External Liaison and Scrutiny
In 2005-06, the Department’s Audit and Fraud Control Branch continued to be responsible for liaison between the Department and the Australian National Audit Office (ANAO). The branch also provided coordinated departmental responses to preliminary audit findings and recommendations prior to the Auditor-General presenting his reports in Parliament.
The Audit and Fraud Control Branch was responsible for the coordination of arrangements between the Department and the Joint Committee of Public Accounts and Audit (JCPAA) and the Commonwealth Ombudsman's Office. Details of ANAO reports, JCPAA and Commonwealth Ombudsman matters affecting the Department in 2005-06 are below.
Australian National Audit Office
During 2005-06, the ANAO tabled a number of reports on audits involving the Department in Parliament. Included were audits specific to the Department, audits of other individual agencies that involved consultation with the Department, cross-agency audits where the Department was involved and other audits where the Department was not directly involved but where recommendations were targeted at all agencies.
Audits Specific to the Department
- A Financial Management Framework to Support Managers in the Department of Health and Ageing (Audit Report No.5 of 2005-06): the audit objective was to examine whether the Department’s financial management framework and processes adequately support the Secretary, Executive and managers to make informed decisions.
The audit made one recommendation to which the Department agreed and has taken steps towards implementation.
- Regulation by the Office of the Gene Technology Regulator (Audit Report No.7 of 2005-06): the audit objective was to form an opinion on the discharge by the Office of the Gene Technology Regulator (OGTR) of selected functions entrusted to it under the Gene Technology Act 2000 (the Act). The audit assessed the practices of the OGTR against the criteria of whether the OGTR has established systems and procedures for the management and assessment of applications under the Act; whether the OGTR has established systems and procedures for ensuring compliance with the requirements of the Act; and whether the OGTR manages selected aspects of its work efficiently and effectively.
The audit report made a number of recommendations for improvement, which the Department has made progress towards implementation.
- Administration of Primary Care Funding Agreements (Audit Report No.41 of 2005-06): the audit objective was to assess the Department’s administration of primary care funding, with a focus on the administrative practices of the Primary Care Division and the Department’s State and Territory Offices. The audit report commented on a range of issues including the utility of funding agreements, monitoring, payments and support for administrators.
The Department has commenced implementing a number of initiatives for the administration of primary care funding agreements which address many of the issues raised in the audit report. These reforms and initiatives have been acknowledged in the report.
- Administration of the 30 per cent Private Health Insurance Rebate Follow-up Audit (Audit Report No.42 of 2005-06): the follow-up audit assessed the extent to which the Department had implemented recommendations arising from Audit Report No.47 2001-02, Administration of the 30 per cent Private Health Insurance Rebate. The audit also looked at the implementation of some of the suggestions for improvement made in the original audit; and the current validity of some of the positive findings from that audit.
The follow-up audit found that the administration of the rebate is being undertaken effectively.
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- Selected Measures for Managing Subsidised Drug Use in the Pharmaceutical Benefits Scheme (Audit Report No.44 of 2005-06): the audit objective was to examine how effectively the Department manages the risks of the Pharmaceutical Benefits Scheme (PBS) not being used according to PBS subsidy conditions. The audit examined how the Department identified and implemented measures to decrease the risks of PBS drugs being used outside of subsidy conditions, and how the Department confirmed that usage and expenditure on PBS drugs was consistent with estimates.
The audit concluded that the Department’s management of the risk of drugs being used outside of the subsidy conditions is reasonable, although some improvements in the Department’s administration would strengthen the management of the risks. The audit made two recommendations which have received the Department’s agreement.
Audits of other Individual Agencies that Involved Consultation with the Department
- Administration of the Commonwealth State Territory Disability Agreement (Audit Report No.14 of 2005-06);
- The Management and Processing of Leave (Audit Report No.16 of 2005-06);
- Regulation of Private Health Insurance by the Private Health Insurance Administration Council (Audit Report No.20 of 2005-06); and
- Administration of Petroleum and Tobacco Excise Collections: Follow-up audit (Audit Report No.33 of 2005-06).
Cross-agency Audits where the Department was Involved
- Cross Portfolio Audit of Green Office Procurement (Audit Report No.22 of 2005-06);
- Reporting of Expenditure on Consultants (Audit Report No.27 of 2005-06); and
- Management of Net Appropriation Agreements (Audit Report No.28 of 2005-06).
Other Audits where the Department was not Directly Involved but where Recommendations were Targeted at all Agencies
- The Senate Order for Departmental and Agency Contracts (Calendar Year 2004 Compliance) (Audit Report No.11 of 2005-06);
- IT Security Management (Audit Report No.23 of 2005-06); and
- Internet Security In Australian Government Agencies (Audit Report No.45 of 2005-06).
In line with arrangements applying to all Australian Government agencies, the Department's Audit Committee maintains scrutiny over the implementation of recommendations from ANAO reports, where they are applicable to the Department. Formal reports are provided to the Audit Committee twice yearly. Following the departmental Audit Committee's consideration of the progress in implementing ANAO recommendations, a summary report is provided to the JCPAA.
Details of the above ANAO reports, including responses to the recommendations where the Department was involved in the audit, can be found at the ANAO web site
Joint Committee of Public Accounts and Audit (JCPAA)
- JCPAA Report No.404 included the Committee’s review of Audit Report No.18, 2004-05, Regulation of Non-prescription Medicinal Products (Therapeutic Goods Administration). The Committee made six recommendations, to which the Department has responded.
- On 13 February 2006, the JCPAA conducted a public hearing in relation to its review of the Auditor-General’s Audit Report No.58, 2005-06, Helping Carers: the National Respite for Carers Program. The Department attended the hearing and gave evidence.
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- On 14 June 2006, the JCPAA conducted a public hearing in relation to its review of the Auditor-General’s Audit Report No.11, 2005-06, The Senate Order for Departmental and Agency Contract (Calendar Year 2003 Compliance) and Audit Report No 27, 2005-06, Reporting of Expenditure on Consultants. The Department attended the hearing and gave evidence.
Other Parliamentary Scrutiny
The Department appeared before the Senate Community Affairs Legislation Committee (Senate Estimates) on three occasions during the year for a total of four days. The Department also gave evidence and/or made submissions to a number of Parliamentary Committee Inquiries, as indicated in the following table.
|Joint Committee of Public Accounts and Audit
||Audit REport No.58, 2005-06, Helping Carers: The National Respite for Carers Program
|Senate Community Affairs References and Legislation Committee
||Quality and Equity in Aged Care
Services and Treatment Options for Persons with Cancer
Inquiry into Gynaecological Cancer in Australia
Response to the Petition on Gynaecological Health Issues
Petrol Sniffing in Remote Aboriginal Communities
The Aged Care (Bond Security) Bill 2005,the Aged Care (Bond Security) Levy Bill 2005 and the Aged Care Amendment (2005 Measures No. 1) Bill 2005
A matter relating to Positron Emission Tomography (PET) Review of 2000
Health and Other Services (Compensation) Amendment Bill 2006
Health Insurance Amendment (Medicare Safety-nets) Bill 2005
National Health Amendment (Budget Measures - Pharmaceutical Benefits Safety Net) Bill 2005
Inquiry into the Transparent Advertising and Notification of Pregnancy Counselling Services Bill 2005
Inquiry into Therapeutic Goods Amendment Bill 2005
National Health and Medical Research Council Amendment Bill 2006
Therapeutic Goods Amendment (Repeal of Ministerial Responsibility for Approval of RU486) Bill 2005
|House of Representatives Standing Committee on Economics, Finance and
||Improving the Superannuation Savings of People under the Age of 40
|House of Representatives Standing Committee on Health and Ageing
|Senate Select Committee on Mental Health
||Provision of Mental Health Services in Australia
|Joint Standing Committee on Migration
||Skills Recognition and Associated Issues of Licensing and Registration
|ACT Legislative Assembly Standing Committee on Health and Disability
||Health Science in the ACT
|House of Representatives Standing Committee on Science and Innovation
||Pathways to Technological Innovation
|House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs
|Joint Standing Committee on Foreign Affairs, Defence and Trade - Trade Subcommittee
||Review of the Australia-New Zealand Closer Economic Relations Trade Agreement (CER Agreement)
|Joint Parliamentary Committee on the Australian Crime Commission's Inquiry into Amphetamines and Other Synthetic Drugs
||Amphetamine and Other Synthetic Drugs
In addition, the Department had a significant workload of Parliamentary Questions with a combined total of 228 questions received on notice from the House of Representatives and the Senate, and a total of 745 from the three Senate Estimates Hearings.
Judicial Decision and Decision of Administrative Tribunals
In 2005-06, the Department was involved in 13 matters before the Administrative Appeals Tribunal; three matters before the Federal Magistrates Court; four matters before the Federal Court; two matters before the High Court; and one matter before the Full Federal Court.
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During 2005-06, the Commonwealth Ombudsman investigated 22 complaints against the Department’s administrative practices, with four of these remaining open. In comparison to 2004-05, the number of complaints lodged with the Commonwealth Ombudsman that went to the investigation stage decreased by 39 per cent.
Of the 11 complaints that were carried over from 2004-05, investigations have now been completed for nine. The investigations conducted by the Commonwealth Ombudsman, and finalised during 2005-06, did not result in any adverse findings for the Department.
The Department's Audit Committee met on five occasions during 2005-06. Membership included an independent member appointed from outside the Department and a representative from the Australian National Audit Office as a ‘
The committee is responsible for approving the strategic direction of the Audit and Fraud Control Branch and assessing the branch’s performance. The committee also considers the outcomes of audits and reviews undertaken by the branch, including the appropriateness of subsequent follow-up action by managers; provides advice to the Secretary on the signing of the Department’s financial statements; and assesses the outcomes of external reviews of departmental programs, including any follow-up action.
Audit and Fraud Control Branch
The Department’s Audit and Fraud Control Branch promotes and improves the Department’s corporate governance through the conduct of audits and investigations and the provision of high quality independent advice and assistance.
In 2005-06, the branch undertook a department-wide audit risk assessment to guide the development of the Audit and Fraud Control Branch strategic planning framework and annual work program. The branch conducted a range of audits and reviews, in line with the approved work program. These related to compliance with departmental control frameworks, grants and contract management, IT management and departmental expenditure and procurement activities. The branch also provided fraud prevention and investigation services.
Fraud Minimisation Strategies
As part of its responsibilities to protect the public interest, the Department pursues a fraud control program that complies with the Commonwealth Fraud Control Guidelines. In this program, fraud risk assessments and fraud control plans are prepared; appropriate fraud prevention, detection, investigation and reporting procedures and processes are in place; and annual fraud data is collected and reported. These are all undertaken in line with the Commonwealth Fraud Control Guidelines.
In 2005-06, the Department investigated 40 fraud allegations. While some of these investigations are continuing, outcomes of completed investigations included a number of matters being referred to the Australian Federal Police, State Police or departmental officers with powers authorised under the Public Service Act 1999
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