Andrew Leigh (Fraser, Australian Labor Party) Share this | Hansard source

The Auditor-General Amendment Bill 2011 before the House this evening implements a number of recommendations in the report of the Joint Committee of Public Accounts and Audit inquiry into the Auditor-General Act 1997. I will go through the recommendations of the report that would be implemented in further detail.

I want to make a couple of broad points about the role of the Auditor-General. The Auditor-General has played a valuable role in Australian politics, most memorably in recent times in uncovering the regional rorts scandal put in place under the Howard government. As those with long memories would be aware, this was one of the most insidious forms of pork-barrelling that occurred under the Howard government—the notion that, rather than allocating essential infrastructure based on the need of the local community and on strict cost-benefit criteria, you would instead make those decisions based on electorates. I did a little academic work on this while I was at the Australian National University, looking at the allocation of a number of funding programs under the Howard government—the Roads to Recovery Program, the Regional Partnerships Program and the Sustainable Regions Program. Under each of those programs you could see clear evidence of partisan bias and clear evidence that a substantial increase in funding was going to electorates then held by the coalition. That is an allocation that is not an appropriate use of public money and that does not ensure that the Australian taxpayer gets the best value for money. I am pleased at the role that the Auditor-General played in uncovering that.

I have to say that I am a little concerned about the lack of courtesy shown in the debate this evening to the member for Lyne. I will go short on my speech to ensure to the greatest extent possible that he is able to speak in this debate. But I think it would have been appropriate had he been able to commence this debate. On the suggestion by the member for Mackellar that somehow this could all be resolved if only the member for Lyne would read his own report, I just do not know what to say about statements like that.

The functions performed by the Auditor-General continue to be a matter of great significance. It is critical that the Auditor-General has the appropriate powers to respond to new audit challenges that arise. The amendments are going to implement the recommendations of the report, as I noted above. One of the important changes that flows from the implementation of the committee's recommendations will be the Auditor-General having the power to 'follow the money'. That is, the Auditor-General will be able to undertake audits of Common­wealth partners—private sector and state and territory entities—that receive Australian government funds to implement a government program. That ensures that the Auditor-General's powers keep up with the way in which modern government operates. At the moment, the Auditor-General is unable to assess the extent to which individuals or entities that receive Australian government funds achieve the purpose for which those funds were provided. An amendment implements the change to that.

The bill as amended contains appropriate restrictions on the extent of those powers, and the government anticipates that those powers would be used only sparingly. For example, the Auditor-General would be able to assess the operations of the state or territory entity only after a request by the Joint Committee of Public Accounts and Audit or the responsible minister and only to the extent that they relate to achieving the purpose for which the funds were provided. It ensures that the Auditor-General has the tools to respond to today's auditing chall­enges.

There are a number of minor amend­ments—for example, providing clear authority for the Auditor-General to undertake assurance reviews and audits of performance indicators, which are currently carried out as audits by agreement under section 20 of the act. The bill, if passed, will clarify the Auditor-General's powers to require the production of documents that are the subject of legal professional privilege. I will conclude my statements there so as to allow further opportunity for others to participate in the debate this evening.

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