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Tuesday, 9 May 2000
Page: 16066

Mr CHARLES (4:15 PM) —I ask leave of the House to make a statement relating to the recommendations of the Joint Committee of Public Accounts and Audit on the draft budget estimates for the Australian National Audit Office.

Leave granted.

Mr CHARLES —In accordance with provisions of the Public Accounts Committee Act 1951, the committee is required to make recommendations to both houses of parliament and to the Prime Minister on the draft budget estimates of the Australian National Audit Office. The committee, having considered the draft budget estimates for 2000-01 submitted by the Auditor-General, is able to advise the parliament that it is satisfied that the estimates are sufficient to enable the Auditor-General to properly exercise his functions and powers under the Auditor-General Act 1997. The estimates specifically refer to the provision of assurance audit services, performance audit services and information services.

The 2000-01 ANAO budget submission is based on a detailed review of the internal and external factors likely to impact on the ANAO's service delivery and cost of outputs. The net impact of these factors and other underlying budget assumptions is a four per cent increase in employee expenses and an overall increase of 7.8 per cent in the net cost of services in the 2001 financial year. The total budget allocation being sought for 2000-01 is $50.1 million. The net budget outlay is estimated at $39.3 million after taking account of estimated audit fees of $10.8 million. The draft estimates indicate a rise in net budget outlays in respect of the ANAO of $4.5 million over the next four years. This is primarily because the cost associated with attracting and retaining skilled resources, either on a staff or on a contract basis, will rise significantly over this period. Revenues from audit fees are expected to remain relatively stable.

The ANAO recognises that the ongoing management and funding of accumulated employee entitlements is an important issue and intends undertaking further analysis to assist in determining both the time and cost involved in reducing the current level of accumulation and the appropriate level of investment required to meet future obligations. The ongoing issue of the management of leave arrangements will be dealt with in the context of the negotiations relating to the next certified agreement. The Auditor-General told the committee that in the present difficult market conditions the ANAO had maintained an ongoing recruitment program. The greatest challenge currently faced by the Audit Office was to meet the tighter deadlines for audited financial statements imposed under the Charter of Budget Honesty legislation. The ANAO will make greater use of private sector resources as necessary to meet deadlines.

With respect to the ANAO's ability to deliver planned audits listed on the forward performance audit program, the Auditor-General told the committee that requests for additional audits from members of parliament could not readily be delivered without some adjustment to the level of resources set aside for performance audits. Any adjustments to the existing program would be subject to consideration by the committee, given its role in providing advice to the Auditor-General on audit priorities. During this financial year, the committee continued to refine the process by which it fulfils its responsibilities as the audit committee of the parliament. With respect to requests for ad hoc audits, it was agreed that the Auditor-General will inform the committee of any request and indicate the extent of its impact on the overall audit program. By means of this process, the committee is kept fully informed of the adequacy of resources available to the Auditor-General—a vital element in maintaining effective parliamentary scrutiny of the executive government. I ask leave of the House to present a copy of my statement.

Leave granted.

Mr CHARLES —I present my statement.