Chapter 2 - Individual Reports

Reports under the Innovation, Industry, Science and Research portfolio

Department of Innovation, Industry, Science and Research (DIISR) – Annual Report 2009-10

2.1        DIISR's Annual Report emphasised the work of the department in implementing the government's 10-year plan to overhaul Australia's innovation system, Powering ideas: an innovation agenda for the 21^st century, which was released in May 2009. It also emphasised work being done to support Australian businesses during the continuing global economic uncertainty and to undergird Australian industry. The department's contribution to a project on fostering innovation in the public sector was also highlighted, which culminated in May 2010 with the release of the government's final report on the issue, Empowering change: fostering innovation in the Australian Public Service.

2.2        The annual report also described the work of IP Australia, which managed to further reduce its backlog of patent applications over the 2009-10 financial year, having initiated a comprehensive program to try and deal with this problem in the previous year. IP Australia also noted the launch of a package of competency units in IP which are being marketed for inclusion in registered training organisation training packages.

2.3        The report includes compliance indices for both DIISR and IP Australia, and a discussion of external scrutiny of the department. In 2009-10 DIISR was the subject of one investigation by the Commonwealth Ombudsman, into the LPG Vehicle Scheme, and four ANAO performance audits, the recommendations of which are being implemented. The discussion of external scrutiny did not, however, mention DIISR's appearance before parliamentary committees, despite DIISR appearing at Estimates in February 2010 and both DIISR and IP Australia appearing at Estimates in October 2009 and June 2010. 

Commonwealth Scientific and Industrial Research Organisation (CSIRO) – Annual Report 2009-10

2.4        CSIRO's annual report highlights the significant royalties obtained from their wireless technologies, estimating that almost 4 billion devices worldwide will contain the CSIRO technology by the end of 2013. Other highlights included developing Australia's first Zero Emission House, receiving the first signals from space to the Square Kilometre Array telescope, and completing the development of a new breed of prawn which could more than double the yield of the prawn farming industry in Australia. The annual report emphasises CSIRO's strong record of publications and citations in academic journals, pointing to the excellent quality of the science CSIRO undertakes.

2.5        The annual report includes a compliance index and discusses CSIRO's accountability to the government but not to the parliament. CSIRO had appeared at Estimates in October 2009 and February and June 2010. 

Australian Institute of Aboriginal and Torres Strait Islander Studies (AIATSIS) – Annual Report 2009-10

2.6        AIATSIS is a statutory authority whose goal is to be the world's leading research, collecting and publishing institution in the field of Australian Indigenous studies. Its annual report highlights the inscription of its Indigenous languages collection into Australia's contribution to the UNESCO Memory of the World program, as well as its growing number of research grants awarded, and looks forward to the establishment of a specific languages unit within AIATSIS over the next three years. 

2.7        The committee notes that the Institute included a compliance index in its report, and a discussion of its accountability to government and to the parliament.

Australian Institute of Marine Science (AIMS) – Annual Report 2009-10

2.8        AIMS is a statutory authority established by the AIMS Act 1972. Its mission is research to support the sustainable use and protection of the marine environment.

2.9        Its annual report highlights the successful field work undertaken by the Institute's scientists around Australia, with its five vessels clocking up a total of 668 research days in the field over the year. AIMS also drew attention to the announcement of government support for the construction of an Indian Ocean Marine Research Centre at the University of Western Australia, as well as noting its aquaculture team's achievement of successfully rearing lobster larvae on entirely artificial feed, a world first breakthrough which could potentially pave the way for a commercially viable aquaculture of lobsters.

2.10      The committee commends AIMS for including a compliance index in its report.

Chief Scientist of Australia – Annual Review 2009-10

2.11      The committee is pleased to note that in line with its suggestion in its Annual Reports (No. 1 of 2010), the Office of the Chief Scientist published its first Annual Review for the 2009-10 year.

2.12      The annual review highlights the Chief Scientist's work in developing a foresighting framework to help inform the work of the Prime Minister's Science, Engineering and Innovation Council (PMSEIC), a framework which now may be adopted in several countries overseas. Other milestones included the launching of the Chief Scientist's website and presentations by the Chief Scientist at the World Science Forum in Budapest.

Reports under the Resources, Energy and Tourism portfolio

Australian Solar Institute (ASI) – Annual Report 2009-10

2.13      The Australian Solar Institute is a $100 million commitment by the Commonwealth Government to support the development of solar energy technologies, lower the cost of solar power for consumers and promote the uptake of solar as a significant energy source for Australia. After its establishment was announced on 15 January 2009, ASI was incorporated as a not-for-profit company limited by guarantee on 10 August 2009.

2.14      In its first year of operation, ASI undertook significant start-up work establishing the organisation's corporate structures, as well as awarding its first round of R&D grant funding. Ten projects were approved in the first funding round, representing over $29.5 million in investment from the ASI. In June 2010 ASI launched a postdoctoral scholarship program which will provide funding for PhD students to undertake cutting-edge research in solar technologies.

2.15      ASI also noted the development of networking relationships across the Australian solar industry in its first year of operations, as well as the initiation of strategic relationships with like organisations in other countries, with a view to developing these further into the future. The most noteworthy achievement in this regard was the signing of a Memorandum of Understanding with Germany's Fraunhofer Institute.  

2.16      The Committee suggests that ASI include a compliance index in future annual reports.

Tourism Australia – Annual Report 2009-10

2.17      Tourism Australia's Annual Report notes that the tourism industry showed signs of recovery in 2009-2010 after a difficult year in 2008-09 in the aftermath of the global financial crisis. A core focus for Tourism Australia was the launch in March 2010 of the global 'There's Nothing Like Australia' campaign, which draws on the experiences of individual Australians to help promote Australia. It also highlighted the ongoing progress of the 'No Leave No Life' campaign to promote domestic tourism.

2.18      Additionally, there was a strong focus in 2009-10 on developing Tourism Australia's presence online and in social media. The Australia.com website attracted over 18 million visitors over the year, more than doubling the previous year's total, and the newly launched Facebook page attracted over 700,000 followers by the time the annual report was written.

2.19      The report includes little discussion of external accountability and lacks a compliance index. There is also no discussion of parliamentary scrutiny, despite Tourism Australia's appearance before Senate estimates throughout the year. The annual report did note that Tourism Australia provides a Compliance Report to its board as well as the Minister for Resources, Energy and Tourism and the Minister for Finance and Deregulation, which includes more extensive information on Tourism Australia's legislative compliance and financial sustainability.

2.20      The committee suggests that a copy of this Compliance Report be made available to the committee each year so as to enable it to assess fully Tourism Australia's performance throughout the year.

Snowy Hydro Ltd – Consolidated Financial Report 2008-09

2.21      Snowy Hydro Ltd and its subsidiaries manage and maintain the Snowy Hydro-electric Scheme, generating and marketing renewable electricity and electricity products. The organisation is a company limited by shares, of which the Commonwealth holds a 13 per cent stake, and Snowy Hydro is required to table its annual reports in the federal parliament under the Snowy Hydro Corporatisation Act 1997. This annual report covers the period 29 June 2008 to 4 July 2009, and outlines the financial performance of Snowy Hydro Ltd over the year, as well as mentioning its compliance with environmental regulations.

2.22      As a company limited by shares, Snowy Hydro is not subject to the requirements for annual reports of government departments and agencies outlined by the Department of Prime Minister and Cabinet. Its annual report, however, does comply with the provisions of the Corporations Act 2001.

Reports under the Treasury portfolio

The Treasury – Annual Report 2009-10

2.23      Treasury's annual report highlights numerous achievements for the 2009-10 year. The final report of the Australia's Future Tax System review was delivered to the Treasurer in December 2010, making 138 recommendations about potential reform to Australia's taxation system. In consultation with Treasury, the government released the final report and its initial response on 2 May 2010. Treasury assisted the government in the development of the 2010 Intergenerational Report, Australia to 2050: Future Challenges, which was released in February 2010. Treasury successfully worked to advise on and implement the Government's fiscal strategy, with the 2010-11 Budget predicting a return to surplus in 2012-13. Treasury also continued its input into the G-20 global reform agenda, undertook significant work on the National Health and Hospitals Network reforms, and oversaw the introduction of 31 taxation or superannuation related bills into the parliament over the year.

2.24      The committee commends Treasury for the extensive discussion of external accountability in its report, including its appearance before parliamentary committee inquiries. The committee notes that 18 of its appearances were before the Senate Economics Committees and expresses its appreciation to Treasury for this valuable contribution. It also commends Treasury for including a comprehensive compliance index and references to Australian National Audit Office reports relating to its operations in its annual report.

Australian Bureau of Statistics (ABS) – Annual Report 2009-10

2.25      The annual report describes 2009-10 as a tough, but successful year for the ABS. It notes that there was an improved financial outlook for the organisation which allowed it to reinstate many of the work program cuts implemented in 2008-09 and address emerging priorities for the organisation.

2.26      A significant mention is given to the initial work undertaken during the year in preparation for the 2011 Australian Census, including the implementation of a Northern Australia Enumeration Strategy to help improve the data collected from remote areas in Northern Australia. The 2011 Census will mark 100 years since the first Australian Census in 1911. Other highlights included work on a review of the Consumer Price Index and the continuing provision of timely and accurate economic statistics to the government in the aftermath of the global financial crisis.

2.27      The committee commends the ABS for the inclusion of a compliance index, and notes the discussion of external scrutiny contained in the annual report. In this discussion, however, the committee suggests that the ABS could have included reference to scrutiny by parliamentary committees, in particular its appearances at Senate Estimates in October 2009 and February and June 2010.

Australian Statistics Advisory Council (ASAC) – Annual Report 2009-10

2.28      ASAC advises the Minister and the Australian Statistician on matters relating to official statistics, and met twice over the 2009-10 financial year. The annual report notes concern about the adequacy of resourcing of the ABS, despite funding increases in the 2009 federal budget, and also noted the need for improved data integration across all levels of government.

Australian Office of Financial Management (AOFM) – Annual Report 2009-10

2.29       The AOFM is a prescribed agency responsible for the management of the government's debt, financial investments and cash balances. Its annual report explains that the global financial crisis and the sovereign debt crisis affecting much of Europe pose many challenges to the work of the AOFM, and that these challenges were effectively met in 2009-10.

2.30      The report notes that gross bond issuance for the year increased by over 40 per cent from 2008-09. Over the year, 81 tenders were conducted for Treasury bonds and 68 for Treasury notes. In September 2009 the AOFM also resumed the issuance of Indexed Treasury Bonds, a move which was very favourably received by the market. The AOFM also extended its Residential mortgage-backed securities (RMBS) program to help provide support for lending to small business as well as for housing.

2.31      The Committee commends the AOFM for including a compliance index in its report. The AOFM appeared before the committee at Senate estimates hearings in October 2009 and February and June 2010.  The Committee suggests that references to such appearances before Senate committees should be included in future reports as these appearances are an important aspect of external scrutiny of government agencies.

Australian Prudential Regulation Authority (APRA) – Annual Report 2009-10

2.32      APRA describes 2009-10 as a year in which financial institutions began to move back towards a 'business-as-usual' mindset after the shocks of the global financial crisis. Despite this, APRA continued its supervisory activities at the high levels reached during the previous two years. APRA saw this increased scrutiny as essential given the continuing uncertainties in the global economic outlook.

2.33      Notable work conducted in 2009-10 included a stress-test of capital adequacy in the Authorised Deposit-taking Institution (ADI) industry, based on a specified macroeconomic scenario developed with the RBA and the Reserve Bank of New Zealand. APRA also continued its involvement in the Basel Committee on Banking Supervision, and noted in its annual report that in the context of the Basel Committee and global banking reforms, APRA is cited as an example of good supervision in practice.

2.34      The committee commends APRA for including a compliance index in its annual report, and for noting APRA's appearances before parliamentary committees throughout the year. The annual report details APRA's three appearances at Senate Estimates over 2009-10, as well as appearances before two Economics References Committee inquiries over the same period.    

Australian Reinsurance Pool Corporation (APRC) – Annual Report 2009-10

2.35      The ARPC is a statutory authority, established by the Terrorism Insurance Act 2003 in response to a marked reduction in the commercial terrorism insurance market following the events of 11 September 2001. It administers a scheme for providing coverage for commercial property and business interruption.

2.36      Treasury conducted a review in 2009 which concluded that the APRC scheme should continue to operate for a further three years, and made six recommendations for refinements to the scheme, which are now being taken up by APRC.

2.37      The annual report notes the renewal of APRC's retrocession program in December 2009, and highlights the continued work undertaken to enhance the APRC's loss estimation capabilities.

2.38      The committee suggests that the annual report could be improved by including a specific compliance index. The readability of the report could also be improved by the inclusion of an index and glossary of terms.

Australian Taxation Office (ATO) – Annual Report 2009-10

2.39      2010 was the ATO's centenary year, and its 2009-10 annual report celebrates the growth and evolution of the Tax Office over the last hundred years. It describes 2009-10 as 'a year of consolidation and platform building', and also a year in which the ATO ushered in significant change in its infrastructure, culture and skills. The final phase of the ATO's change program was deployed in 2009-10, completing a process of technology upgrade initiated in 2002. The ATO also released its Strategic Statement 2010-15 outlining the vision of the ATO for the next five years.

2.40      The 2009-10 annual report also highlighted potential areas for improvement, noting that the ATO managed to meet only 15 of its 27 service standards throughout the year, and that customer complaints rose correspondingly in 2009-10.

2.41      The ATO's annual report is clearly set out and includes a thorough discussion of external accountability. The report notes that in addition to its three appearances before Senate Estimates, the ATO additionally appeared before 15 inquiries of parliamentary committees over the year. The report also includes both a compliance index and a separate list covering its legislative reporting requirements specified in 27 Acts.  

Commonwealth Grants Commission (CGC) – Annual Report 2009-10

2.42      The CGC is a statutory authority with the goal of fiscal equalisation (i.e. providing state governments with the financial capacity to provide the same range and quality of services to their residents) through allocation of revenue from the Goods and Services Tax. The annual report describes the commission's major achievement in 2009-10 as the completion of the Report on GST Revenue Sharing Relativities 2010 Review. This report was the final result of a review process initiated in 2005, and provided recommendations on the methods that should be used to determine the sharing of GST revenue between the States and Territories over the next four to five years. 

2.43      The annual report notes 'the Commission is subject to external scrutiny by bodies such as Parliamentary Committees...'.[1] The committee suggests that the commission's annual report could be improved by including a specific compliance index.

Companies Auditors and Liquidators Disciplinary Board (CALDB) – Annual Report 2009-10

2.44      The CALDB determines whether a registered auditor or liquidator should be disqualified from practising in Australia. Its annual report notes that in 2009-10 one registration was cancelled and two suspended.

2.45      The annual report notes the appearance of the CALDB Chairman before the Economics References Committee's 2010 inquiry into Liquidators and Administrators, and takes note of the view expressed by the committee in its final report that the CALBD should hold its hearings publically rather than in private session. Whilst not venturing an opinion on these proposed changes to the way the CALDB operates, the annual report notes the Board's willingness to participate appropriately in any future discussions on the issue.  

Corporations and Markets Advisory Committee (CAMAC) – Annual Report 2009-10

2.46      CAMAC is a statutory agency under the FMA Act 1997 consisting of part-time members appointed by the Minister. Its role is to advise the minister about corporate, financial product and financial market matters.

2.47      CAMAC's 2009-10 annual report details the two reports completed by CAMAC over the year, relating to members' schemes of arrangement and guidance for directors. The annual report also highlights work started by CAMAC on a review of executive remuneration practises, which was referred to CAMAC in May 2010.

2.48      The committee commends CAMAC for including a comprehensive compliance index in its annual report, as previously suggested in the committee's report Annual Reports (No. 2 of 2010).

Financial Reporting Panel (FRP) – Annual Report 2009-10

2.49      The FRP is the primary adjudicator between ASIC and companies, disclosing entities or registered schemes in relation to the application of accounting standards in financial reports. As in 2008-09, no matters were referred to and resolved by the FRP during 2009-10. Four cases were referred to the panel late in the financial year, and the outcome of these referrals will be reported on in the FRP's 2010-11 annual report.

Inspector-General of Taxation (IGT) – Annual Report 2009-10

2.50       The IGT's annual report describes the five reports completed and published in the 2009-10 year, relating to a range of aspects of the work of the ATO. It also notes three further reports which were completed and submitted to the Minister during the year, which have not yet been made publically available, and four IGT reviews that were currently in progress at 30 June 2010.

2.51      The committee commends the IGT for including a compliance index and thorough discussion of external scrutiny in its annual report.

Superannuation Complaints Tribunal (SCT) – Annual Report 2009-10

2.52      In 2009-10 the number of complaints received by the SCT decreased slightly from the previous year, although still remaining at a high level. The nature of complaints received was again informed by the lingering effects of the global financial crisis. The number of complaints proceeding to review decreased, reflecting a higher proportion of complaints relating to negative investment returns rather than improper behaviour by funds.

2.53      The committee commends the SCT for including a compliance index in its annual report.

Tax Practitioners Board – Annual Report 2009-10

2.54      The TPB commenced its activities on 1 March 2010 as Australia's regulator of tax agents and business activity statement (BAS) agents. Its establishment was provided for in the Tax Agent Services Act 2009, and the TPB replaces six state-based Tax Agents' Boards. The TPB is not an agency for the purposes of the FMA Act, and is resourced through the ATO. The Board's financial operations are reported on in the ATO's annual reports.

2.55      The TPB's first annual report details the key start-up activities of the board. Most of the board members were appointed in October 2009, and work was done developing registration eligibility criteria for tax and BAS agents and articulating professional standards requirements for the industry in the lead-up to the TPB commencing administration of the new registration system for tax agents on 1 March 2010.

2.56      The committee commends the TPB for including a compliance index in its report, and looks forward to monitoring the progress of the TPB in its first full financial year of operations in 2010-11.

Foreign Investment Review Board (FIRB) – Annual Report 2008-09

2.57      FIRB is a non-statutory body responsible for advising the Treasurer on foreign investment policy and administration. Secretariat services to the board are provided by the Foreign Investment and Trade Policy Division of Treasury, and FIRB's financial operations are reported on in Treasury's annual reports.

2.58       In 2008-09, FIRB advised the approval of over 5300 foreign investment proposals, representing $181.4 billion of proposed investment. The number of proposals represents a decrease of 32 per cent in applications from the previous year. During the year three proposals relating to real estate purchases were rejected. In 2009-10 the US represented the largest source country for foreign investment into Australia, followed by China, Japan, the UK and France. By industry, the minerals and resource sector saw the most foreign investment over the year.

2.59      The committee suggests that a specific compliance index as well as an index of terms may be useful additions to FIRB's future annual reports.

Senator Annette Hurley

Chair

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