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Monday, 4 May 1987
Page: 2258

Senator WATSON —I present the 272nd report of the Joint Committee of Public Accounts entitled `Administration of the Commonwealth's Property Functions'. I seek leave to make a short statement.

Leave granted.

Senator WATSON —The Public Accounts Committee decided to undertake a wide-ranging inquiry into the administration of Commonwealth property in 1984 after consideration of a report of the Auditor-General. At that time the audit report was the latest in a succession of reports which indicated that there were continuing problems with the Commonwealth's property administration. This was despite the creation of the Property Directorate in 1980 within the Department of Local Government and Administrative Services.

Subsequent to the commencement of the Committee's inquiry-in July 1986-an inter-departmental review of the property functions was announced by the Government. The review, chaired by the Public Service Board, was to report earlier this year. The Committee has programmed its activities to ensure that its recommendations are available in a timely fashion to the Government in its consideration of the Public Service Board's more detailed review. The aims of this inquiry were to find out whether there were major fundamental problems in the delivery of the Commonwealth's property functions, to identify their causes and to determine the reasons for their persistence. A final aim was to assess whether there were workable alternative administrative structures which, if implemented, could lead to demonstrable improvements.

The current inquiry was therefore necessarily broad in scope and focused on aspects of the domestic property function. The Committee received over 60 submissions from 45 organisations, representing Commonwealth agencies, unions and non-government organisations, including some with large property portfolios. Eight public hearings were held and the Committee visited Perth, Sydney and Canberra locations for inspections. The large number of organisations participating in the inquiry and the level of their representation at the Committee's hearings suggested that there were widespread concerns about the delivery of the Commonwealth's property functions. The overwhelming theme of the evidence received was that the existing administrative arrangements were cumbersome, slow and inflexible and that major changes were necessary.

In general, the Committee concluded that the central problem with property administration appeared to be the complex and cumbersome procedures which had evolved as a result of the involvement of too many disparate organisations with overlapping areas of responsibility. This served to perpetuate and exacerbate the delays in the delivery of property services. Further problems have arisen both from the difficulties inherent in the Budget process and from a lack of planning on the part of client departments. The Committee is of the view that strategic control by a central co-ordinating body is necessary for the efficient functioning of property administration. However, allied to the retention of the central body is the streamlining of procedures, the precise determination of areas of responsibility and the devolution of financial responsibility and many of the more routine functions to clients.

The Committee feels that the central co-ordinating role currently performed by DOLGAS should continue to be the responsibility of that portfolio, with a Central Property Agency performing such a role where property matters are concerned. The Committee has therefore recommended that a Central Property Agency be the central body responsible for the administration of the Commonwealth's property functions, with overall policy control. The Central Property Agency should be established as an independent, ministerially accountable agency with responsibility for the management of the Commonwealth-owned estate.

The Central Property Agency would retain strategic control for the following purposes: To advise on strategic planning; to protect the national interest, particularly in the case of disposals; to prevent gazumping; to develop and implement strategies on the location of Commonwealth Government employment, particularly in the major cities; and to ensure a co-operative relationship with other levels of government. The Central Property Agency would have responsibility for the following strategic functions: The provision of policy advice to the Minister; the management of owned property; compulsory acquisitions under the Lands Acquisition Act; the forecasting of future property requirements; the rationalisation of the Commonwealth's property portfolio; the setting of accommodation guidelines; and finally the collection of aggregate information, providing a central point for information on the Commonwealth's property holdings.

As a complement to the Central Property Agency, the Committee feels that there is a case for the devolution of certain routine functions to clients. The Committee further proposes that full financial responsibility, including Budget sponsorship for property programs, be devolved to clients. Because the costs of accommodation and associated property services for each agency form part of the overheads associated with program delivery, decisions on resource allocation at the department or authority level are best decided in the context of the department's or authority's own budget. As part of the rationalisation of responsibilities, the Committee has further recommended that all construction and fit out activity above the tender threshold be the sole responsibility of the Department of Housing and Construction.

The Committee's other major recommendations include: Responsibility for routine servicing functions to be devolved to departments and authorities; the option of using outside expertise for such services; the establishment of a Property Advisory Board; the institution of trust account funding arrangements; the development by the Central Property Agency of an efficient management information system and performance indicators; the implementation of a career structure for property specialists within the Australian Public Service; the creation of a separate item within departmental and non-trading statutory authority appropriations to provide for excess maintenance and restoration costs associated with Commonwealth properties listed on the Register of the National Estate; the delegation of the Minister's powers under the Lands Acquisition Act to off-Budget statutory authorities, with the proviso that there be mandatory compliance by such authorities within ministerial directions in order to give effect to the strategic controls and functions of the Central Property Agency; and finally the approval by the Central Property Agency of disposals on behalf of these off-Budget authorities.

As Deputy Chairman of the Joint Committee of Public Accounts, I commend this report to honourable senators. In so doing, I would like to acknowledge the valuable and important work of the secretariat. I believe that, implemented, these proposals could make far-reaching reforms in the delivery of property services by the Commonwealth and make for a much more efficient organisation.