Mr CHARLES (4:19 PM) —On behalf of the Joint Committee of Public Accounts and Audit, I present the following reports: Report 358—Review of Auditor-General's reports 1996-97—Third Quarter and Report 359—Review of Auditor-General's reports 1996-97—Fourth Quarter .

Ordered that the reports be printed.

Mr CHARLES —by leave—The main purpose of these reports is to inform parliament that hearings have been held by the committee to examine various reports of the Auditor-General. I propose to highlight those aspects of the audit reports examined about which the committee has the most concern.

I turn first to Report 358—Review of Auditor-General's Reports 1996-97—Third Quarter. A public hearing was held on 7 May 1997 to take evidence on four reports of the Auditor-General selected by the committee for closer scrutiny. Audit reports Nos 22 and 25 concerned client service in the Taxation Office and the Department of Social Security. The committee canvassed a number of issues at its public hearing on these reports, including:

. the development of the Taxpayers' Charter;

. the effectiveness of new complaints procedures in the tax office;

. the effect of the Tax Pack on self-lodgement by taxpayers;

. customer service policies in the Commonwealth Service Delivery Agency;

. agencies' awareness of the need to develop services for indigenous Australians; and

. agencies' efforts to improve staff training and standards of service to the public.

The committee acknowledges the positive and constructive attitude displayed in this audit by the tax office, the Department of Social Security and the Australian National Audit Office. In particular, the committee welcomes the development of the Taxpayers' Charter. The charter was first advocated by the JCPAA in 1993 in report 326 on the committee's review of the tax office.

The committee recommends that a detailed report be provided in the half-yearly portfolio statements on the progress of the development of client-customer oriented services in the tax office and the Department of Social Security.

Audit report No. 23, on the recovery of the proceeds of crime, was selected for audit by the audit office because recoveries appeared low relative to the estimate of the total proceeds of crime. Recoveries from the proceeds of crime are indeed significantly less than were expected when the Commonwealth proceeds of crime legislation was enacted. However, the committee considers it risky to speculate about the proportion of the total proceeds of crime which fall within the Commonwealth's jurisdiction when the figures for the total proceeds of crime are themselves only estimates.

An issue that drew the attention of the committee was that the National Crime Authority and the Australian Federal Police were unable to provide the committee with accurate details on the amounts recovered by their agencies. The committee recommends that agencies associated with the recovery of the proceeds of crime jointly develop procedures to ensure that all proceeds recovered are clearly identified and attributed to the appropriate agency.

Audit Report No. 27: Army presence in the north, assessed the effectiveness and efficiency of Army's management of the move of 1st Brigade to Darwin as part of the APIN project. The findings of the audit report concern ing Army's failure to adequately estimate operating costs and to clearly track expenditure throughout the project convinced the committee that much remains to be done by Defence to reform its financial management systems.

Misjudgments over training arrangements in the north require the unforeseen return, on an annual basis, of a squadron of Leopard tanks from Darwin to Puckapunyal. The committee considers that this, in addition to the effect of the climate extremes on tank crews and equipment, poses a risk to operational readiness. The committee recommends that Defence provide details on the progress of the development of appropriate training facilities in the Northern Territory and the installation of airconditioning in the Leopard tanks, which, we understand, is in progress.

I now turn to the committee's report No. 359. Two reports of the Auditor-General were the focus of the fourth quarterly public hearing for 1996-97 held on 25 July 1997. These were Audit Report No. 34: Australian Defence Force health services and Audit Report No. 36: Commonwealth natural resource management and environment programs. Report 359 focuses on the main issues raised during the public hearings.

Following its examination of Audit Report No. 34: Australian Defence Force health services, the committee makes five recommendations. The committee recommends that Defence: take prompt action to implement the accounting and financial management reforms proposed in the report of the defence efficiency review; undertake an assessment of the merits and implications of a member contribution for health services additional to those required for the maintenance of individual readiness or outside Defence's duty of care to its employees; undertake a detailed costing of all defence hospitals and medical centres, and rationalise the provision of beds where their cost exceeds the cost of beds in equivalent civilian facilities, and where their retention cannot be justified on preparedness and operational grounds; take steps towards sourcing its requirement for dentists from outside the full-time Defence Force; and, lastly, urgently develop and implement short- term strategies aimed at reducing the current level of injuries to forces personnel.

The second audit report looked at by the committee in report 359 was Audit Report No. 34: Commonwealth natural resource management and environment programs. It is clear from this audit report on land and conservation programs that work needs to be done to ensure the efficient and effective expenditure of Natural Heritage Trust funds.

The committee raised a number of issues in report 359 which have implications for the Natural Heritage Trust, including: setting realistic and concise operational objectives for programs; establishing appropriate and uniform performance indicators for programs; strengthening the needs assessment process to ensure that Natural Heritage Trust funds are well targeted; and ensuring that reporting requirements for community grants meet accountability requirements without alienating those whose efforts are needed to achieve program objectives.

The committee recommends that the Department of Primary Industries and Energy and Environment Australia liaise with the states to ensure that appropriate and uniform performance indicators for the Natural Heritage Trust programs are developed and effectively applied.

I conclude by thanking, on behalf of the committee, those people who contributed their time and expertise to the JCPAA's review hearings upon which these two reports are based. The JCPAA has been appreciative of the cooperation it has received from the agencies involved.

I am also indebted to my colleagues on the committee who have dedicated much time and effort to reviewing these Auditor-General's reports. As well, I would like to thank the members of the secretariat who were involved in the inquiries: Dr Margot Kerley, the JCPAA secretary, Ms Jennifer Hughson and Ms Tiana Gray. I commend the reports to the House.