Chapter 2
Annual reports of agencies
2.1
This chapter examines, in greater detail, selected annual reports that
have been received during the period 1 November 2013 to 30 April 2014, and
provides the Senate with information that may be of particular interest. During
the reporting period two new reporting entities were established and two ceased
operation; their inaugural and final reports are examined in this chapter.
Agriculture Portfolio
Commonwealth authorities
Cotton Research and Development
Corporation (CRDC)
2.2
The Cotton Research and Development Corporation (CRDC) has again
provided a helpful table that lists its Key Performance Indicators (KPIs) and
identifies whether they were achieved, partially achieved, or not achieved.
Where a KPI was either partially achieved or not achieved, CRDC provided an
explanation.[1]
The committee considers this best practice in terms of measuring performance
and commends CRDC for the consistently high standard of annual reports it has
produced.
2.3
During 2012-13, CRDC's 2013-18 Strategic Research and Development (R&D)
Plan was finalised and approved. CRDC reported that the plan 'connects insights
into changes in society with those of the cotton sector and identifies the
critical importance of responding with better knowledge sharing and even
stronger relationships between farmers, industry and customers.'[2]
The committee notes that in October 2012 ACIL Tasman conducted an independent
review of CRDC's organisational performance with a view to guiding its
implementation of the Strategic R&D Plan. The review concluded:
CRDC is a significant and respected organisation in cotton
RD&E [Research, Development and Extension], whose actions are consistent
with the PIERD Act, aligned with its Strategic Plan and the priorities of
industry and government.[3]
2.4
In response to the review, CRDC reported that its Board and management
had 'accepted the report recommendations for improvement to CRDC's performance
framework, stakeholder engagement and human resource management.'[4]
Fisheries Research and Development
Corporation (FRDC)
2.5
The committee notes that Fisheries Research and Development Corporation
(FRDC) prepared its report in compliance with the Commonwealth Authorities
and Companies (Report of Operations) Orders 2008 made (formerly) under
section 48 of the Commonwealth Authorities and Companies Act 1997.[5]
The committee highlights that the 2008 Orders have been repealed and replaced
by the Commonwealth Authorities (Annual Reporting) Orders 2011 and that
future reports should be prepared in accordance with updated legislation. The
committee again reminds FRDC that an assessment on the effectiveness of
operations should be included in its annual report, as opposed to only listing
'achievements'.[6]
Grape and Wine Research and Development
Corporation (GWRDC)
2.6
During 2012-13, the Grape and Wine Research and Development Corporation
(GWRDC) implemented a new five-year Strategic Research, Development and
Extension (RD&E) Plan. GWRDC reported that the plan 'specifically
encompasses more active direction of RD&E projects, a heightened emphasis
on extension activities, and more active engagement with research providers to
ensure the delivery of research outcomes that can be adopted by [its] stakeholders
and used for continuous improvement and innovation.'[7]
GWRDC also indicated that it was actively working towards and supported a
merger with the Wine Australia Corporation (WAC). However, it would continue to
emphasise 'its commitment to maintaining the distinction between the R&D
levies reserved for GWRDC's investments and the marketing levies allocated to
WAC.'[8]
The committee notes that the new industry statutory body, the Australian Grape
and Wine Authority, commenced operations on 1 July 2014.
2.7
The committee reiterates previous comments that the use of columns in
the GWRDC's annual reports detrimentally affects readability.[9]
It also suggests that performance reporting could be improved by more clearly
assessing whether targets and outcomes have been achieved, were in progress, or
not achieved.[10]
The committee commends the incorporation of a compliance index with a clear
distinction between the relevant legislative reporting requirements.[11]
Sugar Research and Development
Corporation (SRDC)
2.8
On 28 June 2013, the bills that provided for the restructuring of sugar
research and development organisations were passed by the Australian
Parliament.[12]
On 5 August 2013, the then Minister for Agriculture, Fisheries and Forestry
announced that Sugar Research Australia Limited (SRA) would be the new Industry
Owned Company with responsibility for undertaking and funding research on
behalf of industry. SRDC's current and previously approved Research,
Development and Extension (RD&E) projects were thus transferred to SRA for
management. SRDC's assets and liabilities were also transferred and SRDC wound
up as at 30 September 2013.[13]
2.9
The committee notes that the final two annual reports of the SRDC did
not respond to previous comments made by the committee,[14]
whereby both reports again had an incomplete compliance index.[15]
Prescribed agencies
Wheat Exports Australia (WEA)
2.10
The Wheat Export Marketing Amendment Bill 2012, passed by both houses of
Parliament on 29 November 2012, brought about the abolition of the Wheat
Export Accreditation Scheme and the Wheat Export Charge on 10 December 2012 and
the WEA ceased operating on 31 December 2012.[16]
The committee examined the WEA's 2011-12 annual report in December 2013.[17]
However, it was later referred a final report for the period 1 July to 30
December 2012.
2.11
The WEA was established with the objective of regulating 'the export of
bulk wheat (that is, other than in bags and containers) from Australia through
the Wheat Export Accreditation Scheme 2008 and to inform government, growers,
accredited bulk wheat exporters and industry stakeholders of outcomes.'[18]
These arrangements 'were intended to increase competition in the bulk wheat
export market.'[19]
WEA reported that between 1 July 2012 and 31 December 2012, no new exporters
were accredited, 14 exporters renewed their accreditation and one exporter
surrendered its accreditation, leaving a total of 22 accredited exporters as at
9 December 2012.[20]
WEA also outlined future transitionary arrangements that will take place
following the closure of WEA:
The requirement for providers of grain port terminal services
to pass the access test as a condition for exporting bulk wheat was retained
until 30 September 2014. After that date the access test will be abolished on
the condition that a mandatory industry code of conduct covering access to
grain export terminals is in place.
If the code is approved the market will move to full
deregulation from 1 October 2014. All aspects of the industry will then be
subject to general competition law administered by the Australian Competition
and Consumer Commission and complemented by the code.
The government is to establish a national wheat industry
advisory taskforce to examine current arrangements along the supply chain and
provide recommendations on the appropriate use of surplus funds from the Wheat
Export Charge.[21]
Infrastructure and Regional Development Portfolio
Commonwealth authorities
National Transport Commission (NTC)
2.12
The National Transport Commission (NTC) is not a Commonwealth authority
for the purposes of the Commonwealth Authorities and Companies Act 1997 (CAC
Act), however, the NTC's enabling legislation states that certain sections of
the CAC Act apply to it, including section 9, relating to annual reporting
requirements.[22]
Under schedule 1 of the CAC Act, an agency's report must include a report of
operations prepared in accordance with the CAC Orders.
2.13
The committee highlights that the NTC has once again provided an
accessible and informative report, with clear and detailed reporting of the
NTC's performance, including safety and productivity outcomes. However, it
notes the absence of a statement indicating the annual report of operations is
adopted by resolution of the directors as well as how and when approval was
given. This statement must also indicate that directors are responsible for the
preparation and contents of the annual report of operations.[23]
2.14
During 2012-13 the regulators established by the Heavy Vehicle National
Law and Rail Safety National Law commenced operations, with the NTC leading the
development of these laws.[24]
The 2012 Review of the National Transport Commission and other relevant
transport bodies, which examined the role of the NTC in supporting the
start of the national Heavy Vehicle Regulator (NHVR) and National Rail Safety
Regulator (NRSR) in January 2013, made a number of recommendations. The NTC
reported that it had taken these recommendations into consideration in
developing its 2013-2014 to 2015-16 Strategic Plan and Work Program.[25]
Prescribed agencies
National Capital Authority (NCA)
2.15
The National Capital Authority (NCA) is responsible for administering
the Commonwealth's interest in Canberra as the National Capital. The nation
celebrated the centenary of the founding of Canberra in March 2013, with the
NCA coordinating many Centenary Celebrations. During 2012-13 a review of the
National Capital Plan commenced and the NCA reported that it would continue
reform of the plan in 2013-14. The NCA also reported that in 2012-13 it had
received $4.620m in additional revenue over 2011-12 (predominantly a result of
increased funding from the Commonwealth Government in response to Dr Allan
Hawke's review of the NCA) and was budgeting consecutive surpluses over the
coming three financial years to recover the deficit position from 2011-12.[26]
2.16
This committee and the Senate Finance and Public Administration
Committee have previously made comments that the NCA should focus its future annual
reports on the assessment of its performance, rather than providing a
description of its activities.[27]
While the NCA's Annual Report 2012-13 incorporated substantially more
statistics and specific milestones than previous reports, it still lacked any clear
and substantive assessment of its performance against relevant outcomes. The
committee encourages the NCA to address this issue in future reports.
Other agencies
Office of the National Rail Safety
Regulator (ONRSR)
2.17
The Office of the National Rail Safety Regulator (ONRSR) commenced
operations on 20 January 2013, established in July 2012 by the collective
Australian Governments through an Intergovernmental Agreement and by industry.
It was created to enforce compliance with the Rail Safety National Law (South
Australia) Act 2012 (RSNL), with the objectives of 'encouraging rail safety
improvements across Australia, reducing the bureaucracy that operators have
faced in obtaining multiple accreditations of each state in which they operate,
and providing the environment in which industry can harmonise standards to
increase productivity and reduce costs.'[28]
The ONRSR is a body corporate established under the RSNL and is not
subject to Ministerial direction in the exercise of its functions and powers.
As of 30 June 2013, the RSNL had yet to be enacted in Victoria, Queensland, the
ACT and Western Australia.[29]
2.18
The Regulator is required to prepare an annual report in accordance with
section 43 of the RSNL and deliver it to the responsible Ministers for tabling in
the Parliament of each participating jurisdiction, including the Commonwealth.
The committee notes the high standard of the Regulator's inaugural report,
which meets its legislative requirements and also includes helpful tables and
clear statistical information. The committee commends the incorporation of a
compliance index, which assisted the committee to easily check that reporting
requirements had been met.[30]
However, the committee encourages the NHVR to comply with the Printing
standards for documents presented to Parliament, which specify that all
documents to be presented in Parliament must be printed in international B5
size.[31]
2.19
The committee appreciates that the effectiveness of the Regulator is
constrained until all jurisdictions have enacted the required legislation, a
significant milestone that is set to be achieved during 2013-14.[32]
It nevertheless highlights the Regulator's key achievements to date, including
the establishment of:
-
a national register of accreditation and notice information on
the ONRSR website;
-
a drug and alcohol testing program to test rail safety workers;
and
-
a National Operations Committee to harmonise the approach to rail
safety in different jurisdictions.[33]
National Heavy Vehicle Regulator
(NHVR)
2.20
In August 2011, the states, territories and the Australian Government
agreed through the Intergovernmental Agreement on Heavy Vehicle Regulatory
Reform to establish the National Heavy Vehicle Regulator (NHVR). The NHVR was
created to administer one set of rules for all heavy vehicles under the Heavy
Vehicle National Law Act 2012 (Qld). The NHVR is a statutory body corporate
with perpetual succession and is neither a governmental corporation nor a
departmental body and there are no shareholders. It was formally established on
12 October 2012 and commenced partial operations on 21 January 2013, with a
view to assuming its full responsibilities once the Heavy Vehicle National Law
is in place in all jurisdictions.[34]
2.21
Section 693 of the Heavy Vehicle National Law Act 2012 (Qld) sets
out the reporting requirements for the NHVR, including that it transmit the
report to all responsible Ministers for tabling in each House of the Parliament
of each participating jurisdiction and of the Commonwealth. The annual report
referred to the committee is the NHVR's inaugural annual report and is for the
period 12 October 2012 to 30 June 2013. The committee notes that because the NHVR's
Corporate Plan did not come into effect till 1 July 2013, certain reporting
requirements were not triggered in the first year of NHVR operations.[35]
The NHVR stated that 'underpinning the [reporting] period' was:
...the organisational transformation from multi-operations
separated both geographically and legislatively, to an amalgamated unit in one
location, the introduction of new core systems including a central call centre,
and the creation of management teams for both the National Heavy Vehicle
Accreditation Scheme (NHVAS), the Performance-Based Standards (PBS) Scheme
design and call centre.[36]
2.22
While the committee notes that the NHVR sought to satisfy its
legislative requirement to report on industry feedback,[37]
it is of the view that an actual statement summarising industry comments is
needed, as opposed to just outlining outcomes purportedly achieved due to industry
feedback. The committee also encourages the NHVR to comply with the Printing
standards for documents presented to Parliament, which specify that all
documents to be presented in Parliament must be printed in international B5
size.[38]
Finally, it would assist the committee if future reports incorporated a
compliance index.
2.23
The committee notes the comments of the Delegate of the Auditor-General
of Queensland that the NHVA recorded 'a substantial net loss, net liability
position, and negative operating cash flow position in 2012-13' and that
'significant uncertainty exists regarding the entity's ability to fund its
operational activities' because 'the source and amount of funding subsequent to
30 June 2013 has not yet been determined.'[39]
However, the committee draws attention to the fact that the '[b]oard members of
the Regulator are of the opinion that there are reasonable grounds to believe
there will be continuing support from the Commonwealth Government and
participating states and territories' to meet its financial requirements.[40]
Senator Bill Heffernan
Chair
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