Introduction

1.1      The Senate Economics Legislation Committee (the committee) is responsible for examining the annual reports of the departments and agencies of the Treasury portfolio and the Industry, Innovation and Science part of the Jobs and Innovation portfolio.[1]

1.2      This is the committee's second report on annual reports for 2018. Its purpose is to provide an overview of the relevant annual reports presented to the Parliament between 1 November 2017 and 30 April 2018 for the 2016–17 reporting period.

Terms of reference

1.3      Under Senate Standing Order 25(20) the annual reports of certain departments and agencies are referred to committees for examination. Each committee is required to:

1. examine each annual report referred to it and report to the Senate whether the report is apparently satisfactory;
2. consider in more detail, and report to the Senate on, each annual report which is not apparently satisfactory, and on the other annual reports which it selects for more detailed consideration;
3. investigate and report to the Senate on any lateness in the presentation of annual reports;
4. in considering an annual report, take into account any relevant remarks about the report made in debate in the Senate;
5. if the committee so determines, consider annual reports of departments and budget-related agencies in conjunction with examination of estimates;
6. report on annual reports tabled by 31 October each year by the tenth sitting day of the following year, and on annual reports tabled by 30 April each year by the tenth sitting day after 30 June of that year;
7. draw to the attention of the Senate any significant matters relating to the operations and performance of the bodies furnishing the annual reports; and
8. report to the Senate each year whether there are any bodies which do not present annual reports to the Senate and which should present such reports.

Allocated portfolios

1.4        The Senate allocated departments and agencies to committees on
12 February 2018.[2] In accordance with that resolution, the committee has responsibility for the oversight of the following:

• Industry, Innovation and Science portfolio; and
• Treasury portfolio.

Role of annual reports

1.5      Annual reports place a great deal of information about government departments and agencies on the public record. Accordingly, the tabling of annual reports is an important element of accountability to the Parliament, as the information provided in annual reports assists in the effective examination of the performance of departments and agencies, and the administration of government programs.

1.6      Together with Portfolio Budget Statements (PBS), Portfolio Additional Estimates Statements (PAES) and the Estimates process, annual reports are the primary mechanisms for scrutiny of the operations of government. Indeed, as highlighted in the Requirements for Annual Reports for Departments, Executive Agencies and Other Non-corporate Commonwealth Entities (Requirements for Annual Reports or PM&C guidelines) released by the Department of the Prime Minister and Cabinet (PM&C), and approved by the Joint Committee of Public Accounts and Audit (JCPAA) under subsections 63(2) and 70(2) of the Public Service Act 1999 (PS Act):

Annual reports serve to inform the Parliament (through the responsible Minister), other stakeholders, educational and research institutions, the media and the general public about the performance of departments in relation to services provided. Annual reports are a key reference document and a document for internal management. They form part of the historical record.[3]

...

Annual reports and PB Statements are the principal formal accountability mechanisms between government and departments and from departments through (or on behalf of) government to the Parliament.[4]

Annual reporting requirements

1.7        The Public Governance, Performance and Accountability Act 2013
(PGPA Act), which commenced on 1 July 2014, establishes a performance reporting framework for all Commonwealth entities and companies.

1.8        Section 46 of the PGPA Act sets out the annual reporting requirements in relation to non-corporate Commonwealth entities, including that annual reports must comply with any requirements prescribed by the PGPA Rule 2014. Section 97 sets out the annual reporting requirements for corporate Commonwealth entities.

1.9      The enabling legislation of some agencies may require that agency to report on matters other than those included in the PM&C guidelines, or impose different reporting requirements. The committee's view is that such agencies, while bound by their enabling legislation, should also comply with the PM&C guidelines, to the extent that the requirements do not conflict.

Reports referred to the committee

1.10         The first Report on Annual Reports for 2018 was tabled on 20 March 2018.

1.11         Under Senate Standing Order 25(20)(f), the committee is required to report on the annual reports of departments and agencies tabled by 30 April each year by the tenth sitting day after 30 June of that year. This year that date is 11 September 2018.

1.12         This Report on Annual Reports also examines annual reports that were tabled after 30 April 2016 but before the tabling of this report; that is, up to 16 August 2018.

Reports examined

1.13      During the period examined in this report, two annual reports of bodies or statutory office holders were presented to the Parliament and referred to the committee. The reports examined are categorised as follows:

Treasury Portfolio

Corporate Commonwealth entities

• Corporations and Markets Advisory Committee

Non-statutory bodies

• Foreign Investment Review Board

Additional reports referred to the committee

1.14         As the committee is not obliged to report on Acts, statements of corporate intent, surveys, policy papers, budget documents, corporate plans or errata, the following documents were referred to the committee for information only:

Treasury portfolio

• Australian Taxation Office:  
  • Low Income Superannuation Contributions–Quarterly Report–for the period
    1 July 2017 to 30 September 2017–Section 12G of the Superannuation (Government Co-contribution for Low Income Earners) Act 2003;
  • Low Income Superannuation Contributions–Quarterly Report–for the period
    1 October 2017 to 31 December 2017–Section 12G of the Superannuation (Government Co-contribution for Low Income Earners) Act 2003;
  • Low Income Superannuation Contributions–Quarterly Report–1 January 2018 to 31 March 2018–Section 12G of the Superannuation (Government
    Co-contribution for Low Income Earners) Act 2003;
  • Super Co-contributions Quarterly Report–for the period 1 July 2017 to
    30 September 2017–Section 54 of the Superannuation (Government
    Co-contribution for Low Income Earners) Act  2003;
  • Super Co-contributions Quarterly Report–for the period 1 October 2017 to
    31 December 2017–Section 54 of the Superannuation (Government
    Co-contribution for Low Income Earners) Act  2003;
  • Super Co-contributions Quarterly Report–for the period 1 January 2018 to
    31 March 2018–Section 54 of the Superannuation (Government
    Co-contribution for Low Income Earners) Act  2003;
• Productivity Commission—Report no. 85—Introducing Competition and Informed User Choice into Human Services: Reforms to Human Services, dated 27 October 2017;
• Productivity Commission—Report no. 87—National Water Reform, dated
  19 December 2017;
• Productivity Commission—Report no. 88—Horizontal Fiscal Equalisation, dated 15 May 2018; and
• Productivity Commission—Report no. 89—Competition in the Australian Financial System, dated 29 June 2018.

Timeliness

1.15      Senate Standing Order 25(20)(c) requires the committee to report to the Senate on the late presentation of annual reports.

Departments and PGPA Act entities

1.16      Section 46 of the PGPA Act, which applies to annual reports of Commonwealth entities, states that annual reports of departments and agencies must be provided to the responsible Minister by the 15^th day of the fourth month after the end of the reporting period (generally, 15 October of the relevant year). The responsible Minister must, in turn, present the report to each House of the Parliament on or before 31 October in the year in which the report is given. Furthermore, if Senate Supplementary Budget Estimates hearings are scheduled to occur prior to
31 October, it is best practice for annual reports to be tabled prior to those hearings.[5]

1.17      Section 97 of the PGPA Act sets out the requirements for the provision of the annual reports of Commonwealth companies to the responsible Minister. Subsection 2 states that the company must give the reports and information by:

1. (a) if the company is required by the Corporations Act 2001 to hold an
2. annual general meeting—the earlier of the following:
   1. (i) 21 days before the next annual general meeting after the end of the reporting period for the company;
   2. (ii) 4 months after the end of the reporting period for the company; and
3. (b) in any other case—4 months after the end of the reporting period for the company;
   or the end of such further period granted under subsection 34C(5) of the Acts Interpretation Act 1901.

1.18      Subsection 97(5) of the PGPA Act states that:

(5) If the Commonwealth company is a wholly-owned Commonwealth company, or is not required to hold an annual general meeting, the responsible Minister must table the documents in each House of the Parliament as soon as practicable after receiving them. In all other cases, the responsible Minister must table the documents in each House of the

Parliament as soon as practicable after the annual general meeting of the company.

1.19      The provisions of subsections 34C(4)–(7) of the Acts Interpretation Act 1901 (AIA Act) apply in relation to an application for extension of the period. An extension under the AIA Act would need to be sought where a specified timeframe cannot be met. However, it remains the government's policy that all annual reports should be tabled by 31 October.[6]

Other entities

1.20      Entities reporting in accordance with their own legislation are often required to prepare for the relevant Minister their annual report 'as soon as is practicable' after the end of the particular period to which the reports relates. The committee draws attention to subsections 34C(2) and 34C(3) of the AIA Act, which stipulate that where no date for providing a report to a Minister is specified, the report should be presented no more than six months after the reporting period, and the Minister must provide the report to the Parliament within 15 days after receipt.

Timeliness of 2016–17 reports examined

1.21      The committee considers the timely presentation of annual reports to be an important element of accountability to the Parliament and continues to encourage bodies and statutory offices to endeavour to meet relevant timeframes.

1.22      Appendix 1 lists the annual reports tabled (or presented) in Parliament and referred to the committee between 1 November 2017 and 30 April 2018, as well as those received before the tabling of this report, that is before 16 August 2018.  

1.23      The Foreign Investment Review Board (FIRB) is a non-statutory body, established by the Minister, and is therefore not subject to the reporting requirements set out in the PGPA Act. FIRB does not have a legislative requirement to table an annual report; however, the committee notes that this year's report was presented later than usual. The report explains:

The report is delayed this year due to additional time required to reconcile the approvals data. Significant improvements to the foreign investment case management system and online application portal to be implemented by mid-2018 will address this issue, improving the quality of the data and process for compiling the annual report.[7]

1.24      The committee commends FIRB for continuing to report to the Parliament each year.

1.25      The Corporations and Markets Advisory Committee (CAMAC) was a corporate Commonwealth entity under the PGPA Act. However, the committee notes that this is the final report of CAMAC, which ceased operation in 2014–15 and was abolished in February 2018.

Senate debate

1.26      In accordance with Senate Standing Order 25(20)(d) the committee is required to take into account any relevant remarks about the reports made during debate in the Senate. The committee notes that none of the annual reports examined in this report have been the subject of comment or debate in the Senate.

Non-reporting bodies

1.27      Senate Standing order 25(20)(h) requires that the committee inquire into and report on any bodies which do not present annual reports to the Senate but should present such reports.

1.28      The committee did not inquire into or make any comment in relation to bodies that did not present an annual report to the Senate.

Apparently satisfactory

1.29      Senate Standing Order 25(20)(a) requires that the committee report to the Senate on whether the annual reports of departments and agencies in its portfolios are 'apparently satisfactory'. In making this assessment, the committee considers such aspects as timeliness of presentation and compliance with relevant reporting requirements.

1.30      The committee has examined all annual reports referred under the Industry, Innovation and Science and Treasury portfolios during the reporting period and considers that they are apparently satisfactory.

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