Introduction
Referral of inquiry
1.1
On 10 November 2016, the Senate referred an inquiry into the Department
of Defence's management of credit and other transaction cards to the Foreign
Affairs, Defence and Trade References Committee for inquiry and report by 11
May 2017. The terms of reference for this inquiry are as follows:[1]
The Department of Defence's
management of credit and other transaction cards with particular reference to:
- Controls in place to manage credit
card expenditure including action to prevent credit card misuse and minimise
risk to the Commonwealth;
-
Issuing of CabCharge 'Fastcards'
and 'E-tickets' to staff including monitoring and management of e-ticket
accounts;
-
Controls in place on the use of
fuel cards for commercial and military vehicles, including compliance testing
of the assurance framework;
-
Implementation of the Department
of Defence's new governance arrangements for credit card management;
-
Legislative requirements and
framework set out in the Financial Management and Accountability Act 1997
and its successor, the Public Governance, Performance and Accountability Act
2013; and
-
any other related matters.
Conduct of the inquiry
1.2
The committee advertised the inquiry on its website and wrote to
individuals and organisations likely to have an interest in the inquiry and
invited them to make written submissions.
1.3
The committee received two submissions to the inquiry. Additional
information was received from the Departments of Defence and Finance, the
Australian Institute of Criminology and the Australian Payments Clearing
Association.
1.4
Two public hearings were held in Canberra on 7 March and 6 April 2017,
at which witnesses from the Australian Institute of Criminology, the Australian
National Audit Office (ANAO) and the Departments of the Attorney-General's,
Defence and Finance, gave evidence.
Structure of report
1.5
The report contains four chapters. This introduction outlines the scope
and process of the inquiry. Chapter 2 briefly outlines the unique nature of the
Defence resource management environment. It also describes the requirements for
the proper use of relevant monies established by the Public Governance
Performance and Accountability Act 2013 (No. 123, 2013 with amendments
No.126, 2015) (PGPA) and the Commonwealth resources management framework under
the public management reform agenda which was introduced in 2013. The public management
reform agenda, through the Commonwealth resources management framework and the PGPA,
frames the ANAO performance audit report into Defence's management of credit
and other transaction cards, which triggered the inquiry.[2]
1.6
Chapter 3 summarises the key issues explored by the committee during the
inquiry, illustrating these through an examination of case studies for each
card type. It also considers the implications for the governance of credit and
other transaction cards in the Department of Defence. Chapter 4 concludes with
the committee's view and recommendations for ensuring the proper use of
relevant monies by the Department of Defence when using credit and other
transaction cards.
Acknowledgements
1.7
The committee thanks all those who contributed to the inquiry by making
submissions, providing additional information or expressing their views through
correspondence and emails. The committee acknowledges those who gave their time
to attend the public hearings and give evidence.
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