Senator CAROL BROWN (2:38 PM) —My question is to Senator Santoro, Minister representing the Minister for Families, Community Services and Indigenous Affairs. Is the minister aware of yesterday’s audit report criticising the government’s administration of $1 billion worth of community sector grants that were awarded last year? Didn’t the Audit Office find that 19 per cent of grants involved incorrect payments or payments being made without authority, only nine per cent of grant recipients provided proper audited financial accounts as required and 88 per cent of multiyear agreements did not have proper authorisation under the financial management act? Don’t these findings mean that potentially hundreds of millions of taxpayers’ dollars a year are being inappropriately paid or remaining unaccounted for through these grants? Why has the government been so slapdash in its treatment of $1 billion worth of community grants and left taxpayers exposed to significant risk?

Senator SANTORO (Minister for Ageing) —The Department of Families, Community Services and Indigenous Affairs has agreed to the recommendations of the Australian National Audit Office. Only 122 agreements were examined in the audit. While there were issues found, work has already commenced, I can advise the Senate, on a number of initiatives to address these. This work started before the ANAO had even finished its fieldwork. ANAO found that appropriate funding agreements were in place for almost all grants that it looked at. While some issues were found with the Emergency Relief Program in particular, FaCSIA has undertaken action to address these with new funding agreements for all grants put into place before 1 July 2005.

FaCSIA has undertaken a number of reforms aimed at improving its performance management framework. The ANAO considers that these reforms have the potential to deliver useful performance information. The ANAO found that 94 per cent, all but six per cent, of the funding agreements used appropriate agreements. In relation to acquittals, 94 per cent had sufficient information to satisfy performance requirements.

Senator CAROL BROWN —Mr President, I ask a supplementary question. Isn’t it the case that failing to properly manage a $1 billion grant program leaves the system wide open to abuse? Don’t Australians have every right to be cynical about the Howard government’s politically motivated abuse of taxpayer funded grants in the wake of the regional rorts scandal? Can the minister now provide an absolute assurance that every last cent of the $1 billion community sector grants program has been properly administered and acquitted?

Senator SANTORO (Minister for Ageing) —The government do not accept that we are in any way mismanaging the $1 billion worth of programs and funds that the senator refers to. We will continue to administer all programs, including the $1 billion of funds that the senator has mentioned, in a responsible and responsive way.