Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Joint Committee of Public Accounts and Audit - 19/07/2011 - National funding agreements

EHRENBERG, Mr Laurie, Principal Treasury Analyst, Intergovernmental Relations Branch, Queensland Treasury

MATT, Ms Pavlina, Senior Treasury Analyst, Intergovernmental Relations Branch, Queensland Treasury

WARD, Dr Gary James, Assistant Under Treasurer and Government Statistician, Queensland Treasury

Committee met at 9:30

CHAIR ( Mr Oakeshott ): Welcome. Before we begin the public hearing, is there any objection to the proceedings being recorded and filmed? There being no objection, it is so ordered.

I declare open this public hearing of the Joint Standing Committee of Public Accounts and Audit's inquiry into national funding agreements. Today the committee will hear from the Queensland government, the Queensland Audit Office and from Professor AJ Brown, from Griffith University.

The committee thanks each witness for making time to meet with the committee and looks forward to discussing a range of issues with each of you today. We thank the Queensland government for the submission it made. It was of great value to us in our deliberations.

Although the committee does not require you to give evidence under oath, I should advise you that this hearing is a legal proceeding of the parliament and warrants the same respect as proceedings of both the House and the Senate. The giving of false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. I invite you to make an opening statement before we proceed to questions.

Dr Ward : As the committee is aware, the Intergovernmental Agreement on Federal Financial Relations, agreed by COAG in November 2008, introduced a wide range of measures to improve the previous model for providing funding to the states. The reforms have sought to improve transparency and accountability in the areas in which both levels of government have shared policy objectives. The issue of shared policy objectives is particularly important in the light of Australia's relatively high level of vertical fiscal imbalance—that is, the large disparity between the revenue-raising capacity and expenditure responsibilities of state governments in particular and the resultant dependence of states on the assistance of the Australian government in responding to emergent needs.

Additionally, the IGA reforms have sought to improve the overall operation of shared programs by giving states more flexibility in service delivery, in exchange for greater public accountability for achieving results. The reforms have led to major improvements for states through the changes to specific purpose payments, specifically, the aggregation of SPPs to a handful of broad funding streams, to give states more flexibility in how to use the funding. Secondly, recognition of disparity between states' expenditure responsibilities and their revenue capacities through the conversion of the broad banded SPPs into ongoing funding streams—effectively, ongoing base funding, if you will—to give states more budget certainty. Thirdly, the review of the levels of base funding in each of the broad categories and the escalation parameters for each broad banded SPP—now national agreement— to ensure that funding continues to be adequate for states' requirements and that the real value of the SPP is maintained over time.

As part of the reform, states also agree to implement an expanded performance-reporting framework, which had the objectives of, firstly, increasing states' accountability, via reporting to the public at large. Secondly, entrenching the role of the COAG Reform Council in reviewing and reporting on states' performance and, thirdly, introducing the concept of accountability for achieving outcomes rather than focusing on inputs.

Treasuries clearly have an interest in the implementation of the reforms, not least through the role of the Standing Council on Federal Financial Relations—formerly the Ministerial Council for Federal Financial Relations— which comprises the treasurers of the Commonwealth and the states and territories, in overseeing the operation of the intergovernmental agreement. In December 2009, the then ministerial council proposed a review of the implementation of national agreements, national partnerships and implementation plans to COAG. This proposal reflected a view of treasurers and heads of treasuries nationally that some elements of the COAG reforms had not realised their full potential. COAG agreed to the proposal and considered the final report of the subsequent review, the HoTs review, in February 2011. Queensland endorsed this report and agrees that the underlying principles of the intergovernmental agreement continue to provide strong foundation for pursuing the COAG reform agenda.

Queensland also agrees that, while implementation of the reforms has generally progressed well to date, some challenges remain. These include the need for improved performance reporting, cultural change and more flexible and effective funding agreements. In addition to these broad issues, operational changes could improve the process for states: for example, firstly, the development and maintenance of a national list of agreements under development, including national agreements, national partnership agreements, project agreements and implementation plans; secondly, the provision of Commonwealth monthly forward estimates of payments to states—this is of particular concern with regard to large payments, which have a significant impact on states' budgets; and, thirdly, some process improvements to require that implementation plans are developed in parallel with national partnership agreements as far as possible so that the Commonwealth and the states have a better understanding of the detail underpinning the agreements when the NPs are actually signed.

Queensland believes that federal and state governments will be able to work together cooperatively to finalise the implementation of the funding framework that provides accountability, transparency and value for money for both the Australian and state governments through implementing the recommendations of the heads of treasuries review. Thank you.

CHAIR: Thank you. Does anyone else want to make an opening statement? No? We will go straight into questions. I have a couple, and then we will hand it around in an orderly fashion—as orderly as MPs can be! The first from me is an administrative question in regard to the reference to the HoTs review, which your submission referred to a number of times. I just want to clarify the status of that review. My understanding is that it is an in-confidence document within the COAG process. Is that your understanding as well?

Dr Ward : It is not a public document, but the HoTs review was presented first to HoTs and then to the Ministerial Council for Federal Financial Relations and then on to COAG. So COAG is the final recipient of that report. So it is not a public document but, should the committee wish to see a copy of that document, I guess the best avenue of approach would be to approach the Commonwealth in the first instance.

CHAIR: I just wanted to clarify if it is worth spending some time and energy chasing it. Without breaking any confidences, is there anything in there that is overly sensitive that the committee—

Dr Ward : I do not believe so.

CHAIR: Is there an issue that we should not be aware of?

Dr Ward : I do not think there is anything overly sensitive in the report. Certainly we have alluded to many of the key recommendations in our submission, and I have noticed that some of the submissions from other states have also made reference to the report.

CHAIR: Which, from our perspective, makes it difficult to, I guess, integrity-test those submissions if we cannot get access to that document. So we will pursue that, I think, and see how we go. You made reference to inputs and outputs, and that is also some information that is coming through loud and clear. Parallel with that are some pretty clear messages coming through about data collection and outdated data. The reform council in particular gave some strong advice to us that data is a problem in both its collection and the timeliness of its use. I am being, I guess, provocative, but is the whole argument around inputs and outputs a bit esoteric until we have decent data to measure against on either case? Isn't timely data the main priority of the moment for the whole COAG process? If we cannot measure against anything, what does it matter whether it is inputs or outputs?

Dr Ward : I guess I will attempt to answer that question in this way: data are clearly important in this exercise but, from a state's perspective, it is important to understand what it is that we want to report on and therefore what data we need to collect in order to meet that reporting obligation. In some instances, the data will be different in an input reporting framework versus an outcomes reporting framework. One of the issues for us is that there appears to be a lack of clarity across all of the agreements about precisely what it is that we are reporting on. Your point about data being the key issue is certainly correct, but we need to agree first about what it is that we actually want to report on and what we agree to report on, and that will then drive what data we need to access in order to do the job.

CHAIR: You are providing us advice that the HoTs review is onto that and starting to shape some sensible and timely data collections around outputs rather than inputs.

Dr Ward : Outcomes in particular, rather than outputs or inputs. What we are trying to do at this stage is redraft, in some minor cases, some of the agreements to ensure that the focus goes back to the outcomes measurement approach rather than the inputs approach. The second and associated issue is that in many of the agreements there are quite substantial indicator lists on which states are being asked to report. In some cases we do not have data for many of those indicators. A good example would be the national agreement for Indigenous reform. There are 27 indicators on the list, 13 of which we do not have data for. So the question we are grappling with at the moment is: what is the pragmatic and sensible way through this? Do we attempt to set up programs to collect those data or do we simply agree to reduce the number of indicators that we are going to utilise to report against that agreement? Bear in mind that when COAG signed off the intergovernmental agreement it asked for roughly 10 indicators per agreement, so in many instances we have got many more indicators embedded in the agreement than COAG was seeking in the first instance. One of the options for us is simply to reduce the number of indicators against which we are reporting and try and focus on the areas for which we do have data and time series data.

Mr Ehrenberg : One of the documents which the committee may be interested in is a conceptual framework for performance indicators. It is a public document; it is on the federal financial relations website. It spells out the framework that treasuries and first ministers departments are using through that review process, which basically takes a hierarchical approach, running down through outcomes and outputs and so forth, and spells out what we should be seeking to do and what we do when we cannot find information at the level that we deem to be appropriate—where the fallbacks are, for instance.

CHAIR: A big part of the committee's deliberations is this question of whether we have a sense of confidence that the whole issue of data is being adequately addressed. It seems that there is an awareness that it is a problem. It seems to be about, using a term I think you used, 'grappling' with how best to resolve the problem. It is the next question that I think the committee has to make some considerations on—that is, for that broader value for money question in administration, is that turning into a result as to some practical outcomes in timely data, some KPIs or whatever you want to call them, that everyone can benchmark against? Do you have a sense of confidence that the process is now getting to a point of going beyond grappling, to some practical implementation and recognition of a problem that has been identified for some time by the reform council and others?

Dr Ward : A quick answer is: yes, I do.

CHAIR: Good. Thanks. I hope that is on the record.

Dr Ward : I have faith, Mr Chairman.

CHAIR: I hope it is not blind. The only other question I have before handing over to the deputy chair is around the issue of oversight. One of the other issues that are emerging is that the whole reform process and intergovernmental work has been a reflection of the three tiers of government and the structures that we have and trying to find a way to drive reform in the historical structures and realities that we have. There are plenty of pluses in that. One of the criticisms is about the oversight of people in that process. It can be argued that it is executives talking to executives. The HoTs review is probably a good example. We are a parliamentary committee and we do not have any access to a critical document that you are putting in to a parliamentary committee about some critical aspects of the reform agenda. So, on the question of oversight of the whole reform agenda from a parliamentary perspective, do you have any views that you want to put on the record with regard to the number of different options that could emerge, whether it is standing parliamentary committees, tabling of COAG documents on a regular basis or any number of options? Is there any reflection on the fact that, if I am just a layperson on the street, my point of access to this whole critical reform agenda—45 per cent of the revenue of the Queensland government is arguably coming through this process—is a COAG website and whether that is enough for that oversight and engagement with the population at large?

Dr Ward : The Ministerial Council for Federal Financial Relations comprising the treasurers has the responsibility of oversight of the intergovernmental agreement and the agreements that sit under the IGA. So there is that direct connection between elected representatives and the oversight process. Ultimately of course COAG is the body that signs off on the agreements in the first instance and all reports from the work that we do at HoTs level ultimately ends up at either the Ministerial Council for Federal Financial Relations and COAG. If I understand you, you are asking whether there needs to be some broader oversight mechanism.

CHAIR: Yes, whether you have got any reflections one way or the other.

Dr Ward : I do not believe so. Being a treasury official, my primary connection and objective is to report upwards to my treasurer, so in terms of oversight of the activities that we undertake my first answer would be that it is perfectly satisfactory. In terms of whether there needs to be some broader oversight regime or mechanism, I really cannot comment.

Mrs D'ATH: Following on from that, in relation to programs being implemented under national partnership agreements between the Queensland government and the Commonwealth, beyond reporting back to COAG are there any current processes where you report through the state parliament about the achievement of outcomes with these programs?

Dr Ward : We do have a state based regime where we report upwards through our treasurer and premier to parliament.

Mr Ehrenberg : As far as I am aware there is no specific process for individual partnership agreements to be reported back to parliament. There is the review process through the estimates committee obviously. That can be raised if people want to.

Mrs D'ATH: So, other than reporting directly to the relevant minister or to the premier, at this stage there is no process where the minister or the premier would then report to the parliament itself on the achievements of the outcomes in those programs?

Dr Ward : Not on the progress.

Mrs D'ATH: At a state level through your state auditor-general, are there any audit processes or audit reports of those national partnership agreements that are tabled in the state parliament?

Dr Ward : Can I take that question on notice. I note that you are speaking with the Queensland Auditor-General, so perhaps it is a question you can put to him.

Mrs D'ATH: Yes, I will be asking him. I am very interested in what this committee has heard so far and I am interested in whether this accurately reflects the views you have raised, possibly in the heads of treasuries report but also more generally. There needs to be a lot more work done in relation to the performance indicators in the agreements—the KPIs or whatever you want to call them—to provide more clarity on what needs to be achieved. But there also need to be improvements made to the data collection in terms of what you actually measure those indicators against. Those seem to be the two key areas, plus there seems to be—and the chair went to this in some part—a lack of transparency beyond COAG to the parliament or to the broader public about the outcomes and how they have been achieved under these national partnership agreements. Would you see that as an accurate reflection of where we are currently with the intergovernmental agreements?

Dr Ward : I can best answer that question in this way. When you say 'a lot more work' is required in regard to the performance reporting frameworks, the point I made earlier was that one of the key issues from our perspective is to better utilise what data we do have access to—for example, where we have decent time series data to report against. It is a matter, as I said, that we are working with at the moment, which is perhaps more an issue of streamlining the reporting requirements in the existing agreements to accord better with what data we currently have access to and then making decisions about areas in which there is broad and general agreement that we need to start collecting data and where we are currently not collecting data. We try and keep that to a very focused and pragmatic framework rather than just simply trying to do everything.

As I said before, if you take the Indigenous reform agreement there are 27 indicators listed, 13 of which we do not have data for. The question is: would it be pragmatic and sensible to try and embark on a data collection exercise to collect all of that data? The issue for us is to figure out whether we can do a perfectly satisfactory job with the data that we currently do have access to, without spending more time, money and resources on collecting a lot more indicators.

Mrs D'ATH: Indigenous reform is a good example, and I would like to take it a bit further. You may not be in a position to respond to this. These are negotiated by COAG in developing the National Partnership agreements and in setting the indicators. How is it that they are setting indicators where the data does not exist? Where are we falling down in the system? Are the people who are negotiating these agreements not getting proper advice in relation to the drafting of those agreements? Because it is not just a problem of 'How can we find the data elsewhere?' If we are sitting around developing agreements and setting indicators where clearly there is no data to address those indicators, isn't there a flaw in the way that these agreements are being drafted?

Mr Ehrenberg : There is an issue that relates back to when the agreements were being developed. There was a desire to make the ambit of the agreements quite ambitious and there was also a desire to include in them as many pieces of information as could be fitted into the agreement. One of the things that we are finding as we go through the review process for the agreements is that a number of the indicators are not really relevant to the outcomes that we are trying to achieve. I think a valuable process in refining the agreements is to work through what is and is not an important indicator. For instance, Gary was referring to the 27 and the 13 issue. A number of the indicators in the agreements are fairly low level and you could probably say 'irrelevant' to getting to an outcomes focus. Some of them do not have data very regularly or it is quite partial data and does not give a very full picture or, in some cases, could give a misleading picture. I guess what we are finding is that we are running through a very useful tidying-up exercise in trying to focus on what is really important in those agreements now.

Mrs D'ATH: How binding are those indicators? They are listed there. You are saying that some may not be as significant as others. Do you have discretion as to which indicators you choose to measure against or not?

Dr Ward : No, not at all, which is why the HoTs review exercise came to fruition in the first place. What we are busy with at the moment is, as Laurie says, basically cleaning up and streamlining the various agreements to ensure that we have a set of indicators against which we can accurately report. As I said, at the start of this process there are issues around both time and culture, so it is probably fair to say that NPs and implementation plans that sit under them were drawn up quite speedily in order to get the reform program going, and everyone embarked on that exercise with a best endeavours intent, if you like. There are a few occasions where people have put indicators on the table, as Laurie says, with an ambitious frame of mind. Yes, it would be wonderful were we able to collect all of the data that are there. The question for us is whether it is actually worth while doing so and whether it would better allow us to report against the outcomes focus that COAG actually want us to report against.

Mrs D'ATH: One of your recommendations is that implementation plans are developed at the same time as the partnership agreement itself. That proposition seems to have a lot of merit to it. Would you be concerned if the implementation plan were being developed at that level at the same time? Would you be achieving the flexibilities that the states wanted, which were: 'We want to be able to implement the program as we see fit, as long as we achieve the outcomes under that agreement'? Are you at all concerned that an implementation plan would actually put more controls around how you do it as opposed to providing you with the flexibility that you want?

Dr Ward : Indeed, that is what we believe has happened in some cases under the current process. In other words, the NP has been signed by first ministers and then the implementation plan follows and, when the implementation plan gets to see the light of day, there are things in there that arguably do not sit well with the spirit and intent of the broader intergovernmental agreement and indeed the particular national partnership that COAG has already signed off at an earlier point in time. That is one of the issues that the HoTs report actually investigated and deals with.

Ms SMYTH: I suppose the question for me in relation to a lot of these arrangements is the trade-off in terms of flexibilities, inevitably, and the management of risk, I suppose, at a state level. Do you have any insights into the period since implementation of the agreements and the way in which Queensland, for instance, has responded in terms of risk management at a state level in order to then give assurances to others that the flexibilities that are being sought by the state are responded to with risk management mechanisms and processes in a culture of risk management at a state level? That is possibly a fairly nebulous question, but I just wondered if you could expand a bit on the state's risk management processes since the implementation of the revised national agreements.

Dr Ward : If I understand the question, it is: do we have a process or a framework whereby we manage and mitigate risk associated with each of the agreements? The answer is yes. We certainly look at that, both from a fiscal perspective and from a reporting perspective. So, yes, that certainly would be part of our thinking in terms of how we would approach the implementation of a particular agreement and progress towards a particular reform.

Ms SMYTH: I suppose where I am heading to is, if the state is seeking additional flexibility in the administration of agreements and in the implementation of those agreements, how does it respond when the Commonwealth is inevitably going to inquire about risk management mechanisms? Have those been expanded upon, increased, in order to reflect a desire for increased flexibility in the administration of an agreement? Presumably there has to be a cultural change in terms of risk if you are seeking additional flexibility in the implementation of an agreement.

Dr Ward : Sorry, I am still not clear on precisely what you are asking.

Ms SMYTH: If the contention of the state is that it should have additional flexibility in the administration of an agreement, presumably, at the same time, what the Commonwealth will be concerned about is the state taking over its area of responsibility in some ways, and the state not necessarily having an opportunity or a requirement to report back to the Commonwealth as fully as it might under previous arrangements. So it is that sense of cultural change that I am trying to reach, perhaps inelegantly.

Dr Ward : I think the best way of answering that or attempting to answer that is that we think the reporting requirements that are placed around pretty much all of the agreements are more than adequate. So where we would be seeking greater flexibility would be under what we would consider to be the spirit and intent of the new intergovernmental agreement, where the whole purpose of the new reform agreement was that the Commonwealth and the states would work collaboratively, in partnership, to improve service delivery to the Australian community. That, in our minds, means less onerous reporting requirements and greater flexibility, certainly in the areas where we actually deliver the services, rather than the converse. That is the way we would approach that particular issue. So is there a risk that what we might end up reporting on is not sufficient? I really do not believe that. The reporting requirements that are placed on states currently under the existing agreements are really quite satisfactory, and quite onerous in some cases, so there really is not much risk of the Commonwealth not getting enough information, at the end of the day, about how states are performing against each of the agreements.

Mr Ehrenberg : I might just supplement that and say that, in terms of the cultural change, I think we would argue that, from what we have seen in the reporting requirements under the majority, at least, of implementation plans, there has not been any significant diminution in the amount of information that is being requested of states by Commonwealth agencies. So I think the situation is fairly well unchanged at that level, from our perspective.

CHAIR: Senator Thistlethwaite, questions?

Senator THISTLETHWAITE: Yes, I have one more question. On page 2 of the Treasurer's submission, the third paragraph from the bottom mentions the HoTs review, the IGA and the COAG reform agenda, and it goes on to state:

… while implementation has generally progressed well, some challenges remain.

Can you elaborate on that for the committee and provide some details of those challenges?

Dr Ward : The challenges, at least some of them, are the ones we have been talking about, inasmuch as we have been trying to shift the focus of attention onto reporting on outcomes of the reform process rather than outputs or inputs. That is one of the challenges that the HoTs review report refers to and one of the challenges that the Treasurer, in his letter, was referring to.

The other challenge for us—and it comes back to the element of risk, which the previous question was about—is to not get to a point where we actually end up with a greater reporting burden than existed under the previous regime. So what we are trying to do is quite actively and consciously move towards a situation whereby we end up doing what COAG asked us to do in the first instance, which is (1) that we have a reporting regime around reform agreements that focuses on outcomes and (2) that the admin burden around the administration and reporting in association with those agreements is less than it was before.

The other issue for us from a state perspective is always fiscal risk—that is, the issue around national partnerships being finite. At the end of the day, every time the Commonwealth and the states sign up to a national partnership agreement, it is for a finite term, and whether or not the funding associated with that performance agreement will continue following the cessation of the agreement period is another challenge that we are grappling with in terms of trying to get some clarity about how we determine with the Commonwealth whether those funding streams are retained or cease. Currently the issue is that the decision ultimately is a Commonwealth budget decision and that provides us with an element of fiscal risk, so that is another challenge that we are again working with currently.

Ms O'NEILL: I guess a lot of this is about value for money. You used the term 'the spirit and intent of the agreements'. Can you expand on what you sense is the spirit and intent of the agreement?

Dr Ward : I think in a nutshell from our perspective the spirit and intent of the new intergovernmental agreement is that the Commonwealth and the states agree to work collaboratively and in partnership with each other to improve service delivery. For example, the bundling of the previous 100 and something SPPs into five broad national agreements was based on the recognition by the Commonwealth that that was effectively base funding that was required by the states in order to keep service programs in operation. What we had there was an absolutely wonderful reform whereby the states then got certainty about, if you like, base funding for those programs going forward—education, health and so on. The NPs are the additional bits—in other words, the money that is put on the table to bring into effect some reform in certain areas. So from our point of view the spirit and intent of the new intergovernmental agreement was all about collaboration, partnership and reduction in reporting burden—in other words, streamlining the process as far as possible and focusing on the main game, which was to reform certain programs and achieve specifically agreed outcomes.

Ms O'NEILL: Do you see that as being achieved?

Dr Ward : Yes. We have certainly gone a long way beyond where we were five or six years ago, specifically through the broad banding of the SPPs, for example. I remain very confident that this program will continue to provide very good reform. Again, once we manage to rectify some of the things that have crept in that are not within what we believe is the spirit and intent of the IGA, then we have every confidence that the outcomes will be much better than they were in the past.

Ms O'NEILL: Do you see any better ways of bridging the gap between the outcomes that are desired and the current processes of measuring and managing?

Dr Ward : It is an issue of time. So really it is a case of keep working away at the key focus, which is outcomes, and ultimately get all parties to the same point.

Ms O'NEILL: So it is a cultural change that is still required?

Dr Ward : It is a time issue and possibly a cultural issue, yes.

Ms O'NEILL: And it has got not very much to do with data collection?

Dr Ward : No, I would not say so. The data collection is a separate matter. We simply are required to report on the progress against those outcomes. It is a question, as I said before, of striking a balance between trying to do too much and trying to do what is sensible and pragmatic with the resources and the data we have at our disposal, recognising that there may well be some areas where the dearth or the paucity of data requires us to actually embark on an entirely new collection program, and that would be a matter for COAG to decide and potentially, for example, through the Australian Bureau of Statistics to set up a national collection to achieve a specific purpose. I guess the concern all of us have is that we want to keep that to a minimum rather than trying to do everything, which can then become an enormously expensive data collection exercise which might not necessarily vastly improve the delivery of outcomes at the end of the day.

Ms O'NEILL: How would you characterise the roadblocks to cultural change? Are they the same across all of the agreements or do they differ from site to site?

Dr Ward : I do not think there is anything unique or special about the sorts of issues we are facing in the work we are doing currently. It is simply a matter of getting people to change the way they think. In this case what Commonwealth line agencies require from state agencies under a particular agreement is an issue that can be resolved in time, but it is very hard to change, overnight, people's views and expectations about what needs to be done under a particular agreement.

Ms O'NEILL: So there is agreement at the higher level, but then in terms of a language deficit, of different ways of doing things, state and federal, there is still quite a cultural divide in processes, practices and language?

Dr Ward : It may be a language deficit; it may simply be a cultural issue, where it has not filtered down to all levels within the respective bureaucracies about what it is that COAG is actually seeking at the end of the day.

Ms O'NEILL: How would you redress that?

Mr Ehrenberg : That is a very interesting issue and that was a topic that came up in the HoTs review. I am sorry you have not been able to access that document. One of the topics that is being considered by officials from treasuries, first ministers departments and the Department of the Prime Minister and Cabinet is exactly that issue of what do we do to address the understanding that particularly exists in line agencies at both the Commonwealth and state levels of how the arrangements have changed, what that actually means for them, and what that means in terms of changing their skill sets to operate in more of an outcomes based environment and to be more comfortable about letting go of the detailed information that they are used to. In these departments many of these officers have worked in that environment for a long period of time and they are very comfortable with the established arrangements. We would like to see that changed.

We are looking at a few mechanisms, but mostly in the area of what we can do in terms of training material and documentation. For instance, we are looking at guidance, practitioners toolkits and that kind of material at a fairly technical level. We are also looking at what kinds of arrangement we can institute between central agencies to provide better guidance, and better processes for managing the development of agreements. For instance, we recognise that we need to intervene at times to put back on track some of the dialogue that happens between line agencies which like to operate at a fairly low and operational level and to lift that up, to elevate the level, into something that we deem is more appropriate for the kind of environment that COAG has asked us to work within. There are a number of issues there. We are in some senses still looking for the answers to that question ourselves.

Mr BRIGGS: Obviously one of the great spends in recent times of federal government money through the states was the BER project. A couple of weeks ago we saw the committee allocated to look at the BER project suggest that there was about $1 billion of waste in the eastern states. What lessons has the Queensland government learnt from the BER experience? Are you using those lessons to improve the ways that you would spend federal government money in the future?

Dr Ward : I understand there was a report quite recently. I could perhaps quote from a QAO report on the national building and jobs program. Overall, it found that departments had 'designed and implemented appropriate processes to address the requirements' of the initiative. It went on to say:

Given the tight timeframes and the large number of individual projects to be completed, it was expected that there would be examples of projects which could have been better managed. However, overall the outcome of the work undertaken by the departments on these programs is positive.

This is about Queensland, by the way. It also said:

The Building the Education Revolution construction costs examined by audit were generally less than pre Stimulus program construction costs.

So, by all accounts, the experience in Queensland was very positive. I wonder whether some of the comments that have been made, and the nature of your question perhaps, do not refer to Queensland as much as perhaps to some other jurisdictions.

Mr BRIGGS: You obviously have some information there. Do you have information that compares the efficiency of the private schools' building record to what the government's record was? Particularly in New South Wales, and in other states, there were examples where the private school system was able to be a lot more efficient with the use of the money they were allocated than the public sector was. Do you have similar information?

Dr Ward : I certainly do not have that sort of information to hand, but we can take that on notice and see what information was collected by the public works department in the oversight of the construction activity in the private schools sector. In the final report of the BER Implementation Task Force, the task force found that Queensland was the 'only state government that can claim to have all of the attributes of an informed buyer of capital works projects'. So there are some very positive stories coming out of the Queensland jurisdiction. Again, I do not know, but perhaps some of the questions that are being asked are perhaps better directed to other jurisdictions. The experience here seems to have been quite positive.

CHAIR: I have a couple of questions that I want to ask, just to make sure that we get them on the record. The first goes to the scrutiny of agreements questions that I was alluding to before with regard to oversight. When there is sign-off on an agreement, what is the place of the Queensland parliament in that process either leading into or on the back of an agreement reached?

Dr Ward : 'Leading into' would be the connection. When we get draft agreements what generally happens is that we assess the fiscal implications of those and indeed what it would mean to the service delivery activity in Queensland and we would put a submission to the budget review committee of cabinet or cabinet—depending on the magnitude of the agreement that we are talking about—but not parliament as such.

CHAIR: So is the answer none?

Mr Ehrenberg : Yes.

CHAIR: Would the answer be the same for the implications plans on the back of that?

Mr Ehrenberg : That would be correct.

CHAIR: It is sometimes heard from conversations with ministers that, because COAG is sometimes seen as a cumbersome process, there is an almost parallel informal COAG process which is minister to minister and trying to do everything they can to avoid the COAG process if there is a particular reform that they may want to implement. Can you confirm whether you hear what I hear on that front—that is, that rather than COAG being the place of preferred reform, it is almost the reform of last resort process because ministers are really reluctant to get caught in a COAG process?

Dr Ward : I have to be honest and say that at my level I am not privy to those sorts of discussions or thoughts. So, no, I simply do not have a comment to make in response to that because it is not something that I have heard.

CHAIR: Anyone else?

Mr Ehrenberg : I would have to agree with Gary.

CHAIR: I was really testing the waters to see whether it was a common view held by many. Thank you very much for making the time to come and speak to the committee today. Feel free to feed any additional information to the committee through the secretariat. I think there was one question taken on notice. If you could feed that into the secretariat as quickly as possible—preferably within the month—that would be greatly appreciated. Thank you for your time this morning.