Good auditors are like wombats and any documents that look like the record-keeping equivalent of Swiss cheese will prompt more digging. But to what end?, writes Tom Ravlic.
The work done by the Australian National Audit Office is critical and it typically finds shortcomings in nooks and crannies that are embarrassing to government and a revelation to the community. It is often also fresh meat for political opponents and the Canberra press pack to sink its teeth into.
The work also provides highlights for those monitoring Senate estimates, which provides a forum used to embarrass the government. But those inquisitions happen during a parliamentary sitting period and not in the hot and sweaty flurry of an election campaign.
Consider the recent report flagging the direction of funds totalling $660 million for the building of national commuter car park projects in which the ANAO dumps a bucket on the process that resulted in 77% of those projects being awarded to car park sites in Coalition-held electorates and 10% in one of six non-Coalition electorates.
Projects were not just skewed to projects in electorates with a specific political flavour – allocations of funds for the building of car parks were more prevalent in one state.
There were 64% of cark parking projects awarded to Melbourne despite the fact that Infrastructure Australia had pointed out that some of the worst congestion on roads is actually in the state just north of Victoria.
Melbourne-based car park projects were mostly allocated to sites in the south-east, but the greatest congestion has been documented as being in the north-west.
These assessments quoted by the ANAO help buttress the argument that taxpayers’ funds were thrown at projects that were motivated by political concerns.
Criticisms of the process in the ANAO performance were scathing and included the fact that the process was not ‘open or transparent’, engagement with state governments and councils did not take place, no evidence was provided that projects were selected on merit, and grants for projects reflected political background and geographical locations of those consulted.
Another dangerous oversight noted by the ANAO was the fact that records related to funding decisions were – to coin a phrase – inadequate.
It appears odd that departments being run at the time that a political party that would argue it has rolled gold business credentials is in government need to be told that ‘good quality business information’ must be created.
The ANAO recommends that the information must have: “sufficient detail to meet current business needs and can be understood by others in the future, is accurate; and is created in a format that enables efficient business processes and maximises its potential for use and reuse.”
These are basic elements of information gathering and record keeping that accounting undergraduates are taught in a commerce degree. It is somewhat dumbfounding that a government department would need to have such a basic business practice reinforced by a performance audit.
Good auditors are like wombats and any documents that look like the record-keeping equivalent of Swiss cheese will prompt more digging and the eventual outcome will be a full reveal of the complete sorry mess.
One of the other consequences of half-baked documentation is that it would create suspicion on the part of any members of an audit engagement team about the reason for a lack of detail or disclosure.
Departments could actually save auditors the aggravation and the angst that comes with going off to find material that plugs a hole or four in their quest to find sufficient evidence to come to an opinion by getting it right the first time.
Coverage of the report cited above and others, such as the sports rorts fracas, highlights the highly politicised nature of grant or funding allocation and the need for politicians ultimately accountable to demonstrate a degree of fairness in allocation.
How impactful these reports are in the long term will depend on the ability of an opposition to prosecute a case in committees or on the floor of either parliamentary chamber, the amount of coverage given to these reports by the media, and whether pollsters seek to measure community attitudes after reports that irritate and embarrass the federal government are released.
The key word to keep in mind is ‘embarrassment’. It seems rare that auditors’ reports that shuffle out of the front door of the ANAO do little else than embarrass the government of the day, because there appears to be little in the way of sanction for some of the more extravagant instances of grant allocation to friendly electorates, for example.
It is for this reason that action to develop a national integrity commission or a similar body that can build on the ANAO’s work becomes necessary so that these issues can be probed further if required. The ANAO cannot furnish the public with the raw evidence because it is obligated to maintain confidentiality, which is the price the national auditing body pays for access to the documents it needs to examine government.
A further consideration regarding embarrassing reports is whether these revealing documents have any serious impact on an incumbent government’s changes at a federal election.
Mere embarrassment is not necessarily something that will shift the dial electorally, however, because it depends on how much of coverage of the gaming of grants regimes, for example, sticks along with other issues that may impact on the mindset of electors across Australia and, more importantly for nervous political players, marginal seats.
Voter cynicism about the way in which politicians as a class have allocated grants over the years may ensure that these reports – no matter how bad – have little or no electoral impact.
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