|
Home
> Contents > Chapter 8 - Management and Accountability
 
Management and Accountability
Section 1 - Introduction
Section 2 - Corporate governance
Section 3 - Corporate and operational planning,
reporting and review
Section 4 - Managing financial and operational risk
Section 5 - Ethical standards
Section 6 - Purchasing and asset management
Section 7 - Consultancies and competitive tendering and contracting
Section 8 - Ecologically sustainable development
Section 1 – Introduction
This chapter examines our corporate governance practices, our
accountability framework and other management issues.
Section 2 – Corporate governance
Senior management committees and their roles
There are nine senior ongoing management committees: the Executive
Committee; the Corporate Leadership Group; the People and Leadership
Committee, the Corporate Information Technology Committee, the Research
and Evaluation Board, the Budget Policy and Strategy Committee, the
Audit and Business Assurance Committee, the Strategic Consultation
Committee and the National Programme Management Board. Their
relationships are set out in Chart 6.
The Executive Committee manages high level corporate strategy,
decides the senior staffing arrangements and determines internal
resource allocation. It coordinates the involvement of the Executive in
the leadership of the department.
The Corporate Leadership Group’s mandate includes corporate
management, strategic issues and portfolio policy functions. It assists
the Secretary in managing the department efficiently, effectively and
ethically.
The People and Leadership Committee was established to develop
the department’s capability, with particular emphasis on people and
leadership. It provides strategic advice and support to the Corporate
Leadership Group in setting the department’s directions in people and
leadership.
The Corporate Information Technology Committee provides advice
to the Corporate Leadership Group and the Executive on the department’s
strategic directions in information technology, the performance of the
department’s information technology services, and priorities for
information technology funding. It includes two external members.
The Research and Evaluation Board’s function is to set
strategies for research and evaluation across the department. This
includes the development of a rolling research and evaluation plan for
the department. The plan covers the strategic priorities for both
internal and external research and evaluation for the next three years.
The Budget Policy and Strategy Committee’s role is to:
provide strategic oversight of reviews required by the Expenditure
Review Committee for inclusion in the Budget process;
set priorities for a programme of rolling reviews of Administered
and Departmental activities being undertaken by the Strategic Review
of Programme Delivery; and
provide strategic advice on budget and planning processes,
including the Budget process, Outcome budgeting and the Portfolio
Budget Submission.
The Audit and Business Assurance Committee is a sub-committee
of the Executive Committee and includes two external members. It helps
the Secretary with his responsibilities for financial reporting,
maintaining an efficient system of internal controls, improving
performance and accountability, and reviewing specific matters arising
from the external audit process.
The Strategic Consultation Committee is the department’s peak
consultative body of staff and management representatives. It consults
on strategic human resource management and workplace relations issues.
The National Programme Management Board was established to
drive continuing business improvement through collaboration between
National, State and Territory Office policy and programme areas.
During 2001-02 these management committees have been supported by a
range of cross-functional teams and cross-departmental committees that
have looked at strategies and procedures for improving how we do our
business and deliver our programmes.
Chart 6: Senior
management committees.
Return to
top
Section 3 – Corporate and operational planning, reporting and review
The Corporate Plan is the major document guiding the strategic
planning of the department. The 1999 Corporate Plan was updated during
the first half of 2002 for release in August of that year. The 2002 Plan
contains the department’s vision, goals, key result areas and business
priorities. Details on the Corporate Plan can be found in
Chapter 2,
Section 1.
The Portfolio Budget Statements contain the department’s Outcomes and
Strategic Priorities. They can be found in Section 3, Chapter 2 of this
Annual Report. The department’s business planning supports the delivery
of our Outcomes and the fulfilment of our vision.
A revised Performance Management Framework was developed in November
2001 to strengthen the accountability arrangements of corporate
functions and streamline business planning and reporting activities.
Business planning integrates all aspects of planning throughout the
department. Clear linkages are now in place between the strategic
priorities in the Portfolio Budget Statements and the deliverables in
Group, Branch and Section business plans. Future work will include
drawing better connections between the Budget process and business
planning.
Group plans derive from the Portfolio Budget Statements. They are
finalised by the Group’s senior management in consultation with the
Executive. At the same time, last year’s performance is also reviewed.
Group managers are held accountable for their performance against their
business plans in their performance agreements.
Branch plans derive from the broad Group plans and translate them to
an operational level. They inform and guide detailed section and work
plans and Individual Performance Agreements.
The departmental planning framework is closely integrated. Group and
Branch business plans link to corporate planning processes such as
workforce planning, risk management and fraud, and the business
partnership arrangements between the department and Centrelink.
Other corporate planning processes which contribute to our
performance are the:
Annual Audit Plan;
Fraud Control Plan;
Risk Management Plan;
Department of Education, Science and Training Workplace Diversity
Plan;
Occupational Health and Safety Plan;
People Management Improvement Plan;
Yarrangi Plan;
Continuity Management Plan; and
Workforce Planning.
In addition, the department is working, through its planning at all
levels, to improve its capability in the five areas identified in the
2000-01 Annual Report: understand, anticipate, create, influence and
implement. In 2001-02 a sixth capability, ‘collaborate’, was added.
The Centrelink Business Partnership Arrangement sets out arrangements
for the department’s services delivered by Centrelink. It is reviewed
annually.
Return to
top
Section 4 – Managing financial and operational risk
The department has a number of strategies in place to ensure that the
risks associated with its work are identified, planned for and managed
properly.
Risk Management
The department has established a corporate approach to risk
management based on the Australian standard AS/NZS 4360 Risk Management
in order to include risk management as part of the department’s
management culture.
A three-tier risk management framework has been established. Under
the framework, there are plans identifying risk and setting down control
strategies at the corporate, group and programme levels. During the
period September to November 2001, risk management training was
delivered to all State Offices and the majority of Branches in National
Office.
The department has a risk management section that has policy
responsibility for risk management including fraud risk, insurable risk,
contract management policy and financial viability assessment of
suppliers and funded bodies. This maintains an emphasis on applying risk
management principles to all departmental programmes and support
activities. This section is within the Legal and Business Assurance
Branch, creating strong ties between risk management, procurement policy
and legal advice.
Fraud Control
In accordance with the requirements of the Commonwealth Fraud Control
Guidelines, the department confirms that it has prepared fraud risk
assessments and fraud control plans. In addition, it has in place
appropriate fraud prevention, detection, investigation, reporting and
data collection procedures and processes that meet the specific needs of
the agency and comply with the guidelines.
The department’s Fraud Control Plan sets out:
the department’s obligations under the Fraud Control Policy of
the Commonwealth and the Financial Management and Accountability Act
1997;
the organisational values and behaviours, polices and procedures
and organisational arrangements underpinning those obligations; and
the roles and responsibilities of the departmental staff in
preventing, detecting and reporting suspected fraud.
Audit and Investigations Group undertakes the department’s fraud
prevention function through:
promoting and implementing fraud prevention and deterrence
measures. These include reviewing programme guidelines and providing
fraud awareness training to staff and external providers;
detecting illegal and financially inappropriate activity and
impropriety. This is achieved through, for example, undertaking
compliance surveys and investigations of irregular activity; and
improving accountability through debt recovery, prosecution and
correction of programme and procedural weaknesses identified through
investigations.
Within Audit and Investigations Group, the National Investigations
Unit and Fraud Targeting and Analysis Team together drive a five-point
fraud control strategy. The five points are prevention, deterrence,
detection, investigation and prosecution. Prosecution can include
criminal, civil, administrative and disciplinary action.
The National Investigations Unit based in National Office undertakes
both external and internal investigations across Australia. The Unit
investigates allegations of fraud and other offences against the
department’s programmes and internal criminal or serious misconduct
matters. The department has initiated systems changes to enable the
collection of data to meet its own reporting requirements as well as
those set out in the Commonwealth Fraud Control Guidelines.
Audit
To complement these developments, the department’s Annual Audit Plan
was compiled on the basis of risk factors identified in consultation
between the Audit Unit and Group and State managers. Audits were
concluded into the operations of information technology systems,
programme performance, programme management, legislative and programme
delegations, contract management and external provider compliance, and
the department’s financial statements.
Return to
top
Section 5 – Ethical standards
Since the introduction of the Public Service Act 1999, the department
has established a number of ethical standards policies that reflect both
departmental and Australian Public Service values. Various methods have
been used to inform and remind employees of their responsibilities
including presenting information sessions, distributing information
brochures and presenting information online via the department’s
Intranet.
All new departmental employees and contractors are required to attend
a corporate orientation session. The session provides information on the
Australian Public Service Code of Conduct and Values, and how the
department has integrated these statements into policies and guidelines
such as the Internet and E-mail Code of Conduct and performance
management.
Contractors receive clear information on the expectations of people
undertaking service work on behalf of the department and action that
will be taken under the terms of their contract if standards fall below
those expectations.
Return to
top
Section 6 – Purchasing and asset management
Procurement Management
The department’s Financial Management Manual and Procurement Manual
detail processes for procuring goods and services that comply with
Commonwealth Procurement Guidelines. Both manuals are readily available
to staff through the departmental Intranet site and via the department’s
Procurement Management Information System (PROMISe).
The Procurement Manual specifically outlines the issues related to
contract management. It covers how to:
develop a contract management plan;
establish roles and responsibilities in managing a contract;
establish contract administration procedures;
measure performance;
manage poor performance or non-performance; and
evaluate the project.
Responsibility for most procurement in the department is devolved to
programme areas. This has given programme managers high levels of
responsibility for their decisions and minimises the lack of
responsiveness that can arise when a centralised area is tasked with
undertaking procurements. However, it can cause a loss of procurement
expertise and compliance.
This is why the department has implemented and continues to develop
PROMISe. The system has two main purposes:
to guide staff through and obtain the best possible compliance
with the correct Commonwealth and departmental procurement
processes; and
to collect and report data for management purposes on all
contracts for service, including consultancies, engaged by the
department. Reports include details of contracts for the
department’s Annual Report and in response to parliamentary
questions.
The controls within this system should ensure high levels of
procedural compliance while maintaining devolved procurement. To help
control the procurement process, PROMISe:
leads users through the initiation and authorisation of
procurements;
assists with tender development and the specification of
requirements and evaluation criteria;
provides direct access to proforma documents such as standard
contracts, contract variations, requests for tender and quotations;
inserts a procurement number into those standard documents to
establish a management trail; and
records details of all contract variations, such as monetary and
end date variations, for each contract.
To help officers comply with the core principles contained in the
Commonwealth Procurement Guidelines, PROMISe:
requires documented authorisation of decisions to vary from the
prescribed policies;
provides complete, accurate and timely data about procurements;
and
requires officers to assess compliance with other Commonwealth
policies. As part of this function it provides an Internet link to
the Affirmative Action website to allow checks for non-compliant
suppliers.
During 2001-02, the department employed additional temporary staff to
update PROMISe for all procurement data published in response to
Parliamentary reporting requirements such as responses to questions at
Senate Estimates and Senate Order 192. The department also initiated a
complete review of procurement business rules, the outcomes of which
will be implemented during 2002-03.
Asset management
Asset management within the department is not a significant aspect of
our business. There is limited scope to make decisions and many of the
assets are controlled by legislation. It is nonetheless recognised as a
priority task.
Asset management is devolved to Divisions, State and Territory
offices and responsibility for local assets is under their control.
National Office coordinates a number of tasks, including the annual
stocktake of assets and the revaluation of assets. However, the basic
management and responsibility for the safekeeping of assets remains
within each functional area. The Department of Finance and
Administration requires agencies to revalue their assets every three
years. The department revalued all of its assets (excluding internally
developed software) in the 2000-01 financial year to meet this reporting
requirement.
An asset replacement strategy has also been developed by the
department to ensure that it has an adequate budget in place for the
replacement of assets as they come to the end of their useful lives.
Return to
top
Section 7 – Consultancies and competitive tendering and contracting
Consultancies
In 2001-02, the department undertook 247 consultancies with
expenditure of $24.6m including 140 new consultancies let in 2001-02
with a total contract value of $23.6m. Details of summary usage by the
department and consultancies let in 2001-02 are listed in
Appendix 7.
Competitive tendering and contracting
The department’s Performance Improvement Cycle Review commenced in
July 1999. The Review was in response to the Government’s requirement to
systematically review its activities and use of resources to identify
the most cost effective means of delivering departmental services.
In November 1999 the Government announced a decision requiring
mandatory market testing of agency activities, commencing with corporate
services.
The department has progressively market tested its corporate
services. As a result of this process the department has decided, on
overall value for money grounds, to continue to use in-house resources
for the delivery of human resource services, financial services and the
management of office services. Most of the office service functions
continue to be provided through external contract arrangements.
Facilities (property) management functions were successfully re-tendered
and outsourcing arrangements continue.
In June 2000, the department concluded a re-tendering exercise for
the existing panel arrangement for external legal services that it has
had in place since 1996. The total cost for external legal services in
2001-02 was $1.2m. This process has continued to enable the department
to get best value for money in the legal services market place as well
as retaining its ability to call on a broad range of expertise.
Contracts exempted from being reported in the purchasing and
disposals gazette
Under Regulation 7 (1) of the Financial Management and Accountability
Act 1997 the Commonwealth has set up the Commonwealth Procurement
Guidelines. Under section 1.2 of the Commonwealth Procurement
Guidelines, if the Chief Executive of an agency decides that details of
a contract or standing offer are exempt matters under the Freedom of
Information Act 1982, he or she may then direct in writing that the
details are not to be notified in the Gazette.
In 2001-02 the Chief Executive signed one exemption certificate as
designated under section 1.2 of the Commonwealth Procurement Guidelines.
This certificate was for the value and any other information or
contractual provision which would reveal the unit price of the contracts
under the Language, Literacy and Numeracy Programme 2002-2004. There
were 61 contracts entered into under this programme during the 2001-02
financial year. All other details relating to these contracts were
gazetted in accordance with Commonwealth Procurement Guidelines section
1.2.
Return to
top
Section 8 – Ecologically sustainable development
Section 516A of the Environment Protection and Biodiversity
Conservation Act 1999 requires the department to report on how the
actions and administration of legislation accorded with the principles
of ecologically sustainable development.
(516A(6)(a)) How the actions and administration of legislation
accorded with the principles of ecologically sustainable development
Under the States Grants (Primary and Secondary Education Assistance)
Act 2000 all education authorities are required, as a condition of
funding from 2001, to make a commitment to the National Goals for
Schooling in the Twenty-first Century. One of these goals is that, 'when
students leave school they should have an understanding of, and concern
for stewardship of the natural environment, and the knowledge and skills
to contribute to ecologically sustainable development'.
(516A(6)(c)) The effect of the department’s actions on the
environment and any measures taken to minimise the impact of actions on
the environment
The Minister for Science established a Bushfire Research Advisory
Group to ensure better coordination of the national bushfire research
effort and greater public awareness of bushfire issues.
In April 2002 a report was released responding to public comment on
the safe storage of radioactive waste.
The Cooperative Research Centres (CRC) programme provided about $145m
in 2001-02 to 64 Cooperative Research Centres. Of these, 17 centres were
directly related to ecologically sustainable development outcomes.
Programme funding for these centres amounts to some 26 per cent of total
programme funds in 2001-02. Some examples of centres with research
programmes directed towards environmental or biodiversity outcomes are:
the CRC for Waste Management and Pollution Control; the Australian CRC
for Renewable Energy; the CRC for the Sustainable Development of
Tropical Savannas; and the CRC for Tropical Rainforest Ecology and
Management.
(516A(6)(d)& (e)) Mechanisms for reviewing and increasing the
effectiveness of those measures
The department has engaged an energy consultancy firm to assist with
the development and implementation of an Environmental Management System
for National Office by December 2002. It will be capable of ISO/AS 14001
certification.
In addition, the department has extended its consortium arrangement
with other Commonwealth agencies in Canberra to purchase bulk supplies
of electricity for the next three years. The new contract will deliver
reduced prices and a greater proportion of electricity from renewable
energy sources.
Return to
top
|
