Federal audit trail could go cold amid budget cuts

Posted on 11 Nov 2020

By Joshua Presser and Georgie Bailey, SmartyGrants

Audit i Stock 166231644
Budget cuts to the Australian National Audit Office could affect its audit program.

With billions of dollars in government money allocated to Australia’s pandemic response and recovery, grantmakers will be central to spending that money wisely through a myriad of programs.

Ensuring money is not wasted will be crucial, but it appears the biggest watchdog of them all when it comes to national grants programs – the Australian National Audit Office (ANAO) – could be hamstrung in its mission to monitor spending, performance and integrity.

The ANAO has been instrumental in exposing poor practices in grants programs over many years. In the past year, its work has shone a spotlight on big-spending grants programs, exposing:

Hehir Grant
ANAO Auditor-General Grant Hehir

Yet despite a plea for funds by ANAO chief Grant Hehir to Prime Minister Scott Morrison, the ANAO suffered a $14 million budget cut in the October 2020 budget, according to post-budget media reports by the ABC and the Guardian.

Grants Management Intelligence contacted the ANAO office to seek verification of the figures, which are not clearly spelt out in the budget papers.

According to the ANAO’s 2019–2020 annual report, the office reported an operating deficit of more than $3 million in the past year, amid spending of about $80 million.

Mr Hehir noted in the report – before the federal budget was handed down – that the ANAO budget was “in loss for the third year in a row”.

“Without supplementary appropriations, the number of performance audits tabled in the Parliament will continue to reduce. On this basis, I have written to the Prime Minister to propose that the ANAO’s funding is put on a more sustainable basis to meet both mandated financial statements audits and the suite of performance and other reports which are provided to Parliament to achieve transparency and accountability in the Australian Government sector.”

Mr Hehir had warned that “any further savings measures applied to the ANAO that reduced the funding base would impact on our ability to deliver the planned audit program”.

The office conducted six fewer audits than planned in the past year, and it appears that trend will continue.

Earlier this year, shortly before the pandemic triggered widespread lockdowns across the country, Grants Management Intelligence outlined a summary of the extensive audits planned by the country’s watchdogs.

While the dossier of proposed investigations noted that the ANAO audits were getting all the attention, state and territory audit offices have also confirmed a series of investigations into grants management.

MORE INFORMATION
#

Sign-up to our newsletter