Julian Hill (Bruce, Australian Labor Party) Share this | Hansard source

I wish to make a statement on behalf of the Joint Committee of Public Accounts and Audit concerning the draft budget estimates for the Australian National Audit Office and the Parliamentary Budget Office for 2024-25. I thank the member for Solomon for being so deeply interested in this topic that he has promised to stay for the entire statement, which is a credit to the House!

On behalf of the Joint Committee of Public Accounts and Audit, I present this statement on the draft budget estimates of the Australian National Audit Office, the ANAO, and the Parliamentary Budget Office, or the PBO. The committee is required under the Public Accounts and Audit Committee Act 1951 and the Parliamentary Service Act 1999 to consider the draft budget estimates of the ANAO and the PBO, respectively, and to make recommendations to both houses of parliament regarding these estimates. This required statement on behalf of the committee is in advance of the budget being handed down and is an important transparency measure that informs the parliament and the public on the adequacy of the ANAO's and the PBO's resourcing. The committee considers both offices vital in supporting the work of this parliament and in strengthening integrity and transparency in public administration. I was counting today: this is actually the ninth time I've delivered this statement, which is a testament to how well my parliamentary career is going! We'll aim for 10!

The committee has carefully scrutinised the ANAO's and the PBO's draft budget estimates and has resolved to endorse them subject to further review of the costings and final estimates, which may be agreed with the Department of Finance. The ANAO received supplementations in both the 2021-22 and 2023-24 budgets to deal with acute cost pressures, but it is not requesting any additional funding in this budget. As outlined in its budget submission to the committee, however, the ANAO will require funding in future years if it is to meet both its legislative requirements and its other outputs under the present framework. This is due primarily to the cumulative impact of the efficiency dividend which currently applies to the ANAO. I would just say that the committee has resolved—and this will take a few minutes, but we have a few minutes—to fulfil our legislative requirement and make some detailed comments on this for the record.

For many years, over successive parliamentary terms, the committee has been grappling with the sustainability of the ANAO's long-term financial position and the risk arising to its operational independence and ability to perform its vital statutory roles at an appropriate level of output. In plain English: I'm a Victorian and I lived through the 1990s. I saw what happened when the then Kennett government effectively tried to nobble their then auditor-general by slashing the budget. That's what these mechanisms in the Commonwealth legislation aim to avoid. For the coming financial year, though, the ANAO can draw on accumulated reserves to meet its resourcing requirements. However, it has become clear to the committee, in discussions over many months regarding the ANAO's funding models and protections, that its current financing model is not sustainable over the long term. The ANAO is a relatively small agency and has a legislative mandate to undertake financial statement auditing—that's mandatory—alongside a set of other agreed outputs. Notable of those are performance audits, which are the things which attract the most public attention, and, more recently, a new third limb, if you like, in auditing the performance statement auditing.

Financial statement auditing has to meet very strict Australian Accounting Standards and can involve unavoidable unforeseen costs. When the auditor finds something, they're obliged to go and spend money to dig into it. There is no discretion there and there is no discretion about the quality standards they have to meet.

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