Opinion Piece - A matter of public trust

Getting trust is hard.  Losing it is easy. And the work of maintaining trust in our democracy, and the public institutions it rests on, is constant, quiet and careful. 

That trust is built on accountability and transparency.

It relies on an assurance that government programs are well managed and delivered efficiently and effectively to give the best results for the Australian people.

And it demands impartial adjudicators to provide that assurance.

Of course, holding the Government to account for its expenditure is the role of the entire Parliament – and especially the role of the Opposition.

But that assurance cannot always be provided quickly, or without a great deal of work, so there is also a place for a smaller group of parliamentarians to take a closer look at the administration of Government policy and programs, and its expenditure.

That’s where the Joint Committee of Public Accounts and Audit comes in.

The committee holds Commonwealth agencies to account for the lawfulness, efficiency and effectiveness with which they use public monies.
To do that, the role of robust performance information is becoming more and more important.

And the space is changing.

The Commonwealth Financial Accountability Review stimulated an open discussion of many elements of reform.

It drove the design of the Public Governance, Performance and Accountability Act 2013, which brings together the essential elements of the Commonwealth financial framework in one piece of legislation.

The Act is designed to encourage reform and a coherent system of governance across Commonwealth entities.

However the Act’s objectives are only meaningful with real action – especially by auditors.

Government and its agencies must be open to unfettered scrutiny in their expenditure and use of taxpayers’ money. This is a vital aspect of the relationship between a Government and the community as it safeguards the trust on which our system depends.

And there are a range of ways auditors can improve transparency and accountability.

The first is getting the metrics, the Key Performance Indicators, right.

The indicators should be a fundamental way of judging whether a program is being implemented effectively and achieving its aims. If significant variations from expected performance are observed, it’s a sure sign that closer examination of the program is needed.

A lot of effort has gone into indicators in recent years. Progress has been made, but everyone recognises the issue is complex.

Establishing meaningful indicators, which are aligned across and up and down agencies, and become business as usual, is not easy. And it cannot be done independently of other public sector reform.

Cultural change is inevitably at the heart of all these discussions and two aspects of that strike me.

The first is risk-aversion. The second is the silo problem.

A crucial challenge in overcoming a too-timid approach to doing business is that we do not, on the whole, have incentives in the system that encourage taking risks. In fact, many of the incentives do the opposite.

The Australian Public Service, generally speaking, has a compliance oriented and bureaucratic approach to managing risk that is a barrier to improving risk management performance.

Where there is heavy stress on compliance, there is likely to be greater risk aversion– where it is more important to tick the compliance box than do things more efficiently, since the punishments for compliance failure strongly outweigh the rewards of greater efficiency or good judgement.

Fortunately, the challenge of risk management is on the agenda, with the State of the Service report for 2013-14 listing organisational culture and workforce capability as the major barriers.

But improving risk management is not simply a matter of adding additional checks and balances in existing processes.

One lesson to auditors and assurance professionals is that they have a role to play in changing this culture. Don’t be a risk-averse auditor who feels it necessary to list every minor offence.

The Australian National Audit Office is leading by example by focusing recommendations only on significant areas of improvement, with reference to less important matters only made in the body of each report.

Auditors have a critical role to play in terms of advocacy to encourage programs and management to get the balance right between rigour and risk based judgement calls.

But a more balanced risk management culture will only germinate if both the Government and the Parliament - including its committees - change their ways to recognise that innovative policy design and complex program implementation needs to embrace risk to be successful.

The second aspect of cultural change is the problem of too many silos.
Perhaps in some simpler past, public service agencies could generally operate with exclusive rights and functions within their own well-defined boundaries. But as social and economic challenges become more complex, this isn’t feasible.

Modern government in Australia is still coming to grips with this new imperative. Programs often involve multiagency collaboration across several jurisdictions, where the boundaries are well and truly crossed both within jurisdictions and across them. Not surprisingly, ensuring a consistent approach and assessing outcomes has been difficult to achieve.

Collaboration between different entities is nothing strange to the private sector. One lesson we can draw is that in collaborations it is important to have a clear line of authority and control. A consistent message from ANAO reports is the need for a lead agency when programs are delivered by multiple agencies.

In March this year, the committee decided to inquire into the development of the Commonwealth Performance Framework to ensure an effective, integrated performance management system that continues to improve accountability to the Parliament and the Australian people. While the quality of financial information has improved significantly over the last few decades, the quality of non-financial performance information has not.

Improving public sector transparency and accountability is a task that demands eternal vigilance.

To quote US President John Quincy Adams’ Secretary of State and Speaker of the House of Representatives, Henry Clay:

“Government is a trust, and the officers of the government are trustees. And both the trust and the trustees are created for the benefit of the people.”

To maintain that trust, we just need to find the best way of measuring how the people have benefited.

Gai Brodtmann is the Member for Canberra and Shadow Parliamentary Secretary for Defence. She has been a member of the Joint Committee of Public Accounts and Audit since 2010, and was deputy chair in 2013.

This article was first published in the Canberra Times on Tuesday, 6 October 2015.

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