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Management and accountability
Part 3 provides an overview of the Commission’s approach to corporate governance and the management of its resources.
Achievements
The Commission’s activities continued to be delivered against the background of a tight budgetary climate and rising fixed costs. The Commission sought to improve its efficiency and effectiveness through the year.
Achievements in 2008–09 included:
- successfully transitioning the Commission’s ICT infrastructure to its new service provider, DEEWR
- implementing the Commission’s new risk management framework
- commencing negotiations for a new collective agreement for 2009–10
- successfully tendering for new providers for our internal audit, cleaning and printing services
- continuing to provide high-quality corporate and administrative services to support the delivery of the Commission’s outputs and outcomes.
Corporate governance framework
The Commission’s performance expectations and anticipated use of resources are set out in our Portfolio Budget Statements and corporate plan. These cascade through group business plans and individual performance agreements providing the framework for staff compliance and accountability.
The Commission’s Corporate Plan 2008–09 identified the primary and secondary strategic priorities framed against the output structure, and the corporate support and culture needed to deliver on those priorities.
Corporate committees
The Executive establishes the directions and work programme of the Commission and directs the agenda for the Commission Management Committee. It approves business plans and budgets and determines senior staffing matters. It meets fortnightly. Five advisory committees support the Executive in its management and accountability role.
The Commission Management Committee is chaired by the Commissioner and comprises the Executive, Group Managers and the Principal Adviser, Review and Legal. The committee meets weekly and is the Commission’s primary forum for scoping strategic challenges and directions and for providing information updates about Commission activities.
The Audit Committee is established in accordance with the Financial Management and Accountability Act 1997. The committee is chaired by the Merit Protection Commissioner and comprises two senior staff members, an external member, representatives from the Australian National Audit Office, the Commission’s internal auditors (Deloitte Touche Tohmatsu) and the Commission’s Chief Finance Officer. The committee met four times in 2008–09.
The Information Technology Advisory Committee is chaired by the Merit Protection Commissioner and comprises the Group Managers Corporate, Programmes, Evaluation and Regional Services. An external member (the Chief Information Officer of the Workplace Authority) also attends the committee’s meetings. The committee is responsible for guiding and managing the Commission’s information services and oversees the development and implementation of the Commission’s information technology strategy. The committee meets on a bi-monthly basis.
The Workplace Relations Committee is chaired by the Depty Public Service Commissioner and comprises three management representatives and five elected staff representatives. It is responsible for advising the Commissioner on the implementation and development of the Commission’s collective agreement. The committee met five times in 2008–09.
The Occupational Health and Safety Committee comprises three management representatives and three employee representatives and is chaired on an annually rotating basis. It is responsible for advising the Commissioner on the administration of the Commission’s occupational health and safety policies and practices. The committee met four times in 2008–09.
Internal audit programme
The Commission’s contract with Ernst & Young for the provision of internal audit and related services expired in October 2008. In October 2008 the successful tenderer, Deloitte Touche Tohmatsu, was engaged for a period of two years, with the option of two one-year extensions at the end of the second year. Audit planning proceeded and an internal audit plan for the period 2008–11 was approved in February 2009.
Two performance reviews were completed and two were commenced to be finalised in 2009–10. The two completed audit reports (Internal Audit of Program Evaluation Process: October 2008 and Report on the Conduct of the Procurement Process for its Leadership, Learning and Development Panel: May 2009) were considered by the Commission’s Audit Committee and no significant risks were identified. The Commission is implementing the accepted recommendations.
The Audit Committee continues to monitor and provide independent assurance to the Commissioner, including with the annual certification on the financial management and sustainability of the Commission. This annual certification is in compliance with the Commissioner's role as Chief Executive Officer under the Financial Management and Accountability Act 1997.
Risk management and fraud control
During 2008–09 the Commissioner approved the Commission’s revised risk management framework. The framework includes the following documents:
- a risk management statement from the Commissioner, which is published on the Commission’s external website
- a risk management policy
- a risk assessment handbook.
These documents are available on the Commission’s intranet.
The Commission continued to participate in Comcover’s annual risk management benchmarking survey. In 2008–09, for the third year in a row, the Commission received an overall rating higher than the all-agencies average and received a small increase in the discount on its Comcover insurance premium for 2009–10.
The Commission’s Fraud Control Plan 2008–09 complies with the Commonwealth Fraud Control Guidelines and meets the Commission’s obligations in fraud prevention, detection, investigation, reporting and data collection.
In early 2009–10 the Commission will revise its Fraud Control Plan 2008–09 to better reflect our new structure and operating environment.
Ethical standards
The Commission’s Executive supports a workplace culture that gives visible and strong commitment to the APS Values.
Activities in 2008–09 included:
- issuing APS Values and Code of Conduct information to all staff following the launch of the Ethics Advisory Service in May 2009 and individual Group briefings by Ethics Advisory Service staff
- providing information to the Commission’s new staff at induction about the APS Values and Code of Conduct
- scheduling development programmes designed to educate employees about the APS Values and Code of Conduct and its relevance to their day-to-day work and decision-making
- incorporating references to the relevant APS Values in management policies, guides and instructions released by the Commission during the year
- assessing for behaviour consistent with the APS Values through the Commission’s performance appraisal scheme
- dealing promptly with allegations of staff misconduct.
External scrutiny
Court and tribunal decisions
R v Tjanara Goreng-Goreng [2008] ACTSC
This case was the first judicial test of Regulation 2.1 in its current form and the result provides greater assurance to APS agencies of the regulation’s validity. There were no other court or tribunal decisions in 2008–09 of relevance to the Commission’s activities.
Reports by the Auditor-General
There were no reports into the operations of the Commission by the Auditor-General in 2008–09. Reports of general application are considered by the Commission’s Audit Committee.
People management
Workforce planning and profile
The Commission's workforce planning strategies are developed each year to support the corporate plan, address identified skill gaps and inform recruitment strategies.
At 30 June 2009, the Commission employed 220 staff, excluding Executive Level 1 casual employees employed in the Commission’s regional offices who provide fee-for-service work (see Table 31). Of these 220 staff , the majority were based in Canberra (86.4%), and 197 were employed on an ongoing basis.
More detailed information about the Commission’s workforce is set out in Appendix H.
Notable trends in the Commission’s staffing are:
- the Commission’s staffing level decreased between June 2008 and June 2009. The proportion of non-ongoing employees increased from 9.8% to 10.5%.
- the proportion of women working in the Commission at June 2009 remained steady at 73.6% compared with 73.7% at June 2008
- the proportion of employees identifying as being of Aboriginal or Torres Strait Islander descent decreased from 5.4% at June 2008 to 4.1% at June 2009
- eight Senior Executive Service staff were employed at 30 June 2009, including one AusAID-funded staff member deployed overseas.
| Participation rates | 2004–05 | 2005–06 | 2006–07 | 2007–08 | 2008-09 |
|---|---|---|---|---|---|
| Note: Figures include indirect costs (e.g. salary during training). | |||||
| Total staff days | 570 | 420 | 351 | 312 | 685 |
| Average days per staff member | 3.1 | 2.3 | 1.7 | 1.4 | 3.6 |
| Total cost ($) | 280,000 | 175,000 | 124,000 | 235,034 | 135,000 |
| Average cost per staff member ($) | 1,519 | 902 | 605 | 1,049 | 710 |
Entry-level recruitment
The Commission recruited two graduates in January 2009. The graduates participated in the Commission small agency graduate programme. The programme offers a variety of structured learning and development activities, including a Diploma of Government (Management) and access to on-the-job and technical learning and development opportunities.
The Commission continued to support one Indigenous cadet in 2008–09.
Learning and development
Staff participated in Exe cutive Level and Senior Executive Service residential leadership development programmes. Senior staff participated in the Executive Masters in Public Administration from the Australia and New Zealand School of Government and Career Development Assessment Centres.
Staff continued to access the Commission’s Study Encouragement Scheme, which supports study towards qualifications in the fields of public administration, human resource management, learning and development and public policy and governance. The number of staff accessing the scheme increased from 11 in 2007–08 to 13 in 2008–09.
These corporate learning and development programmes supplement other development opportunities funded by Groups.
Health and lifestyle
The Commission sponsored a health and lifestyle programme in October 2008, which included a wide range of team activities, interactive health and lifestyle-related information sessions and health tips.
Collective agreement
In December 2008, staff voted to have a union agreement. This will be the first union agreement for the Commission.
Negotiations on the Commission’s replacement collective agreement began in March 2009, but the new agreement was not finalised by the time the current agreement nominally expired on 20 June 2009. As the new Fair Work Act 2009 took effect on 1 July 2009, the agreement will be finalised under the new legislation and will be known as an ‘enterprise agreement’. Work is under way to transition staff from Australian Workplace Agreements to section 24(1) determinations pending coverage by the enterprise agreement. Senior Executive Service (SES) staff continue to have all of their terms and conditions set through section 24(1) determinations.
The salary ranges for the Commission’s classification levels covering the collective agreement, section 24(1) determinations and Australian Workplace Agreements (at 30 June 2009) are set out in Table 23.
| Classification | Minimum ($) | Maximum ($) |
|---|---|---|
| Note: The Commission employs no SES Band 2s and one SES Band 3 employee. Their salaries are not included in this table. | ||
| APS 1–2 | 35,646 | 45,427 |
| APS 3–4 | 47,445 | 56,243 |
| APS 5–6 | 58,630 | 73,633 |
| EL 1 | 78,397 | 97,128 |
| EL 2 | 90,343 | 126,800 |
| SES 1 | 135,200 | 160,855 |
Performance management
The Commission’s performance appraisal scheme directly links annual assessment of individual performance with remuneration. The scheme integrates corporate, group and individual performance planning, providing a basis for consideration and development of individual needs and, where necessary, management of poor performance. The Commission’s scheme provides for annual incremental advancement depending on performance.
In July 2008 the Commission paid $78,264 in performance bonuses to 23 employees covered by Australian Workplace Agreements during the 2007–08 assessment cycle. Details of payments made to staff are included in Table 24.
Unscheduled absences
The Executive and senior management continued to monitor unscheduled absences and to focus on providing support to staff to return to work. The Commission’s overall unscheduled leave reduced slightly from 10.74 days per employee in 2007–08 to 10.33 days per employee in 2008–09.
Other people management matters
The Commission conducted one primary review of action under Public Service Regulation 5.24(1).
| Classification | No. of staff | No. receiving | Total payment $ | Average payment | Range |
|---|---|---|---|---|---|
| Note: These amounts represent payments for the performance cycle 2007–08 and were paid in July 2008. | |||||
| APS 1–6 | 112 | 2 | 3,000 | 1,500 | 1,500–3,000 |
| EL 1 | 66 | 10 | 23,000 | 2,300 | 2,000–4,000 |
| EL 2 | 31 | 8 | 29,500 | 3,688 | 3,000–5,500 |
| SES | 11 | 3 | 22,764 | 7,588 | 4,240–11,024 |
Financial performance
2008–09 income
The Commission’s total income for 2008–09 was $41.54 million. Appropriation from government accounted for 53.3% and sales of goods and services accounted for 46.6% (see Table 25).
Appropriation funding
Appropriation funding increased from $20.80 million in 2007–08 to $22.13 million in 2008–09. Increases in funding were sourced from the following 2008–09 Portfolio Additional Estimates Statements budget measures:
- Ethics Advisory Service ($0.50 million)
- Governmental use of information and communication technology—review ($0.67 million)
- Recruitment advertising policy and website ($0.14 million).
Non-appropriation income
Income from the sale of goods and services in 2008–09 was earned from development programmes (65.5%), employment services (19.0%), international assistance (11.4%), better practice and evaluation (4.0%) and other services (0.1%).
Income from development programmes and employment services amounted to $12.71 million in 2008–09 and made up 30.6% of the Commission’s total income from all sources. This income is earned in an open market, where agencies have choice about where they source their services and the level of services they require. As demand can be unpredictable, the Commission devotes considerable effort to estimating income and expenditure and to monitoring its financial performance during the year.
Operating result for 2008–09
The Commission’s operating result for 2008–09 was a deficit of $0.05 million. The deficit is mainly due to accounting adjustments arising from minimum operating lease payments for office rental.
Budget outlook
The Commission’s income from the sale of goods and services is projected to be $0.83 million lower than the 2008–09 levels. Appropriation income will also reduce by $1.15 million in 2009–10. This is largely due to a reduction of $0.60 million in funding for Indigenous recruitment and the introduction of portfolio savings of $0.30 million a year. These portfolio savings are to be sourced through implementing alternative service arrangements and streamlining administrative support services for the Commission’s area offices.
| Income source | 2004–05 (%) | 2005–06 (%) | 2006–07 (%) | 2007–08 (%) | 2008–09 (%) |
|---|---|---|---|---|---|
| Appropriation from government | 52.8 | 47.3 | 51.8 | 51.7 | 53.3 |
| Sale of goods and services | 47.1 | 52.6 | 48.0 | 48.2 | 46.6 |
| Other income (gains from sale of assets and resources received free of charge) | 0.1 | 0.1 | 0.2 | 0.1 | 0.1 |
| Year | 2004–05 ($ million) | 2005–06 ($ million) | 2006–07 ($ million) | 2007–08 ($ million) | 2008–09 ($ million) |
|---|---|---|---|---|---|
| Appropriation | 17.195 | 18.073 | 20.591 | 20.804 | 22.132 |
| Non-appropriation income | 15.388 | 20.102 | 19.172 | 19.427 | 19.365 |
| Total | 32.583 | 38.175 | 39.763 | 40.231 | 41.497 |
| 2004–05 ($ million) | 2005–06 ($ million) | 2006–07 ($ million) | 2007–08 ($ million) | 2008–09 ($ million) | |
|---|---|---|---|---|---|
| Surplus | 0.872 | 1.134 | 2.344 | 0.097 | |
| Deficit | 0.052 |
Cost pressures will arise from the first full year of operation of the Commission’s new ICT arrangements and ongoing annual wage rises and property rental increases.
Purchasing
The Commission’s purchasing is consistent with the Commonwealth Procurement Guidelines, which were reissued in December 2008. The Commission has established a framework for managing the risks inherent in procurement activities and has operational guidelines to support staff in assessing the risks associated with their projects. The Commission has published the Annual Procurement Plan on AusTender (as required by the Commonwealth Procurement Guidelines) to facilitate early procurement planning for 2009–10.
Consultants
The Commission engaged consultancy services in circumstances where it required particular expertise that was not available internally. During 2008–09 11 new consultancy contracts were entered into, involving total actual expenditure of $613,000. Information on contracts and consultancies for 2008–09 is available through the AusTender website. Additional details for consultancy contracts over $10,000 can be found on the Commission’s website.
| Number of new consultancies let | Number of ongoing consultancy contracts that were active | Total actual expenditure on new consultancy contracts ($’000) | Total actual expenditure on ongoing consultancy contracts that were active ($’000) | Total actual expenditure on all consultancy contracts ($’000) | |
|---|---|---|---|---|---|
| 2005–06 | 16 | 4 | 183 | 180 | 363 |
| 2006–07 | 9 | 4 | 168 | 363 | 536 |
| 2007–08 | 13 | 9 | 258 | 313 | 571 |
| 2008–09 | 11 | 11 | 276 | 337 | 613 |
Australian National Audit Office access clauses
The Commission’s standard form contracts for services and consultancies provide for access by the Australian National Audit Office.
Asset management
The Commission manages assets with a gross value of $8.40 million. These assets are managed by Groups to meet their business needs.
The Commission conducts annual reviews of its capital budget and plan. A four-year capital investment plan is developed from which the Commission manages its future asset purchases and disposals. All assets owned by the Commission, including any information technology assets, are subject to an annual stocktake to verify the accuracy of asset records. Assets are depreciated at rates applicable for each asset class, as verified by the Australian National Audit Office.
Exempt contracts
Under the Freedom of Information Act 1982, the Commission can issue exemptions from the requirement to publish any contract or standing offer on AusTender, on the grounds that it would disclose matters that might normally be exempt from disclosure under the FOI Act.
The Commission did not issue any exemptions during 2008–09.
Grant programmes
The Commission did not administer any grant programmes in 2008–09.
Information management
The Commission’s contract for the provision of its ICT infrastructure support services was with Volante (now CSG) under a Group 8 cluster arrangement that expired on 26 June 2009.
In late 2008 a project team began developing a strategy for cost-effective sourcing of ICT services following the expiration of the Group 8 contract. The project’s objective was to manage the transition to a new ICT service provider, and disengage from CSG, and was a key focus during 2008–09.
The project team identified a number of options for the delivery of the Commission’s ICT services, finally recommending that the most cost-effective option was to enter into a memorandum of understanding with DEEWR. In early 2009, the Commission transitioned to DEEWR for the provision of its ICT infrastructure. This involved replacing all Commission desktops and telephony equipment, and a number of servers.
Other activities undertaken during 2008–09 included:
- managing the disengagement project from CSG following expiration of the Group 8 contract
- developing and implementing the Ethics Advisory Service’s database
- undertaking major enhancements to APSjobs to accommodate new Government initiatives such as the Career Transition and Support Centre and Fin@nceJobs
- responding to and participating in the Gershon review of the government’s use of ICT
- developing and implementing an interim intranet for the Commission pending provision of intranet services from DEEWR.
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