Government Sector Audit and Other Legislation Amendment Bill 2022

15th November 2022

Mr GREG PIPER (Lake Macquarie) (20:51): I speak in favour of the Government Sector Audit and Other Legislation Amendment Bill 2022. I note that Government amendments have been circulated. I can confirm that the amendments, while not achieving every element of the recommendations of the O'Connor Marsden report—the quadrennial review that was published earlier this year—certainly go a long way towards delivering on the recommendations. I acknowledge the member for Balmain. I will not have too many more opportunities to serve with him in this place. I appreciate his very generous words. A lot of people have worked hard on this legislation and I acknowledge Jamie Parker, the member for Balmain, as one of those. I also give a big shout-out to Tamara Smith. I hope she is feeling better soon.

I am proud to have been a member of the Public Accounts Committee for just on a decade now. I have been its chair since 2019, including for a period serving with the member for North Shore, who has carriage of the bill in the House in her role as Parliamentary Secretary. The Public Accounts Committee is an important committee and its remit is important to the State. It certainly broadened my understanding of the Audit Office and confirmed in my mind that it is an organisation critical to the good governance of New South Wales. The Public Accounts Committee is also critical to the people of New South Wales in providing information and understanding of the disbursement of their funds, which are generally well managed. As members know, from time to time there are issues that only the Auditor-General can bring to light and bring about the change needed to correct those issues. That said, the Auditor-General works within the constraints of the Audit Office budget and its workforce, and is often restricted in carrying out some of the work it may wish to do from time to time if it had the resources.

However, one area the Audit Office would like to examine is non-government entities where public funds are expended. In New South Wales the ability to follow the dollar has been a glaring omission, which is an anomaly in the New South Wales system compared to other Australian jurisdictions. Before I go further on that point, one of the most important things that the Public Accounts Committee can do is respect the requests of the Auditor-General and Audit Office in seeking the powers and facilities that they need to examine the activities of the Government and the use of taxpayer funds. Part of the Public Accounts Committee's remit is a statutory undertaking for a quadrennial review. That was done earlier this year by O'Connor Marsden, which made a number of recommendations, particularly around "follow the dollar" powers.

I acknowledge O'Connor Marsden, which was not on our radar as an audit company before we went through the process of looking for one. It was very hard to get a substantial auditor that had the resources to undertake the review. O'Connor Marsden was absolutely excellent. I was pleased we found O'Connor Marsden because it did the job extraordinarily well and did justice to the request of the Public Accounts Committee. It made a number of recommendations, and "follow the dollar" was one of the major ones. For a very long time, the Public Accounts Committee has been fighting to get those powers for the Auditor-General, and that is now being proposed by the Government in this bill and the proposed amendments. That is very pleasing.

I turn briefly to the detail of the bill. I note that the "follow the dollar" powers extend to local governments as well as the State under the bill. That is important to the proper accounting of public money. That said, it should be noted that the Auditor-General has had the power to audit councils since 2016, but the Local Government Act will be amended ensure that it contains the "follow the dollar" provisions. New section 38EA reflects that the Audit Office powers are designed to ensure that an entity is carrying out its activities effectively, economically, efficiently and in compliance with all related laws. The bill is not just about ensuring that public money is going where it is supposed to be going.

"Follow the dollar" pathways are also extended to other public services, including charities and not-for-profit organisations. Put simply, if public money is flowing into an organisation, the Audit Office will be empowered, within reason, to make sure that it is being properly managed and doing what it was intended to do. It will no longer matter if the organisation getting the public money is a government or non-government entity. The scrutiny will be there, as it should be. It is not an audit of the entity's entire operation; it is an audit of the entity's activities as they relate to the public money and then only when the Audit Office has reason to do so. I believe the "follow the dollar" powers will be used judiciously but appropriately, and their very existence should, I hope, improve other entities' actions around public funds they receive on the chance that that type of audit can occur. A little bit of tension is a good thing.

New South Wales is not forging a new path with the bill. The powers in the bill already exist in every other Australian State. I thank the Government for bringing this long-awaited reform forward. As I have outlined, there were some problems and I believe that they are fixed by the Government's proposed amendments. To its credit, the Government has stepped up to accept many, but not all, of the recommendations stemming from the quadrennial review. I remember first speaking to former Premier Berejiklian about "follow the dollar" powers some years ago. While I know she was inclined to pursue them, we never quite got them. The current Premier Dominic Perrottet was Treasurer at that time, and I am pleased that he is of the same mind as he was then. The bill is before the House because former Premier Berejiklian and Premier Perrottet believe that "follow the dollar" is a good tool for governance of public moneys.

I also acknowledge the work and support of Treasurer Matt Kean. It is notionally and numerically possible that a government in minority could have a bill like this forced upon them, but it so much better as the gift of the Government. I am certain that we could not have landed here without the support of Premier and Cabinet, including Michael Coutts-Trotter and Kate Boyd. I particularly thank Monica Tudehope from the Premier's office along with Dimitry Chugg-Palmer. Both of them have been somewhat traumatised by dealing with me lately. I acknowledge that Dimitry had to put up with me last week over the Port of Newcastle bill. I offer my sincere apologies to them. Another person I often neglect to recognise is Jason Gordon from my office. He has done so much heavy lifting in this space. He has become an expert on this, working alongside my Independent colleagues and their staff. I have been remiss in forgetting to recognise him a number of times. I thank Jason.

One of the myriad problems the Government has with legislation like this is that the Audit Office is such a substantial and important organisation which has always shown great integrity and fairness. We must go down this path with confidence in widening its scope, not just to fall in line with other Australian jurisdictions but to provide the people of New South Wales with the confidence that their money is being properly managed and well spent. I recognise the Auditor-General, Margaret Crawford, and her staff, who I believe do an amazing job for us. I have said numerous times that I believe they are the gold standard of such an entity. A lot of people have been involved in this bill, including Monica Tudehope. I thank her very much again. The bill should resolve many other matters. I might deal with a number of omissions to the bill next year, depending on what happens with the Government. If it is a minority government, I will come knocking. I thank everybody. I commend the bill to the House.

Website: Read full Parliamentary debate here

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