Chapter 2

Assessment of reports

2.1        The committee has found that one report, The Australian Industry Development Corporation annual report for 2008, neglected to include information in accordance with the Freedom of Information Act 1982, but that all other reports are 'apparently satisfactory'. The committee notes that all financial statements received an unqualified report from the Auditor-General.

Selected Agencies

Australian River Company

2.2        The committee has selected the Australian River Company's (ARCo) 2007 annual report for review to assess whether improvements have been made since the committee last reviewed a report by this company in Annual reports (No. 1 of 2008).

2.3        In that report, the committee found that the ARCo annual report for 2006 lacked detailed information regarding the principal activities of the company and progress made in winding up the company following a ministerial direction in 2002. ARCo's annual report for 2007 has included adequate detail in both of these areas.

2.4        The committee also asked that an explanation be given regarding the basis upon which ARCo made the decision to pay for the services of a company of which an ARCo director was a shareholder and director. The 2007 ARCo report discloses that Acton Corporate Partners, a company of which a director of ARCo is a shareholder and director, was again paid for advisory and other services. Though the amount is small, and smaller still than in 2006, no detail of the selection process has been included in the report, despite the committee's concern that this could lead to a perception of a conflict of interest. The committee reiterates the statements it made in its Annual reports (No. 1 of 2008) regarding this issue.[1]

Australian Industry Development Corporation

2.5        The Australian Industry Development Corporation (AIDC), as a Commonwealth Authority prescribed under the CAC Act, must fulfil the requirements outlined in the Commonwealth Authorities and Corporations (Report of Operations) Orders.

Freedom of Information

2.6        The AIDC 2008 report fulfils the majority of the requirements outlined in the orders. However, it does not include information required under subsection 8(1) of the Freedom of Information Act 1982 (FOI Act). Under the FOI Act, Commonwealth Authorities must include in their annual report:

1. a statement setting out particulars of the organization and functions of the agency, indicating, as far as practicable, the decision‑making powers and other powers affecting members of the public that are involved in those functions;

2. a statement setting out particulars of any arrangements that exist for bodies or persons outside the Commonwealth administration to participate, either through consultative procedures, the making of representations or otherwise, in the formulation of policy by the agency, or in the administration by the agency, of any enactment or scheme;

3. a statement of the categories of documents that are maintained in the possession of the agency, being categories that comply with subsection (6);

4. a statement of particulars of the facilities, if any, provided by the agency for enabling members of the public to obtain physical access to the documents of the agency; and

5. a statement of any information that needs to be available to the public concerning particular procedures of the agency in relation to Part III, and particulars of the officer or officers to whom, and the place or places at which, initial inquiries concerning access to documents may be directed.[2]

2.7        A good example of a report that does fulfil the reporting requirements of the FOI Act can be found in the 2007–08 Annual report of the Albury-Wodonga Development Corporation. The committee recommends that the AIDC should include information required by the FOI Act in its next annual report.

Recommendation 1

2.8        The committee recommends that the Australian Industry Development Corporation ensure that its next annual report fulfils the requirements of section 8 of the Freedom of Information Act 1982.

Conflicts of interest

2.9        The AIDC 2008 annual report, like the ARCo 2007 annual report, includes a section on transactions with board member related entities. This section discloses that AIDC paid over $20 000 to two companies that were connected to current or past board members of the AIDC. The report specifies that these transactions were on normal commercial terms and conditions. Though this may be an acceptable level of disclosure for a private company, the committee recommends that as a Commonwealth authority, an explanation should be given as to why the services of those particular companies were engaged. In the absence of such information, the AIDC risks the perception that a conflict of interest exists in the hiring of these companies.

Recommendation 2

2.10      The committee recommends that where a Commonwealth authority or company pays for the services of a 'related entity' company, the annual report should include an explanation of the decision-making process to engage that company.

 

Senator Helen Polley
Chair

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