Page 272 - Week 01 - Thursday, 17 February 2011
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Recommendation 24 is a very important recommendation, and people will know my interest in this issue. I will read the whole recommendation:
The Committee recommends that the Auditor-General Act 1996 be amended to provide the Legislative Assembly through the Standing Committee on Public Accounts with a formal role in considering the Audit Office’s draft budget estimates and making a report with recommendations to the Legislative Assembly, as part of the Australian Capital Territory’s budget process, on the level of funding required by the Auditor-General.
I think it is very simple and it is very clear. Again, if the Auditor-General is responsible to the Assembly, then it is quite reasonable for the Assembly to have a say in how much funding the Audit Office receives, otherwise, as Mr Hargreaves has pointed out, the easiest way to neuter somebody that is causing a bit of grief is, of course, to decrease or change their budget. So this is saying that scrutiny is important. Particularly in a one-house parliament as we are, the auditor’s role is even more important and so should be enhanced.
Recommendation 25 is also very important:
The Committee recommends that the Audit Office should be funded to conduct a number of performance audits that is determined by the Auditor-General and endorsed by the Standing Committee on Public Accounts within the budget context.
The preceding paragraph makes the case quite clearly. The current ratio is about 35 to 65 in terms of audits that are done. The majority of the funds go on financial audits. Clearly they are important and clearly it is appropriate that the financial status of all the departments is audited so that we know that the money is being spent and where the money is being spent. But we also need to know how effectively that money, taxpayers’ funds, is being spent. A number of nations around the world are moving to a 50-50 ratio where half the auditor’s budget is spent on financial audits and half of the budget is spent on performance audits to measure the performance. I think that it is very important. Governments are addicted to saying, “Aren’t we good because we’ve spent all this money?” Taxpayers want to know, “Hang on, you’ve spent all our money; what did we get for it?” The only way to do that across a range of issues is through the Audit Office and performance audits.
Recommendation 25 should be endorsed as a very sensible approach. We are not saying that you need to do it immediately. Indeed, the auditor has said a number of times she does not currently have the capacity in her office to move to a 50-50 split should the budget increase. But over a period of time—say three to five years—the office would ramp up the number of performance audits so that we make sure that the people of the ACT are getting value for the money the government spends on their behalf.
Recommendation 28 looks at the role of the staff and says that we need to be very careful that the only person who can direct the Auditor-General’s staff is the Auditor-General. There are protections there to ensure that the staff are also looked after.
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