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Thursday, 4 April 2019
Page: 14944

Mr HILL (Bruce) (16:58): On behalf of the Joint Committee of Public Accounts and Audit, I present the following: Report 477, Commonwealth financial statements—second report, and foreign investment in real estate; Report 478, Issuing of a certificate under section 37 of the Auditor-General's Act 1997; and Report 479, Australian government security arrangements, with two components, 'personnel security' and 'domestic passenger screening'.

Reports made parliamentary papers in accordance with standing order 39(e).

Mr HILL: by leave—I looked at the blue on the way in and I was scared this would happen—that I'd end up making a fascinating tabling statement just before the member for Reid's valedictory, because of course he had to sit through that highlight of budget night, the budget statement about the Auditor-General's budget, previously.

An honourable member interjecting

Mr HILL: I'll wait for people to arrive; I'll do you a favour. That's fine. We can make it long or short.

An honourable member interjecting

Mr HILL: As long as I like? All right; this is the instruction. I'll humour those opposite. I was going to skip this bit as a gift, but let's talk for a moment about Report No. 477, which discusses the committee's findings on Audit report No. 24 of 2017-18.

An honourable member interjecting

Mr HILL: I'm doing a favour here! That concerns the financial statements of Commonwealth entities for the period ended 30 June 2017 and Audit report No. 48 of 2017-18, concerning compliance with foreign investment obligations for residential real estate. In the first part of its report, the committee made several recommendations reflecting the critical role that the Commonwealth financial statements play in providing accountability to the parliament and the public for the expenditure of public funds. In the second part of the report, the committee made recommendations to improve processes around management of the foreign investment regime for residential real estate.

I want to make some remarks on report No. 478, which discusses the committee's findings on Audit report No. 6 of 2018-19 concerning the issuing of a certificate under section 37 of the Auditor-General Act. I will sort of decode that and try to put it in English. Section 37 of the Auditor-General Act provides a rarely used power to the executive to gag the Auditor-General. It's been used only once in the history of the Commonwealth—in 1987, in the predecessor act, where the then Attorney-General, Gareth Evans, required the then Auditor-General to delete a small amount of information on the grounds of national security in relation to aircraft explosive ordnance. This was, in fact, the first time in the history of the Commonwealth that an Auditor-General was gagged by the executive to prevent him from expressing a value-for-money conclusion—in this case, on a multibillion dollar Defence Force acquisition.

It was a serious inquiry and the issue has been explored also through Senate estimates because, of course, it could be quite concerning if this in any way set a precedent that prevented the parliament's scrutiny and understanding of the expenditure of vast sums of public money. In its report, the committee recommended that the Joint Committee of Public Accounts and Audit undertake an inquiry on any future occasion that a certificate is issued. We also considered a number of quite practical suggestions made by the Auditor-General, given this was the first time the provision had been used, that may improve the act in the future and have referred them to the next periodic review of the Auditor-General Act, which we expect will happen in the next term of parliament.

Importantly, I suppose, to be balanced, the inquiry did find that the Attorney-General had not exceeded his powers under the act to issue the certificate, although the extent of the use of that power to gag the Auditor-General from expressing a value-for-money conclusion was not as had been anticipated when the act was put in place. In conclusion, I would highly recommend that you also read Audit report No. 478. It's a fascinating read!