Bridget McKenzie ANAO
Former minister for agriculture Bridget McKenzie, who was involved in the 'sports rorts' scandal (Image: AAP/Mick Tsikas)

After five years under Auditor-General Grant Hehir and his agenda to expand the scope of Australian National Audit Office (ANAO) activity, we’ve accumulated a detailed picture of program and policy administration by the Commonwealth public service, its ministers and their staff. And it isn’t pretty.

This week has revealed the department’s bizarre 1000% mark-up for a Coalition donor in the purchase of land at Western Sydney Airport; earlier this year, the ANAO gave us the sports rorts scandal, which ended up costing another National MP their ministry and discredited Liberal-staffer-turned-PM&C head Phil Gaetjens.

But they’re only two of more run-of-the-mill scandals unearthed by the auditors recently. Since 2015, the ANAO has exposed deep flaws in the public service, over and over.

Debacle after debacle at Home Affairs

The Peter Dutton-led, Mike Pezzullo-run Frankenstein’s monster department has been the subject of no less than five damning audits since 2015. These have related to its incompetence in running offshore processing; abuse of its powers; failure to monitor visa holders; and, most recently, a February 2020 audit that found its process for considering and granting citizenship applications was a disaster.

Home Affairs is also the worst departmental offender in the long-running saga of…

Cyber non-resilience

Three-quarters of Commonwealth departments have failed to put in place the most basic cybersecurity strategies, leaving critical information vulnerable to the theft and hacking the government insists is a huge threat to Australia.

The ANAO has diligently revealed this failure over and over and over again and is currently doing yet another audit.

Failure to implement recommendations

One ongoing irritant that Hehir wanted to pursue was the tendency for departments criticised by the ANAO to promise to implement recommendations, only to not bother doing so after the publication of the damning audit.

For example, a 2019 audit of the Agriculture and Infrastructure departments, Airservices Australia and the Australian Pesticides and Veterinary Medicines Authority found “none of the selected entities demonstrated that they had effectively implemented all agreed recommendations”. Agriculture and Infrastructure had also not implemented recommendations made by the ANAO’s parliamentary oversight committee, the Joint Committee of Public Accounts and Audit.

A particularly egregious example emerged this year when the ANAO looked again at the lobbyist register, which it audited in 2017 when PM&C ran it. The register has since been moved to the attorney-general’s department and the ANAO discovered not merely had this department failed to implement any of its recommendations, it had badly botched the transfer from PM&C.

Security agency bungles

It’s not just Home Affairs itself — some of the worst incompetence uncovered by the auditors is to be found in security agencies.

An audit of the Biometric Identification Services (BIS) project that the Australian Criminal Intelligence Commission (ACIC) inherited from one of its predecessor bodies, CrimTrac, found that the “administration of the BIS project by CrimTrac and ACIC was deficient in almost every significant respect. The total expenditure on the project was $34 million. None of the project’s milestones or deliverables were met”.

An audit of the Australian Commission for Law Enforcement Integrity found the allegedly crucial anti-corruption body didn’t have the slightest clue whether it was managing its own resources or operating efficiently. And, in 2018, the ANAO devoted a report to the Australian Federal Police’s inadequate and ineffective mental health services for its officers.

OneSKY

The OneSky program, to establish a combined “civil military air traffic management system” by Defence and Airservices Australia, has continued the great Australian tradition of disastrous big-budget procurement.

The $4 billion debacle with a 10-year delay has earnt not one or two, but three highly critical audits of both the tender process and contractual arrangements for the project centring around major flaws in the selection of the successful tenderer and no evidence of value for money.

Defence

As the government’s major procurer of hardware and services, Defence and its long history (shared, incidentally, with every defence department on the planet) of delays and cost overruns with huge projects is a routine subject of attention from the ANAO.

Last year ANAO examined Defence’s internal system of management of problematic projects, “Projects of Concern”, and slammed it, finding “Defence is not able to demonstrate the effectiveness of its regime in managing the recovery of underperforming projects…

“Its confidence is based on management perception and anecdotal evidence, as it has not attempted any systematic analysis. Over the last five years, the transparency and rigour of the framework’s application has declined.”

Miscellaneous messes

It’s not all about systemic issues. ANAO also looked at how the Environment Department (in its many and changing guises) had implemented the crucial Environment Protection and Biodiversity Conservation Act and had a very long list of criticisms. It found it “not effective”, “not sound”, “not administered effectively or efficiently”, “[had] not implemented arrangements to measure or improve its efficiency”, “unable to demonstrate that conditions of approval are appropriate”,”not assessed with rigour.”

Its examination of the Department of Industry’s collection of North West Shelf royalty revenue found it had “not been sufficiently efficient or effective as the existing assurance arrangements do not effectively address key risks to the accurate calculation of royalty payable” with “significant shortcomings” and the likelihood of large errors in favour of resources companies.

This is only a selection of the many audits that found notable problems in administration. It’s the ANAO’s job to identify even small lapses in process that place taxpayer funding at risk. Some of its criticisms look decidedly pedantic when the overall outcomes of a program have been achieved. But it has routinely identified big problems in large programs or the implementation of important legislation.

The question is: what does the public service do about it?

Tomorrow: failure to comply — how the government tries to ignore the auditors.

Peter Fray

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