in conjunction with examination of estimates.
- Report on annual reports tabled by 31 October each year by the tenth
sitting day of the following year, and on annual reports tabled by
30 April each year by the tenth sitting day after 30 June of that year.
- Draw to the attention of the Senate any significant matters relating to
the operations and performance of the bodies furnishing the annual reports.
- Report to the Senate each year whether there are any bodies which do not
present annual reports to the Senate and which should present such reports.
Purpose of annual reports
1.4
The tabling and scrutiny of annual reports by Senate committees under
Standing Order 25(20) is an important element in the process of government
accountability to the Parliament. The information provided in annual reports is
placed on the public record and assists the Parliament in its examination of
the performance of departments and agencies and the administration of
government programs.
Allocated portfolios
1.5
In accordance with a resolution of the Senate on 4 July 2019, the
committee has oversight of the following portfolios:
- Education; and
- Employment, Skills, Small and Family Business, including
Industrial Relations.[1]
Machinery of government changes
1.6
The Administrative Arrangements Order of 29 May 2019 (May 2019 AAO) replaced
the former order of 4 April 2019. The changes under the May 2019 AAO relevant
to the portfolio responsibilities of the committee include the following:
-
transfer of responsibilities for vocational education and
training, and apprenticeships from the Education portfolio to the Employment
portfolio. In accordance with these changes, the Australian Skills Quality
Authority (ASQA) moved from the Education portfolio to the Employment portfolio;
-
transfer of responsibilities for migrant adult education from the
Education portfolio to the Home Affairs portfolio; and
-
transfer of responsibility for industrial relations from the
Employment portfolio to the Attorney-General's portfolio.[2]
1.7
The Administrative Arrangements Order of 8 August 2019 made additional
changes. Under the new arrangements, policy regulation and programs related to
vocational education and training in schools were transferred from the
Department of Education portfolio to the Department of Employment,
Skills, Small and Family Business (DESSFB) portfolio.[3]
1.8
Further changes were made on 5 December 2019 in accordance with a new
Administrative Arrangements Order, with the changes to come into effect from
1 February 2020. The changes under the 5 December AAO included:
- transfer of employment and skills functions from the Department
of Education to the renamed Department of Education, Skills and Employment
(DESE); and
- transfer of small business policy and programmes to the renamed
Department of Industry, Science, Energy and Resources.[4]
1.9
As this report covers the 2018–19 reporting period, it will refer to the
departments by the names they held at the time.
Industrial relations matters
1.10
As part of the changes made under the May 2019 AAO, industrial relations
matters were transferred from the Employment portfolio to the
Attorney-General's portfolio.[5]
As part of a departmental restructure to accommodate the changes, the
Attorney-General’s Department (AGD) established an Industrial Relations Group.
1.11
Despite the reallocation of portfolio responsibilities, on 21
June 2019 the Department of Finance issued an instrument under subsection
17A(4) of the Public Governance, Performance and Accountability Rule 2014 (PGPA
Rule) to the effect that departments would retain responsibility for preparing
the 2018–19 annual performance statements and annual report for functions which
had been transferred under the May 2019 AAO.[6]
1.12
DESFFB was thus nominated responsibility for reporting on
workplace relations (including work health and safety, rehabilitation and
compensation) functions.
1.13
On 4 July 2019, the Senate resolved that industrial relations
matters should remain within the portfolio responsibility of the committee.[7]
Annual reporting requirements
1.14
The Public Governance, Performance and Accountability Act 2013
(PGPA Act) establishes a performance reporting framework for all
Commonwealth entities and companies. The performance framework is based on
section 38 of the PGPA Act, which requires all Commonwealth entities to measure
and assess their performance.
1.15
The performance framework established under the PGPA Act includes the
requirement for Commonwealth entities to prepare a corporate plan and annual
performance statements. The PGPA Rule contains the minimum requirements to be
included.
1.16
Section 39 of the PGPA Act requires all Commonwealth entities to prepare
an annual performance statement and include those statements in their annual
reports. Entities use the annual performance statements to report on the
results achieved against the targets, goals and measures established at the
beginning of a reporting year in its corporate plans and Portfolio Budget
Statements.
1.17
The PGPA Rule, established under the PGPA Act, details the requirements
for the corporate plan, annual performance statements as well as the guidelines
for annual reports.[8]
PGPA Act bodies
1.18
The PGPA Act categorises bodies as a Commonwealth entity (either a non-corporate
Commonwealth entity or a corporate Commonwealth entity), or a Commonwealth
company, as detailed below:
- Non-corporate Commonwealth entity—an entity that is legally and
financially part of the Commonwealth, and includes departments of state,
parliamentary departments, statutory authorities, and listed entities (a body,
person, group of persons or organisation that is prescribed by rules made under
the PGPA Act).[9]
- Corporate Commonwealth entity—a body corporate that has a
separate legal personality from the Commonwealth, and includes certain statutory
authorities. It can act in its own right exercising certain legal rights such
as entering into contracts and owning property.[10]
- Commonwealth company—a company established by the Commonwealth
under the Corporations Act 2001 that is controlled by the Commonwealth.[11]
Annual reporting requirements
1.19
Annual reporting requirements for non‑corporate and corporate
Commonwealth entities are set out in section 46 of the PGPA Act, including that
annual reports must comply with any requirements prescribed by the PGPA Rule.
Section 97 prescribes the annual reporting requirements for Commonwealth
companies.
1.20
Below is a summary of the instruments under which the 2018–19 annual
reports were prepared:
Non-corporate Commonwealth
entities:
- PGPA Act, section 46 and the PGPA Rule, Division 3A(A);
- for portfolio departments and executive agencies, the Public
Service Act 1999, subsections 63(2) and 70(2);
- for parliamentary departments, the Parliamentary Service Act
1999, section 65; and
- for statutory bodies, relevant enabling legislation.
Corporate Commonwealth entities:
- PGPA Act, section 46 and the PGPA Rule, Division 3A(B); and
- for statutory bodies, relevant enabling legislation.
Commonwealth companies:
- PGPA Act, section 97, which also refers to requirements under the
Corporations Act 2001 and the PGPA Rule, Part 3-3; and
- for statutory bodies, relevant enabling legislation.
Reports examined
1.21
In accordance with Standing Order 25(20)(f), this report examines those
annual reports tabled between 1 May and 31 October 2019. The reports examined
in this report are categorised as follows:
Non-corporate entities:
- Asbestos Safety and Eradication Agency (ASEA);
- Australian Building and Construction Commission (ABCC);
- Australian Research Council (ARC);
- Australian Skills Quality Authority (ASQA);
- Department of Education;
- Department of Employment, Skills, Small and Family Business;
- Fair Work Commission (FWC);
- The Fair Work Ombudsman and Registered Organisations Commission
Entity;
- Safe Work Australia;
- Seafarers Safety, Rehabilitation and Compensation Authority
(Seacare Authority); and
- Tertiary Education Quality and Standards Authority (TEQSA).
Corporate entities:
- Australian Curriculum Assessment and Reporting Authority (ACARA);
- Australian National University (ANU);
- Coal Mining Industry (Long Service Leave Funding) Corporation; and
- Comcare and Safety, Rehabilitation and Compensation Commission.
Commonwealth companies:
- Australian Institute for Teaching and School Leadership (AITSL).
Reports not examined
1.22
The committee is not obliged to report on Acts, statements of corporate
intent, surveys, policy papers, budget documents, corporate plans or errata.
Accordingly, the following documents were referred to the committee but not
examined for the purposes of this report:
- Australian
Building and Construction Commission—Performance of the functions and the
exercise of powers of the Australian Building and Construction
Commissioner—Quarterly report for the period 1 January to 31 March 2019;
- Australian Building and Construction Commission—Performance of
the function and the exercise of powers for the Australian Building and
Construction Commissioner—Quarterly report—Third
quarter of 2018–19— Operations from 1 January to 31 March inclusive –
Section 20(5) of the Building and Construction Industry (Improving
Productivity) Act 2016;
- Australian Building and Construction Commission—Performance of
the function and the exercise of powers for the Australian Building and
Construction Commissioner—Quarterly report—Fourth
quarter of 2018–19— Operations from 1 April to 30 June inclusive –
Section 20(5) of the Building and Construction Industry (Improving
Productivity) Act 2016;
- Social
Security (Administration) Act 1999—Review
of the operation of Youth Jobs PaTH—Final
Report, dated October 2019;
- Building and Construction Industry (Improving Productivity)
Act 2016—Reports by the Commonwealth Ombudsman for the following periods:
1 January to 31 March 2018; 1 April to 31 June 2018; 1 July to 30
September 2018; 1 October to 31 December 2018; and
- Final budget outcome 2018–19—Report by the Treasurer (The Hon Josh
Frydenberg MP) and the Minister for Finance (Senator the Hon Mathias Cormann),
dated September 2019.
Timeliness
Presentation to ministers
1.23
Section 46 of the PGPA Act requires Commonwealth entities, both
corporate and non-corporate, to prepare annual reports and for such reports to
be provided to the responsible Minister by the 15th day of the
fourth month after the end of the reporting period for the entity. Certain
agencies, however, may have a specific date stipulated by their enabling
legislation.
1.24
For Commonwealth companies, the deadline for providing the report to the
responsible minister is stipulated under section 97 of the PGPA Act, namely
four months after the end of the company's reporting period.
1.25
For this reporting period, the annual reports of all non-corporate and
corporate Commonwealth entities, and Commonwealth companies, were presented to
the relevant ministers in a timely manner.
Tabling in Parliament
1.26
Formerly, annual reports of non-corporate entities had to be presented
by the responsible Minister to each House of Parliament on or before 31 October
each year.[12]
There is no longer an explicit stipulation for this to occur as the PGPA Rule
is silent on this matter. However, as explained below, the PGPA Rule does recommend
that such reports be tabled before Supplementary Budget Estimates.
1.27
The PGPA Rule states that annual reports for corporate Commonwealth
entities, non-corporate Commonwealth entities and Commonwealth companies must
comply with the Guidelines for the Presentation of Documents to the
Parliament which is prepared by the Department of the Prime Minister and
Cabinet.[13]
1.28
The guidelines advise that for all Commonwealth entities:
As per past practice, it is expected that the responsible
Minister will present the report to each House of Parliament on or before 31
October. If Senate Supplementary Budget Estimates hearings are scheduled to
occur prior to 31 October, it is best practice for annual reports to be tabled
prior to those hearings. This ensures that annual reports are available for
scrutiny by the relevant Senate standing committee.[14]
1.29
For Commonwealth companies, subsection 97(5) of the PGPA Act states that
the Minister must table the reports as soon as practicable after receiving
them.[15]
This provision is clarified in the Guidelines for the Presentation of
Documents to the Parliament which sets out the expectation that reports
will be tabled on or before 31 October, or sooner if Senate Supplementary
Budget Estimates hearings are scheduled prior to 31 October.[16]
1.30
In this regard the committee notes that the Joint Committee on Public
Accounts and Audit (JCPAA) has considered formally bringing the tabling date
forward:
...the [JCPAA] Committee believes that bringing forward both of
these dates [presentation to ministers and tabling in Parliament], and
formalising the required tabling date in legislation, is both viable and
valuable. If achieved, it will provide some certainty to Senate Estimates
Committees in particular that the important performance information in annual
reports will be made available in a timely manner to assist scrutiny.[17]
1.31
The committee notes that all bodies have met the recommended timeframe
for tabling annual reports in Parliament prior to the commencement of the 2018–19
Supplementary Budget Estimates. The committee welcomes this improved timeliness
in tabling annual reports and thanks the departments and associated agencies.
The committee further encourages departments and agencies to continue this
practice in the future.
1.32
The following bodies tabled annual reports in the Senate prior to the
commencement of Supplementary Budget Estimates:
- ACARA;
- ARC;
- ASQA;
- ANU;
- Department of Education (incorporating reports of the Tuition
Protection Service, Student Identifiers Registrar and the Trade
Support Loan Program); and
- DESSFB.
1.33
AITSL tabled its report in the House of Representatives prior to the
commencement of the Supplementary Budget Estimates hearings.
1.34
The following bodies tabled annual reports in the House of
Representatives on commencement of Supplementary Budget Estimates hearings and in
the Senate on 11 November 2019:
- TEQSA;
- ASEA;
- ABCC;
- Coal Mining Industry (Long Service Leave Funding)
Corporation;
- Comcare and Safety, Rehabilitation and Compensation
Commission;
- FWC;
- Fair Work Ombudsman and Registered Organisations
Commission Entity;
- Safe Work Australia; and
- Seacare Authority.[18]
1.35
The committee reminds all entities and companies that it is best
practice for annual reports to be tabled prior to Supplementary Budget
Estimates.
1.36
Appendix 1 lists the annual reports which were presented to Parliament
between 1 May and 31 October 2019 and referred to the committee, with relevant
tabling dates.
Senate debate
1.37
Senate Standing Order 25(20)(d) requires the committee to take into
account any relevant remarks about the reports made in debate in the Senate.
The committee notes that the annual reports examined in this report have not
been the subject of comments or debates in the Senate.
Bodies not presenting annual reports to the Senate
1.38
The committee is required to report to the Senate on whether there are
any bodies which should have presented an annual report to the Senate but did
not. The committee is satisfied that there are no such bodies at this time.
Method of assessment and general comments on reports
1.39
Senate Standing Order 25(20)(a) requires the committee to examine the
annual reports referred to it to determine whether they are timely and
'apparently satisfactory'. In making this assessment, the committee considers
whether the reports comply with the relevant legislation and requirements for
the preparation of annual reports.
1.40
The reports presented by most agencies met all requirements under the
PGPA Rule relating to the inclusion of a letter of transmittal, independent
auditor's report, appropriate style and formatting, and assessment of
performance against targets.[19]
1.41
The committee notes that while the majority of annual reports were
compliant with their reporting requirements, page numbers in compliance indices
were missing in some reports. The committee reminds agencies that this
information should be included in all future annual reports.[20]
1.42
The following chapter examines selected annual reports in further
detail.
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