Can the public and the parliament be confident that an integrity agency is fulfilling its role with the required vigour if its resourcing is controlled by thegGovernment of the day?
There are many factors that are required to ensure integrity agency independence and capacity to deliver on its role. Legislation needs to require that an office holder such as an auditor-general or an ombud has a specific obligation to be independent, that it has royal commission-type powers to obtain information and that it has unfettered power to report its findings and recommendations to parliament and thereby the public.
Exactly how resources are provided to integrity agencies and how access to these resources might be constrained can seem to be a matter of detail. Furthermore, the scrutiny and public reporting by integrity agencies can be painful for governments so there appears to have been a reluctance across Australia to give this issue the consideration it deserves.
With the recently elected federal government committed to the establishment of a national integrity commission, it can be hoped that this issue will be given the consideration it deserves.
An acknowledged starting point is the provisions of the Australian Federal Integrity Commission Bill 2020, the private member’s bill tabled by Helen Haines MP. It provides a limited measure at Section 250(1)(g) that the parliamentary committee has a duty to request the parliamentary inspector to undertake an audit of the commission’s budget and finances every three years for consideration by the committee. The parliamentary inspector is to advise on the sufficiency of resources and whether the budget should be increased. The associated Explanatory Memorandum indicates that the provisions do not permit the committee itself to review the finances and budget allocation of AFIC and that it “… may only observe those recommendations relating to fiscal allocation”.
By way of contrast, the recently reported Coaldrake Review recommends that:
The independence of integrity bodies in Queensland be enhanced by aligning responsibility for financial arrangements and management practices with the speaker of parliament and the appropriate parliamentary committee, rather than the executive government.
This recommendation provides a broad direction for reform identifying two parties other than the executive that should have responsibilities in relation to the financial arrangements involved.
In a recently published article that reviewed the funding of integrity agencies, I identified a framework based on four characteristics: control or input on the level of funding; transparency including about how the funding level is set; adequacy of funding; and certainty both for the year and years ahead. The article assessed the experience of Australasian auditors-general and identified key features for each of the four characteristics.
While there is a widespread view that it is not appropriate for the executive to have exclusive control over the resourcing of integrity agencies, there are different options for the other parties that might be involved and the nature of their roles.
What input or control the different parties may have included recommendations to be made to the executive or for the executive’s views to be heard by those who make a submission to the parliament. Some express concern that the government would lose control of the budget if, for instance, a parliamentary committee was to determine the resources to be allocated.
Other parties that could be involved include parliamentary committees, the presiding officers, and/or an independent tribunal or officer of the parliament. Consideration needs to be given to the membership of parliamentary committees and the potential that this could give rise to conflicts of interest and provide a pathway for the government of the day to influence resourcing decisions.
Where an integrity agency is treated as if it is a public service department its submissions to the executive and the executive’s responses would not routinely be made public or provided to the parliament. Having requests and responses made public enables scrutiny and accountability for the roles and decisions of all the parties involved.
In New Zealand, a detailed submission by the auditor-general is made public along with a Treasury assessment of this submission and a report by a parliamentary committee that has assessed the submissions. In a different approach, the Australian Capital Territory speaker recommends the funding amount and the treasurer is required to provide reasons publicly if the appropriation amount is less than the recommended amount.
While transparency is achieved by full reporting by integrity agencies on their resources and the results achieved, there can nevertheless be tensions regarding independence where the executive has the power to direct the content or structure of the information and that it is being provided to the executive rather than the parliament.
Adequacy of funding
Establishing the quantum and nature of the funding to be provided to an integrity agency is in part a technical question of understanding the statutory roles and the cost structures of delivering on both obligatory and discretionary functions. However, there are also value judgments related to service quality, the contribution to integrity and the nature and quantity of discretionary activities.
It is therefore important that those parties having input or deciding on resourcing have access to independent expert advice that provides assessments of both the technical and accountability issues and of the opportunities and risks involved.
It is also important to recognise the dynamic nature of integrity issues so that there may need to be adjustments to resourcing within an annual budget cycle so that pathways need to exist for requests to be considered and approved at any time.
There needs to be certainty within an annual budget cycle so that an appropriation cannot be reduced or access delayed by the executive.
Having funds appropriated annually limits the ability of integrity agencies to plan and implement activities that require longer-term commitments. There has been a call for four-year budget allocations to address this concern.
My review of resourcing arrangements for Australasian auditors-general identified many differences in the arrangements in place. In the absence of a coherent framework to guide decisions, the article considered the four characteristics summarised above and developed a checklist of key provisions to inform decision-making.
Important considerations in developing legislation for the national integrity commission include that the identification of its resourcing needs and the decisions are closely linked to its results and benefits to the community. Given that there are several integrity agencies it also warrants consideration of whether there should be coordination and a consistency of approach regarding resourcing across these agencies.
To the extent that parliamentary committees have an increased role, it would be important to consider how potential conflicts of interest are identified and managed. An important protection against such risks is ensuring transparency of the processes and the results of advice provided and decisions made to ensure ongoing learning and accountability.