Introduction
1.1
The Senate Finance and Public Administration Legislation Committee (the
committee) is responsible for examining the annual reports of the parliamentary
departments,[1]
and the departments and agencies of the Prime Minister and Cabinet Portfolio
and the Finance Portfolio.
1.2
This report on annual reports (No. 1 of 2020) provides an overview of the
committee's examination of annual reports presented to the Parliament between 1 May 2019
and 31 October 2019.[2]
Copies of this and other committee reports can be obtained from the Senate
Table Office, the committee secretariat, or online at the committee's web page.
Terms of reference
1.3
Under Senate Standing Order 25(20), the annual reports of certain
departments and agencies stand referred to committees for examination and
assessment. 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; and
-
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.[3]
Allocated portfolios
1.4
The Senate allocated departments and agencies to committees on 4 July 2019.[4]
In accordance with that resolution, the committee has responsibility for the
oversight of the following:
-
Parliament;
-
Prime Minister and Cabinet Portfolio; and
-
Finance Portfolio.
Performance Reporting Framework
1.5
The Public Governance, Performance and Accountability Act 2013
(PGPA Act) established a performance reporting framework for all
Commonwealth entities and companies. Section 38 of the PGPA Act requires
all Commonwealth entities to measure and assess their performance.
1.6
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 annual performance statements to report on the results
achieved against the targets, goals and measures established at the beginning
of a reporting year in the relevant corporate plan and Portfolio Budget
Statements (PBS).
1.7
These documents are an essential part of the accountability system that
provides the Minister, the Parliament and the public with detailed information
about the actual financial and non‑financial performance of entities
through the cycle of reporting periods, and facilitate the examination of how
the use of public resources achieve the intended results for a Commonwealth body.[5]
1.8
The Public Governance, Performance and Accountability Rule 2014
(PGPA Rule) supports the implementation of the PGPA Act and outlines the
requirements of annual reports for Commonwealth entities.
Requirements for Annual Reports
1.9
Annual reports place a great deal of information about government
departments and agencies on the public record. Accordingly, the tabling of
annual reports is an important element of accountability to the Parliament, as
the information provided in annual reports assists in the effective examination
of the performance of departments and agencies, and the administration of
government programs.
1.10
Different types of Commonwealth bodies have separate provisions for
annual reporting which affect content and preparation requirements. Legislative
provisions for Commonwealth bodies include:
-
non-corporate Commonwealth entity[6]—section
46 of the PGPA Act and Subdivision A of Division 3A of Part 2-3 of the PGPA Rule;
-
corporate Commonwealth entity[7]—section
46 of the PGPA Act and Subdivision B of Division 3A of Part 2-3 of the PGPA Rule;
-
Commonwealth company[8]—section
97 of the PGPA Act, which refers to additional requirements under the Corporations
Act 2001 and Part 3–3 of the PGPA Rule;
-
statutory office holders and statutory bodies—statutory office
holders are engaged or employed under an Act, which may prescribe annual
reporting requirements pursuant to the office. It should be noted that there
may be reporting requirements in the enabling legislation for statutory bodies
(which may also be a Commonwealth entity);[9]
and
-
Non-statutory bodies (NSBs)—NSBs are established by a Minister
and not pursuant to a statute. Guidelines for the preparation of annual reports
for NSBs are contained in the government response to the Senate Standing
Committee on Finance and Public Administration report on non-statutory bodies.[10]
1.11
In addition to legislative requirements, the Department of Finance
(Finance) provides guidance material for Commonwealth entities and companies
which sets out further detail on the content requirements for annual reports
under the Commonwealth performance framework in accordance with the PGPA Act
and PGPA Rule.[11]
The material available from this website includes the following guides which
apply to the reports being examined:
-
Resource Management Guide No. 135—Annual reports for
non-corporate Commonwealth entities;
- Resource Management Guide No. 136—Annual reports for corporate
Commonwealth entities; and
-
Resource Management Guide No. 137—Annual reports for
Commonwealth companies.
1.12
The committee notes that Finance published updated versions of these
guidance documents in May 2019 intended for 2018–19 annual reports, which
include implementation steps resulting from the Independent review into the
PGPA Act
(the review).[12]
1.13
Following the review, two amendments to the PGPA Rule were registered on
4 April 2019. These amendments—the Public Governance, Performance and
Accountability Amendment (Annual Reporting) Rules 2019 and the Public
Governance, Performance and Accountability Amendment (Reporting Executive
Remuneration) Rules 2019—affect reporting obligations for entities' and
Commonwealth companies' annual reports from the 2018–19 period.
1.14
The amendments expand the Commonwealth entity and company annual
reporting requirements in the following ways:
Public Governance, Performance and
Accountability Amendment (Annual Reporting) Rules 2019
-
providing for annual reports to be published using Finance's
digital reporting tool as soon as practicable after presentation to the
Parliament;
-
creating a requirement to report on statistics of all employees
of an entity or company (in addition to statistics on Australian Public Service
employees of the entity or company); and
-
inclusion of compliance index templates for corporate
Commonwealth entities and companies, in a structure similar to the existing
compliance index for non-corporate Commonwealth entities.[13]
Public Governance, Performance and
Accountability Amendment (Reporting Executive Remuneration) Rules 2019
-
providing for further requirements for Commonwealth entities and companies
to report on the details of the remuneration of key management personnel and
other senior executives in their annual report;
-
establishing further requirements for Commonwealth entities and
companies to report on their policies and practices for the remuneration of key
management personnel; and
-
requiring Commonwealth entities and companies to publish their
annual reports on their website as soon as practicable after tabling in either
House of Parliament, if required to do so.[14]
1.15
The committee assessed Commonwealth entities' and companies' annual
reports for compliance with these new requirements. The committee's assessment
is set out in this report.
Reports examined
1.16
In accordance with Standing Order 25(20)(f), this report examines annual
reports tabled in the periods 1 May 2019 to 31 October 2019. In these periods, 21 annual reports
of Commonwealth entities, companies and statutory office holders were tabled in
the Senate and referred to the committee. The annual reports examined in this
report are categorised as follows:
Non-corporate Commonwealth entities
Parliamentary Departments
-
Department of the Senate—Report for 2018–19
-
Department of Parliamentary Services—Report for 2018–19
-
Parliamentary Budget Office—Report for 2018–19
Departments of State
-
Department of the Prime Minister and Cabinet—Report for 2018–19
-
Department of Finance—Report for 2018–19
Commonwealth Agencies
-
Australian National Audit Office—Report for 2018–19
-
Australian Public Service Commission—Report for 2018–19—Incorporating
the Report of the Merit Protection Commissioner
-
North Queensland Livestock Industry Recovery Agency—Report for
2018–19
-
Office of the Official Secretary to the Governor-General—Report
for
2018–19
-
Australian Electoral Commission—Report for 2018–19
-
Future Fund Board of Guardians and Future Fund Management Agency—Report
for 2018–19
-
Independent Parliamentary Expenses Authority—Report for 2018–19
Corporate Commonwealth Entities
-
Indigenous Business Australia—Report for 2018–19
-
Indigenous Land and Sea Corporation—Report for 2018–19
-
Old Parliament House (Museum of Australian Democracy)—Report for
2018–19
-
Commonwealth Superannuation Corporation—Report for 2018–19
Commonwealth Companies
-
Aboriginal Hostels Limited—Report for 2018–19
-
National Australia Day Council—Report for 2018–19
-
ASC Pty Ltd—Report for 2018–19
-
Australian Naval Infrastructure Pty Ltd—Report for 2018–19 (also
referred to the Foreign Affairs, Defence and Trade Legislation Committee)
Statutory Office Holders[15]
-
Remuneration Tribunal—Report for 2018–19
Reports not examined
1.17
The committee is not obliged to examine reports on the operation of
Acts, policy papers, budget documents or corporate plans. Where a report is
referred to two standing committees, the committee has deferred examination of
those reports to the committee which has primary oversight of the portfolio
where the agency sits. Accordingly, the following documents were also referred
to the committee but not examined for the purposes of this report:
Reports referred in the period 1
May 2019 to 31 October 2019
-
Defence Housing Australia—Report for 2018–19 (also referred to
the Foreign Affairs, Defence and Trade Legislation Committee)
-
Clean Energy Finance Corporation—Report for 2018–19 (also
referred to the Environment and Communications Legislation Committee)
-
Final Budget Outcome 2018–19—Report by the Treasurer and the
Minister for Finance, dated September 2019
-
Indigenous Land and Sea Corporation—National Indigenous Land and
Sea Strategy 2019–22
-
Members of Parliament (Staff) Act 1984—Report for 2018–19—Report
on ministerial consultants engaged
-
Moorebank Intermodal Company Limited—Report for 2018–19 (also
referred to the Rural and Regional Affairs Legislation Committee)
-
Regional Investment Corporation—Report for 2018–19 (also
referred to the Rural and Regional Affairs Legislation Committee)
-
Snowy Hydro Limited—Report for 2018–19 (also referred to the
Environment and Communications Legislation Committee)
-
Western Sydney Airport—Report for 2018–19 (also referred to
the Rural and Regional Affairs and Transport Legislation Committee)
Timeliness
1.18
Section 46 of the PGPA Act requires Commonwealth entities (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. The PGPA Act does not
provide a timeframe for presentation to the Parliament; however the Minister is
obliged to present it within 15 sitting days upon receiving the report.[16]
1.19
Under section 97(2) of the PGPA Act, Commonwealth companies are required
to prepare an annual report and provide it to the responsible Minister:
- if the company is required by the Corporations Act 2001 to hold
an annual general meeting—the earlier of the following:
- 21 days before the next
annual general meeting after the end of the reporting period for the company;
- 4 months after the end of the
reporting period for the company; and
- in any other case—4 months after the end of the reporting
period for the company; or
the end of such further period granted under subsection 34C(5) of the Acts
Interpretation Act 1901.
1.20
In relation to the tabling of an annual report in the Parliament,
subsection 97(5) of the PGPA Act states that:
(5) If the Commonwealth company is a wholly-owned
Commonwealth company, or is not required to hold an annual general meeting, the
responsible Minister must table the documents in each House of the Parliament
as soon as practicable after receiving them. In all other cases, the
responsible Minister must table the documents in each House of the Parliament
as soon as practicable after the annual general meeting of the company.
1.21
The PGPA Rule states that annual reports for corporate Commonwealth
entities, non-corporate Commonwealth entities and Commonwealth companies must
comply with the guidelines for presenting documents to the Parliament.[17]
The Guidelines for the Presentation of Documents to the Parliament
(including Government Documents, Government Responses to Committee Reports and
Other Instruments), prepared by the Department of the Prime Minister and
Cabinet, were superseded by new Tabling Guidelines (Tabling Guidelines),
which were published in June 2019.
1.22
The Tabling Guidelines direct Commonwealth entities and companies to
consult the Finance Resource Management Guides (RMG) for information about the
preparation, content and reporting timeframes for annual reports.[18]
Timeliness of reports examined
1.23
Standing Order 25(20)(c) requires the committee to report to the Senate
on the late presentation of annual reports. The committee considers the timely
presentation of annual reports to be an important element in accountability to
the Parliament and reiterates its preference of having annual reports available
to the Parliament before Supplementary Budget Estimates hearings.
1.24
Appendix 1 lists the reports referred to the committee over the
reporting period (1 May 2019 to 31 October 2019). The table
lists the date each report was:
-
submitted to its responsible Minister;
-
first sighted by the responsible Minister; and
-
tabled (or presented) in both Houses of Parliament.
1.25
The committee notes that all Commonwealth entities submitted their
annual reports to the responsible Minister by the prescribed date of 15 October 2019
or by the date set by the entity's relevant enabling legislation. In addition,
several of the reports examined did not adhere to best practice advice from the
Tabling Guidelines by tabling before the commencement of the committee's
Supplementary Budget Estimates hearings on 21 October 2019. These
reports include:
-
Indigenous Business Australia—Report for 2018–19;
-
Indigenous Land and Sea Corporation—Report for 2018–19;
-
North Queensland Livestock Industry Recovery Agency—Report for
2018–19; and
-
Regional Investment Corporation—Report for 2018–19 (also
referred to the Rural and Regional Affairs and Transport Legislation Committee).
1.26
The committee again encourages Commonwealth entities and companies to
prepare annual reports in accordance with the timeframe outlined by the PGPA Rule,
the PM&C guidelines and the RMG.
Bodies which have not presented annual reports to the Parliament
1.27
Standing order 25(20)(h) requires the committee to report to the Senate
on whether there were any bodies that were required but failed to present an
annual report to the Senate. The committee notes that all relevant bodies in
the portfolios over which the committee has oversight presented annual reports
to the Senate.
Annual reports referred to in the Senate
1.28
Under Standing Order 25(20)(d), the committee is required to take into consideration
any remarks made in the Senate about each annual report. The committee notes
that there were no relevant remarks about tabled annual reports in the Senate
for the periods covered in this report.
Assessment of reports
1.29
Standing Order 25(20)(a) requires that the committee to report to the
Senate on whether the annual reports referred to it in the relevant period were
'apparently satisfactory'.[19]
In assessing these reports, the committee has taken into consideration the role
and purpose of annual reports within the Commonwealth performance framework,
the legislative requirements for the reports, and guidance for best practice in
the Tabling Guidelines and the RMG. The committee considers all reports
examined to be 'apparently satisfactory', however, as noted above, continues to
encourage Commonwealth bodies to aim for standards of best practice in
preparing annual reports.
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