‘Scathing’ audit has nothing much at all to do with APVMA relocation

By Stephen Easton

Friday June 23, 2017

Normally it is journalists drawing attention to a ‘scathing’ public sector audit that has criticised part of the government, and the minister playing down the negatives while looking to the future.

Sometimes a minister will go so far as to reject an audit completely and suggest the auditor-general’s staff don’t know how to do their jobs — as Minister for Indigenous Affairs Nigel Scullion did in February — but the theme of most responses is generally the same. The problems have already been fixed or will be very soon, it’s only one part of a bigger picture and there are more important issues, and these are recommendations to government and the public service anyway, so members of the general public need not worry about the details.

But yesterday, it was Minister for Agriculture and Water Resources Barnaby Joyce opening a press release with the immortal phrasing: “A scathing report by the Australian National Audit Office (ANAO) highly critical of the Australian Pesticides and Veterinary Medicines Authority (APVMA) was tabled in parliament today…”

His statement goes on to say this particular report “reinforces the Coalition Government’s decision to restructure the agency; including a relocation in partnership with the University of New England at Armidale”.

It is hard to see how it does, either implicitly or explicitly. This claim sits immediately below a helpful dot-point summary that explains, much more accurately: “Findings unrelated to relocation”.

Joyce is on the money there — as he is with his other summary point, “ANAO finds 2014 reforms not well implemented” — because while the report is very critical, it has almost nothing to do with the move to Armidale.

The reforms were all about reducing supposed “red tape” for businesses, in line with the government’s policy that all regulators should focus on making it easier and cheaper for businesses to comply with the relevant rules in their sector. Two groups representing industries regulated by the APVMA, CropLife Australia and Animal Medicines Australia, both issued statements in response to the audit and never mention the relocation, which neither support, incidentally.

The relocation is mentioned, if you scroll a long way down to find a small section that considers how the APVMA has managed risks around the relocation — staff retention being the main one — but the findings in this part are not particularly damning.

The APVMA has certainly recognised this risk and taken steps to mitigate it — while making it plainly clear to the government and the relevant Senate committee that there isn’t much it can do about the brain drain, given a global shortage of the requisite scientists.

In this respect, the audit mainly found the APVMA could have started thinking about how to prepare a few months earlier, when it was not certain but likely that Joyce would sign off on its marching orders. As such, ANAO recommends the agency improve its ability to respond to emerging business risks.

The report shows, according to the Deputy Prime Minister, that “after years of poor performance, the regulator could no longer continue under its business as usual model” and even that is paraphrasing heavily. Funnily enough, nowhere does it recommend that moving the organisation to Armidale and creating a partnership with the University of New England is a good solution.

“The report finds that the ongoing poor culture and governance arrangements have the potential to impact on future reforms and the success of the APVMA’s relocation to Armidale, not the other way around,” said Joyce.

That is not surprising. The auditors don’t pass any judgement on the impact of the relocation because they did not set out to. Their report, as always, presents a specific set of findings in relation to specific questions.

The DPM’s bizarre logic appears to be: a regulatory agency has struggled to implement a set of reforms over the past three years, which shows it needs to seriously change the way it works, so his plan to shift the whole place to Armidale — mainly for the benefit of the town, and in spite of an independent cost-benefit study that showed this move would only make it harder for the agency to do its job — is as good as any other.

Of course the auditors — quite briefly — consider the administrative failures in the context of the relocation; it is now a fact of life for the agency because Joyce decided it would happen. In part of its response, the APVMA pleads it has faced a “challenging operating environment” of late as a direct result of that decision.

In fact, the report mentions the relocation because the agency has to deal with “business continuity risks associated with the move” at the same time as trying to get the 2014 reforms back on track,

The Agriculture Minister says the “poor implementation of the reforms” from 2014, which is detailed in the audit, is the reason that “this government needs to take significant action to reform the APVMA”.

It is not clear what “significant action” he is talking about — perhaps the eventual implementation of the ANAO’s four new recommendations combined with the unfinished 2014 reforms — but he says taking this action is “particularly important in the context of the relocation to Armidale” to ensure the associated business continuity risks properly are managed. The main risk being an exodus of staff.

“With new leadership and the APVMA’s relocation to Armidale, we now have a genuine opportunity to build an efficient and effective regulator of the future,” said Joyce.

“I look forward to working with the interim Chief Executive Officer, Dr Chris Parker, to deliver long overdue improvements to the APVMA’s performance and improve access to agricultural and veterinary chemicals for Australian farmers.”

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