STRATEGIC REVIEW OF
Small and Medium Agencies in the
Attorney-General’s Portfolio
Report to the Australian Government
January 2012
Strategic Review of
Small and Medium Agencies in the
Attorney-General’s Portfolio
Report to the Australian Government
January 2012
8.2.12
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8.2.12
8.2.12
CONTENTS
Transmission letter ..................................................................................................................... v
Terms of Reference ..................................................................................................................vii
Executive Summary – Findings & Recommendations ............................................................. xi
Introduction ........................................................................................................................... xi
Findings and Recommendations ..........................................................................................xii
Chapter 1 - Introduction ............................................................................................................. 1
Background ............................................................................................................................ 1
Review methodology and process ......................................................................................... 1
Governance arrangements .................................................................................................. 1
Consultation Strategy ......................................................................................................... 1
Financial information in Appendices 1-13 ........................................................................ 2
Chapter 2 – Policy context ......................................................................................................... 6
Expenditure Review Principles .............................................................................................. 6
Governance structures and arguments for independence....................................................... 7
The nature of independence ................................................................................................. 14
Recommendations ................................................................................................................ 15
Chapter 3 – Shared Services .................................................................................................... 17
Recent background on shared services ................................................................................ 17
Findings of this Review ....................................................................................................... 20
Conclusion ....................................................................................................................... 22
Recommendations ................................................................................................................ 25
Chapter 4 – Financial Viability: an overview .......................................................................... 29
Overview of financial viability ............................................................................................ 29
The Commonwealth Courts ................................................................................................. 31
Recommendations ................................................................................................................ 34
Chapter 5 – The Commonwealth Courts ................................................................................. 35
Administration of the Commonwealth Courts ..................................................................... 35
Introduction ...................................................................................................................... 35
Options for the future ....................................................................................................... 43
Assessment of the Options ............................................................................................... 55
The application of the Efficiency Dividend to the Commonwealth Courts......................... 59
Contents
Page i
Judicial salaries ................................................................................................................ 60
Special purpose property expenses and the Efficiency Dividend .................................... 62
Use of Commonwealth Law Courts Buildings .................................................................... 63
Recommendations ................................................................................................................ 68
Chapter 6 - Native title functions and Administration ............................................................. 71
Introduction .......................................................................................................................... 71
Substantive native title functions ......................................................................................... 72
Analysis of native title functions ..................................................................................... 78
Administration ..................................................................................................................... 83
Analysis of administration options .................................................................................. 84
Recommendations ................................................................................................................ 87
Chapter 7 - Commonwealth Tribunals ..................................................................................... 91
Commonwealth Tribunals generally .................................................................................... 91
Tribunals of, or administered in, the Attorney-General’s Portfolio................................... 100
Australian Competition Tribunal - Copyright Tribunal of Australia - Defence Force
Discipline Appeal Tribunal ............................................................................................ 101
Administrative Appeals Tribunal ................................................................................... 101
Recommendations .............................................................................................................. 104
Chapter 8 – Commonwealth Legislative Drafting ................................................................. 107
Background ........................................................................................................................ 107
Should OPC be part of the Attorney-General’s Department? ........................................... 108
Should OPC and OLDP be combined? .............................................................................. 112
Conclusion ..................................................................................................................... 117
Recommendations .............................................................................................................. 119
Chapter 9 – The law enforcement agencies ........................................................................... 121
Independence from the Attorney-General’s Department ................................................... 121
Merging agencies ............................................................................................................... 123
Integration and working more effectively.......................................................................... 124
Shared services................................................................................................................... 125
Recommendations .............................................................................................................. 126
Chapter 10 – The remaining agencies .................................................................................... 129
Independence from the Attorney-General’s Department ................................................... 129
Merging agencies ............................................................................................................... 131
Shared services................................................................................................................... 132
Contents
Page ii
Recommendations .............................................................................................................. 134
Appendix 1 – Federal Court of Australia ............................................................................... 137
Appendix 2 – Family Court of Australia ............................................................................... 143
Appendix 3 – Federal Magistrates Court of Australia ........................................................... 149
Appendix 4 - National Native Title Tribunal ......................................................................... 155
Appendix 5 - Administrative Appeals Tribunal..................................................................... 161
Appendix 6 - Office of Parliamentary Counsel ..................................................................... 167
Appendix 7 - Australian Commission for Law Enforcement Integrity ................................. 171
Appendix 8 - Australian Institute of Criminology ................................................................. 175
Appendix 9 - Australian Transaction Reports and Analysis Centre ...................................... 179
Appendix 10 – CrimTrac Agency .......................................................................................... 185
Appendix 11 - Australian Human Rights Commission ......................................................... 191
Appendix 12 - Australian Law Reform Commission ............................................................ 197
Appendix 13 - Insolvency and Trustee Service Australia ..................................................... 203
Appendix 14 – Review questionnaire .................................................................................... 209
Appendix 15 - Questionnaire – Summary of selected responses ........................................... 219
Appendix 16 – Expenditure Review Principles ..................................................................... 227
Appendix 17 – Commonwealth Courts’ savings ................................................................... 229
Appendix 18 – Commonwealth Courts – matters for consideration and report to the AttorneyGeneral ................................................................................................................................... 231
Appendix 19 – Analysis of native title functions................................................................... 235
Appendix 20 – Migration Review Tribunal and Refugee Review Tribunal .......................... 243
Appendix 21 – Social Security Appeals Tribunal.................................................................. 245
Appendix 22 – Veterans’ Review Board ............................................................................... 247
Appendix 23 – Comparative Tribunal statistics..................................................................... 249
Appendix 24 – Administrative Review Council’s Better Decisions Report recommendations
................................................................................................................................................ 253
Appendix 25 – Tribunal Efficiencies Working Group Report recommendations ................. 257
Contents
Page iii
TRANSMISSION LETTER
Senator the Hon Penny Wong
Minister for Finance and Deregulation
Parliament House
CANBERRA ACT 2600
Dear Minister
I am pleased to present for your consideration, and that of Cabinet, the Report of the Strategic
Review of Small and Medium Agencies in the Attorney-General’s portfolio.
The Terms of Reference for the Review required us to:

assess small and medium agencies and the federal courts and tribunals in the
Attorney-General’s portfolio with reference to the Expenditure Review
Principles; and

advise on the range of options for improving the value for money for the
Government in terms of the discharge of their functions and accountable and
transparent decision-making, including with respect to:
operational and administrative structures;
monitoring and evaluation of performance of their programs, including
underlying policy settings;
opportunities for shared services or administration arrangements; and
financial viability in their current form.
In addition to these matters, the Review also required us to consider the potential for shared
services and administration arrangements between the tribunals within the AttorneyGeneral’s portfolio and administrative review bodies in other portfolios.
The attached Report sets out the findings reached during the course of our consideration of
these matters and makes numerous recommendations directed to the attainment of greater
efficiency and effectiveness within the agencies subject to the Review.
In conducting the Review, we have been greatly appreciative of the cooperation and
assistance provided by all those agencies, and by the support and assistance of the many
officers in your Department and the Attorney-General’s Department who have offered
guidance and comment as our thoughts have evolved. Particular thanks are due to Peter
Saunders and Stephen O’Loughlin in your Department for their challenging and helpful
guidance.
In my own role as Review Leader I have been immeasurably assisted by a talented, tireless,
cohesive and convivial team comprising Robert Antich, Donna Degen and (for a period)
Michael Cosgrove of your Department, Sara Samios of the Attorney-General’s Department
Transmission letter
Page v
and Simon Kelso of the Family Court of Australia. The Report owes an enormous amount to
their great contribution.
At the same time, however, any inadequacies in the Report are entirely a matter for my own
responsibility.
Thank you for the opportunity to lead this Review. I hope the decisions that the Government
makes consequent upon it will make a worthwhile difference.
Yours sincerely
Stephen Skehill
Transmission letter
Page vi
TERMS OF REFERENCE
The Review will assess small and medium agencies in the Attorney-General’s portfolio with
reference to the expenditure review principles (appropriateness, effectiveness, efficiency,
integration, performance assessment and strategic alignment) and advise on the range of
options for improving their value for money for the Government, in terms of the discharge of
their functions, and decision-making, including with respect to:
a.
operational and administrative structures;
b.
monitoring and evaluation of performance of their programs, including
underlying policy settings;
c.
opportunities for shared services or administration arrangements; and
d.
financial viability in their current form.
2.
Paragraph 1 applies to all agencies with the Attorney-General’s portfolio other than the
Attorney-General’s Department, the federal courts and tribunals, the Australian Security
Intelligence Organisation, the Australian Federal Police, the Australian Crime Commission,
the Office of the Commonwealth Director of Public Prosecutions and the Customs and
Border Protection Services.
3.
The review will not examine the exercise of agencies’ statutory functions in individual
matters.
Federal Courts and Tribunals in the Attorney-General’s Portfolio
4.
With regard to the federal courts and tribunals in the Attorney-General’s portfolio, the
review will consider options for improving efficiency and flexibility in court and tribunal
administration, including service delivery, whether the courts and tribunals are financially
viable in their current form, including options for improving shared services and
administration arrangements.
5.
In addition to those matters set out in paragraph 4, the review should consider the
potential for shared services and administration arrangements between the tribunals within
the Attorney-General’s portfolio and administrative review bodies in other portfolios.
6.
Paragraph 4 applies to the Federal Court of Australia, the Family Court of Australia, the
Federal Magistrates Court of Australia, the Administrative Appeals Tribunal and the National
Native Title Tribunal but does not apply to the High Court of Australia.
7.
The exercise of judicial functions within the Federal courts and decision making by
tribunal members is outside the scope of the review.
8.
So far as it relates to the federal courts and tribunals, the review will be undertaken by
an independent consultant engaged in consultation with the Attorney-General’s Department
and supported by staff from the Department of Finance and Deregulation, the AttorneyGeneral’s Department and the courts and tribunals.
Office of the Commonwealth Director of Public Prosecutions
9.
With regard to the Office of the Commonwealth Director of Public Prosecutions (DPP),
the objectives of the review will be addressed in a shorter time frame in a related review. This
separate review will consider:
Terms of Reference
Page vii
a.
b.
c.
options for improving the ability of the DPP to manage its caseload in the most
efficient, flexible and effective manner, including by collecting accurate data
about the time and costs involved in prosecuting each type of offence across the
range of Commonwealth offences;
arrangements for handling less serious and summary offences, including
examining whether there are policy options for more efficient and cost-effective
regulatory and compliance strategies to deal with these matters; and
options for a sustainable funding model that will provide for the continued
prosecution of serious Commonwealth offences.
10. The exercise of the DPP’s powers in relation to the conduct of individual prosecutions
is outside the scope of the review.
General
11. In formulating recommendations about any particular option the review will assess the
resourcing, costs, benefits, business model for delivery and implementation risk of the option.
12.
In undertaking its work, the review will be informed by previous reviews, including:
a.
the Senate Inquiry into the Australian Law Reform Commission;
b.
Review of the Legislative Drafting and Publishing Function within the AttorneyGeneral’s Department;
c.
Review of the Corporate Governance of Statutory Authorities and Office Holders
(Uhrig Review);
d.
Bendelta Review of AAT Registry Functions;
e.
Fellows Medlock and Associates Review of NNTT Structure, Functions and
Service Delivery;
f.
the Strategic Review of Shared Services; and
g.
KPMG’s Courts Shared Services Review.
13. The review will consider the suitability of applying the findings of the review’s
examination of the AG’s portfolio small and medium agencies to other small and medium
agencies across the Australian Government.
Review Timeline
14. The review is to complete its final report by end November 2011. The review of the
Office of the Commonwealth Direction of Public Prosecutions is expected to report by the
end of 31 August 2011.
Resourcing and Governance
15. Subject to the separate arrangements set out above for the federal courts and tribunals
and the Office of the Director of Public Prosecutions, the review will be led by an internal or
external senior appointment, supported by staff from the Department of Finance and
Deregulation and secondees from other agencies as required.
Terms of Reference
Page viii
Terms of Reference
Page ix
EXECUTIVE SUMMARY – FINDINGS & RECOMMENDATIONS
Introduction
The Terms of Reference for this Strategic Review require it to:

assess small and medium agencies and the federal courts and tribunals in the
Attorney-General’s portfolio with reference to the Expenditure Review
Principles; and

advise on the range of options for improving the value for money for the
Government in terms of the discharge of their functions and accountable and
transparent decision-making, including with respect to:
operational and administrative structures;
monitoring and evaluation of performance of their programs, including
underlying policy settings;
opportunities for shared services or administration arrangements; and
financial viability in their current form.
E.2 In addition to these matters, the Review is to consider the potential for shared services
and administration arrangements between the tribunals within the Attorney-General’s
portfolio and administrative review bodies in other portfolios.
Agencies within Review scope
E.3 The Attorney-General’s portfolio agencies within the Review’s scope are:

Federal Court of Australia;

Family Court of Australia;

Federal Magistrates Court of Australia;

National Native Title Tribunal;

Administrative Appeals Tribunal;

Australian Commission for Law Enforcement Integrity;

Australian Transaction Reports and Analysis Centre;

CrimTrac Agency;

Australian Institute of Criminology;

Australian Human Rights Commission;

Australian Law Reform Commission;

Office of Parliamentary Counsel; and

Insolvency and Trustee Service Australia.
E.4 The Commonwealth tribunals that are within the scope of the Review, other than the
Administrative Appeals Tribunal, are not specified in the Terms of Reference. The Review
has proceeded on the basis that it extends to all Commonwealth bodies that provide
independent merits review of Commonwealth administrative decisions. This includes some
Executive Summary
Page xi
bodies that are not titled a tribunal (such as the Veterans’ Review Board) and excludes some
bodies that are titled a tribunal but do not conduct merits review of decisions made by third
parties (such as the Remuneration Tribunal). This still leaves numerous bodies within the
scope of the Review. For this reason the Review has more particularly focussed its attention
on the following tribunals that account for the vast majority of Commonwealth merits review
proceedings:

Administrative Appeals Tribunal;

Migration Review Tribunal;

Refugee Review Tribunal;

Social Security Appeals Tribunal; and

Veterans’ Review Board.
The Expenditure Review Principles
E.5 The Expenditure Review Principles to which the Review is required to have regard (set
out in full at Appendix 16) relevantly provide as follows:

Appropriateness
activity is directed to areas where there is a role for government, and is
undertaken by the most appropriate level of Australian government.

Effectiveness
activities have clear and consistent objectives, are effective in achieving
their objectives, and represent value for the expenditure of taxpayer money.

Efficiency
programs are administered and delivered in the most efficient way
achievable, taking into account both short and long term economic and
fiscal consequences, and consideration is given to whether part or all of the
cost should be recouped directly from program beneficiaries.

Integration
government agencies should work together effectively to consistently
deliver the Government’s policy objectives within clearly defined lines of
responsibility.

Performance assessment
government activity should be subject to robust performance assessment
and measurement.

Strategic Policy Alignment
activity should be consistent with the Government’s strategic long term
policy priorities.
Findings and Recommendations
“Independent” agencies
E.6 In Chapter 2 the Review discusses the application of the Expenditure Review
Principles¸ and the interpretation the Review has placed on them in relation to the agencies
Executive Summary
Page xii
within Review scope. In doing so, the Review has also sought to identify a number of
indicative tests relevant to whether a new independent agency should be established separate
from the relevant portfolio Department or whether its independence should continue.
Recommendation 2
The Government should agree that:
a.
there should be a prima facie presumption against creating any new
independent agency unless that course of action would be supported by the
strength of the case as evidenced by the following indicative tests:
i.
international comity;
ii.
avoidance of conflict of interest;
iii.
to secure the conferral of extra-ordinary powers;
iv.
to distance government from regulatory intrusion;
v.
to ensure government access to best advice;
vi.
to ensure participation by stakeholders; and
vii.
to allow ministers and departments to focus on higher priorities;
b.
in any subsequent review of existing agencies, there should equally be a prima
facie presumption that the functions of an already established independent
agency should be transferred to their portfolio Department or another
appropriately justified portfolio agency where the continued existence of that
agency cannot be justified by reference to these indicative tests;
c.
where one or more of these indicative tests are met, the strength of the case for
independence should then be critically assessed and not simply assumed; and
d.
in each case the alternative of establishing an independent statutory officer
within the relevant portfolio Department should be actively explored.
E.7 Chapter 2 also discusses the nature of independence that can or should be enjoyed by
agencies separate from their portfolio Department, or through statutory office holders. It
notes that, even where there is a compelling case for a substantive function being performed
within an independent agency separate from the relevant portfolio Department, this does not
carry with it any necessary conclusion that the corporate services necessary to support that
substantive function should be provided entirely, or at all, from within the agency. Provision
of corporate support by a portfolio Department, another agency or a private contractor need
not undermine the independence sought to be achieved by the establishment of the agency.
And external provision of corporate support, if done well, need not detract from and can
potentially enhance the level of performance of an agency’s substantive function.
Shared Services
E.8 Chapter 3 then discusses the concept of shared services to which the Review is
required to give particular regard. It notes that, to date, while the prospect of gaining
efficiency through shared services is intuitively attractive, the Commonwealth’s approach to
shared services has largely been limited to rationalisation of services within Departments, and
that there currently appears to be little probative evidence that would support any general
proposition that provision of corporate support to small to medium (or indeed any) agencies
by their portfolio department (or by another portfolio agency) would necessarily be more (or
less) economical than self-provision by those agencies, let alone more (or less) efficient.
Executive Summary
Page xiii
E.9 This is not to say, however, that the concept of shared services or other cross-agency
corporate service provision should be abandoned. Rather, it would be preferable if the
information necessary to allow the concept to be tested on an agency-by-agency basis was
developed. Accordingly, this Chapter proposes a methodology for future testing of the
shared services model across the Attorney-General’s portfolio and more widely across those
Commonwealth portfolios that have significant numbers of portfolio agencies.
Recommendation 3.1
The Attorney-General’s Department (or alternatively a portfolio agency agreed by the
Attorney-General) should prepare a business-like proposal setting out in a “corporate
services business offering”:
a.
b.
c.
d.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
the service level specifications at which those services would be provided;
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
the financially justifiable price at which each such service would be provided.
Recommendation 3.2
Once the Attorney-General’s portfolio “corporate services business offering” is available:
a.
it should be made available to the Attorney-General and the Minister for
Finance and Deregulation; and
b.
all agencies within the portfolio should be required to review and compare the
offering to their existing corporate services provision arrangements and report
to the Attorney-General and the Minister for Finance and Deregulation on
whether or not they intend to access that offering and their rationale for doing
so.
Recommendation 3.3
The Government should similarly require each department (or a portfolio agency agreed
with its Minister) in other portfolios with significant numbers of portfolio agencies to do the
same, and set a clear timetable for the preparation of those proposals, assessment of them
within portfolios, and reporting back to their respective Ministers and the Minister for
Finance and Deregulation, and through the Finance Minister to Cabinet.
E.10 Once that material was available, soundly based decisions would be able to be made,
within agencies and across portfolios, as to whether or not individual agencies should, in
conformity with the Expenditure Review Principles, provide their own corporate support
services, acquire those services from a commercial provider or acquire them from their
portfolio department or other portfolio agency provider.
E.11 Adopting these recommendations should assist, but would certainly not remove the
need for, other related initiatives already being advanced in the Department of Finance and
Deregulation.
E.12 The Review has also recommended (in Chapters 5 and 6) that further opportunities for
shared services be taken forward independently of the Recommendations in Chapter 3.
Executive Summary
Page xiv
E.13 There are already a number of generally limited “shared services” initiatives in place
between the agencies within Review scope, including an arrangement between the Australian
Human Rights Commission (AHRC) and the Office of the Australian Information
Commissioner (OAIC). The Memorandum of Understanding governing this arrangement
does not adequately specify service level standards for the services provided under it, and the
Information Commissioner has indicated that he may contemplate establishing an internal
corporate services capacity. The Review is concerned that this may not be optimally
efficient.
Recommendation 3.4
Noting the present arrangements between the AHRC and OAIC:
a.
b.
AHRC and OAIC should seek to negotiate appropriate service levels for
inclusion within their MoU to replace the present inadequate specification in
that agreement; and
OAIC should not move to establish its own internal corporate support capacity
before operating under an MoU that includes proper service levels and, if the
preceding recommendations of this Review are accepted, before proper
consideration and assessment of the Attorney-General’s portfolio “corporate
services business offering” recommended above.
E.14 These service level standards, if well enunciated, may prove to be a very useful guide to
the development of the portfolio “corporate services business offerings” referred to above.
E.15 While there are a number of portfolio or Commonwealth-wide procurement contracts
that have been negotiated and are utilised to the benefit of the agencies subject to the Review,
it was a frequent suggestion that a further such arrangement should be negotiated for access
to electronic publications that are increasingly (and more efficiently) used by agencies that
have often largely disbanded their hard-copy libraries.
Recommendation 3.5
The Attorney-General’s Department should explore the possibility of negotiating with
publishers a “whole-of-portfolio” co-operative purchasing arrangement to allow licences
permitting access to relevant electronic legal publications to be acquired otherwise than on
an individual (and potentially costly) agency-by-agency basis. The Department should also
consider allowing agencies external to the portfolio access to any resulting arrangement.
Financial Viability of the Agencies
E.16 Chapter 4 provides an overview of the Review’s findings on the financial viability of
the Attorney-General’s portfolio agencies subject to the Review. The Chapter advises that
most agencies are, or are capable of becoming within a reasonable period, financially viable
without Budget supplementation. It notes however that there are some concerns in relation to
the Administrative Appeals Tribunal and some important qualifications with respect to the
Federal Court, the Family Court and the Federal Magistrates Court.
Executive Summary
Page xv
E.17 The Review was not able, in the time available to it, to fully examine, analyse and test
the financial situation in relation to the Courts in order to be able to conclude one way or the
other with adequate confidence that the Courts are financially viable to operate at acceptable
service levels within their current and Forward Estimates appropriations and at currently
experienced and anticipated activity levels. The Review therefore recommends that the
Attorney-General’s Department undertake a review of, and report to the Attorney-General on,
issues affecting and options for ensuring the Courts’ future financial viability.
Recommendation 4
The Attorney-General’s Department should undertake a review of, and report to the
Attorney-General on, issues affecting and options for ensuring the Courts’ future financial
viability. This further review should be conducted with the close involvement of not only
the Commonwealth Courts but also the Department of Finance and Deregulation, and
should draw on expertise in financial accounting, budget policy, justice policy and court
administration. The further review should:
a.
conduct a line-by-line examination of Courts’ previous and projected
expenditure;
b.
consider existing options to reduce expenditure, and identify further options that
may be available;
c.
identify likely impacts of each of the available options on court administration
and service levels; and
d.
develop an indicative priority list of the expenditure reductions and other
measures that should be pursued to avoid future deficits, with a focus on
minimising negative impacts on service levels.
Commonwealth Courts
E.18 Chapter 5 provides a detailed analysis of the history of Commonwealth Courts’
administration, and identifies 8 options for the future. It recommends adopting Option 4,
which implements an administrative arrangement to foster greater cooperation between the
separate Commonwealth Courts, which is designed to achieve some immediate increase in
efficiency and to put in place a cross-Court governance and reporting arrangement for the
identification and implementation of further efficiencies. This arrangement will allow the
Government to assess what is being achieved every six months and decide whether savings to
the Budget are achievable or, alternatively, whether Option 7, a more dramatic (legislatively
driven) structural change option, should be implemented.
Executive Summary
Page xvi
Recommendation 5.1
a.
b.
The Government should adopt Option 4 (Administratively foster greater
cooperation between the separate Commonwealth Courts) as sought by the
Heads of Jurisdiction (but incorporating also the changes to administration
structures under Option 3). Option 4 includes a governance structure and
reporting regime that will provide not only an incentive for achievement but
also a clear capacity for the Government to monitor success on a timely basis.
The Government should retain Option 7 (Legislatively merge all administration
of the Federal Court, Family Court and Federal Magistrates Court (and the
proposed Military Court)) as a future possibility if efficiencies and
effectiveness are not adequately achieved through Option 4.
E.19 If these Options are accepted, this would seem to obviate the need to further amend
legislation to restructure the Federal Magistrates Court at this time. (However, amendments
to the Federal Magistrates Act 1999 will be necessary if Recommendation 5.5 is accepted.)
Recommendation 5.2
The Government should not pursue further legislative change to the structure of the
Federal Magistrates Court at this time. The Government should, instead, reconsider the
need for any such action in the light of experience following implementation of the
recommendations of this Report and assessment of whether or not they have achieved the
increased efficiency and integration that motivated previous legislative proposals.
E.20 Consistent with the Recommendations in Chapter 3 in relation to shared services, the
Commonwealth Courts should also be required to consider the Attorney-General’s portfolio
“corporate services business offering” once it is developed.
Recommendation 5.3
Once the Attorney-General’s portfolio “corporate services business offering” is available,
the Commonwealth Courts should be required to review and compare the offering to their
existing corporate services provision arrangements and report to the Attorney-General and
the Minister for Finance and Deregulation on whether or not they intend to access that
offering and their rationale for doing so.
E.21 Chapter 5 also considers the application of the Efficiency Dividend to the
Commonwealth Courts. While it concludes that the Courts should remain subject to the
Efficiency Dividend, it does recommend that the Government should consider changing the
manner of appropriation of judicial salaries.
Executive Summary
Page xvii
Recommendation 5.4
The Government should consider funding Federal Court and Family Court judicial salaries
by way of the Standing or Special Appropriations already included in legislation rather
than through Departmental Appropriations.
Recommendation 5.5
The Government should also consider amending the Federal Magistrates Act 1999 to
include a Standing Appropriation provision.
E.22 The Commonwealth Law Courts Buildings in Sydney, Melbourne, Brisbane, Adelaide,
Perth, Hobart, Canberra and Parramatta occupy prime real estate and have been purpose built
for use by the Commonwealth’s Courts, including the High Court. They markedly exceed the
standard of accommodation provided by the Commonwealth for other Commonwealth
officers, including other holders of high office. While this is not inappropriate, it does make
it essential that the Government and the public have a high degree of confidence that the
associated cost is properly recognised and that the resources are put to the best use.
Recommendation 5.6
The High Court, the Federal Court, the Family Court, the Federal Magistrates Court, the
Administrative Appeals Tribunal (in respect of Brisbane and Adelaide), the AttorneyGeneral’s Department and the Department of Finance and Deregulation should be required
to prepare for the Attorney-General and the Minister for Finance and Deregulation a
detailed strategic plan for the ongoing occupancy of Commonwealth Law Courts
buildings.
This plan should:
a.
b.
c.
d.
govern use of each building on a “whole-of-system” basis and without any
presumption of ongoing allocation of space for the exclusive use of any Court;
seek to optimise the provision of common facilities such as libraries,
conference rooms, common rooms etc. for use of all building tenants;
provide that the accommodation allocation for Public Service Act staff should
not exceed that otherwise applicable in the Public Service generally, unless
reconfiguration would be a more expensive option; and
include a specification of priority uses for each building.
Native Title
E.23 Chapter 6 considers:
a.
the balance of responsibilities and resource allocation between the Federal Court
and the National Native Title Tribunal (NNTT);
b.
whether all current discretionary functions of the NNTT should continue to be
performed, or performed at the current level;
Executive Summary
Page xviii
c.
d.
whether any of the NNTT’s discretionary functions should be subject to a costrecovery regime; and
the future structure of the NNTT.
E.24 The Chapter contains a detailed analysis of the key native title functions performed by
the NNTT and the Federal Court. It concludes that mediation of native title claims should be
conducted wholly in the Federal Court, rather than dividing the function between the Federal
Court and the NNTT. This would better align responsibility and capability and provide an
opportunity for financial savings.
Recommendation 6.1
The funding and resources for the native title mediation function should be transferred from
the National Native Title Tribunal (NNTT) to the Federal Court. This does not require any
substantive amendment to the Native Title Act 1993 (NTA). The Federal Court would, at an
appropriate time, simply order NNTT mediation of relevant claims to cease and then, as
appropriate, allocate them to mediation by Federal Court staff or an external party.
However, for certainty and clarity, it would be preferable to amend the NTA within a
reasonable timeframe to align the legislation with the change in administrative practice.
Recommendation 6.2
Further work should be undertaken by the Federal Court and the NNTT, in consultation
with the Attorney-General’s Department and the Department of Finance and Deregulation,
to identify the quantum of the savings that would be achieved by conducting current
mediation activity levels in the Federal Court rather than the NNTT.
The Government should then decide whether those savings should be reinvested in native
title mediation, reallocated to other priorities in the native title system or harvested to the
Budget.
Recommendation 6.3
Other NNTT functions that are ancillary to the judicial function should remain with the
relevant administrative agency performing closely connected administrative functions.
E.25 Chapter 6 also recommends that the NNTT should continue to exist as a separate
statutory entity, and otherwise continue to have responsibility for its current functions.
Recommendation 6.4
The NNTT should continue to exist as a separate statutory entity, subject to
recommendation 6.7 below, albeit with its mediation function and resources transferred to
the Federal Court as set out in Recommendation 6.1.
E.26 The Chapter also considers the large discretionary workload undertaken by the NNTT,
noting that some of these functions are crucial to the native title system, while others appear
to be of limited ongoing relevance. The Review recommends developing a plan for
expenditure on discretionary native title functions, including consideration of options for cost
recovery of some discretionary functions performed by the NNTT.
Executive Summary
Page xix
Recommendation 6.5
The Government should give further consideration to the extent to which the NNTT’s
discretionary functions should continue to be performed, and to what extent those functions
should be funded. To this end, the NNTT and the Attorney-General’s Department (in
consultation with the Department of Families, Housing, Community Services and
Indigenous Affairs) should develop for consideration by Government a plan for expenditure
on discretionary native title functions. That plan should deal with:
a.
the extent to which the NNTT’s discretionary functions should continue to be
performed, particularly strategic planning and research and publications; and
b.
whether resourcing should be reduced for any discretionary functions.
Recommendation 6.6
The plan referred to in the Recommendation 6.5 should also consider the efficiency of
pursuing options for full or partial cost recovery for NNTT discretionary functions designed
to extend the NNTT’s capacity to provide expert assistance and encourage parties to reach
outcomes efficiently.
E.27 Finally, Chapter 6 considers a number of options for the future administration of the
NNTT and concludes that administrative and budgetary efficiencies, and organisational
synergies, could be enhanced by the NNTT ceasing to be a separate FMA Act agency and
instead being administered by the Federal Court.
Recommendation 6.7
While the NNTT should continue to exist as a separate statutory entity, the NNTT should
no longer be a separate FMA Act agency but should, instead, be serviced from within the
Federal Court administration (albeit with the Portfolio Budget Statements for the AttorneyGeneral’s portfolio showing an anticipated expenditure by the Federal Court on NNTT
functions).
Recommendation 6.8
The extent of financial savings that would accrue from the integration of the NNTT and
Federal Court administration, and the timing on which those savings might reasonably be
expected to become available, should be resolved in consultation between the NNTT, the
Federal Court, the Attorney-General’s Department and the Department of Finance and
Deregulation in consultation with the Department of Families, Housing, Community
Services and Indigenous Affairs.
Executive Summary
Page xx
Commonwealth Tribunals
E.28 Chapter 7 identifies a range of Commonwealth “merits review” administrative
tribunals across the breadth of Commonwealth administration. It focuses in particular on the
five tribunals that conduct the overwhelming majority of Commonwealth merits review – the
Administrative Appeals Tribunal, the Migration Review Tribunal, the Refugee Review
Tribunal, the Social Security Appeals Tribunal and the Veterans’ Review Board. It considers
the following options:
a.
abolishing these tribunals and replacing them with a new Administrative Review
Tribunal (ART), as previously recommended by the Administrative Review
Council (ARC);
b.
maintaining the tribunals as separate entities but merging their support functions
into a single administrative unit; or
c.
seeking greater efficiency within existing tribunals through a cooperative process
of review and reporting to Government.
E.29 The Review considers that further work should be undertaken by the tribunals to
identify potential efficiencies in tribunal administration, particularly with respect to those
recommendations in the Tribunal Efficiencies Working Group Report (2.1, 3.1, 4.1, 6.1, 9.1
and 9.2) that appear to offer scope for achieving efficiencies in resource usage by and
amongst the tribunals. The Administrative Appeals Tribunal should have a lead role in
coordinating this work, and governance and reporting arrangements should be established to
ensure accountability.
Recommendation 7.1
a.
b.
The Administrative Review Tribunal proposal as recommended by the
Administrative Review Council should be endorsed as the Government’s
desired end-state (subject to a resolution of the reduction in appeal rights
issue).
The Administrative Review Council model should be extended so that, unless a
compelling case was made to the contrary, all Commonwealth merits review
bodies should be “rolled into” the Administrative Review Tribunal and not just
the five major tribunals.
Executive Summary
Page xxi
Recommendation 7.2
The Government should now formally require the heads of the Administrative Appeals
Tribunal, Migration Review Tribunal, Refugee Review Tribunal, Social Security Appeals
Tribunal and the Veterans’ Review Board to jointly:
a.
review each initiative identified and either supported or rejected in the Tribunal
Efficiencies Working Group Report;
b.
identify further initiatives for other efficiencies or improvements that might be
achieved by cooperative or shared efforts between them; and
c.
report each six months to each relevant portfolio Minister, and to the Minister
for Finance and Deregulation, on progress and in particular:
i.
identify which Working Group Report or other initiatives have been
implemented, and the benefits thereby gained;
ii.
identify which Working Group Report or other initiatives have been fully
analysed and the conclusion drawn that they should not be implemented,
and set out the reasons why; and
iii.
advise the forward work plan for examining these matters.
Recommendation 7.3
The President of the AAT should be designated as the convenor and chair of the group of
tribunals identified in Recommendation 7.2. However, as the current President will retire
in May 2012, in the interests of continuity in an exercise that may take some time, that the
work of the group should not commence until the new President takes up office.
Recommendation 7.4
The Government should decide that:
a.
a representative of each Tribunal’s portfolio Department should participate in
the work identified in Recommendation 7.2 in order (a) to avoid any
divergence between tribunal administration and the underlying merits review
policy objectives of the Government, and (b) to provide practical input and
advice in relation to such matters as the potential availability of support
services that might be provided by those Departments; and
b.
Ministers should consult and then:
i.
either accept or reject those periodic reports; and
ii.
provide feedback and any necessary or desirable direction to the heads of
the tribunals and their Departments.
Recommendation 7.5
The Government should confer on the President of the AAT the role of promoting
cooperation between, and the identification and adoption of best practice tribunal
administration by, all Commonwealth merits review bodies (i.e., not just the five largest
tribunals).
E.30 Chapter 7 also recommends that no further Commonwealth merits review tribunals be
established, with any potential new function instead being conferred on the AAT. In relation
Executive Summary
Page xxii
to the Australian Competition Tribunal, the Copyright Tribunal of Australia and the Defence
Force Discipline Appeals Tribunal, no changes are recommended.
Recommendation 7.6
The Government should now take a decision that, except in exceptional circumstances, no
new Commonwealth merits review body should be established and that any new merits
review jurisdiction should instead be conferred on the AAT.
Recommendation 7.7
There should be no change to the present arrangements in respect of the Australian
Competition Tribunal, the Copyright Tribunal of Australia and the Defence Force
Discipline Appeals Tribunal.
E.31 Chapter 7 also considers in more detail the role, function and culture of the AAT, and
whether it should be formally recognised as the pre-eminent Commonwealth tribunal.
Recommendation 7.8
The Attorney-General should communicate to the incoming AAT President the desirability
of giving consideration to questions of culture and approach as an early priority and to
make clear her expectations of AAT members and staff in this regard.
Recommendation 7.9
AAT administration functions should not be merged with those of the Commonwealth
Courts and, unless it would be inefficient and uneconomic to do otherwise, the AAT
should not be co-located with the Commonwealth Courts.
Recommendation 7.10
The Attorney-General should communicate to the incoming AAT President the need as a
matter of early priority to review the detailed work plan, attribution of responsibility and
governance structure for reporting on and monitoring of the implementation of the AAT’s
Strategic Plan.
Recommendation 7.11
Once the Attorney-General’s portfolio “corporate services business offering” is available,
the AAT should review its then existing corporate services provision arrangements and
report to the Attorney-General and the Minister for Finance and Deregulation on whether
or not it intends to access that offering and its rationale for doing so.
Commonwealth Legislative Drafting
E.32 Chapter 8 deals with the two offices that draft Commonwealth legislation – the Office
of Parliamentary Counsel (OPC) and the Office of Legislative Drafting and Publication
(OLDP). It considers the arguments for and against OPC remaining as an independent
statutory authority and OLDP remaining as a Division of the Attorney-General’s Department.
Executive Summary
Page xxiii
It also considers the benefits to the quality of the Commonwealth’s overall “legislation book”
that would be achievable with incorporation of the two bodies into one entity.
Recommendation 8.1
OPC should remain a separate statutory and FMA Act agency outside the AttorneyGeneral’s Department, but solely on the condition that the drafting functions of OLDP are
transferred to it.
Recommendation 8.2
To allow resolution of transitional issues and the adoption in advance of common drafting
standards across both OPC and OLDP, the Government should set a 1 July 2012 transfer
date.
Recommendation 8.3
When the drafting functions of OPC and OLDP are combined, that combination should
include all other associated functions of OLDP.
Recommendation 8.4
Sufficient Budget funding should be transferred to OPC from the Attorney-General’s
Department so that, in combination with other revenue sources including user-pays
drafting and (properly set) FRLI registration fees, OPC is properly resourced to undertake
all its functions.
Recommendation 8.5
First Parliamentary Counsel, as head of the combined office, should replace the Secretary
of the Attorney-General’s Department as the person designated in section 16 of the
Legislative Instruments Act 2003 as responsible to “cause steps to be taken to promote the
legal effectiveness, clarity, and intelligibility to anticipated users, of legislative
instruments”.
Recommendation 8.6
The Attorney-General should issue an appropriate Letter of Expectation to the head of the
combined office in relation to the deployment of the combined resource with a view to
ensuring that all elements of the Commonwealth’s legislative drafting requirements are
appropriately met within overall resource availability.
Recommendation 8.7
Early decisions should be taken on the manner in which the “sunsetting” of legislative
instruments is to be resolved, and on how any necessary requirements for additional
resourcing are to be met.
Executive Summary
Page xxiv
Recommendation 8.8
Once the Attorney-General’s portfolio “corporate services business offering” is available,
OPC should be required to review and compare the offering to its existing corporate
services provision arrangements and report to the Attorney-General and the Minister for
Finance and Deregulation on whether or not OPC intends to access that offering and its
rationale for doing so.
Executive Summary
Page xxv
Law Enforcement Agencies
E.33 Chapter 9 deals with the Australian Commission for Law Enforcement Integrity
(ACLEI), the Australian Institute of Criminology (AIC), the Australian Transaction Reports
and Analysis Centre (AUSTRAC) and the CrimTrac Agency (CrimTrac). It concludes that
the retention of these bodies as separate independent agencies is justified by reference to the
indicative tests discussed in Chapter 2. It notes however that there are a variety of
governance, funding, operational and legislative issues of relevance to CrimTrac that are the
subject of separate consideration elsewhere within Government, and it does not seek to
intrude on these matters. While the Review considers that the present corporate services
arrangements of ACLEI, AIC and AUSTRAC are generally sound, it was not able to be
certain that those of CrimTrac were cost-efficient. This issue should be resolved consistently
with, but without delaying, resolution of CrimTrac’s other issues.
Recommendation 9.1
ACLEI, AIC, AUSTRAC and CrimTrac should each continue to exist in their present
separate form.
Recommendation 9.2
Without delaying the changes to CrimTrac’s governance that are currently in train, a
suitably qualified external consultant should be engaged to report to CrimTrac, the
Minister for Home Affairs and Justice and the Minister for Finance and Deregulation on
whether or not CrimTrac’s corporate support services costs are reasonable, both absolutely
and having regard to the best available benchmarking data.
Recommendation 9.3
Once the Attorney-General’s portfolio “corporate services business offering” is available,
each of ACLEI, AIC, AUSTRAC and CrimTrac should review their then existing
corporate services provision arrangements and report to the Minister for Home Affairs and
Justice and the Minister for Finance and Deregulation on whether or not they intend to
access that offering, and their rationale for doing so.
Remaining Agencies
E.34 Chapter 10 deals with the Australian Human Rights Commission (AHRC), the
Australian Law Reform Commission (ALRC) and Insolvency and Trustee Service Australia
(ITSA). It concludes that the retention of these bodies as separate independent agencies is
justified by reference to the indicative tests discussed in Chapter 2. While the Review
considers that the present corporate services arrangements of each are generally sound, each
agency should also assess any Attorney-General’s portfolio “corporate services business
offering” that is prepared.
Executive Summary
Page xxvi
Recommendation 10.1
AHRC, ALRC and ITSA should each continue to exist in their present separate form.
Recommendation 10.2
Once the Attorney-General’s portfolio “corporate services business offering” is available,
each of AHRC, ALRC and ITSA should review their then existing corporate services
provision arrangements and report to the Attorney-General and the Minister for Finance
and Deregulation on whether or not they intend to access that offering and their rationale
for doing so.
Recommendation 10.3
AHRC should negotiate with the OAIC service level standards for the provision of the
various support services that it provides to the OAIC.
Executive Summary
Page xxvii
Executive Summary
Page xxviii
CHAPTER 1 - INTRODUCTION
This Introduction provides a background to the Review, its governance arrangements, the
context in which the Review was undertaken and the matters discussed in the Review Report.
Background
1.2 The Review has been undertaken as part of an ongoing suite of strategic reviews for
Cabinet consideration which assess the performance of government programs and services
against the Government’s current policy environment.
1.3 The Expenditure Review Principles, with their focus on appropriateness, effectiveness,
efficiency, integration, performance assessment and strategic alignment, have been a key
driver of the Review. Other important policy drivers include the need to explore the potential
of shared services and assessing the nature and extent of independence from the executive
government that is desirable, either through the establishment and/or maintenance of agencies
separate from their portfolio department, or alternatively by bestowing powers on
independent statutory officer holders.
1.4 The diverse size and scope of the small and medium agencies within the AttorneyGeneral’s portfolio provided an opportunity to test and apply current Government policy
parameters to different scenarios, and in the process develop options to improve individual
agency performance, structure and service delivery, enhance governance and reporting to
Government to provide a capacity for better informed and more timely decision-making, and
develop concepts that might have wider application across Government.
Review methodology and process
Governance arrangements
1.5 Stephen Skehill (a former Australian Government Solicitor, former Secretary of the
Attorney-General’s Department and Special Counsel with Mallesons Stephen Jaques) led the
Review, assisted by five officers from the Department of Finance and Deregulation, the
Attorney-General’s Department and the Family Court of Australia. The Review team was
located in the Department of Finance and Deregulation.
1.6 The Review team established a Reference Group, comprising representatives from the
Department of Finance and Deregulation, the Attorney-General’s Department, the
Department of the Prime Minister and Cabinet, and Treasury, which met monthly to discuss
Review progress. Progress reports were also provided to the (then) Attorney-General and the
Minister for Home Affairs and Justice, and to the Secretaries of the Department of Finance
and Deregulation and the Attorney-General’s Department or their relevant senior officers.
Consultation Strategy
1.7 In late July 2011, the Attorney-General’s Department provided initial advice to
affected portfolio agencies that the Review had been approved and provided the substance of
the terms of reference to these agencies.
Chapter 1- Introduction
Page 1
1.8
The Review commenced on 12 August 2011.
1.9 On 18 August 2011 the Review team leader initially met collectively with the agency
CEOs/Heads of Jurisdiction or their representatives to discuss the approach being taken in the
Review.
1.10 Thereafter further meetings were held with all relevant agency heads and/or their staff
(usually face to face) throughout September and October 2011 to discuss the Review in more
detail and to canvass possible future options. Where appropriate, combined consultations
were held with agencies relevant to particular propositions.
1.11 Consultation included agencies outside the Attorney-General’s portfolio:

the Department of Immigration and Citizenship;

the Refugee Review Tribunal and Migration Review Tribunal;

the Department of Families, Housing, Community Services and Indigenous
Affairs;

the Social Security Appeals Tribunal;

the Department of Veterans’ Affairs; and

the Veterans’ Review Board.
1.12 Extensive consultations were undertaken within both the Department of Finance and
Deregulation and the Attorney-General’s Department, in relation to a wide variety of issues
relevant to the agencies under review and underlying Government policy.
1.13 Consultations did not extend beyond government agencies.
1.14 A questionnaire was provided to Attorney-General’s portfolio agencies at the end of
August 2011 seeking detailed resource-related information. Agency responses were both
prompt and valuable in assisting more detailed consultations with agencies in face to face
meetings. A copy of the Review questionnaire is at Appendix 14, and a summary of selected
questionnaire responses is at Appendix 15.
1.15 The Review team considered the following material in preparing its report:

annual reports and other published performance information in relation to
agencies;

the reports and reviews referred to in the Review Terms of Reference;

various other reports and reviews of relevance;

agency questionnaire responses; and

additional/follow up material arising from the questionnaire after meetings with
agencies.
1.16 This material, and other information considered by the Review team, is referenced in
the relevant chapters and Appendices.
Financial information in Appendices 1-13
1.17 Appendices 1-13 provide further information about each of the agencies within the
Review’s scope, including financial information. The Review considers that the financial
information contained in the Appendices provides useful financial data for the purposes of
the Review Report in relation to each agency as at November 2011.
Chapter 1- Introduction
Page 2
1.18 This financial information is largely drawn from agency responses to the Review’s
survey questionnaires, and data from primary sources including agency annual reports and
relevant Budget Statements of the Attorney-General’s Portfolio.
1.19 Unless otherwise noted in each Appendix:
a. Actual appropriations and agency receipts from 2008-09 to 2010-11 are
derived from annual reports. Appropriations for 2008-09 and 2009-10 include
depreciation funding. Appropriations for 2010-11 exclude Departmental
Capital Budgets (DCB). Appropriations since the introduction of DCB
(2010-11 and future years) are not directly comparable to 2008-09 and
2009-10 appropriation amounts.
b. Estimated appropriations are derived from the 2011-12 Portfolio Budget
Statements and exclude DCB.
c. Actual operating results are derived from annual reports:
i. for 2008-09 and 2009-10 these numbers include depreciation funding
and expenses as it is not possible to consistently identify depreciation
funding from material available in annual reports or Portfolio Budget
Statements;
ii. for 2010-11 the numbers exclude DCB (where relevant) and
depreciation expenses to clearly identify the relationship between
funding and operational expenses; and
iii. as a result, 2008-09 and 2009-10 operating results are not directly
comparable with 2010-11 operating results.
d. Estimated operating results were provided by agencies, although the Review
notes that agencies cannot budget for a loss in future years.
i. These estimates exclude DCB and depreciation expenses and are based
on business as usual, with agencies asked to separately identify
measures proposed or under consideration to avoid deficits (where
deficits were projected). This approach was used to fully understand
the financial viability of agencies at the levels of activity assumed by
agencies and allow the Review to analyse steps that may be taken in
future for agencies to avoid running deficits.
ii. It is however important to note that these estimates:
A. are not Budget Estimates as published by the Government
B. have not been verified by the Review Team;
C. have not been validated by the Department of Finance and
Deregulation; and
D. may differ from authorised forward estimates either held by the
Department of Finance and Deregulation or which are otherwise
publicly available.
1.20 The specific methodology for sourcing data is as set out below:
Actual and budgeted appropriations table
Appropriations line:
Chapter 1- Introduction
Page 3
Actual 08-09, 09-10 and 10-11: Revenue from government (sourced from
comprehensive income statements in annual reports).
Estimate 11-12, 12-13, 13-14, and 14-15: Revenue from government (sourced from
PBS 2011-12 comprehensive income statements).
Other Agency Receipts line:
Actual 08-09, 09-10 and 10-11: Total own source revenue (sourced from
comprehensive income statements in annual reports).
Estimated 11-12, 12-13, 13-14 and 14-15: Total own source revenue (sourced from
PBS 2011-12 comprehensive income statement).
Operating results tables:
Actual 08-09 and 09-10: Surplus (deficit) attributable to the Australian Government
(sourced from comprehensive income statements in annual reports).
Actual 10-11: Surplus (deficit) attributable to the Australian Government (sourced
from comprehensive income statement in annual report) excluding depreciation and
amortisation expenses.
Estimated 11-12, 12-13, 13-14 and 14-15: Forecast operating results (sourced from
Review questionnaires provided to agencies).
1.21 Note also that the financial information does not take into account any potential
financial updates to publicly available material subsequent to November 2011, which was not
publicly available as at November 2011. In particular, it does not take into account:
a. Additional Estimates variations; and
b. the Government’s announcement on 29 November 2011 to apply an additional
2.5% one-off efficiency dividend to most Government agencies for the 201213 year, and, where relevant, to reduce agencies’ Departmental Capital
Budgets by 20%, which will impact on the estimations in the Appendices in
relation to future appropriations, agency receipts and actual/estimated
operating results for affected agencies.
1.22 Specific circumstances affecting the interpretation of financial data provided by each of
the agencies are also noted, where relevant, in each Appendix.
Chapter 1- Introduction
Page 4
Chapter 1- Introduction
Page 5
CHAPTER 2 – POLICY CONTEXT
This chapter considers:
a.
the interpretation of the Expenditure Review Principles that the Review is
required to apply in its assessment of the agencies within the scope of the
Review;
b.
given that those principles make reference to the integration of agencies, the
bases on which the creation or continuation of independent statutory authorities
separate from a portfolio Department may be justified; and
c.
the nature of, and the consequences that flow from, that independence.
Expenditure Review Principles
2.2 The Terms of Reference for the Review require that, in assessing the AttorneyGeneral’s portfolio agencies within scope, the Review is to apply the Expenditure Review
Principles1.
2.3 The full text of the Expenditure Review Principles is at Appendix 16. The following
extracts are of particular significance in the context of the agencies within Review scope:

Appropriateness:
activity is directed to areas where there is a role for government, and is
undertaken by the most appropriate level of Australian government;

Effectiveness:
activities have clear and consistent objectives, are effective in achieving
their objectives, and represent value for the expenditure of taxpayer money;

Efficiency:
programs are administered and delivered in the most efficient way
achievable, taking into account both short and long term economic and
fiscal consequences, and consideration is given to whether part or all of the
cost should be recouped directly from program beneficiaries;

Integration:
government agencies should work together effectively to consistently
deliver the Government’s policy objectives within clearly defined lines of
responsibility;

Performance assessment:
government activity should be subject to robust performance assessment
and measurement; and

Strategic Policy Alignment:
activity should be consistent with the Government’s strategic long term
policy priorities.
2.4 A close reading of these extracts from the Principles makes clear a number of
propositions:
Expenditure Review Principles – Commonwealth Department of Finance and Deregulation, 24 August 2011,
http://www.finance.gov.au/budget/budget-process/expenditure-review-principles.html
1
Chapter 2 – Policy context
Page 6
a.
b.
c.
d.
they do NOT require that the least expensive option must be adopted. The
Principles focus on effectiveness and value for money, not avoiding expenditure
per se;
conversely, they do not mandate that everything must be done in the most
efficient way possible - rather they require only that things be done in the most
efficient way “achievable”. This means that the relevant test is whatever is
practicable within the realistic context, including financial capability;
the requirement for integration through agencies working together is consistent
with the proposition that there are necessarily limits on the view that can be taken
of the independence of agencies. Independent agencies are still expected to
exploit opportunities for efficiency or effectiveness improvements through
collaboration; and
similarly the requirements for performance assessment and strategic policy
alignment are also consistent with the proposition that independence is not an
absolute quality.
2.5 Key implications of the Expenditure Review Principles are the requirements for
Commonwealth government entities to deliver their respective outcomes/services within the
most appropriately integrated governance structure, and more generally to do so as
effectively and efficiently as possible. In the context of this Review, that particularly
includes exploring opportunities to share services.
2.6 A critical balance needs to be struck between the most appropriate governance structure
to deliver the Government’s policy intent and the potential costs or savings of alternative
options. Too much emphasis on either can be problematic.
2.7 While the suite of functions, powers and services within most portfolios probably
cannot or should not be delivered within one agency, it is conversely the case that every
independent agency, no matter its function, does not have to be fully self-reliant and is
potentially able to avail itself of at least some shared corporate services. Nor should it be
assumed that all currently separate agencies should remain so.
Governance structures and arguments for independence
2.8 The Australian Constitution clearly establishes a separation of powers between the
Legislature, the Executive and the Judiciary. While it is legally possible for every other
function of Government to be undertaken within and by the Executive arm, only the
Parliament can make (or authorize the making by the Executive of) legislation affecting the
rights of citizens and only the Judiciary can exercise the judicial power of the
Commonwealth.
2.9 As a result, the Federal Court of Australia, the Family Court of Australia and the
Federal Magistrates Court of Australia, while each a creation of the Parliament rather than the
Australian Constitution, are and must remain separate independent agencies outside the
Executive arm (unless, of course, they were merged into a single Court outside the Executive
arm, as discussed in Chapter 5).
2.10 While the Constitutional separation of powers is the only immutable requirement for
independence, a prominent feature of the Attorney-General’s portfolio and many other
Commonwealth portfolios is the proliferation of independent agencies outside the Executive
arm and the portfolio Department of State. Given that there is no compelling legal necessity
Chapter 2 – Policy context
Page 7
for this separation, it is pertinent to consider the various justifications that may exist for
creating and maintaining each of these separate non-Court agencies.
2.11 The Review of the Corporate Governance of Statutory Authorities and Office Holders –
June 2003 (the Uhrig Review), which was largely focused on the governance mechanisms
between statutory authorities and the Government, provided only a limited examination of the
issue. The Uhrig Review (at p.7) found that:
...statutory authorities should be created only where there is sufficient need
for:
efficiency: that is, a clear purpose is required to achieve objectives
and it considered beneficial to undertake functions outside the
portfolio department, or
independence: when functions require a level of separation from
government to ensure objectivity.
2.12 In the opinion of the Review, this is not a sufficiently elucidated basis for considering
whether or not agencies within the scope of the Review (or independent Commonwealth
agencies more generally) should remain as separate independent entities.
2.13 Further assistance can be found in a 2005 publication by the (then) Department of
Finance and Administration, not long after the Uhrig Review2. In the Executive Summary it
is stated that:
There is a policy preference to curb unnecessary proliferation of Government
bodies. Consequently, a function, activity or power should, if possible, be
conferred on an existing department, or another existing Australian
Government body, rather than on a new body.
If there are persuasive policy reasons to form a new body, then its purpose —
and its financial, legal and staffing status — will need careful consideration. ...
The aim is to ensure that the governance arrangements promote the effective
implementation of policy. Poor governance structures can threaten good policy
outcomes.
2.14 Key questions about independence raised in this publication included whether or not
legislation was necessary to establish and maintain the function, ensuring that the function
had appropriate accountability structures to the Parliament and Government, and guarding
against developing mechanisms that would lead to unnecessary fragmentation of the
machinery of Government. The publication also included a “Flowchart for Placing
Australian Government Activities” to assist decision making about the appropriate structures,
which is set out below.
2
Government Governance Arrangements for Australian Government Bodies August 2005 - Commonwealth
Department of Finance and Administration
Chapter 2 – Policy context
Page 8
2.15 Although broad and flexible parameters are needed to enable decisions to deliver the
right structure for the right function, the Review considers that it would be worthwhile to also
set out a variety of more detailed reasons that may, to greater or lesser extent, contribute to a
case for the establishment of independent statutory agencies outside the portfolio Department
of State. Of course, even where a degree of independence is necessary, this may be able to be
adequately achieved by conferring power on a statutory officer within a Department of State
without creating a separate agency.
2.16 The following does not purport to be an exhaustive list of reasons; however it would
seem to have some general applicability not only outside the purpose of this Review but also
beyond the Attorney-General’s portfolio.
a.
International comity – Australia may have agreed, in ratifying an international
convention or otherwise giving a commitment in international fora, that it will
establish a separate independent body to give effect to its international obligations
or understandings. Of relevance to the present Review, under the Principles
relating to the Status of National Institutions (the ‘Paris Principles’), Australia
agreed that its national human rights agency:
...shall have an infrastructure which is suited to the smooth conduct of its
activities, in particular funding. The purpose of this funding should be to
enable it to have its own staff and premises, in order to be independent of the
Government and not subject to financial control which may affect its
independence.
Chapter 2 – Policy context
Page 9
This provides a clear justification for the maintenance of the Australian Human
Rights Commission (AHRC) as a separate independent agency.
b.
Avoidance of conflict of interest – The performance of some functions, if
undertaken within the Executive, may give rise to a perception that the
Government would so manage the function to ensure that benefit accrued to itself
rather than to affected citizens. For example:
i.
the approval of future acts on Crown land pending the resolution of an
application currently before the Federal Court for a declaration of native
title over that land could readily give rise to such a perception if not
undertaken by an independent body such as the National Native Title
Tribunal, or possibly by an independent statutory officer;
ii.
the management of bankrupt estates in which the Australian Taxation
Office may be a major creditor could give rise to a claim of favouritism
towards taxation revenues if undertaken by the Executive rather than by an
independent body such as the Insolvency and Trustee Service Australia
(ITSA) (or, as discussed below, by independent statutory officers within a
Department);
iii.
acceptance of the outcome of review of decisions of the Executive sought
by citizens who remain aggrieved even after internal review within the
Executive requires the existence of independent tribunals such as the
Administrative Appeals Tribunal, the Migration Review Tribunal, the
Refugee Review Tribunal, the Social Security Appeals Tribunal and the
Veterans’ Review Board (or some alternative equivalent); and
iv.
claims of government accountability and transparency are clearly enhanced
when there are mechanisms to test those claims, such as the AHRC, the
Commonwealth Ombudsman and the Freedom of Information laws
oversighted by the Office of the Australian Information Commissioner;
c.
To secure the conferral of extra-ordinary powers – It is often the case that
Parliament will only agree to confer highly intrusive or coercive powers on an
agency independent of the Executive – for example, police or national security
powers or the information gathering powers of bodies such as the Australian
Competition and Consumer Commission or the Australian Taxation Office. And
it may be unacceptable to the Parliament for the oversight of the exercise of those
powers to rest solely with the Executive. For this reason, a Parliamentary
Committee may be established to monitor an agency such as the Australian
Securities and Investments Commission, or there may be a separate body such as
the Australian Commission for Law Enforcement Integrity (ACLEI, which is
within the scope of this review) or the Inspector-General of Intelligence and
Security.
d.
To distance government from regulatory intrusion – Occasionally, responsible
government requires the imposition of significant restraints on the pursuit by
business or other private individuals of what would otherwise be lawful activity.
However, at the same time it may properly be desired that responsibility for such
activity not be directly attributable to a Government Minister but rather to an
independent agency. Agencies that regulate business affairs such as the
Australian Competition and Consumer Commission, the Australian Securities and
Investments Commission and the Australian Prudential Regulatory Authority fall
into this category. Of relevance to the Review, so too does the Australian
Chapter 2 – Policy context
Page 10
e.
f.
g.
Transactions Reports and Analysis Centre (AUSTRAC) and ITSA. Of course,
there are many other regulatory functions of Government that are undertaken
directly by the Executive, or by independent statutory officers within a
Department.
To ensure government access to best advice – The Australian Public Service has
an accepted role in providing “frank and fearless” advice, having regard to the
best information available within and to the Service, including the wider
community. However, there are occasions when the Government wishes to
obtain a more in-depth consideration of issues from advisers who are
unencumbered by other potentially contradictory or competing demands and who
can more readily formulate advice based on wider and more detailed community
consultative mechanisms, in the process obtaining views that may not otherwise
be made known, or obtaining assistance or input that might not otherwise be
provided to the Executive itself.
This may provide a justification for the separate existence of bodies such as the
Productivity Commission or, within the scope of the Review, the Australian Law
Reform Commission (ALRC) and the Australian Institute of Criminology (AIC).
Additionally, such bodies are often able to access, at no or minimal cost, input
and advice that could not be expected to be made available to a Department of
State on the same basis. For example, the ALRC advises that it obtains the
voluntary assistance of judges and other talented and experienced practitioners to
assist policy development for which a Department would be expected to pay
some hundreds of thousands of dollars each year. Similarly, the AIC advised the
Review that they are able to generate double blind peer review of their
publications by utilizing the voluntary assistance of highly qualified academics
and others, to a value exceeding $150,000 pa.
To ensure participation by stakeholders – On occasion, it is only by creating a
separate independent agency that vital stakeholders can be induced to participate
and provide an essential contribution to the achievement of a common goal. Of
relevance to the Review, it is understood that it was only by establishing the
CrimTrac Agency (CrimTrac) as an agency independent of both the AttorneyGeneral’s Department and other portfolio agencies that State and Territory Police
Commissioners could be persuaded to make available their individual crimerelated data-sets that collectively generate the highly desirable national database
administered by CrimTrac.
To allow ministers and departments to focus on higher priorities – Sometimes,
the reason for moving a function out of a Department into, or maintaining it in, a
separate agency may be as simple as allowing the Minister and Department to be
able to concentrate on what are perceived at the time to be other higher priority
issues without the need to carry active responsibility for more routine,
transactional-type business.
2.17 An additional argument often raised in favour of independence is that over time,
independent agencies develop their own culture, expertise, practices and identity, all of which
may (but will not necessarily) assist the performance of their functions. While these
attributes are certainly not determinative of the need for independence and, if desired, can
also be achieved within a Department, they may when taken with other factors above become
a tipping point in favour of retaining an agency outside the Department of State.
Chapter 2 – Policy context
Page 11
2.18 The following table indicates how these reasons contributing to a case for independence
apply to the various agencies within the scope of the Review:
Table 2.1: Factors that may contribute to a case for maintenance of a
separate agency
Federal Court of
Australia

Family Court of
Australia
Federal
Magistrates Court
AAT

Allow concentration
on Higher Priority
Issues







AUSTRAC
ITSA

ACLEI






CrimTrac
ALRC
AIC
MRT/RRT/SSAT/
VRB
OPC
Ensure Participation
by Stakeholders
Access to Best
Advice
Regulatory function
Justify Extraordinary Powers

NNTT
AHRC
Avoidance of
Conflict of Interest
International
convention
Agency
Constitutional
Rationale







2.19 Even where the independence of a non-Court agency can be justified on a number of
these grounds, this does not necessarily compel that it be independent or fully independent.
These grounds are suggested as indicative tests which may contribute to a case for
independence being justified, rather than as criteria that, if met, necessitate independence.
For example, ITSA existed for many decades as effectively a Division of the AttorneyGeneral’s Department (albeit headed by departmental officers who were also statutory
officers) without any generalised complaint about lack of independence.
2.20 And, of course, the creation of an independent statutory agency does not come without
attendant cost. This extends beyond the mere monetary cost to the agency and the
Commonwealth Budget of maintaining separate accounts, annual reports, audit committees,
etc. (which may be as high as $500,000pa) that are incurred where the agency is not only
independent but also a Financial Management and Accountability Act 1997 agency.
Chapter 2 – Policy context
Page 12
Potential benefits of restricting the growth of such entities (or reducing their number) are
likely to include:
a.
reducing the number of points of entry to government, so that it is easier for the
public to interact with government;
b.
increasing the use of departments rather than stand-alone bodies allows for
flexibility through the refocusing of work when required by the government of
the day without requiring amendment of enabling legislation to change a body;
c.
increasing employee flexibility and reducing the costs associated with interagency transfers;
d.
maximising the application of accountability laws and processes—for example,
freedom of information, parliamentary accountability and Public Service Act
coverage;
e.
achieving savings in the oversight costs of responsible departments, central
agencies and integrity agencies3; and
f.
reducing any undesirable proliferation of separate cultures, practices, systems etc.
2.21 The first of the above points was also noted to in the 2005 Guide referred to above and
warrants further comment. Any unnecessarily large number of agencies means that the
workload of central agencies such as the Department of Finance and Deregulation and the
Australian Public Service Commission is increased. Perhaps more significantly, where
agencies are only small to medium in size, there is a real risk that this increase will be
disproportionately greater for the simple reason that administrators in those agencies may not
have familiarity and/or regularity of experience in dealing with matters such as New Policy
Proposals, major capital acquisitions, termination of staff, etc. This in turn means that they
may not achieve the best possible outcomes for their agencies in dealing with such issues.
2.22 For this reason portfolio Departments, and particularly those with small to medium
agencies, should provide a strong level of coordination and support to their agencies in their
dealings with central agencies. And portfolio agencies should seek and welcome that
Departmental involvement for the potential benefit it offers, and not regard it as in any way
detracting from agency independence. As noted above, substantive independence does not
necessitate self-reliance in the provision of corporate support.
2.23 Taking these factors into account, the Review recommends that the Government agree
that:
a.
there should be a prima facie presumption against creating any new independent
agency unless that course of action would be supported by the strength of the case
as indicated by the indicative tests identified above;
b.
in any subsequent review of existing agencies, there should equally be a prima
facie presumption that the functions of an already established independent agency
should be transferred to their portfolio Department or another appropriately
justified portfolio agency where the continued existence of that agency cannot be
justified by reference to the strength of the case as indicated by these indicative
tests;
3
In relation to a-e, see Review of the Measures of Agency Efficiency - March 2011 (Department of Finance and
Deregulation).
Chapter 2 – Policy context
Page 13
c.
d.
where one or more of these indicative tests are met, the strength of the case for
independence should then be critically assessed and not simply assumed; and
in each case the alternative of establishing an independent statutory officer within
the relevant portfolio Department should be actively explored.
The nature of independence
2.24 Most importantly, it must be stressed that independence is not an absolute quality.
2.25 Even where an agency is independent, the almost universal rule (apart from the
Auditor-General) is that it is the Executive, through the portfolio Minister, which is
fundamentally held accountable by the Parliament for the performance of both Departments
and portfolio agencies, through mechanisms such as annual reports, appearances before
parliamentary committees and other independent scrutiny including the Auditor General and
the Commonwealth Ombudsman.
2.26 Relevant legislation, while conferring independently exercisable powers, may
nevertheless also empower the Minister to issue directions that are binding on the
independent agency – for example, section 12 of the Civil Aviation Act 1988 allows the
Minister to issue general, non-case-specific, directions to the Civil Aviation Safety Authority
in relation to the performance of its functions, and sections 28 and 48A of the Commonwealth
Authorities and Companies Act 1995 allow the issuance of binding general policy orders.
2.27 Even without express powers of direction, other legislation clearly constrains the
activities of independent statutory agencies and their staff– such as the Financial
Management and Accountability Act 1997, the Public Service Act 1999 and the Freedom of
Information Act 1982.
2.28 And, of course, it is the Executive that formulates agency budgets for submission to the
Parliament in Appropriation Bills.
2.29 Very fundamentally in the context of this Review, it must be said that the possession of
full independence does not necessitate that an agency must be fully self-reliant – i.e., that it
must internally provide all its own corporate services in support of its substantive functions.
The Courts represent the strongest case for substantive independence. But even here,
although there were complaints about the adequacy of the service provided, there was no
sustained claim that their independence was compromised during the period in which the
Attorney-General’s Department (rather than the Courts themselves) provided the entirety of
their corporate support services.
2.30 Even where there is a compelling case for a substantive function being performed
within an independent agency separate from the relevant portfolio department, this does not
carry with it any necessary conclusion that the corporate services necessary to support that
substantive function should be provided entirely or at all from within the agency. Provision
of corporate support by a portfolio department, another agency or a private contractor need
not undermine the independence sought to be achieved by the establishment of the agency.
External provision of corporate support, if done well, need not detract from and can
potentially enhance the level of performance of an agency’s substantive function.
2.31 As already noted, independence does not necessitate that the agency must itself be a
separate agency under the Financial Management and Accountability Act 1997 or an
executive agency under the Public Service Act 1999. There are many examples of functions
being independently performed by statutory office holders who are themselves a part of a
Chapter 2 – Policy context
Page 14
Department or other agency, or who operate with the assistance of staff in respect of whom
they do not themselves possess the “employer” powers of a Secretary.
2.32 Rather, governance structures should be designed to ensure the best outcome for the
substantive function and without preconception as to form and status. As the Expenditure
Review Principles make clear, it is the entirety of the agency’s operation that is to be
assessed.
2.33 It is against the background of the above discussion of relevant policy settings that the
Review has undertaken its task of considering not only the individual agencies within the
scope of the Review but also the potential for greater use of shared services.
Recommendations
Recommendation 2
The Government should agree that:
a.
there should be a prima facie presumption against creating any new
independent agency unless that course of action would be supported by the
strength of the case as evidenced by the following indicative tests:
i.
international comity;
ii.
avoidance of conflict of interest;
iii.
to secure the conferral of extra-ordinary powers;
iv.
to distance government from regulatory intrusion;
v.
to ensure government access to best advice;
vi.
to ensure participation by stakeholders; and
vii.
to allow ministers and departments to focus on higher priorities;
b.
in any subsequent review of existing agencies, there should equally be a prima
facie presumption that the functions of an already established independent
agency should be transferred to their portfolio Department or another
appropriately justified portfolio agency where the continued existence of that
agency cannot be justified by reference to these indicative tests;
c.
where one or more of these indicative tests are met, the strength of the case for
independence should then be critically assessed and not simply assumed; and
d.
in each case the alternative of establishing an independent statutory officer
within the relevant portfolio Department should be actively explored.
Chapter 2 – Policy context
Page 15
CHAPTER 3 – SHARED SERVICES
Recent background on shared services
It is said from time to time that a larger agency should, through economies of scale, be able to
provide corporate services to multiple other agencies more cost effectively than a smaller
agency can provide those same services to itself. This concept is generally referred to as
“shared services” and the term is used in this sense in the Report.
3.2 At the State and Territory level, the Australian Capital Territory and the Northern
Territory have adopted whole of government approaches to shared services like payroll,
finance and HR, while the States are at various stages of adopting, or in Western Australia’s
case decommissioning, shared services centres4.
3.3 At the Commonwealth level, support for the proposition has been largely limited to
rationalisation of services within large departments, and more widely across the portfolio in
the case of Human Services.5 Beyond this, however, the Review has found little probative
evidence of a broader shared services approach being adopted at the Commonwealth level.
Indeed, the Attorney-General’s portfolio agencies under review (and some anecdotal
evidence in relation to other portfolios) provide some indications to the contrary.
3.4 While the prospect of gaining efficiency through shared services is intuitively
attractive, a careful and sound analysis is required before making significant financial
decisions to adopt a shared services approach. Such analysis should be expected of senior
Commonwealth managers charged with the “efficient, effective, economical and ethical use”
of Commonwealth resources in a manner not inconsistent with the policies of the
Commonwealth under section 44 of the Financial Management and Accountability Act 1997.
3.5 At the same time however, the Review considers that it would be wrong to dismiss the
proposition without further testing. If it can be shown to be correct, it may afford significant
savings across the Commonwealth.
3.6 This Chapter therefore summarises relevant information about shared services and
proposes a methodology for future testing of the proposition, at least in the short to medium
term. This methodology would not be inconsistent with and may support other measures in
contemplation to further test the potential of shared services.
3.7 The four most recent reports to the Government on shared services projects6 provide a
sober assessment of the potential pathways and pitfalls.
4
Government of Western Australia, News Brief, 11 July 2011,
https://www.oss.wa.gov.au/portal/page/portal/SSC_DMZ/Home/Library/ERA_Inquiry_News_Brief.pdf
5
Agencies centralising services such as HR, payroll and other corporate support services include the
Departments of Defence; Health and Ageing; Education, Employment and Workplace Relations; and
Immigration and Citizenship.
6
The 2009 Strategic Review of Future Directions for Shared Services - October 2009 (Vanderheide Strategic
Review); the Shared Services Feasibility Study - December 2010 (DoFD/PM&C/Treasury Feasibility Study);
Review of the Measures of Agency Efficiency - 2011 by the Department of Finance and Deregulation (Agency
Efficiency Review); and the KPMG Shared Services Business Case for the Commonwealth Courts (June 2011)
(KPMG Shared Services Business Case).
Chapter 3 – Shared services
Page 17
Vanderheide Strategic Review
3.8 A 2009 Strategic Review conducted by Mr Michael Vanderheide distinguished shared
services from centralisation, cluster outsourcing and purchaser-provider models. It found that
the shared services rationale offers long term potential to deliver improved efficiency,
consistency and reliability in the delivery of corporate services within the Australian
Government, but also that Australian and international experience shows that successful
implementation is difficult and that savings from shared services are not ‘low hanging fruit’.
3.9 The Vanderheide Strategic Review found that benefits are difficult to gauge and
implementation requires sound analysis, major up-front investment and strong and effective
governance to manage the risks (as evidenced by case studies) of overstated and undelivered
potential savings/benefits and understated complexities and costs.
3.10 The Vanderheide Strategic Review also found that:
a.
resourcing and workload data from 22 agencies in relation to finance and human
resource activity indicated significant variations in process efficiency and made
estimates of savings targets difficult;
b.
there was (and remains) a paucity of quality baseline data and benchmarking that
would assist a shared services business case analysis;
c.
experience in other jurisdictions suggested that the net efficiency gain of
integrating small agencies with already established corporate service options can
be marginal and that small agencies’ participation in shared services
arrangements can be problematic; and
d.
scope may exist for shared services savings and efficiencies in relation to the
establishment of new agencies.
3.11 The Vanderheide Strategic Review also drew attention to:
a.
the difficulty in finding a model that gives small agencies an adequate say in the
governance of a shared services operation alongside larger agencies; and
b.
the likelihood that a small agency will not require (and cannot therefore justify
the expense of) the level of sophistication and capability in financial and HR
systems that larger agencies may need.
3.12 In response to the Vanderheide Strategic Review, the Government agreed to adopt a
long-term objective of delivering cost effective support services and to further explore shared
services initiatives within government entities (other than CAC bodies). The Government
also commissioned a Feasibility Study into a shared services arrangement between the
Departments of Finance and Deregulation, the Treasury and the Prime Minister and Cabinet
to further test the shared services model (the 2010 Feasibility Study) and required the
Attorney-General’s Department to develop a business case for establishing a shared services
arrangement for transactional human resource and finance services for the High Court, the
Federal Court and the Family Court.
3.13 The Government also decided that ‘small’ agencies newly established under the
Financial Management and Accountability Act 1997 are now required to obtain their
corporate services from their parent agency or an existing shared services provider within the
Australian Government, unless a business case exists demonstrating the net benefits of the
new agency establishing separate arrangements.
Chapter 3 – Shared services
Page 18
The DoFD/PM&C/Treasury Feasibility Study
3.14 The 2010 Feasibility Study conducted between the Departments of Finance and
Deregulation, the Prime Minister and Cabinet and Treasury assessed the current processes of
the three central agencies against three shared services delivery models - ranging from
sharing current services with minimal changes to systems or processes, to a new systembased solution, and finally to a fully integrated shared services arrangement.
3.15 The Study’s preferred model was the status quo - i.e., with the agencies remaining
responsible for managing their own systems. It found that a shared services arrangement
across the three central agencies was “not viable”. The factors in support of this outcome
were:
a.
the lack of scale/critical mass (4,500 staff compared with 20,000 which had been
shown to be a typical minimum in other jurisdictions);
b.
currently divergent systems and business processes would increase
implementation costs;
c.
the current system carried a lower risk; and
d.
savings from the most advanced service delivery model over the assessment
period (eight years) would be only $4.7m, or about $200,000 per year per agency
- a five per cent saving over that time.
The Agency Efficiency Review
3.16 This 2011 Review analysed opportunities for agency efficiency. Findings included the
need to measure productivity in the public sector and again noted the dearth of meaningful
data in this area, preventing robust estimates of efficiency gains over time. Actions
recommended included undertaking benchmarking of common functions, developing a set of
principles to determine suitable government structures (and if necessary, reduce the number
of government entities) and a longer term process to standardise common processes (which
might include people, property, information and communications technology, and financial
management). It was noted that standardisation of common processes could enable greater
use of shared services models across the Australian Government.
3.17 Following consideration of the report on the Review, the Government directed the
Department of Finance and Deregulation to develop a Strategic Efficiency Agenda that would
help reduce costs across the Australian Government and help agencies to meet the demands
of the Efficiency Dividend and other cost pressures (for example, the requirement that wage
increases be absorbed or the need to offset New Policy Proposals). The Department of
Finance and Deregulation intends to collaborate widely across Australian Government, other
jurisdictions and industry to create a common understanding of what drives efficiency and
encourages best practice. This effort will have a substantial emphasis on understanding
business processes across government, how to measure their efficiency and identifying better
ways of delivering common (or generic) outcomes.
3.18 In this context, the Government also recently7announced further measures to drive
efficiency within Government, including:
7
Media Release: Senator the Hon Penny Wong, Minister for Finance and Deregulation, 29 November 2011
http://www.financeminister.gov.au/media/2011/mr_pw25311.html.
Chapter 3 – Shared services
Page 19
a.
b.
applying an additional 2.5% efficiency dividend to most Government agencies8
for the 2012-13 year (in addition to the existing 1.5% dividend); and
forming a Working Group, led by the Special Minister of State, and comprising
representatives of the Departments of the Prime Minister and Cabinet and
Finance and Deregulation, the Australian Public Service Commission and the
Community and Public Sector Union. This Working Group will advise on the
implementation of the increased efficiency dividend and wider public service
reforms.
3.19 As part of this work, the Department of Finance and Deregulation will also examine the
potential for shared services arrangements to apply where underlying businesses processes
are common across government, rather than on the basis that agencies share particular policy
goals or come within the same portfolio.
3.20 Agencies within the Attorney-General’s portfolio should desirably participate in this
process. Whilst doing so would not necessarily lead to greater use of shared services in the
Attorney-General’s portfolio, it could allow agencies to remove some of the existing
impediments and increase the viability of shared services in the longer-term.
KPMG Shared Services Business Case
3.21 The Courts’ business case on transactional aspects of finance and human resources
required by the Government’s response to the Vanderheide Strategic Review was undertaken
by KPMG and considered the Federal Court, the Family Court and the Federal Magistrates
Court but not the High Court. It reported in June 2011 and found that implementing
alternatives to the current model (under which the Family Court provides services for itself
and the Federal Magistrates Court, and the Federal Court is self-sufficient) would be unlikely
to lead to financial savings or service delivery benefits, at least within the confined
transactional functions which were the subject of the business case.
Findings of this Review
3.22 Amongst the agencies within Review scope there are a number of corporate services
practices that involve agencies not seeking to be entirely self-reliant:
a.
The Family Court and the Federal Magistrates Court, while remaining as separate
statutory and FMA Act agencies, have effectively merged their administrations.
This is not strictly speaking a “shared services” arrangement but has been
assessed as generating significant financial savings, most of which have been
returned to the Budget.
b.
The AHRC provides the support services for IT, personnel and finance to the
Office of the Australian Information Commissioner (OAIC). The OAIC has its
own corporate section which handles some other work. This arrangement had its
genesis in the origins of both bodies which had originally been parts of the former
Human Rights and Equal Opportunity Commission. The arrangement persisted
despite the transfer of the former Office of the Privacy Commissioner from the
Attorney-General’s portfolio to the portfolio of the Prime Minister and Cabinet.
The Commissioner advised the Review that he considered that the AHRC could
8
The Family Court, the Federal Court, the Federal Magistrates Court, the AAT, SSAT and MRT/RRT have
relevantly been exempted from the additional 2.5% efficiency dividend.
Chapter 3 – Shared services
Page 20
provide corporate services more efficiently and more economically than the
Department of the Prime Minister and Cabinet.
A Memorandum of Understanding (MoU) was entered into to govern the
provision of those services. It defines the services to be provided in some detail.
However, it does not adequately specify the level of service quality to be
provided. Instead, it simply provides that “The Commission will provide the
Services to the OAIC at a standard necessary to comply with the Australian
Public Service employment and financial obligations and other relevant
legislative requirements.”
The formation of the OAIC in 2010 placed extra demands on the shared services
arrangement because the OAIC works from two offices in Sydney and Canberra,
has extra staff, an expanded range of functions and activities and different
security requirements, and has been reviewing and changing many of the work
practices of the former Office of the Privacy Commissioner. There has been
regular discussion between AHRC and OAIC, including about the priority and
levels of services provided.
c.
d.
While OAIC was a part of the portfolio of the Prime Minister and Cabinet at the
commencement of this Review, it has now reverted to the Attorney-General’s
portfolio from 1 November 2011. Had that occurred earlier, it would have been
within the scope of this Review. The Review has thus given some consideration
to that MoU and makes a related recommendation later in this Chapter.
It is common amongst the agencies under Review for them to acquire some
corporate services other than on a completely self-reliant basis. To the extent that
they are required by Government decision to acquire services under whole of
Government contracts (such as IT, air travel, advertising, etc), they of course do
so. However, it is also common for agencies to “piggy-back” on other contracts
negotiated elsewhere within the portfolio or the broader public sector where they
perceive that it is cost-effective to do so – these instances include cleaning, legal
services and other procurement processes.
In this latter regard, a number of agencies noted that, while they had largely
abandoned “hard-copy” libraries, they still required electronic access to many
law-related publications, but there was no “whole-of-portfolio” or “whole-ofGovernment” purchasing arrangement to allow licences for electronic material to
be acquired otherwise than on an individual (and costly) agency-by-agency
basis.9
The Attorney-General’s Department has implemented a limited range of shared
services arrangements with relevant agencies to date, providing services to
support the “high side” secure network for a number of agencies both within and
external to the portfolio as well as some property services. The Department will
also shortly host the IT infrastructure to support the Personal Property Security
9
A recent preliminary assessment by the Department of Finance and Deregulation of the merits of a whole of
government coordinated procurement for electronic subscription services in general found that the
Commonwealth annual expenditure of approximately $32m was insufficient in scale and comprised too many
submarkets to justify proceeding further, as it would not generate sufficient benefits to government.
Chapter 3 – Shared services
Page 21
e.
Register for ITSA, and is working to co-locate parts of AUSTRAC, the Office of
the Australian Information Commissioner, and potentially DFAT within the
Department’s property footprint. The Department is also looking at options to
provide payroll services to another agency.
In some cases agencies have actually ceased providing some corporate services to
themselves in favour of contracting them out to private sector service providers.
3.23 At the same time, the Review found a very understandable reluctance by agencies to
relinquish all control of the corporate services that are necessary to sustain their substantive
functions.
3.24 Some agencies have what prima facie appears to be a well-founded belief that the
Attorney-General’s Department could not provide the service they require at the same or a
lesser cost - for example, while the Department needs and operates highly capable and
expensive systems such as Aurion and SAP, smaller agencies are meeting their own needs
and achieving unqualified audit statements using far cheaper, albeit less-capable, systems
such as MYOB and Micropay.
3.25 Moreover, the generally negative perception of the service levels likely under a shared
services arrangement is understandable given the current lack of precedent frameworks to
assist providers and recipients to agree on the terms and conditions of a service level
agreement and to effectively enforce it. While such frameworks are prevalent for contracted
private sector providers to government, the same cannot be said for intra-government service
providers and their government ‘clients’.
3.26 Some agencies within Review scope believe that the Attorney-General’s Department
would not be as responsive to their needs for timely support services, especially where it is
essential to avoid delay in their substantive work. While the experience of the Office of
Parliamentary Counsel (OPC) in this regard is very dated, ITSA’s experience in the years
following its split from the Department in 2000 is somewhat more current. However, it is
significant that such experience has not been against a clearly agreed framework of service
level standards.
3.27 The Review gathered data from each agency under Review about the quantum and level
of the resources they deployed to key corporate services such as human resources, financial
management, facilities management and IT (see Appendix 15). As was the case in the
Vanderheide Strategic Review, discrepancies in the methodology used to report staffing
levels or resourcing mean that these figures are of themselves unable to tell the full story,
without more intensive ‘drilling down’ beyond the scope of this Review. Generally speaking
however, these figures tended to “cluster” fairly closely, with “outliers” being those which
were expected – for example, a higher than average IT spend at AUSTRAC. Noticeable
issues, also consistent with earlier reviews, included the differing IT platforms and other
business processes used by these agencies.
3.28 However, because there is very little benchmark material available, it was not possible
for the Review to be completely satisfied that these figures were fully consistent with the
Expenditure Review Principles and reflected “the most efficient way achievable”.
Conclusion
3.29 The Review’s findings on sharing corporate services echo the work of the earlier
reviews, in that the lack of reliable data on agencies’ corporate services prevents a
Chapter 3 – Shared services
Page 22
meaningful assessment of where efficiencies might lie across the portfolio or within
Government more generally.
3.30 There appears to be currently inadequate evidence to support any general proposition
that the provision of corporate support to small-to-medium (or indeed any) agencies by their
portfolio department (or by another portfolio agency) would necessarily be more (or less)
economical than self-provision by those agencies, let alone more (or less) efficient. At the
least, what is required is relevant or sufficiently comparable data that would provide
confidence in a business case assessment and which would enable the proper testing of
assumptions about costs, benefits and potential efficiencies.
3.31 To now mandate the general implementation of shared services across all or part of the
Attorney-General’s (or any other) portfolio on the current levels of information would
therefore present a significant risk, given that the ‘critical mass’ of staff is relatively low,
there are significant implementation costs and risks due to differing systems, and the case for
likely efficiencies is unknown.
3.32 However, this is not to say that the concept of shared services or other cross-agency
corporate service provision should be abandoned, as the existing shared services
arrangements undertaken by the Attorney-General’s Department and the ongoing transition
between the Family Court and the Federal Magistrates Court shows. Rather, it would be
preferable that the information necessary to allow the concept to be tested on an agency-byagency basis be now developed. In Chapter 5, the Review outlines a process to further test
the concept of shared services within the Commonwealth’s Courts, and similarly in Chapter 6
for the National Native Title Tribunal. In the balance of this Chapter, the Review proposes a
process for testing the potential of shared services across agencies more generally.
3.33 From the perspective of the individual agency, management knows what it is spending
on its corporate support and is able to control not only expenditure but the level of service it
receives. In deciding whether to keep supplying its own corporate services or to outsource
them, it can also obtain detailed service offerings from private sector commercial providers
and in so doing can expect those offerings to set out:
a.
a detailed specification of each service to be provided;
b.
a service level standard agreed to be met for each service;
c.
a present price per service, and a methodology for any price increase over time;
d.
a “help desk” facility to speedily resolve any problems in service delivery;
e.
a dispute resolution process to deal with any more persistent problems in service
delivery, with an eventual capacity to resort to legal proceedings if necessary; and
f.
a specification of the consequences for failure to comply with contracted service
levels, which may include significant liquidated damages.
3.34 If a comparable offering was available from the Attorney-General’s Department (or
another suitably capable agency within the portfolio), then rational and properly accountable
decisions could be made on an agency-by-agency basis about whether, and to what extent (if
any), agencies should be self-reliant in their provision of corporate services in support of their
substantive functions or should acquire Commonwealth provided shared services. It is
acknowledged that development of such an offering would take some initial resources, which
may not be capable of being recouped, but that appears to be insufficient reason to not
develop such an offering given the possibility that it may allow significant efficiencies to be
generated through a resultant provision of shared services.
Chapter 3 – Shared services
Page 23
3.35 In respect of some services, agencies may be able to take up such an offer in the short
to medium term and gain early advantage. In the case of other services, it may be that the
need for IT systems changes would make migration uneconomical in the short term, and a
longer term view and managed approach might need to be adopted to allow shared services
arrangements to be implemented at a later time. By way of example, in the areas of Finance,
HR and Records Management, the Government requires that, when existing applications are
replaced, the applications are to be implemented without being customised.
3.36 The Review thus recommends that the Attorney-General’s Department (or another
portfolio agency agreed by the Attorney-General) should prepare a business-like proposal
setting out in a “corporate services business offering”:
a.
those (properly defined) corporate services that it is able and prepared to provide
to other agencies within the portfolio;
b.
the service level specifications at which those services would be provided;
c.
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
d.
the financially justifiable price at which each such service would be provided.
3.37 Once that material was available, soundly based decisions would be able to be made,
within agencies and across the portfolio, as to whether or not individual agencies should, in
conformity with the Expenditure Review Principles, provide their own corporate support
services, acquire those services from a commercial provider, or acquire them from their
portfolio department or other portfolio agency provider.
3.38 Accordingly, the Review further recommends that, once the Attorney-General’s
portfolio “corporate services business offering” is available:
a.
it should be made available to the Attorney-General and the Minister for Finance
and Deregulation; and
b.
all agencies within the portfolio should be required to review and compare the
offering to their existing corporate services provision arrangements and report to
the Attorney-General and the Minister for Finance and Deregulation on whether
or not they intend to access that offering and their rationale for doing so.
3.39 There appears to be no reason why this process would not potentially be equally
pertinent to other portfolios.
3.40 The Review thus further recommends that, to allow the concept to be more widely
tested, the Government should similarly require each department (or a portfolio agency
agreed with its Minister) in other portfolios with significant numbers of portfolio agencies
to do the same, and set a clear timetable for the preparation of those proposals, assessment of
them within portfolios, and reporting back to their respective Ministers and the Minister for
Finance and Deregulation, and through the Finance Minister to Cabinet.
3.41 The results of this process may also be of assistance in assessing the comparative
efficiency of Departments themselves, and may open up the possibility that agencies in one
portfolio might be able to acquire services from a provider in another portfolio (as indeed
was the case while OAIC was in the Prime Minister and Cabinet portfolio but acquired
services from AHRC within the Attorney-General’s portfolio).
R
e
3.42 Noting the present arrangements between the AHRC and OAIC as discussed above, the
c
Review also recommends that:
o
m
m
Chapter 3 – Shared services
Page 24 e
n
d
a
t
a.
b.
AHRC and OAIC should seek to negotiate appropriate service levels for inclusion
within their MoU to replace the present inadequate specification in that
agreement; and
OAIC should not move to establish its own internal corporate support capacity
before operating under an MoU that includes appropriate service levels and, if the
preceding recommendations of this Review are accepted, before proper
consideration and assessment of the Attorney-General’s portfolio “corporate
services business offering” recommended above.
3.43 These service level standards, if well enunciated, may prove to be a very useful guide to
the development of the portfolio “corporate services business offerings” referred to above.
3.44 Finally, the Review recommends that the Attorney-General’s Department explore the
possibility of negotiating with publishers a “whole-of-portfolio” co-operative purchasing
arrangement to allow licences permitting access to relevant electronic legal publications to be
acquired otherwise than on an individual (and potentially costly) agency-by-agency basis.
The Department should also consider allowing agencies external to the portfolio access to
any resulting arrangement.
Recommendations
Recommendation 3.1
The Attorney-General’s Department (or alternatively a portfolio agency agreed by the
Attorney-General) should prepare a business-like proposal setting out in a “corporate
services business offering”:
a.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
b.
the service level specifications at which those services would be provided;
c.
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
d.
the financially justifiable price at which each such service would be provided.
Chapter 3 – Shared services
Page 25
Recommendation 3.2
Once the Attorney-General’s portfolio “corporate services business offering” is available:
a.
it should be made available to the Attorney-General and the Minister for
Finance and Deregulation; and
b.
all agencies within the portfolio should be required to review and compare the
offering to their existing corporate services provision arrangements and report
to the Attorney-General and the Minister for Finance and Deregulation on
whether or not they intend to access that offering and their rationale for doing
so.
Recommendation 3.3
The Government should similarly require each department (or a portfolio agency agreed
with its Minister) in other portfolios with significant numbers of portfolio agencies to do the
same, and set a clear timetable for the preparation of those proposals, assessment of them
within portfolios, and reporting back to their respective Ministers and the Minister for
Finance and Deregulation, and through the Finance Minister to Cabinet.
Recommendation 3.4
Noting the present arrangements between the AHRC and OAIC:
a.
AHRC and OAIC should seek to negotiate appropriate service levels for
inclusion within their MoU to replace the present inadequate specification in
that agreement; and
b.
OAIC should not move to establish its own internal corporate support capacity
before operating under an MoU that includes proper service levels and, if the
preceding recommendations of this Review are accepted, before proper
consideration and assessment of the Attorney-General’s portfolio “corporate
services business offering” referred to in Recommendations 3.1 and 3.2.
Recommendation 3.5
The Attorney-General’s Department should explore the possibility of negotiating with
publishers a “whole-of-portfolio” co-operative purchasing arrangement to allow licences
permitting access to relevant electronic legal publications to be acquired otherwise than on
an individual (and potentially costly) agency-by-agency basis. The Department should also
consider allowing agencies external to the portfolio access to any resulting arrangement.
Chapter 3 – Shared services
Page 26
Chapter 3 – Shared services
Page 27
CHAPTER 4 – FINANCIAL VIABILITY: AN OVERVIEW
Overview of financial viability
The Review’s Terms of Reference require that it consider the financial viability of each
agency in its current form, within the scope of the Review. Appendices 1 to 13 include
comments in this regard for each such agency within the Attorney-General’s portfolio. Time
has not permitted the Review to give consideration to the financial viability of
Commonwealth administrative review bodies outside the Attorney-General’s portfolio.
4.2 This Chapter provides some overview comments on the financial viability of the
Attorney-General’s portfolio agencies. For this purpose, the Review has taken “financial
viability” to mean that an agency has now, and will likely have over the Forward Estimates
period, sufficient financial resources to deliver the functions or services expected of it by
Government.
4.3 On the basis of the information provided to the Review, it appears that most of the
Attorney-General’s agencies within the scope of the Review are, or are capable of becoming,
financially viable within a reasonable period and without additional funding (whether by way
of reallocation of resources from other portfolio agencies or other Budget supplementation).
Amongst this group, particular mention should be made of CrimTrac which has accumulated
large financial reserves from the fees it has charged to those parties that access its services.
The Review has not considered what should be done with those reserves, because that and
other CrimTrac specific issues are the subject of separate Government consideration.
4.4 However, a further comment is warranted in relative to a number of agencies which are
forecasting proportionately significant deficits.
4.5 First, the Review notes that the Administrative Appeals Tribunal predicts deficits over
the Forward Estimates, culminating in a deficit of $3.2m or around 10% in 2014-15. The
AAT’s position ought to be closely monitored in the coming period to see whether any action
is warranted beyond refinement and implementation of its Strategic Plan and in the light of
the results of the further review of efficiency measures amongst Commonwealth Tribunals
generally, if the recommendations in Chapter 7 of this Review are accepted by the
Government.
4.6 Far more significantly, when viewed as a group the Federal Court, the Family Court
and the Federal Magistrates Court (the Courts) predict the following deficits (the details of
which have not been able to be verified by this Review in the time available to it):
a.
2011-12: $6.6m
b.
2012-13: $13.1m
c.
2013-14: $16.5m
d.
2014-15: $19.5m.
4.7 While the 2014-15 predicted deficit may be only around 8% of the combined Forward
Estimates for the three Courts, the persistent upwards trend in these figures provided by the
Courts is particularly noticeable.
4.8 These predictions by the Courts are stated to have been made on a “business as usual”
basis – i.e., they are outcomes predicted to occur if no remedial action is taken, beyond that
already taken or committed. However, and very importantly, it should be stressed that these
Chapter 4 – Financial viability: an overview
Page 29
forecasts assume that rent supplementation for the Courts’ occupancy of the Commonwealth
Law Courts Buildings will continue at a level of the order provided in 2011-12. This is not
certain and is dependent upon the Government’s consideration of a separate review of Special
Purpose Properties being undertaken by the Department of Finance and Deregulation. It was
put to this Review that one possible option identified in that review would remove
supplementation without reducing rents for those buildings and that this could require
proportionally very significant expenditure cuts affecting each Court. As there is a separate
process to examine the rent issues as they would affect the Courts, this Review has not sought
to involve itself further in that issue. Clearly, any reduction in current funding levels for the
Courts’ occupancy of the Commonwealth Law Court Buildings would exacerbate the deficit
levels currently predicted by the Courts.
4.9 However, even with this rent issue resolved without adverse impact on the Courts, the
above projections provided by the Courts indicate an underlying and accelerating issue that
needs to be addressed.
4.10 The processes for seeking and gaining increases in efficiency and effectiveness that are
recommended in Chapter 5 may have the effect of reducing the forecast deficits to some
extent (assuming that there is no harvesting of resulting savings to the Budget), but it is too
early to indicate by how much. Even so, those changes are most unlikely to provide a
complete answer.
4.11 There is thus a real prospect that, even with successful implementation of those
efficiencies, there may remain an ongoing and material issue to be addressed. The Review
understands that the Courts have been developing plans to allow them to operate within
ongoing appropriations, and that the Family Court and the Federal Magistrates Court have
indicated to the (then) Attorney-General that these will likely involve significant cuts to
access and service.
4.12 Given the size of these potential deficits predicted by the Courts and their potential
impact on both the Courts and the public, the Review sought further information from the
Courts in addition to that provided in their initial questionnaire responses. This is discussed
further below.
4.13 The Review’s findings that the remaining agencies are capable of being financially
viable does not mean however that there is any particular level of “comfort” amongst them or
that there is much in the way of “low-hanging fruit ripe for the picking”.
4.14 More generally, the Review notes that all agencies have been financially impacted to a
greater or lesser extent by:
a.
ordinary fiscal measures applicable throughout the Commonwealth public sector
generally (such as the Efficiency Dividend to harvest productivity gains or the
repatriation to the Budget of accumulated capital fit-out depreciation); and/or
b.
agency-specific Budget measures (such as the recent harvesting of savings from
the Family Court, the Federal Magistrates Court and the Australian Law Reform
Commission).
4.15 At the same time agencies will generally have benefited from portfolio or Governmentwide procurement initiatives in areas such as air travel and travel management services,
advertising, legal services, whole-of-Government ICT coordinated procurement arrangements
(e.g. desktops, mobiles etc.), motor vehicle leasing and telecommunications, and will be
required to comply with those whole-of-Government coordinated procurement arrangements
Chapter 4 – Financial viability: an overview
Page 30
when reviewing and comparing alternative offerings to their existing corporate services
provision arrangements.
4.16 In this environment, the Review has been impressed by the number of reviews (as
referred to in Chapter 1 and the individual agency Appendices) that have been undertaken
into relevant agencies in recent years, either of their own motion or as required by
Government. The Review has noted the efforts that agency management have generally
made to pro-actively seek, and harvest for reinvestment, savings in many often small but
cumulatively not insignificant ways. And there have been clear examples of “doing more
with less”, such as the extent of the native title case management and mediation that the
Federal Court has undertaken without any additional resourcing.
4.17 The result of all of the above is that the Review has found only limited savings that
might now be taken – these are discussed in Chapter 6 in relation to the National Native Title
Tribunal.
4.18 However, the Review has also identified potential for either achieving further
efficiency and effectiveness or for quantifying future savings, or both. These are discussed
in:
a.
Chapter 5, in relation to the Commonwealth Courts;
b.
Chapter 6, in relation to the National Native Title Tribunal; and
c.
Chapter 7, in relation to Commonwealth Tribunals.
4.19 The Review notes the need for the Government, rather than the individual agency itself,
to have the opportunity to assess and decide whether any savings should be harvested for the
Budget or allowed to be reinvested by agencies. To ensure this, the Review has in each case
taken care to recommend appropriate governance, accountability and reporting arrangements
that will place the Government in a properly-informed position to take timely decisions.
The Commonwealth Courts
4.20 As noted above, when viewed as a group, the Federal Court, the Family Court and the
Federal Magistrates Court predict increasing deficits over the Forward Estimates period with
the combined annual projected deficit reaching $19.5m or around 8% of combined Forward
Estimates appropriations in 2014-15.
4.21 The Courts have indicated to the Review that these predicted deficits would use up their
remaining cash reserves. The Family Court has advised that it has already exhausted its
uncommitted reserves and is now spending amounts set aside to cover existing liabilities.
The Federal Magistrates Court has indicated that it expects to be in the same position before
the end of the current financial year. The Federal Court advised that its uncommitted
reserves are expected to cover its projected deficits over the Forward Estimates period but no
further. As a result, the data provided to the Review by the Courts suggests, on the face of it,
that there are questions to be addressed in relation to the ongoing financial viability of the
Courts at current activity levels and on the basis of current spending levels and practices.
4.22 The Review thus engaged with each of the Courts to obtain some additional
information regarding the historical and future pressures that have impacted, or that they
expect will impact, on their financial viability. The key data provided by the Courts or
otherwise available to the Review included information in relation to:

trends in appropriations;

trends in staffing and judicial resourcing;
Chapter 4 – Financial viability: an overview
Page 31

the Courts’ fixed costs;

workload and performance;

action already taken by the Courts to reduce expenditure;

forward pressures on Court budgets identified by them; and

options they have identified for further reducing expenditure.
4.23 It has not been possible, in the time available, for the Review to fully examine, analyse
and test the material provided in order to conclude one way or the other with adequate
confidence that the Courts are financially viable to operate at acceptable service levels within
their current and Forward Estimates appropriations and at currently experienced and
anticipated activity levels. However, the data does indicate that the financial position of
those Courts warrants further close attention.
4.24 The Review’s analysis in Appendices 1, 2 and 3 tends to suggest that the Courts’
expenditure on corporate services generally appears reasonable and efficient. It also appears
from the information provided by the Courts that salary levels under their enterprise
agreements, and their staffing profiles, are broadly consistent with the APS as a whole. It
thus seems that these factors are unlikely to be material drivers behind the current deficit
projections of the Courts.
4.25 This suggests that a range of other potential impacts warrant consideration, which may
include:
a.
workload trends, both lodgements and finalisations;
b.
any changes in jurisdiction or proportions of differing case types;
c.
changes in the numbers and mix of judicial officers;
d.
changes in work practices; and
e.
trends in appropriations and expenditure on other cost items.
4.26 The Courts have identified a range of measures already taken to generate internal
efficiencies or otherwise reduce expenditure, leading to savings being reinvested, returned to
the Budget or to offset the costs of other priorities in the Portfolio. (These are set out further
in Appendix 17.) These include savings made by not replacing some judicial officers on
retirement – this has provided estimated savings of $23m over a four year period.
4.27 The Review is not in a position to fully test the specific deficit projections made by the
Courts. However, if those projections were validated, it would appear that there are real
pressures on the Courts’ budgets given current activity levels and methods of operation,
particularly for the Family Court and Federal Magistrates Court. The Review’s consideration
of corporate and back-office functions suggests that things that the Courts have already done
and things that they might now do of the type recommended by this Review would not, of
themselves, generate sufficient savings to avoid the projected deficits.
4.28 Further consideration should thus be given to whether a cutback in substantive services
would be required for the Courts to function within their current and Forward Estimates
appropriations. Some of these issues go to the heart of the exercise of judicial functions
(which are outside the terms of Reference of this Review), and not just to the Courts’ support
structures and arrangements (to which this Review was predominantly directed). If a cutback
in substantive services is required, further consideration should be given to which possible
cutbacks should be implemented and what the impact on service delivery would be.
Chapter 4 – Financial viability: an overview
Page 32
4.29 The Review acknowledges that the financial position of the Courts has already been
considered in several previous reviews. However, examination of issues around the Courts’
viability requires a very close consideration of all items of Court expenditure, including those
directly connected with the exercise of the judicial function. None of the previous reviews
conducted appears to have included a sufficient level of detail or to have involved sufficiently
broad engagement with the Attorney-General’s Department and the Department of Finance
and Deregulation to resolve questions of the Courts’ viability or to analyse impacts on
substantive services. Such a detailed examination was also not possible in the timeframes of
this Review, given the wide scope of its exercise.
4.30 The Review therefore recommends that the Attorney-General’s Department undertake a
review of, and report to the Attorney-General on, issues affecting and options for ensuring the
Courts’ future financial viability. This further review should be conducted with the close
involvement of not only the Commonwealth Courts but also the Department of Finance and
Deregulation, and should draw on expertise in financial accounting, budget policy, justice
policy and court administration. The further review should:
a.
conduct a line-by-line examination of Courts’ previous and projected
expenditure;
b.
consider existing options to reduce expenditure, and identify further options that
may be available;
c.
identify likely impacts of each of the available options on court administration
and service levels; and
d.
develop an indicative priority list of the expenditure reductions and other
measures that should be pursued to avoid future deficits, with a focus on
minimising negative impacts on service levels.
4.31 The further review should of course be informed by Government decisions on
Recommendations 5.1 to 5.6 and 6.7 of this Review, and any decisions on the concurrent
Department of Finance and Deregulation review of Special Purpose Properties.
Chapter 4 – Financial viability: an overview
Page 33
Recommendations
Recommendation 4
The Attorney-General’s Department should undertake a review of, and report to the
Attorney-General on, issues affecting and options for ensuring the Courts’ future financial
viability. This further review should be conducted with the close involvement of not only
the Commonwealth Courts but also the Department of Finance and Deregulation, and
should draw on expertise in financial accounting, budget policy, justice policy and court
administration. The further review should:
a.
conduct a line-by-line examination of Courts’ previous and projected
expenditure;
b.
consider existing options to reduce expenditure, and identify further
options that may be available;
c.
identify likely impacts of each of the available options on court
administration and service levels, and
d.
develop an indicative priority list of the expenditure reductions and other
measures that should be pursued to avoid future deficits, with a focus on
minimising negative impacts on service levels.
Chapter 4 – Financial viability: an overview
Page 34
CHAPTER 5 – THE COMMONWEALTH COURTS
This chapter deals with three major issues of relevance to the Commonwealth Courts:
a.
structures for the administration of the Federal Court of Australia, the Family
Court of Australia, and the Federal Magistrates Court of Australia (and the
Military Court of Australia, when it is created);
b.
the application of the Efficiency Dividend to those Courts; and
c.
the use of Commonwealth Law Courts Buildings (other than the High Court
building in Canberra).
5.2 Court-specific detail is set out in Appendices 1 (Federal Court of Australia), 2 (Family
Court of Australia) and 3 (Federal Magistrates Court of Australia).
Administration of the Commonwealth Courts
Introduction
5.3 The section deals with structures for the administration of the federal courts, other than
the High Court of Australia. The Courts to which it relates are referred to as
“Commonwealth Courts”.
5.4
It takes as given the following propositions:
a.
the separation of powers entrenched in the Australian Constitution;
b.
the need to ensure that, within that framework, optimum use is made of public
resources; and
c.
the ongoing existence of the Family Court of Western Australia (which is not
separately discussed hereafter).
Traditional Commonwealth Court administration structure
5.5 The Federal Court of Australia Act 1976 and the Family Law Act 1975 respectively
declare that the Federal Court of Australia and Family Court of Australia comprise only their
judicial officers.
5.6 Traditionally all administrative support for each Court was provided by officers of the
Attorney-General’s Department and Chief Justices had no lawful capacity to direct the duties
of relevant departmental officers (unless so delegated by the Secretary of the Department).
5.7
In the estimation of the Review Leader, experience under this structure was that:
a.
Chief Justices either refrained from seeking to direct officers (which provided no
incentive for departmental officers to better serve the judicial arm of the Court),
or purported to direct those officers without legal authority or the associated
accountability (and often with adverse financial and other impacts for the
Department);
b.
officers assigned to the Courts were located distant from the departmental
executive and were largely ignored by the Canberra-based executive in terms of
day-to-day oversight;
Chapter 5 – The Commonwealth Courts
Page 35
c.
d.
the departmental executive generally had no relevant experience, qualification or
interest in the discipline of courts administration and were more focussed on core
government policy issues; and
as a result, neither administrative efficiency nor budgetary discipline was a matter
of priority in or for the Courts.
5.8 Should there be a return to the traditional structure, all of these issues would be capable
of being remedied so long as the Department focussed closely on any court responsibility
assigned to it. Notably this model is adopted in all States and Territories (other than South
Australia) and, while courts in those jurisdictions often complain about it, State and Territory
governments are generally not moved to alter the regime (although this may be changing –
there are recent proposals to move to some form of non-departmental/self-administered
arrangement in Victoria).
5.9 However, even if those issues were remedied, under this model there would still be a
gap between responsibility for judicial performance (which would rest with the heads of
jurisdiction) and responsibility for administration (which would rest with the Secretary) in
circumstances where first principles suggest that optimum efficiency of the Court system will
be optimised if both the judicial arm and the administration arm work in close and
accountable harmony.
5.10
A potential advantage of the traditional model might be thought to be that the
Department could require the Courts to receive some “back office” functions, such as
personnel and financial processing, from the Department’s corporate services area rather than
these being provided solely by staff assigned exclusively to the Courts. This would be
appropriate where, due to economies of scale, it was more economical for such services to be
provided in this way. However, such economies should not be automatically assumed and
the proposition needs to be tested because:
a.
it is possible that relevant departmental systems are more complex and thereby
more expensive to install, maintain and operate than the systems needed for the
Courts (and other small or medium agencies) which may already be obtaining
such services at comparable or lower cost and at better service levels; and
b.
even if the Courts are administered independently of the Department, there is no
reason why they could not choose (or be directed) to obtain such services from
the Department where this was demonstrably more economic and efficient.
5.11
Of course, even if the Courts are administered independently of the Department,
it would necessarily continue to provide portfolio coordination and government-level policy
advice (whether or not it was also a “back office” service provider).
5.12
The traditional administration structure for the Courts can be depicted
diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 36
Diagram 5.1: Traditional Courts Administration Structure
Commonwealth Courts self administration in the 1990s
5.13
In 1991/92 the Commonwealth moved away from the traditional structure
described above and implemented a “self administration” structure under which all
responsibility and resources for running each Court were transferred to it. The Department
retained (and still retains) its portfolio coordination and government-level policy functions.
For a time it continued to provide some “back office” support; however, over time each Court
moved these functions in-house (or outsourced them to contractors other than the
Department) and became fully administered independently of the Department.
5.14
In each case the legislation provided that the Chief Justice was responsible for the
administration of the Court and was assisted in that regard by the Registrar/CEO.
5.15
Immediately following its introduction, the self administration model could be
depicted diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 37
Diagram 5.2: Commonwealth Courts Self Administration - as originally
implemented
Parliament
Attorney General
Attorney-General’s
Department
Secretary
Division A
Division B
Federal
Court of
Australia
Family
Court of
Australia
Judicial Officers
and Staff
Judicial Officers
and Staff
Division C
Coordination
of all
portfolio
agencies
including
courts
5.16
The Financial Management and Accountability Act 1997 introduced a new
element into the Chief Justice – Registrar/CEO relationship in two ways:
a.
notwithstanding that the Court legislation declared that each Court consisted only
of its judicial officers, the FMA Act Regulations declared that the Court
comprised only its Registrar/CEO and their Public Service Act staff; and
b.
notwithstanding that the Court legislation declared that the Chief Justice was
responsible for the administrative affairs of the Court, the FMA Act Regulations
established an apparent incongruity in that they declared that the Registrar/CEO
was the Chief Executive of the Court as a “prescribed agency” for the purpose of
the FMA Act and Regulations.
5.17
The passage of the Public Service Act 1999 and associated amendments to the
Courts’ legislation also reflected a qualification on the responsibility of the Chief Justice for
the administration of the Court that was inherent in the original self administration
provisions, in that employer powers in respect of staff employed under that Act were vested
in the Registrar/CEO rather than the Chief Justice.
5.18
It would be inappropriate for financial and employer powers under the FMA Act
and the Public Service Act, which are a feature of the Executive branch of Government, to
Chapter 5 – The Commonwealth Courts
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be conferred on the Chief Justices as jurisdictional heads of the judicial arm of Government.
Such powers should properly reside with the head of the administration supporting each
Chief Justice.
5.19
Implementation of the recommendations of this chapter will involve some minor
amendments to the legislation governing each of the Federal Court, Family Court and Federal
Magistrates Court and changes to the previously introduced but now lapsed Bill to establish
the Military Court of Australia. Given the concerns expressed above, further consideration
should be given as to whether it would be desirable that those amendments also include a
provision to formally recognise the relevant administration and not just the head and staff of
it, so that the FMA Act Regulations can more properly declare the administration rather than
the Court as the “prescribed agency”.
5.20
In 1999 the Federal Magistrates Service/Court was established. It exercises a
range of family law and general federal law jurisdictions, much of which is concurrent with
the respective jurisdiction of the Federal Court and the Family Court. The majority of
Federal Magistrates deal exclusively with matters within the family law jurisdiction; a
smaller number deal exclusively with matters within the general federal law jurisdiction, and
some deal with matters in both jurisdictions. Upon establishment of the Federal Magistrates
Court, the self administration model that applied at that time to the Federal Court and the
Family Court was again adopted but with one major qualification - it was required to access
much of the services and resources that it required through those other Courts rather than
being physically fully self administering. As a result it had only small staffing and
accommodation resources of its own.
5.21
Accordingly, at the end of the 1990s there were three separate Courts, each of
which was:
a.
an FMA Act prescribed agency; and
b.
funded to be administered either totally internally or, in the case of the Federal
Magistrates Court, partially internally and partially through the other self
administering courts.
5.22
Under this model, responsibility for the administration of the judicial and
administrative arms was aligned in both the Federal Court and the Family Court; in the
Federal Magistrates Court funding for both the judicial and administrative arms was
combined; although the Court was significantly dependent on the other two Courts for the
physical provision of necessary services and resources. This latter arrangement proved to be
problematical because the Federal Magistrates Court could not itself control the majority of
the services and resources that it required for its judicial purposes.
5.23
Commonwealth Courts administration at the end of the 1990s can be depicted
graphically as follows:
Chapter 5 – The Commonwealth Courts
Page 39
Diagram 5.3: Commonwealth Courts Administration at the end of the 1990s
Commonwealth Courts administration today
5.24
Whilst the Federal Magistrates Court remained relatively small compared to the
Family Court, the unusual basis on which the Federal Magistrates Court was established,
although problematic, was managed largely by the respective CEOs (and heads of jurisdiction
when necessary), but generally on an ad-hoc basis.
5.25
However, as the Federal Magistrates Court grew the problems around resource
and accommodation sharing became increasingly difficult and it was decided that ad-hoc
decision making should be replaced with a more structured vehicle to provide for principled,
consistent and transparent decision making.
5.26
In order to deal with these issues the Courts agreed to establish a governance
board. It was originally called the Family Law Courts Board, and later renamed the Family
Law Courts Advisory Group. This group initially consisted of the Chief Justice of the Family
Court, the Chief Federal Magistrate and the respective CEOs. The group was established in
2005.
5.27
This group made decisions about sharing resources, including use of family
consultants, registrars and accommodation. However, the Courts continued to operate as
completely separate entities and duplicated many administrative functions.
5.28
In 2008 the Government appointed Mr Des Semple to review arrangements
between the Family Court and Federal Magistrates Court to see if a more integrated system
Chapter 5 – The Commonwealth Courts
Page 40
for the delivery of family law services was warranted. The Semple Review, which
recommended a merger of the Federal Magistrates Court with the Family Court (and Federal
Court), was released in August 2008, and proposed a structure in which Federal Magistrates
would constitute a 'second tier' in the superior Courts. In May 2009 the Attorney-General
announced a restructure of the Commonwealth Courts, which was subsequently delayed
whilst the Government considered the implications of the High Court's decision in Lane v
Morrison for the proposed restructure of the Commonwealth Courts, and the formulation of a
proposal for an appropriate jurisdiction to determine military justice matters, including the
involvement of Chapter III courts.
5.29
In May 2010 the Government announced its decision on the future of the
Commonwealth Courts. Subject to passage of legislation:
a.
a new Military Court of Australia would be created with jurisdiction to try serious
service offences. Less serious offences, which comprise the vast majority of
service offences, will continue to be heard by summary authorities at unit level;
b.
the Federal Magistrates Court would be retained to hear general federal law
matters, with the Federal Court assuming responsibility for the administration of
the Federal Magistrates Court; and
c.
the Family Court would be the single court for all family law matters and would
be restructured into two divisions. Federal Magistrates exercising mostly family
law jurisdiction would be offered commissions in the lower division of the
Family Court. The Federal Court would continue to exercise its current
jurisdiction in its current form.
5.30
That legislation has not yet been passed by the Parliament.
5.31
In November 2008, ahead of the Government's announcement, the Family Court
and Federal Magistrates Court decided that it was timely, sensible and opportune to make
some more significant changes. These changes involved:
a.
merging all corporate and administrative services;
b.
having one CEO to head a joint administration; and
c.
expanding membership of the Family Law Courts Advisory Group.
5.32
The expanded membership reflected the integrated management and the Family
Law Courts Advisory Group now consists of the two heads of jurisdiction, the person holding
the offices of CEO of the Family Court and acting CEO of the Federal Magistrates Court, one
additional Family Court Judge, one additional Federal Magistrate and an Attorney-General's
Department representative.
5.33
The administrative merger produced considerable savings and, as a result, the
Government reduced the total appropriation for the two Courts by some $7.8m over four
years on the basis the new arrangements would generate savings to the Budget of that order.
Government reinvested $1.5m over 4 years in additional Family Reports resulting in a net
saving of $6.3m to the Budget over 4 years.
5.34
Because the administrative merger was not supported by legislative amendment,
there still remain in existence not only two separate Courts but also two separate Financial
Management and Accountability Act 1997 (FMA Act) prescribed agencies (notwithstanding
that the Budget savings had taken the savings estimated to arise from reduction of two FMA
Act agencies to one). The Courts estimate that the continued existence of two FMA Act
agencies for the one merged administration costs an additional $500,000 per annum in
Chapter 5 – The Commonwealth Courts
Page 41
maintaining dual accounting records, separate audit committees, etc., and when all associated
costs are included, in excess of $1.0 million per annum.
5.35
As noted above, the Government has announced its intention to create a Military
Court of Australia. The relevant Ministerial announcement made clear that that Court would
be administered by the Federal Court, much as the Federal Magistrates Court and Family
Court administrations have merged. A Bill to establish the Military Court was prepared on
the basis that it would be a separate FMA Act entity. The Bill lapsed with the calling of the
previous election.
5.36
In 2011-12, the resourcing for the three Courts totals some $271 million and a
human resource of 1,167 (including judicial officers and Registrar/CEO), divided as follows:
Table 5.1: Courts’ appropriation and ASL (2011-12)
2011-12 Departmental
Appropriation Budget10
2011-12 “ASL”
Estimate11
(‘000)
Family Court of Australia
129,766
572
Federal Court of Australia
88,907
36012
Federal Magistrates Court of Australia
52,025
234
TOTAL
270,698
1,167
5.37
By way of comparison, the 2011-12 departmental appropriation budget for the
Attorney-General’s Department is $222.127 million and its ASL is 1395 (although, the
Department does not of course share the high costs associated with judicial salaries and
property (primarily Commonwealth Law Courts Buildings) spread throughout Australia).
5.38
Accordingly, as at present and as foreshadowed, the structure for administration
of the Commonwealth Courts can be depicted graphically as follows:
10
11
Source: 2011-12 Portfolio Budget Statements – Attorney-General’s Portfolio.
Source: 2011-12 Portfolio Budget Statements – Attorney-General’s Portfolio.
The average staffing level numbers included in the Federal Court’s Portfolio Budget Statements excludes
judicial officers; the above estimate has been revised to include judicial officers for consistency across the
courts. The above estimate also includes the three judicial officers, whose work with other courts or tribunals
occupies all or most of their time.
12
Chapter 5 – The Commonwealth Courts
Page 42
Diagram 5.4: Commonwealth Courts Administration Today - as
announced
Options for the future
5.39
The following discussion seeks to identify a range of options for the
administration of Commonwealth Courts for the future. It does not purport to be exhaustive
and other options could possibly be suggested. In some cases, there may be sub-options that
could be developed.
5.40
The options canvassed below are those that are within the unilateral power of the
Commonwealth. Accordingly, the options do not include, for example, the concept of a
“National Superior Court” that would subsume the Commonwealth Courts and the Supreme
Courts of the States and Territories. Such more radical options could be expected to raise
constitutional concerns and are beyond the scope of the present review.
5.41
Each option recognises the announced intention to create a Military Court of
Australia.
5.42
It appears to be generally accepted that the Courts could achieve efficiencies in
various areas including human resource management, financial management, counter
services, property and libraries. Experience also shows that there should be significant
efficiencies in other areas such as facilities management, information technology
development, video conferencing, etc.
Chapter 5 – The Commonwealth Courts
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Option 1 - Maintain the status quo
5.43
a.
b.
Maintaining the status quo would not:
resolve the present problem confronting the Family Court and the Federal
Magistrates Court whereby, despite their merged administration, they remain two
FMA Act agencies, continue to bear the burden of that dual reporting (which they
estimate at $500,000 pa), and have already had a reduction in appropriations
based on their becoming one FMA Act agency; or
give the Government any confidence that diseconomies of or inefficiencies in the
present separate self administration regimes would be overcome.
Option 2 - Revert to the traditional Commonwealth Court ‘Departmental’
administration model
5.44
Reverting to the traditional Commonwealth Court departmental administration
model would allow the Government, through the Attorney-General’s Department, to drive the
pursuit of economies that might be available through common administration. At the same
time, however, it would carry the risk of a recurrence of the problems previously experienced
before self administration was introduced.
5.45
It would be a matter of judgment for the Government where the balance of these
perceived benefits and risks might lie.
Option 3 - Legislatively support merger of the administration of the Family Court and
the Federal Magistrates Court, and the administration of the Federal Court and the
proposed Military Court
5.46
a.
b.
This option would involve:
amendments to the Family Law Act 1975 and the Federal Magistrates Act 1999
only to the extent necessary to allow the existing administrative arrangements in
the Family Court and the Federal Magistrates Court to operate as intended - that
is, there would cease to be two FMA Act agencies within the joint administration,
and a single CEO position would be recognised; and
any legislation to establish the Military Court would be accompanied by
amendments to the Federal Court of Australia Act 1975 to ensure that there
would be a single FMA Act agency containing the joint administration for the
Federal Court and the Military Court with a single Registrar position – i.e., the
Military Court would not be a separate FMA Act agency as had originally been
proposed.
5.47
This option would allow savings of the present unproductive cost of duplication
of record-keeping, etc, and avoidance of a similar cost when the Military Court is created.
However, it would not otherwise provide any greater potential for economy or efficiency
beyond that already achieved by the Family Court and Federal Magistrates Court acting as
they have done to date, or in the Government’s proposed model for administration of the
Military Court. Nor would it offer any mechanism for achieving efficiencies or economies
across Commonwealth Courts more generally.
5.48
While the result of this option would be that there would be a single
appropriation for the Family Court and the Federal Magistrates Court combined, and a second
appropriation for the Federal Court and the Military Court combined, the Portfolio Budget
Statements could provide individual “sub-program” splits of the combined total amounts,
Chapter 5 – The Commonwealth Courts
Page 44
providing an “order-of-significance” indication of the amounts which the Government and
the Parliament expected would likely be spent on each of the individual Courts.
5.49
The combined Family Court/Federal Magistrates Court administration would
review the current service provision and develop an updated Memorandum of Understanding
or other agreement with the Federal Court (and future Military Court) administration for
services provided by it in support of federal magistrates hearing general federal law matters.
5.50
This option could be depicted diagrammatically as follows:
Diagram 5.5: Option 3 - legislatively support merger of the administration
of the Family Court and the Federal Magistrates Court and of
the Federal Court and Military Court
Option 4 - Administratively foster greater cooperation between the separate
Commonwealth Courts
5.51
The Courts already work together to some extent in a number of areas including
information technology and property and facilities management. However, outside the
Family Court/Federal Magistrates Court, these joint activities have been characterised by a
degree of informality and the absence of any over-arching governance structure involving
heads of jurisdiction to provide strategic direction or a forum for resolving differences or
disputes across administrations.
5.52
Under this option, the Heads of Jurisdiction of the Federal Court, the Family
Court, the Federal Magistrates Court and, if and when it is established, the Military Court
would, by Memorandum of Understanding between them, meet no less than quarterly to
discuss and agree upon a program of work for the examination and, where feasible and
desirable, the implementation of initiatives for joint or shared administration across the
Courts.
Chapter 5 – The Commonwealth Courts
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5.53
Such initiatives would be primarily directed to the achievement of increased
efficiency and effectiveness in the managements of the Courts, but might also identify
financial savings that could be either re-invested within the Courts or returned to the Budget.
5.54
The Heads of Jurisdiction, in setting the program of work and in deciding upon
the results of work completed or in progress under that program, would be advised by the
Registrar of the Federal Court/Military Court and the CEO of the Family Court/Federal
Magistrates Court.
5.55
Given that, as noted below, the Heads of Jurisdiction would periodically report to
the Attorney-General on the progress and outcomes of the work program, a representative of
the Attorney-General’s Department would be invited to attend these meetings in an observer
capacity so as to better facilitate the Department’s briefing of the Attorney-General on those
reports, and provide information about the broader operating environment relevant to this
group.
5.56
The Heads of Jurisdiction could, of course, invite any other person to attend and
participate in these meetings.
5.57
The first meeting would establish and prioritise projects to be undertaken within
the program over the following 12 months, and establish timetables for each project.
5.58
a.
b.
c.
Each subsequent meeting would:
receive a joint report from the Registrar/CEO of progress on each project since
the preceding meeting;
review the priorities and timetable for each project, and update the forward work
program to cover a rolling 12 month period; and
take decisions about any completed project.
5.59
Projects would be undertaken by project teams drawn from the Courts, reporting
to a Steering Committee comprising at least the Registrar/CEO. External consultants would
be engaged as necessary. The Steering Committee would report to the Heads of Jurisdiction
between scheduled meetings as appropriate or directed.
5.60
The Heads of Jurisdiction would report to the Attorney-General on the work
program and outcomes twice yearly, and would include appropriate detail on an annual basis
in each Court’s Annual Report. Reports to the Attorney-General might, as necessary in the
interests of commercial confidentiality or other sensitivity, be more detailed than the material
included in the Annual Reports. If the Attorney-General considered that the Courts were not
addressing the work program quickly enough or in the highest priority order, or if she
disagreed with emerging conclusions, she would thereby have the opportunity to draw these
concerns to the attention of the Heads of Jurisdiction.
5.61
The matters that would be covered by the work program would involve at least
the following:
a.
Corporate services:
i.
human resources;
ii.
payroll and leave;
iii.
information technology support;
iv.
property allocation and usage;
v.
facilities/asset management;
vi.
procurement;
Chapter 5 – The Commonwealth Courts
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vii.
records management (archive/storage covering electronic and hard copy);
viii.
libraries;
ix.
communications and media;
x.
audit – internal compliance;
xi.
protective security; and
xii.
financial and budget management.
b.
Registry services:
i.
Case initiation; and
ii.
joint counters.
5.62
Further detail on the activities covered under these headings is at Appendix 18.
5.63
By extension, if the Government also agrees to adopt Recommendation 6.7 in
Chapter 6 (in relation to the NNTT), NNTT corporate and registry services would also be
included in cooperative arrangements between the Courts.
5.64
This option could be depicted diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 47
Diagram 5.6: Option 4 - administratively foster greater cooperation
between the separate Commonwealth Courts
Option 5 - Legislatively foster greater cooperation between the separate courts
5.65
This option differs from the previous option only in the sense that there would be
a legislative provision requiring the Heads of Jurisdiction to periodically consult and
commission studies designed to identify cooperative arrangements to assist each Court to
make best use of its individual resources. Expressly or implicitly, the provision would
acknowledge that acceptance or rejection of any proposals developed in this way would
remain a matter for the individual Head of Jurisdiction.
5.66
While such a provision may reinforce legislative interest in the exploration of
cooperative arrangements between the Courts and may positively require mandatory
consultation, it would not provide any greater assurance of positive outcomes than the
previous option. It may also reduce flexibility to adapt the mechanism for consideration of
cooperative arrangements as it developed. This option could be depicted diagrammatically as
follows:
Chapter 5 – The Commonwealth Courts
Page 48
Diagram 5.7: Option 5 – legislatively foster greater cooperation between
the separate Courts
Option 6 - Legislatively merge some administration of the Federal Court, Family Court
and Federal Magistrates Court (and the proposed Military Court)
5.67
This option would involve the creation of a common administration for the
provision of “back office” functions to each Court, while responsibility for “case
management” functions, and the associated support staff, would remain with each Court.
5.68
There would be a need to legislatively define at least those functions that were to
be conferred upon the common administration and this may prove a difficult task to achieve
with precision. However, probable common functions would be or include those matters
detailed in Appendix 18 with respect to Option 4.
5.69
There are potentially grey areas associated with case management
responsibilities, and this area would be more difficult to legislate. A robust process would be
required to define the functions in detail and ensure the equitable allocation of back office
Chapter 5 – The Commonwealth Courts
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staff and case management staff. Under-resourcing in one or the other could lead to service
delivery issues, thus having severe consequences for the judiciary and court users.
5.70
This option would be significantly different to the South Australian model, which
has all staff employed within a single agency (the Courts Administration Authority). Under
this option, a partial merger of administration would mean some staff would remain
employed by the different Courts, while others would move to a new entity. The most
common movement of staff between courts is between registry services, case management
and chambers staff. Therefore, the administrative overheads in managing staff movements
would remain a burden.
5.71
However, the potential for a more developed “back office” workforce with a
broader base of skills would be expected to provide an advantage in covering peak times and
workload shifts.
5.72
The option would either require the creation of an additional FMA Act agency, or
require the back office function for all courts to be within one of the existing FMA Act
agencies.
5.73
Creating an additional FMA Act agency would lead to a substantial
administrative burden and cost that would include the separation of funding from current
appropriations and increase the duplication in financial and annual reporting. The different
cultures and ideologies of each court would be further tested under this model. With back
office staff being separated into a new body separate from the Courts, there may be the
potential for cultural issues to develop.
5.74
On the other hand, locating the back office function for all courts within one of
the existing FMA Act agencies could lead to concerns about the level of service being
provided to the different courts, and may also create or exacerbate cultural issues.
5.75
This option could be depicted diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 50
Diagram 5.8: Option 6 – legislatively merge some administration of the
Federal Court, Family Court and Federal Magistrates Court
(and the proposed Military Court)
Option 7 - Legislatively merge all administration of the Federal Court, Family Court
and Federal Magistrates Court (and the proposed Military Court)
5.76
This option would extend the concept of one administration servicing multiple
courts to all Commonwealth Courts - the present (Family Court/Federal Magistrates Court)
and that announced (Federal Court/Military Court).
5.77
At the same time the option would see each court remaining as a separate entity,
and there would be no change to present responsibilities for judicial leadership of and
responsibility for the individual court.
5.78
Under this option, the separate administrative structures (but not the judicial
structures) of the Federal Court, Family Court and Federal Magistrates Court would be
collapsed into a single FMA Act agency. In maintaining independence from the Executive,
the judicial officers in each jurisdiction would comprise their respective courts, as is currently
the case under the respective Acts. While each Head of Jurisdiction would remain
responsible for the judicial leadership and functioning of his or her Court, a combined
governance structure would be responsible for the single administration.
5.79
This option would seem to provide the potential to optimise economies of scale in
the provision of the full range of court administration services, not limited to corporate
services and registry services in other options, and perhaps most importantly, break down the
Chapter 5 – The Commonwealth Courts
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current siloed approach between the Courts in their use of, and requests for, resourcing and
infrastructure.
Council of Heads of Jurisdiction and Chief Executive Officer
5.80
This option would establish a governance body referred to for discussion
purposes as the Council of Heads of Jurisdiction (the Council). It is proposed that the
Council membership would comprise the Chief Justice of the Federal Court, the Chief Justice
of the Family Court, the Chief Federal Magistrate, the Chief Justice of any future Military
Court, and a Chief Executive Officer of the single administration. (The Chief Executive
Officer’s membership of the Council would differ from South Australia where the Courts
Administrator is not a member of the Council.)
5.81
Consideration would need to be given to the leadership model within the Council.
It would seem inappropriate to legislatively deem any one Head of Jurisdiction as the
“Chair”, or alternatively to provide that the chairmanship should periodically rotate. It may
be preferable to simply leave it to the members of the Council to select their own Chair. The
legislation could provide that decision making was to be by majority vote or, potentially, that
a vote was only operative if the majority included specified Heads of Jurisdiction.
5.82
Consideration could also be given to making provision for additional membership
of the Council to include, for example, appointees with specific skills such as financial
expertise, management acumen and commercial experience. This type of arrangement, while
more normally adopted in agencies with a commercial focus, exists in courts administration
in other countries such as Ireland and the Netherlands.
5.83
The legislation would require the Council to administer, through the Chief
Executive Officer, the totality of the Courts’ financial, staff and property resources so as to
ensure that the administrative support needs of each Court from time to time were most
efficiently met. To this end the Council would have available to it all such resources, in
contrast to the present situation where each Court can access only its individual finances,
staffing and property resources.
Operating structure
5.84
The single administration would be managed on a day-to-day basis by a Chief
Executive Officer (who, as noted above, would be a member of the Council). The Chief
Executive Officer would be responsible to the Heads of Jurisdiction through the Council and,
as is currently the case with the Registrar of the Federal Court and Chief Executive Officer of
the Family Court and Federal Magistrates Court, have no direct reporting relationship to the
Attorney-General or the Attorney-General’s Department. The Council would provide
strategic direction and oversight to the Chief Executive Officer.
5.85
This model already exists with several FMA Act agencies having the function of
the Chief Executive separate to the statutory function of the authority. These include agencies
such as the Australian Fisheries Management Authority, Australian Skills Quality Authority
and the National Health and Medical Research Council.
5.86
The sub-structure within the single administration would of course be a matter for
the Council to decide but it could comprise several groups, each headed by an “Executive
Director”. Possible groups could be:
a.
General law – case management support;
Chapter 5 – The Commonwealth Courts
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b.
c.
d.
Family law – case management support;
Military law – case management support; and
Corporate services – back office staff and registry support.
5.87
In this way, jurisdiction-specific expertise could be maintained within a cohesive
dedicated structure, while cross-jurisdiction services could be provided in a manner best
designed to achieve efficiencies and economies of scale.
5.88
Under such a structure, Executive Directors would be responsible for their
individual group, and report directly to the Chief Executive Officer. Within the overall
budget appropriation for the single administration, each group could be provided with a
funding allocation to enable it to manage the functions of that group, but the existence of only
one Parliamentary appropriation (and other relevant resource conferrals, such as property
allocations) would provide flexibility for the Council and Chief Executive Officer to move
resources as necessary to meet emerging pressures.
5.89
All staff would be employed within and by the single agency, with staff internally
assigned to each group. This would enable flexibility, increase career options and mobility,
and reduce the administrative overhead should staff wish or be required to move between
groups.
5.90
While this option would involve the establishment of a new FMA Act agency,
under this model the Federal Court, the Family Court and Federal Magistrates Court (and
potentially the Military Court) would no longer be FMA Act agencies. Therefore, this option
would reduce the overall burden and cost currently experienced in the administration of
separate budget appropriations and reporting.
5.91
It is acknowledged the different systems, cultures and services of each individual
Court may take some time to integrate; however, once this is achieved there should be other
long term benefits:
a.
with the appropriate level of training, the ability to redistribute resources based on
workload requirements becomes more readily available, thus providing a more
flexible and holistic service to the different jurisdictions;
b.
there should be a significant reduction in the duplication of effort, particularly in
corporate support areas such as human resources and financial management, thus
creating a more effective and efficient administration;
c.
having a single administrative body would provide a flexibility that is not
currently available to the Courts; and
d.
the structure should provide for stronger assurance to Government that existing
resources are being used as effectively as possible, thus removing a potential
obstacle to future bids for any necessary increased funding.
5.92
This option could be depicted diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 53
Diagram 5.9:Option 7 – legislatively merge all administration of the
Federal Court, Family Court and Federal Magistrates Court
(and the proposed Military Court)
Option 8 – Abolish the Federal Court, Family Court and Federal Magistrates Court to
form one unified Commonwealth Court
5.93
Under this option, each of the separate Courts would cease to exist completely,
and there would be substituted a single Commonwealth Court exercising the jurisdiction
currently conferred separately on the Federal Court of Australia, the Family Court of
Australia, the Federal Magistrates Court and, potentially, the Military Court of Australia.
The creation of jurisdiction-specific Divisions within the single Court would mean that only
those judicial officers with relevant expertise in the legislative and procedural subject matter
would be able to handle specific types of matters. The specialised nature of the work in each
jurisdiction means that judicial officers are not generally interchangeable across jurisdictions.
5.94
The single Court would be supported by a single administration.
5.95
It would thus be expected to achieve all efficiencies and economies in
administration that would be expected to be attainable under other models. It would
additionally provide a structure that could achieve efficiencies in the exercise of judicial
power. However, it is not immediately clear that these latter efficiencies would extend
significantly beyond those already achieved under the present model of separate judicial
structures. A potentially significant impediment to implementation would be the need for all
serving judicial officers to accept commissions on the new Court (although it would not be
essential that they relinquish commissions to their current Court).
5.96
This option could be depicted diagrammatically as follows:
Chapter 5 – The Commonwealth Courts
Page 54
Diagram 5.10: Option 8 – One unified Commonwealth Court
Assessment of the Options
5.97
The Review firmly believes and recommends that, at the least, Option 3
(Legislatively support merger of the administration of the Family Court and the Federal
Magistrates Court, and the administration of the Federal Court and the proposed Military
Court) should be implemented. However, it also considers that implementation of that
Option would be insufficient and that further action is ineluctable.
5.98
As to what further action should be taken, the Review considers that the realistic
choice for the Government at this time is between Option 4 (Administratively foster greater
cooperation between the separate Commonwealth Courts) and Option 7 (Legislatively merge
all administration of the Federal Court, Family Court and Federal Magistrates Court (and the
proposed Military Court).
5.99
The following discussion assesses each of the identified Options.
5.100
Option 1 (Maintain the Status Quo) should be rejected outright. There are
efficiencies that can be realised. Doing nothing to achieve them is simply not acceptable.
5.101
Option 2 (Revert to the traditional Commonwealth Court administration model)
should be an option of last resort only. If this model were reinstated, the implementation
costs relating to system alignment and potential redundancies may be significant and would
require careful consideration. More importantly, unless it is demonstrably less efficient, a
regime of self administration by the Courts is firmly preferable to administration by the
Attorney-General’s Department. This is because it aligns responsibility with capability,
something the traditional model cannot do. Only the Head of Jurisdiction and the judicial
officers of a Court can achieve the substantive business of the Court. To do so they require
quasi-judicial and administrative support. If the latter operates at the direction of a third party
such as the Attorney-General’s Department, there can be no assurance that substantive and
support efforts will come together to produce an optimal outcome from the available
resource. If the judiciary, on the other hand, is able to direct the deployment of the support
Chapter 5 – The Commonwealth Courts
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resource, then it is placed in a position where it can deliver that optimal outcome by using the
available resource to best effect. It will be squarely responsible and accountable for the use
of public money. And, concomitantly, the Government will be properly responsible for the
provision of additional resources if the optimal outcome within the available resource is not
acceptable to the public – e.g., if, despite best use of available resources, waiting lists for
judicial determination become unacceptable.
5.102
Whether self administration is demonstrably less efficient than the traditional
model properly depends upon the performance of the Courts, individually and collectively. If
the Courts operate “in silos” or do not optimise their joint efforts, the opportunities for greater
effectiveness and efficiency that may be available through avenues such as shared services
initiatives, economies of scale and the identification and implementation of best practice will
not be achieved. The Courts, when combined, have a greater budget and almost the same
staffing level as the Attorney-General’s Department. Logic suggests that, properly
marshalled, they should be able to achieve greater efficiency and effectiveness than a more
multi-disciplinary Department of roughly the same size (although it needs to be recalled that
significant savings have already been achieved from combining the Family Court/Federal
Magistrates Court administration).
5.103
Option 3 (Legislatively support merger of the administration of the Family Court
and the Federal Magistrates Court, and the administration of the Federal Court and the
proposed Military Court) effects an immediate saving (most of which has already been
returned to the Budget) by eliminating unnecessary duplication. It is worthwhile, but it is not
enough because it does nothing towards achieving additional efficiency and effectiveness.
5.104
Over time the Courts have worked together to some extent to achieve efficiencies
and some savings. The successful merger of the administration of the Family Court and
Federal Magistrates Court is a significant achievement. Joint initiatives between the Federal
Court and Family Court are fewer and far less notable. As mentioned above, outside the
Family Court/Federal Magistrates Court, these joint activities have been characterised by a
degree of informality and the absence of any over-arching governance structure involving
heads of jurisdiction to provide strategic direction or a forum for resolving differences or
disputes across registries.
5.105
The real question is whether greater efficiency and effectiveness can be achieved
without substantial structural change. The Courts say that they can. They favour Option 4
(Administratively foster greater cooperation between the separate Commonwealth Courts)
and ask for the opportunity to prove that it can deliver results.
5.106
The Government should not accept a mere expression of future intent in relation
to matters of such significance. There must be a commitment at the highest levels to a
governance model that gives an acceptable level of confidence that issues will be pursued to
their logical conclusion, and to a reporting and accountability regime that allows the
outcomes of that pursuit to be monitored and assessed by the Government as well as by the
Courts themselves. Option 4 includes those features, and in this respect it is a marked
advance on the joint activities that have been undertaken to date.
5.107
If the Courts make Option 4 work, it has the potential to achieve almost as much
as Option 7 (Legislatively merge all administration of the Federal Court, Family Court and
Federal Magistrates Court (and the proposed Military Court)), which the Courts do not favour
because they say it would make a significant change in the essence of each Court individually
and to their collective relationship with one another. Option 7 would impose a statutory
obligation on Heads of Jurisdiction to take a whole-of-system view of the most effective use
Chapter 5 – The Commonwealth Courts
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of available resources, while Option 4 provides an environment in which they may choose to
do so. However, Option 7 would go beyond that and, as the Courts claim, it would
significantly change the nature of each Court and its relationship with each other Court. Its
implementation would also raise sensitive issues of who would chair the Council, and
whether the wishes of every Head of Jurisdiction could be over-ridden by the vote of the two
or three other Heads of Jurisdiction. Where the immediate concern is to achieve greater
efficiency and effectiveness in resource usage, there is no need to tackle these issues if
Option 4 can be shown to achieve the same benefits as Option 7 in that respect. Of course, if
Option 4 fails to generate results in a timely fashion, it would always remain open to the
Government to then implement Option 7.
5.108
The Review does not regard Option 5 (Legislatively foster greater cooperation
between the separate courts) as any material advance on Option 4 (Administratively foster
greater cooperation between the separate Commonwealth Courts). While it would provide
some legislative expression of expectation that the Courts would work cooperatively together,
the prospect of Option 7 as a likely alternative option is likely to provide far greater incentive
to demonstrate that Option 4 is all that is required to achieve greater efficiency and
effectiveness.
5.109
The Review does not favour setting any pre-determined time for assessment by
the Government of whether or not Option 4 has worked satisfactorily or whether Option 7
should be implemented in its stead. If the predetermined time is too short, it will not allow a
proper trial of Option 4; if the predetermined time is too long, it would unduly limit the
Government’s options and could induce a level of complacency. As noted above, the option
provides for Heads of Jurisdiction to report on their work program twice per year. This
means that, if the Attorney-General considered that the Courts were not addressing the work
program quickly enough or in the highest priority order or if she disagreed with emerging
conclusions, she would thereby have the opportunity to draw these concerns to the attention
of the Heads of Jurisdiction. It also means that she would have regular opportunities to
consider whether or not the Government should move to implement Option 7.
5.110
The Review also does not support adjusting the Forward Estimates in anticipation
of the outcome of the work program. This is for a number of reasons:
a.
as noted elsewhere in this Report (Chapter 4 and relevant appendices), the Courts
are currently under financial pressure and achievement of the efficiencies and
savings that may flow from the Option 4 work program may go some way
towards ensuring their ongoing financial viability;
b.
it would be premature to decide now the level of any financial benefit flowing
from the work program that should be harvested for return to the Budget – there
is simply not sufficient information available to assess the potential level of
financial benefit, or the amount of that benefit that might need to be retained by
the Courts to ensure ongoing financial viability; and
c.
setting any amount now would likely pre-destine that only that level of savings
was achieved and may deny the Budget of the benefit of any potentially higher
gain.
5.111
The Review does however acknowledge that the issues of predetermining review
periods or target savings levels are of course matters for decision by Government and views
contrary to those in the preceding two paragraphs are open. If the Government did wish to
set a predetermined date for reconsideration of Option 7, the Review would suggest 2 years.
Chapter 5 – The Commonwealth Courts
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5.112
The Review does not support Option 6 (Legislatively merge some administration
of the Federal Court, Family Court and Federal Magistrates Court (and the proposed Military
Court)) because it would result in more FMA Act agencies and more cost than is necessary.
5.113
Option 8 (Abolish the Federal Court, Family Court and Federal Magistrates Court
to form one unified Commonwealth Court) is not without its attractions. It would be expected
to achieve all efficiencies and economies in administration that would be attainable under
other options and it would additionally provide a structure that could achieve efficiencies in
the exercise of judicial power. The existence of separate Divisions within the Court would
allow the Government the capacity to ensure that those jurisdictions for which judicial
officers require particular background or suitability have the appropriate appointments.
5.114
However, it is not immediately clear that any efficiencies in the exercise of
judicial power would extend significantly beyond those already achieved under the present
model of separate judicial structures. Moreover a potentially significant impediment to
implementation would be the need for all serving judicial officers to accept commissions on
the new Court (although it would not be essential that they relinquish commissions to their
current Court).
5.115
The choice between Options, and particularly the choice between Options 4 and
7, is necessarily one for the Government. That choice inherently turns on which Option
would give the Government the greatest degree of assurance that available efficiencies and
improvements in effectiveness would be achieved – cooperative effort between the Courts, or
a significant structural change designed to “drive” the pursuit of those outcomes.
5.116
On balance the Review is prepared to recommend that the Government should
adopt Option 4 as sought by the Heads of Jurisdiction (but incorporating also the changes to
administration structures under Option 3). This is because it includes a governance structure
and reporting regime that will provide not only an incentive for achievement but also a clear
capacity for the Government to monitor success on a timely basis. If it accepted this
recommendation, the Government would of course retain Option 7 as a future possibility if
efficiencies and effectiveness are not adequately achieved through Option 4.
5.117
Adoption of Option 4 (or Option 7) would mean that the Federal Magistrates
Court was very closely integrated with the Family Court and that its relationship with the
Federal Court was enhanced. While the Federal Magistrates Court would continue to have
Federal Magistrates operating in both the family and general law streams, the Review queries
whether there would be any appreciable increase in efficiency or effectiveness from seeking
legislative amendments to the structure of that Court of the type previously announced by the
Government (as discussed in paragraphs 5.28 and 5.29 above).
5.118
Accordingly, the Review recommends that the Government not pursue further
legislative change to the structure of the Federal Magistrates Court at this time but, instead,
reconsider the need for any such action in the light of experience following implementation
of the recommendations of this Report and assessment of whether or not they have achieved
the increased efficiency and integration that motivated previous legislative proposals.
5.119
Finally, the Review has recommended in Chapter 3 that the Attorney-General’s
Department should prepare a “corporate services business offering” setting out:
a.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
b.
the service level specifications at which those services would be provided;
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c.
d.
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
the financially justifiable price at which each such service would be provided.
5.120
The Review therefore recommends that, once the Attorney-General’s portfolio
“corporate services business offering” is available, the Courts should be required to review
and compare the offering to their existing corporate services provision arrangements and
report to the Attorney-General and the Minister for Finance and Deregulation on whether or
not they intend to access that offering and their rationale for doing so.
The application of the Efficiency Dividend to the Commonwealth
Courts
5.121
From time to time it has been suggested, on various bases, that the
Commonwealth Courts should be exempt, or partially exempt, from the Efficiency Dividend.
The Review does not support such a proposition put in those terms.
5.122
The Efficiency Dividend is a relatively simple and predictable tool of general
application to all agencies, requiring efficiency gains to be found and returned to the budget.
It is applied to appropriations for the ordinary operating costs of government Departments
and agencies and, in particular, to:
a.
total net Departmental Appropriations in the General Government Sector, unless
they have been specifically exempted by a Government decision;
b.
Departmental Capital Budgets, Administered Capital Budgets and Collection
Development Acquisition Budgets;
c.
appropriations for other expenses of a departmental outputs type nature; and
d.
funding for all new policy initiatives following the year in which the new
measures are introduced into those appropriations.
5.123
In this context, the Efficiency Dividend has been applied by successive
governments consistently (and universally) across departmental expenditure, notwithstanding
that not all elements of that expenditure may be capable of yielding savings to contribute to
the Efficiency Dividend impost, and are in some cases ‘fixed’ costs – e.g., fixed term rent,
contracts of service, etc. This places pressure on agencies to seek efficiencies in other areas
to mitigate the fixed elements of their costs, or to operate more efficiently in areas where
fixed costs can be reduced over time (e.g. reduced tenancy areas). This is how the Efficiency
Dividend is intended to apply – those parts of an agency’s expenditure base that are
discretionary need to contribute more to the Efficiency Dividend than those parts which are
fixed or less discretionary. And, of course, in the longer term some currently fixed costs can
become discretionary or variable – e.g., at the end of a lease.
5.124
Only rarely has the Government granted exemptions from the Efficiency
Dividend. It has only granted partial exemptions to nine bodies, including the Department of
Defence, the ABC and SBS, Safe Work Australia, the Australian Nuclear Science and
Technology Organisation (ANSTO), CSIRO and the Australian Customs and Border
Protection Service (Customs). In respect of ANSTO, the exclusion applies to all its
appropriation except that 15% that is represented by administrative and corporate costs. In
respect of Customs, the exemption applies only to its significant fixed cost in respect of the
Coastwatch contractual arrangements.
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5.125
These exemptions offer little in terms of precedent, and certainly do not give any
clear support for a proposition that the Courts should be totally exempt from the Efficiency
Dividend or partially exempt in respect of any particular fixed costs.
5.126
Amongst their various costs, the Courts have two fixed cost elements that are
particularly significant and that are currently subject to the Efficiency Dividend. These are
judicial salaries and rental for Commonwealth Law Courts Buildings. Each has some special
features that warrant further consideration in the context of this Review. These issues are
discussed further below.
Judicial salaries
5.127
a.
b.
c.
d.
5.128
Judicial salaries are a significant component of each Court’s budget, comprising:
21.23% for the Federal Court;
12.09% for the Family Court;
44.45% for the Federal Magistrates Court; or
21.78% for the Family Court and Federal Magistrates Court combined (given
their shared administration).
There are two important points to note about judicial salaries.
5.129
First, section 72 of the Australian Constitution provides that a Judge’s salary
cannot be diminished during a Commonwealth judge’s tenure in office. It states as follows:
(i)
(ii)
(iii)
The Justices of the High Court and of the other courts created by the Parliament:
shall be appointed by the Governor-General in Council;
shall not be removed except by the Governor-General in Council, on an address
from both Houses of the Parliament in the same session, praying for such removal
on the ground of proved misbehaviour or incapacity;
shall receive such remuneration as the Parliament may fix; but the remuneration
shall not be diminished during their continuance in office.
5.130
While inclusion of judicial salaries in a Departmental Appropriation and
subsequent application of the Efficiency Dividend to the entirety of that Appropriation does
not of itself diminish the remuneration received by any judicial office holder, this would be
the effect if there were not sufficient other non-fixed costs within the Court’s budget that
were able to absorb the impact of the Efficiency Dividend and if the number of occupied
judicial positions remained unchanged.
5.131
Second, consistent with this provision, there are Standing Appropriation
provisions in each of the High Court of Australia Act 197913, the Federal Court of Australia
Act 197614 and the Family Law Act 197515 that specifically appropriate the salaries and
annual allowances of the Judges of each of the High Court, the Federal Court and the Family
Court. That is, it is unnecessary for the annual Appropriation Acts to make any provision for
the salaries and allowances of judges of any of these Courts.
5.132
High Court Judges’ salaries are paid out of a Special Appropriation. In contrast,
the practice has been to appropriate Federal Court and Family Court Judges’ salaries and
13
Section 12
Section 10
15
Section 25
14
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allowances in the Departmental Appropriations for each Court, thereby leading to the
application of the Efficiency Dividend to those amounts.
5.133
This current practice sits uncomfortably (but is not inconsistent) with the inherent
concept in the Australian Constitution that a Judge’s salary should not be diminished and,
moreover:
a.
is inconsistent with the practice that is followed in respect of the High Court;
b.
is unnecessary because of the express provisions in Federal Court of Australia
Act 1976 and the Family Law Act 1975; and
c.
does not reflect the established practice that Standing or Special Appropriations
are outside the application of the Efficiency Dividend.
5.134
Incorporating judicial salaries into the Courts’ Departmental Appropriation
effectively increases the Efficiency Dividend rate - for example the 2011-12 Efficiency
Dividend effectively increases from 1.5% to: 1.7% in the Family Court; 1.9% in the Federal
Court; and 2.4% in the Federal Magistrates Court, or 1.9% for the Family Court and Federal
Magistrates Court combined (given their shared administration). In practice, the effect is
broadly comparable across the three courts (as the Family Court and, to a lesser degree, the
Federal Court provide approximately $36.052 million16 (combined) worth of services at no
charge to the Federal Magistrates Court17).
5.135
The larger impact of the Efficiency Dividend is compounded by the significantly
longer term nature of judicial salary costs. Unlike the shorter fixed terms of most contracts,
judicial officers are appointed by the Governor-General and, once appointed, hold office until
the age of 70 or until they retire (in some cases terms of appointment have been over 30
years).
5.136
The Courts have no discretion to appoint or not appoint judicial officers and no
capacity to adjust the number of judicial officers once appointed. Further, like
parliamentarians (whose salary is also paid through a Special Appropriation), judicial officers
are a separate arm of government and are not part of the Executive.
5.137
For these reasons, the payment of judicial remuneration can be distinguished from
other statutory appointments, and from ordinary costs such as those under a contract or lease.
These differences do not justify exemption of the Courts from the Efficiency Dividend, but
do explain why special provisions have been made in legislation for the payment of judicial
salaries from Special Appropriations.
5.138
The current situation has, on occasion, worked to a Court’s benefit where there
has been an unfilled vacancy in a judicial position for part of the year, with the effect that the
unrequired part of the Departmental Appropriation remains available to the Court to be used
for purposes other than judicial salaries. However, in the medium to longer term this practice
has worked to the disadvantage of the Courts and should be expected to do so if it were to
remain.
5.139
Thus, for the reasons advanced above, the Review recommends that the
Government should consider, in order to better align with existing law, established practice
and Constitutional intent, funding Federal Court and Family Court judicial salaries by way of
the Standing or Special Appropriations already included in legislation rather than through
16
Federal Magistrates Court financial statements 2010-11.
The services provided free of charge includes the provision of family reports, accommodation, registry
services, registrar support and corporate services.
17
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Departmental Appropriations. While this would mean that the Efficiency Dividend no
longer applied to those judicial salaries, it would not constitute an exemption from the
general rule that the Efficiency Dividend applies to the entirety of Departmental
Appropriations.
5.140
a.
b.
It should be noted that:
this change would not deprive the Government of the opportunity to ensure
ongoing efficiency in the deployment of judicial officers – whenever there is a
judicial vacancy the Attorney-General proposes be filled, the matter is brought to
Cabinet which thereby has an opportunity to decide whether or not efficiency and
effectiveness within the relevant Court warrants that position being refilled; and
the cost associated with the change would be offset on those occasions on which
there was a vacancy in judicial office as salary and allowances for those periods
would no longer be available to the Courts for alternative uses as they are at
present. Instead, the short-term saving in a judicial salary would effectively be
treated as a fortuitous saving not available for use as an offset, save in the
occasional circumstances where a judicial vacancy is filled early.18
5.141
In contrast to the High Court, the Federal Court and the Family Court, there is no
Standing Appropriation provision in the Federal Magistrates Act 1999. The adverse impact
of applying the Efficiency Dividend to federal magistrates’ salaries is significant, as noted
above, and the arguments of policy and principle are the same, given that Federal Magistrates
are also Judges under Chapter III of the Australian Constitution.
5.142
Accordingly, the Review also recommends that the Government should consider
amending the Federal Magistrates Act 1999 to include a Standing Appropriation provision
and that, if such an amendment is made, that Federal Magistrates’ salaries and allowances be
made available under that Standing Appropriation. Similarly, the Government will have the
opportunity to test the availability of efficiency in the deployment of magistracy resources on
each occasion that a proposal to appoint a new or replacement federal magistrate comes
before the Cabinet.
Special purpose property expenses and the Efficiency Dividend19
5.143
The Efficiency Dividend is also applied to the whole of the rent debited to the
Courts for their occupancy of the Commonwealth Law Courts buildings and to the rent paid
by them for their occupancy of commercial buildings.
5.144
The Commonwealth Law Courts buildings are special-purpose buildings that the
Commonwealth has provided for the use of the Courts, for which they are unable to negotiate
their rental commitment, and which they are unable to vacate, convert to other uses or sub-let.
These commitments are for these reasons unlike other fixed rental commitments into which
ordinary Departments and agencies voluntarily enter. The Courts have no opportunity to
reduce their rent commitments in respect of these buildings in order to accommodate the
18
Occasionally a new Judge is appointed early because the Judge who they are replacing takes a period of long
leave prior to their specified retirement date (usually several months) – early appointments may be made where
there is a high caseload or backlog in the relevant registry that would be exacerbated by a temporary reduction
in numbers.
19
Special purpose elements of Commonwealth Law Courts Buildings include courtrooms, judicial
accommodation and public areas.
Chapter 5 – The Commonwealth Courts
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Efficiency Dividend, as opposed to other agencies that can terminate or not renew building
leases.
5.145
Moreover, rental commitments of the Courts are a particularly large proportion of
their budgets. Across the Courts, approximately 20% of the budget spend relates to rent
expenses. A large proportion of those rent expenses is for the special purpose aspects of the
Commonwealth Law Courts Buildings. These figures contrast with other agencies in the
scope of the Review, most of whom had property expenditure of 10% or less – there may of
course be other agencies with a higher property expenditure ratio.
5.146
The Review notes that the Department of Finance and Deregulation is,
concurrently with this Review, reconsidering how the special purpose elements of
Commonwealth Law Courts buildings should be funded. If that funding responsibility were
no longer that of the Courts, this aspect of the application of the Efficiency Dividend would
be resolved. Conversely, if Courts remained responsible for meeting the rent on the special
purpose elements of Commonwealth Law Courts buildings, the Review would recommend
that the method of payment for special purpose elements of Commonwealth Law Courts
buildings be adjusted so that, in effect, the Efficiency Dividend no longer applies to those
special purpose (as opposed to general clerical use) elements.
5.147
At the same time, the Review stresses that this does not mean that the Courts
should be excused from achieving efficiency in their use of the entirety of those buildings. A
proposal for the achievement of that efficiency is set out in the next section of this Chapter.
Use of Commonwealth Law Courts Buildings
5.148
This section deals with all special-purpose Commonwealth Law Courts Buildings
other than the High Court building in Canberra. Given that the High Court has occupancy of
space in the Commonwealth Courts Buildings in Sydney, Melbourne, Brisbane, Adelaide,
Perth and Hobart, this section does have potential implications for the High Court even
though it is otherwise beyond the scope of the Review. It has accordingly been consulted in
respect of this section.
5.149
As noted above, the Department of Finance and Deregulation is, concurrently
with this Review, reconsidering how the special purpose elements of Commonwealth Law
Courts Buildings should be funded. This section of the report is not concerned with funding
issues as such, but is instead concerned with ensuring that the best possible use is made of
those buildings.
5.150
The Commonwealth Law Courts Buildings in Sydney, Melbourne, Brisbane,
Adelaide, Perth, Hobart, Canberra and Parramatta occupy prime real estate and have been
purpose built for use by the Commonwealth’s Courts, including the High Court. They
markedly exceed the standard of accommodation provided by the Commonwealth for other
Commonwealth officers, including other holders of high office. While this is not
inappropriate, it does make it essential that the Government and the public have a high degree
of confidence that the associated cost is properly recognised and that the resources are put to
the best use.
5.151
The current allocation of space within these building for exclusive use of an
individual Court does not inspire that degree of confidence.
5.152
For example:
Chapter 5 – The Commonwealth Courts
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a.
b.
c.
d.
e.
f.
The Brisbane building is said to be at full capacity and yet it includes
accommodation used by the Administrative Appeals Tribunal, the Migration
Review Tribunal and the Refugee Review Tribunal.
In Sydney the Family Court and Federal Magistrates Court have constructed
courtrooms and chambers in commercial buildings to accommodate the needs of
the judiciary and their immediate support staff, while “back office” Federal Court
staff who are not “litigant facing” have remained in the Commonwealth/State
Queens Square building.
The notional (although not legally enforceable) allocation of designated floors or
areas of space within these buildings to individual Courts has not been conducive
to ensuring that available unused space is put to its best use across the Courts
viewed as a whole. For example, there are shared buildings where courtroom and
chambers space has been available but it seems that a reluctance to relinquish
control over the facilities has resulted in protracted negotiations regarding
allocation and has generated potentially avoidable costs.
Moreover, those notional allocations have not been realigned to reflect actual
occupancy for a number of years20. The Courts advised the Review that in this
regard a significant piece of work was commenced previously but had been put
on hold in 2008 while awaiting the outcome of the Semple Review.
Misalignment of occupancy and funding means that the impact of the Efficiency
Dividend on affected courts becomes distorted.
When the Federal Magistrates Court was created, it developed a Memorandum of
Understanding with the Federal Court and Family Court respectively, which
included the provision of accommodation. In some locations the courtrooms and
chambers to be allocated to the Federal Magistrates Court were set out in explicit
detail. While the nominal expiry dates on the MOUs have long passed, some of
the agreed service provisions regarding accommodation remain, notwithstanding
the exponential growth of the Federal Magistrates Court.
Libraries, conference rooms and common rooms are often duplicated within each
tenancy in the same building and the level of use of these facilities for their
designated purpose is unclear.
5.153
In other locations where there are no purpose built Commonwealth Law Courts
buildings, the Courts have predominantly entered into private leasing arrangements in
commercially owned premises – on occasions but not consistently with shared use by other
Commonwealth Courts or other Commonwealth agencies.
5.154
The Family Court and the Federal Magistrates Court (in its family law
jurisdiction) have a greater requirement than the Federal Court to service the community
outside the capital cities. As a result, the Family Court in particular has entered a material
number of private leasing arrangements in commercial premises, which have been leveraged
by the Federal Magistrates Court as part of the single administration. Nevertheless the
Federal Court and Federal Magistrates Court (in its non-family law jurisdiction) have a
potentially expanding need to provide services in regional centres – for instance the Fair
Work Ombudsman has expressed an interest in having unfair dismissal cases heard in
Townsville. Any expansion of the service provision in general federal law that requires a
20
More detail on occupancy is included in the respective appendices for each court.
Chapter 5 – The Commonwealth Courts
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presence in a particular location should leverage the existing staffing and accommodation
arrangements of the Family Court and Federal Magistrates Court.
5.155
While the Courts have examined the possibility of sharing accommodation with
State and Territory Courts in general terms, there have only been varying degrees of success.
There are ongoing agreements in a number of locations for the provision of courtrooms and
chambers to support circuits or special fixture sittings. However, aside from the jointly
owned Commonwealth/State Law Courts Building in Sydney, there are only two locations
where the Commonwealth Courts have registries co-located in State facilities.
a.
The Family Court has worked with the Department of Justice and the AttorneyGeneral in Queensland to negotiate the ongoing use of office space to
accommodate the family law registry in Rockhampton. This has proven a
resounding success and benefits both the Commonwealth and the State. Despite
rigorous attempts in Lismore, Albury and Dubbo, no other arrangements have
been agreed.
b.
The Federal Court has a registry presence in the Supreme Court in Darwin, which
includes the occasional use of courtrooms. However, the Family Court and
Federal Magistrates Court occupy a privately leased facility.
5.156
Taking into account the number of staff and the small amount of office space
required in some of regional locations, it may be beneficial for the Commonwealth to engage
with the States and Territories in attempt to assist their Courts in this area. In general terms,
with the exception of Newcastle, the space available in the privately leased regional premises
of the Commonwealth Courts exceeds the needs of those courts, and partnerships with the
State and Territory bodies could gain greater economies of scale across the board at both
Commonwealth and State/Territory levels.
5.157
Where space exists in Commonwealth Law Courts buildings, a more holistic
approach to servicing the needs of litigants might be considered. For example, the
Commonwealth Law Courts building in Adelaide has a low occupancy rate and yet the
nearby State Criminal Courts are understood to be under significant accommodation pressure.
The Review understands that on occasion space has been made available in the Adelaide
building for State civil matters. The Review suggests that consideration could be given by the
Commonwealth to engaging more generally with the States with a view to testing the
potential for a more strategic approach to the accommodation needs of courts generally.
5.158
The arrangements for exclusive allocation of courtrooms and chambers by each
Court are further impacted by the different information technology networks operating in
each of the Federal Court and the Family Court. The creation of the Federal Magistrates
Court made this issue more apparent, because some Federal Magistrates require access to
both networks. The ability to use accommodation in each location to its full potential is
restricted by operational issues related to network access. There have been some ad-hoc
capital works undertaken on a needs basis to ensure courtrooms and/or chambers are cabled
to accommodate both federal and family law jurisdictions. However, to ensure the optimum
use of courtrooms and chambers, it would be beneficial if each courtroom and chambers in
the Commonwealth could be used by any judicial officer in either jurisdiction with minimum
disruption. The Courts have advised that they are now working together to engage a
consultant to review their overall information technology strategic direction, and that this will
include developing options as to how technology may be provided and used in courtrooms
and chambers.
Chapter 5 – The Commonwealth Courts
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5.159
The above does not purport to be a complete or representative summary of the
situation across all locations. Nor should the complexity of the issues involved in optimising
use of the Courts’ accommodation (both Commonwealth owned or privately leased) be
underestimated. For example, the original decision to jointly own and manage the
Commonwealth/State building at Queens Square in Sydney undoubtedly seemed like a good
idea at the time but is now highly problematical.
5.160
However, it seems clear that there are increases in efficiency and effectiveness
that could be achieved in better management of Court accommodation and optimising use of
it across the Courts collectively and not just individually.
5.161
Accordingly, in order to make sure that best use is made of these buildings, the
Review recommends that the High Court, the Federal Court, the Family Court, the Federal
Magistrates Court, the Administrative Appeals Tribunal (in respect of Brisbane and
Adelaide), the Attorney-General’s Department and the Department of Finance and
Deregulation should be required to prepare for the Attorney-General and the Minister for
Finance and Deregulation a detailed strategic plan for their ongoing occupancy across all
tenants within those buildings.
5.162
The Review notes that Commonwealth Property Management Guidelines have
been issued by the Minister for Finance and Deregulation. These include the following:
It is a mandatory requirement for all agencies to have a property management plan
in place from 1 October 2010 to support the achievement of short, medium and
long term property objectives and to assist in demonstrating the efficient, effective
and ethical use of Commonwealth resources.
…
Property management planning should take into account the full inventory of an
agency’s property portfolio and associated costs.
5.163
The plan recommended by the Review would go beyond that required by the
Guidelines because it would not be confined to the inventory of an agency’s property
portfolio, but apply to the entirety of each building and across all tenant agencies. This plan
should:
a.
govern use of each building on a “whole-of-system” basis and without any
presumption of ongoing allocation of space for the exclusive use of any Court;
b.
seek to optimise the provision of common facilities such as libraries, conference
rooms, common rooms etc. for use of all building tenants;
c.
provide that the accommodation allocation for Public Service Act staff should not
exceed that otherwise applicable in the Public Service generally, unless
reconfiguration would be a more expensive option; and
d.
include a specification of priority uses for each building.
5.164
a.
b.
c.
It is suggested that an appropriate (descending) order of priority use could be:
Court rooms;
Hearing rooms (e.g., for registrars);
offices and other necessary facilities for judicial officers and their immediate
staff;
Chapter 5 – The Commonwealth Courts
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d.
e.
f.
g.
h.
i.
j.
k.
l.
m.
offices and other necessary facilities for court staff exercising direction,
mediation and similar powers through contact with litigants;
facilities for litigants attending proceedings in court and hearing rooms;
common counter facilities for litigants lodging or otherwise transacting business
in any court occupying the building, and accommodation and other necessary
facilities for staff of those counters;
accommodation for court staff directly engaged in case management activities;
accommodation for the most senior court administration staff;
Hearing rooms for Commonwealth tribunals;
office accommodation for temporary use by Members of those tribunals only
while hearing matters in those hearing rooms;
ongoing accommodation for tribunal members and case management staff;
accommodation for other court staff providing “back office” support; and
accommodation for back office staff of tribunal tenants.
5.165
By reference to this suggested listing and using the Brisbane building as an
example, as and when more space is required for the judicial function of the courts primarily
occupying that building, the first persons to be relocated elsewhere would be back office staff
of the Administrative Appeals Tribunal, then any back office staff of the Federal Court,
Family Court and Federal Magistrates Court, then members and case management staff of the
Administrative Appeals Tribunal, and so on – progressing up the list until adequate space
became available.
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Recommendations
Recommendation 5.1
a.
The Government should adopt Option 4 (Administratively foster greater
cooperation between the separate Commonwealth Courts) as sought by the
Heads of Jurisdiction (but incorporating also the changes to administration
structures under Option 3). Option 4 includes a governance structure and
reporting regime that will provide not only an incentive for achievement but
also a clear capacity for the Government to monitor success on a timely basis.
b.
The Government should retain Option 7 (Legislatively merge all administration
of the Federal Court, Family Court and Federal Magistrates Court (and the
proposed Military Court)) as a future possibility if efficiencies and
effectiveness are not adequately achieved through Option 4.
Recommendation 5.2
The Government should not pursue further legislative change to the structure of the
Federal Magistrates Court at this time. The Government should, instead, reconsider the
need for any such action in the light of experience following implementation of the
recommendations of this Report and assessment of whether or not they have achieved the
increased efficiency and integration that motivated previous legislative proposals.
Recommendation 5.3
Once the Attorney-General’s portfolio “corporate services business offering” is available,
the Commonwealth Courts should be required to review and compare the offering to their
existing corporate services provision arrangements and report to the Attorney-General and
the Minister for Finance and Deregulation on whether or not they intend to access that
offering and their rationale for doing so.
Recommendation 5.4
The Government should, for the reasons discussed above, consider funding Federal Court
and Family Court judicial salaries by way of the Standing or Special Appropriations
already included in legislation rather than through Departmental Appropriations.
Recommendation 5.5
The Government should also consider amending the Federal Magistrates Act 1999 to
include a Standing Appropriation provision.
Chapter 5 – The Commonwealth Courts
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Recommendation 5.6
The High Court, the Federal Court, the Family Court, the Federal Magistrates Court, the
Administrative Appeals Tribunal (in respect of Brisbane and Adelaide), the AttorneyGeneral’s Department and the Department of Finance and Deregulation should be required
to prepare for the Attorney-General and the Minister for Finance and Deregulation a
detailed strategic plan for the ongoing occupancy of Commonwealth Law Courts
buildings.
This plan should:
a.
govern use of each building on a “whole-of-system” basis and without any
presumption of ongoing allocation of space for the exclusive use of any
Commonwealth Court;
b.
seek to optimise the provision of common facilities such as libraries,
conference rooms, common rooms etc. for use of all building tenants;
c.
provide that the accommodation allocation for Public Service Act staff should
not exceed that otherwise applicable in the Public Service generally, unless
reconfiguration would be a more expensive option; and
d.
include a specification of priority uses for each building.
Chapter 5 – The Commonwealth Courts
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Chapter 5 – The Commonwealth Courts
Page 70
CHAPTER 6 - NATIVE TITLE FUNCTIONS AND
ADMINISTRATION
Introduction
This chapter canvasses options for:
a.
the performance of substantive native title functions currently undertaken by the
National Native Title Tribunal (NNTT) and the Federal Court; and
b.
administrative structures to support bodies performing those functions.
6.2 The High Court’s decision in Mabo v Queensland (No 2) in 1992 presented the
Commonwealth with a novel and challenging dilemma that had to be confronted quickly.
The resultant Native Title Act 1993 (NTA) establishes a complex regime under which
functions are distributed between the Federal Court and the NNTT. Some of these functions
are bestowed exclusively on the NNTT and others exclusively on the Federal Court. Some
other functions are undertaken by both the Federal Court and NNTT (such as mediation of
claims), and in some circumstances may also be undertaken by the private sector.
6.3 Under the NTA as originally enacted, the NNTT made determinations about the
existence of native title and those determinations could then be registered as if they were
orders of the Federal Court. As a result of the subsequent High Court decision in Brandy v
Human Rights and Equal Opportunity Commission in 1995, it became apparent that the
original distribution of native title functions between the NNTT and the Federal Court would
likely be held to be unconstitutional if challenged. Accordingly, significant change was made
to the role and function of the NNTT, so that all applications for declaration of native title
were made to the Federal Court and all determinations that native title existed were made by
the Federal Court and not by the NNTT.
6.4 Over time the Parliament has legislated to further change the role assigned to the
NNTT. For example, in 2007 the NTA was amended to give the NNTT sole responsibility
for the mediation of native title claims. More recently, further amendments reversed the 2007
changes and centralised the case management of native title claims, including allocating
claims for mediation, with the Federal Court.
6.5
Had the NNTT been created after the decision in Brandy it is fair speculation that the
original NTA would have been quite different in its allocation of roles and responsibilities
between the Federal Court and the NNTT. It is also fair speculation that the NNTT would
not have been designated as a “tribunal” as it has never had any merits review function and is
instead:
a.
a primary decision maker in its own right; and
b.
a provider of native title dispute resolution and assistance services, including
services that aid the Federal Court in the exercise of its judicial function.
6.6 Accordingly, the considerations to which the Review is having regard in respect of
those Commonwealth merits review bodies bear no relevance to the NNTT.
6.7 The native title landscape has evolved enormously over the period since 1992,
particularly through the work done by the NNTT and Federal Court – understanding of the
process and implications of native title are now much clearer to key stakeholders.
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6.8
In these circumstances, it is now appropriate to reconsider:
a.
whether all present native title functions should continue to be performed, or
performed at the current level, and how those functions should be resourced;
b.
the balance of responsibilities and resource allocation between the Federal Court
and the NNTT; and
c.
the future structure of the NNTT.
Substantive native title functions
6.9 The NTA identifies a wide range of native title functions. Of these, the principal
function is the determination that native title exists or has been extinguished. This is
necessarily a judicial function that can only be performed by a court, and it is conferred on
the Federal Court.
6.10 All other functions identified in the NTA are subsidiary to the assertion or
determination of native title. For example, mediation is a step in getting to the point where
the Federal Court can make a declaration acceptable to affected parties, while registration of
claims and future act regimes preserve land subject to a current but as yet unresolved native
title claim so that, if native title is eventually found to exist, its value will not have been
degraded by intervening acts. And, while indigenous land use agreements can be and are
negotiated in circumstances where there is not yet a formal claim or a determination that
native title subsists, an assertion of native title by a claimant provides the underlying
motivation of the parties to those negotiations.
6.11 While these subsidiary functions are an important contributing factor to the operation of
the native title system, not all such functions can properly be conferred on a Court – only
those that are ancillary to exercise of the judicial function can be conferred on a Court, and
the balance must be conferred on a suitable executive agency.
6.12 The NTA is somewhat unusual in its conferral of functions on the NNTT. While many
NNTT functions are mandatory and must be performed by it (for example, it must conduct
claim mediation when required to do so by the Federal Court, and it must assess claims
against the registration test when claimants require it to do so), other significant functions are
discretionary – the NNTT is empowered to undertake them, but cannot be compelled to do so.
6.13 It is thus essential to identify:
a.
each relevant native title function;
b.
which organisation has responsibility for each function;
c.
whether the function is mandatory or discretionary; and
d.
what resourcing level is devoted to each function.
6.14 The native title functions can be divided into three broad categories:
a.
decision-making;
b.
dispute resolution; and
c.
native title support services.
NNTT functions
6.15 Broadly, the relevant NNTT functions are:
a.
decision-making:
i.
registration of claims;
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ii.
iii.
registration of Indigenous Land Use Agreements (ILUAs);
determining whether the expedited procedure should apply to a future act;
and
iv.
future act determinations and arbitrations.
b.
dispute resolution:
i.
mediation of claimant and non-claimant applications;
ii.
mediation of future acts; and
iii.
negotiation of ILUAs.
c.
native title support services:
i.
maintaining registers;
ii.
notifications;
iii.
strategic/Regional planning;
iv.
reporting – native title system reports; and
v.
assistance/information including geospatial/mapping and research.
6.16 In addition to these functions, the NNTT has some other functions under the NTA
which it does not perform in practice. These are detailed below in the analysis of functions.
Federal Court functions
6.17 The relevant Federal Court functions are:
a.
decision-making:
i.
determining claims;
ii.
deciding who the parties are; and
iii.
appeals against NNTT decisions.
b.
dispute resolution:
i.
mediation of claimant and non-claimant applications; and
ii.
case management.
c.
native title support services:
i.
counter/information in connection with claims;
ii.
strategic/national planning (National Native Title Coordination Unit, Native
Title Practice Committee); and
iii.
reporting in connection with claims.
6.18 The following table (Table 6.1) contains a summary of each function, identifying those
that are mandatory or discretionary and those that could or could not be conferred on a Court,
and other key findings about each function. Appendix 19 contains detailed supporting
analysis.
Table 6.1: Summary of native title functions
Function
Description
Mandatory/
Discretionary
Allocation
Summary of findings about
function
DECISION-MAKING
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Determination
of claims
Determine whether
or not native title
exists and the
nature and extent of
that title
Mandatory
Federal
Court
Core judicial function, not
capable of being conferred on an
administrative agency.
Registration of
claims
Apply the
registration test to
native title claims
Mandatory
NNTT
Must be performed by an
administrative agency.
Registration confers valuable
rights for native title claimants.
The registration test is complex
and expensive to administer –
the Government could perhaps
consider simplifying the test.
Registration of
ILUAs
Apply the
registration test to
ILUAs
Mandatory
NNTT
Must be performed by an
administrative agency.
Registration binds non-party
native title holders. The
registration test is complex and
expensive to administer – the
Government could perhaps
consider simplifying the test.
Determine
objections to
expedited
procedure
When an objection
to expedited
procedure is
lodged, the NNTT
determines whether
or not the relevant
future act attracts
the expedited
procedure
Mandatory
NNTT
Must be performed by an
administrative agency. Enables
certain minimum impact future
acts to proceed expeditiously
Future act
determinations
Where no
agreement can be
reached, the NNTT
determines whether
or not a future act
may take place, and
any conditions
Mandatory
NNTT
Must be performed by an
administrative agency. This is a
Tribunal Member function and
cannot be performed by a
judicial member of the NNTT.
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DISPUTE RESOLUTION
Mediation of
claims
On the direction of
the Federal Court,
claims are mediated
prior to any
determination of
native title.
Mandatory
NNTT,
Federal
Court or
external
mediator
Currently, the NNTT conducts
the majority of mediations
because it has the resources.
There is no meaningful
difference in how the NNTT and
Federal Court mediate claims. It
would be preferable to
consolidate the mediation
function within the Federal
Court, which would align
responsibility for managing
claims to resolution with the
resources to do so.
Case
management
The Federal Court
case manages all
native title claims.
Federal Court case
management may
incorporate
mediation of
claims.
Mandatory
Federal
Court
Federal Court case management
has been very effective is
driving claims to resolution. It
is appropriate that this function
continue to be performed by the
Federal Court.
Negotiation of
ILUAs
Parties may request
NNTT assistance to
negotiate ILUAs
Discretionary
NNTT or
private
provider
Cannot be performed by the
Federal Court except in
connection with resolution of a
claim. Further consideration
should be given to whether this
function should be performed on
a fully or partially costrecovered basis
Mediation of
future acts
On request from
parties, mediate
among parties to
assist in obtaining
their agreement on
a proposed future
act
Mandatory
NNTT or
private
provider
Cannot be performed by the
Federal Court. Although a
mandatory function, if a cost
recovery regime were
implemented, consideration
could be given to extending it to
mediation of ILUAs to send
appropriate price signals
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NATIVE TITLE SUPPORT SERVICES
Maintenance
of registers
Maintenance and
searches of
registers of native
title, claims and
future acts
Mandatory
NNTT
Only the National Native Title
Register could be maintained by
Federal Court – keeping the
registers together is efficient.
Notifications
Notification of
claims and ILUAs
Mandatory
NNTT
Only claims could be notified by
the Federal Court –keeping
notification functions together is
efficient. Notification can be
costly – with a more developed
native title system, government
should consider whether more
limited notification might be
appropriate in future
Strategic/
regional
planning
Regional planning
meetings etc with a
view to agreeing
priorities.
Discretionary
NNTT
The NNTT’s work in this area
could be discontinued as this
work is now primarily achieved
through the Federal Court’s case
management function.
Native title
system
reporting
Various reporting
on the native title
system
Discretionary
NNTT/
Federal
Court
This function helps to assess the
state of the native title system –
for the function to be performed
effectively, input from various
stakeholders needs to be
consistent, particularly input
from the NNTT and Federal
Court
Information/
assistance
A wide range of
NNTT services
including help with
applications,
information,
geospatial,
mapping, research,
workshops,
seminars
Discretionary
NNTT
Some functions are crucial to the
native title system, particularly
geospatial and mapping.
However, some other functions
should probably not be a priority
– further consideration should
be given to which of these
functions should continue to be
performed. Further
consideration should also be
given to whether some of these
functions should be performed
on a fully or partially costrecovered basis
Other
statutory
functions not
performed in
practice
Detailed in
Appendix 19
Varies
NNTT
No expenditure is recorded
against these functions because
they have not been performed in
practice. The Government
should consider whether some
of these functions should be
removed from the legislation
Chapter 6 – Native title functions and administration
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6.19 Table 6.2 below provides a summary of the NNTT’s expenditure on its substantive
functions including, where available, on a cost per item basis. It does not include expenditure
on corporate services or ‘back office’ functions, which are discussed separately below under
‘Administration’. The data in this table needs to be treated with some caution, recognising
that much of the NNTT’s work is long-term, on a large scale and may stretch over several
years. In considering this information, it is also important to note that outcomes/items will
not always be comparable within and between functions.
6.20 Of the total expenditure by the NNTT of approximately $15 million in 2010-11 on its
substantive functions (excluding one-off savings measures), about $4 million related to
discretionary functions.
Table 6.2: NNTT expenditure on substantive functions
Function
Expenditure
Outcomes/items
2010-11 ($)
2010-11
Expenditure per
outcome/item
2010-11 ($)
DECISION-MAKING
Registration of claims
1,394,757
78 decisions
17,882 per decision
Registration of ILUAs
997,834
72 decisions
13,858 per decision
Expedited procedure
determinations
697,000
1464 objections
resolved, of which:
476 per objection resolved, or
Future act determinations
1,524,290
TOTAL: decision-making
4,613,881
57 determined
12,228 per objection
determined
96 decisions
15,878 per decision
446 outcomes:
- 11 fully resolved
- 191 milestones
(issues)
- 244 milestones
(process/framework)
4922 per outcome
200 outcomes:
- 56 fully resolved
- 144 milestones
5,973 per outcome
293 outcomes:
- 49 fully concluded
- 244 milestones
6,107 per outcome
DISPUTE RESOLUTION
Mediation of claims
Mediation of future acts
Negotiation of ILUAs
TOTAL: dispute
resolution
2,195,259
1,194,743
1,789,425
199,569 per fully resolved
21,334 per fully resolved
36,519 per fully concluded
5,179,427
Chapter 6 – Native title functions and administration
Page 77
Function
Expenditure
Outcomes/items
2010-11 ($)
2010-11
Expenditure per
outcome/item
2010-11 ($)
NATIVE TITLE SUPPORT SERVICES
Maintain registers
418,500
Notifications
534,666
Strategic/regional
planning
221,166
Reporting – native title
system reports
302,334
Assistance/information
1,371,667
TOTAL: native title
support services
2,848,333
409 assistance events,
products or services21
4092 per item
OTHER SUBSTANTIVE FUNCTIONS REPORTED IN QUESTIONNAIRE
Management and
administration /internal
governance
1,456,768
Strategic projects
202,556
Legal services –
substantive functions
318,612
One-off savings measures
4,765,852
TOTAL: other substantive
functions
6,745,493
Total: NNTT substantive
functions excluding oneoff savings measures
14,619,577
TOTAL: NNTT
substantive functions
19,385,429
Analysis of native title functions
Role of the Federal Court
6.21 The role of the Federal Court in native title is clearly defined, and derives from its
central role in determining native title claims, non-claimant applications and compensation
claims.
6.22 The Federal Court is legislatively responsible for case managing all native title claims.
Despite this, no resourcing for the claim mediation function was provided to the Federal
Court when the legislation was amended to confer that responsibility on it. Instead, the
Federal Court has undertaken its current level of claim mediation within its existing budget
and, to the extent that it is unable to do more, refers the balance of claim mediation to the
Outcomes/items in the NNTT’s 2010-11 annual report include ‘reporting’ within ‘assistance and information’,
but expenditure on the functions was split in the questionnaire
21
Chapter 6 – Native title functions and administration
Page 78
NNTT (which has traditionally been appropriated funds for this purpose) or to private
mediators (which happens only rarely).
6.23 It is apparent that Federal Court decisions about who should mediate a dispute are
based solely on availability of resources. The Court does not consider that particular claim
types are better mediated by the NNTT rather than by staff of the Court, and the Court does
not regard NNTT mediators as being more skilled than Court mediators. The result is that the
majority of mediations are performed by the NNTT as it is the body currently resourced to
perform native title mediations.
6.24 While the Review does not, and has no reason to, criticise the performance of NNTT
mediators, it is in the opinion of the Review inconsistent with the Expenditure Review
Principles to divorce responsibility and capability in this manner. If the Federal Court is
responsible for the mediation function, it (rather than the NNTT) should be resourced for that
purpose. Only then can it be held properly accountable for its performance of the function.
While no adverse inference should be drawn from this conclusion, inserting a layer of NNTT
management between the Federal Court and those who undertake mediation at its direction
appears to be unnecessary.
6.25 Accordingly, the Review recommends that funding and resources, including (nonMember) staffing, for the native title mediation function should be transferred from the
NNTT to the Federal Court. This does not require any substantive amendment to the NTA.
6.26 Because non-Member mediation staffing would transfer to the Federal Court, the
parties to current mediation matters would not experience any disruption due to the
intervention in their matters of new personnel in their stead. And, where NNTT Members
were involved in current mediations, the Federal Court could direct that they continue in that
role while they remained Members. Once the initial transition was achieved, the Federal
Court would thereafter simply allocate matters to mediation by Federal Court staff or an
external party. However, for certainty and clarity, it would be preferable to amend the NTA
within a reasonable timeframe to align the legislation with the change in administrative
practice.
6.27 This resource transfer would not only align responsibility with capability; it would also
offer the opportunity for financial savings while still maintaining current activity levels (and
the Review has identified no reason to justify any reduction in those levels at this stage when
there are still significant numbers of outstanding native title claims).
6.28 This is because, in the NNTT, mediation is primarily conducted by Members with
support from NNTT staff while mediations in the Federal Court are conducted by officers at
Legal 2 or SES Band 1 level and the level of support provided to Federal Court officers to
conduct mediation is less than the support generally provided in the NNTT to Members
(although this will vary depending on the complexity of the claim).
6.29 With NNTT Members on a salary of $201,180 (total remuneration package of
$280,590), and Deputy Presidents on a salary of $274,620 (total remuneration package of
$365,410), compared to Federal Court Legal 2 registrars on a salary of $132,438-137,629
(total package approximately $160,000) and SES Band 1 officers on a salary of $166,957
(total package approximately $220,000), there is clearly the potential to achieve savings once
the transfer is effected and personnel rationalised, given that the NNTT projects that, in
2011-12, its intended allocation of resources to mediation will be the equivalent of 2.61
Chapter 6 – Native title functions and administration
Page 79
Members supported by an additional 15.1 FTE of staff at a total cost of approximately $2m.22
It would be a matter for Government to consider whether those savings should be reinvested
in native title mediation, reallocated to other priorities or harvested to the Budget.
6.30 The Review therefore recommends that:
a.
further work should be undertaken by the Federal Court and the NNTT, in
consultation with the Attorney-General’s Department and the Department of
Finance and Deregulation, to identify the quantum of the savings that would be
achieved by conducting current mediation activity levels in the Federal Court
rather than the NNTT; and
b.
the Government should then decide whether those savings should be reinvested in
native title mediation, reallocated to other priorities in the native title system or
harvested to the Budget.
6.31 Given that there are currently approximately 160 matters in NNTT mediation, there
may, as noted above, need to be a transition arrangement for the transfer of resources to the
Federal Court if NNTT Members remain involved in particular matters to ensure that
proceedings are not unduly interrupted.
6.32 Apart from claims mediation there are some other NNTT functions that are ancillary to
the judicial function and that could therefore be performed by the Federal Court, such as
maintaining the National Native Title Register and notification of claims. However, these
functions are also closely connected to similar administrative functions (such as registration
of claims and ILUAs, and notification of ILUAs) that could not be conferred on the Court.
As a result, there is unlikely to be any efficiency gain and thus the Review recommends that
these functions would best remain with the relevant administrative agency performing those
similar administrative functions.
Role of the NNTT generally
6.33 As noted above, there are clearly a number of important native title functions that
cannot be performed by a Court because they are not ancillary to the judicial function. The
question is thus whether they should continue to be performed by the NNTT or whether they
might best be transferred to some other non-court agency. As noted in the introduction, the
existence of a so-called tribunal for native title, and the functions allocated to that tribunal
are, to some extent, an accident of history.
6.34 There is no legal reason why the NNTT’s responsibilities could not be undertaken by
the Attorney-General’s Department. At the same time, however, there is no reason to believe
that transferring these functions to the Department would lead to any increased efficiency in
the manner of their substantive performance (as opposed to efficiency in the provision of
support services, which is discussed separately below under ‘Administration’). While the
Department has a developed native title policy capacity, it has no relevant native title
administration expertise. In addition, allocation of the function to the Department could also
create a perception of a conflict of interest, because the Department also acts as the instructor
for native title litigation where the Commonwealth is a party.
Expenditure of $2.2m in 2010-11 was based on 21 ASL including Members – this has since reduced to
17.5ASL.
22
Chapter 6 – Native title functions and administration
Page 80
6.35 There is no other administrative agency outside the Department which has existing
functions that have any complementarity or synergy with the native title functions performed
by the NNTT.
6.36 The continued existence of the NNTT would undoubtedly be seen to be important to
native title stakeholders, and abolishing it without being able to demonstrate a better
substantive outcome could jeopardise the functioning of the native title system as a whole.
6.37 Accordingly, the Review recommends that the NNTT continue to exist as a separate
statutory entity (albeit with its mediation function and resources transferred to the Federal
Court as recommended above).
Funding for residual NNTT functions
6.38 Several of the NNTT’s mandatory functions have substantial costs attached but the
capacity to reduce the cost of performing those functions may be limited, especially where
the NNTT is required to make determinations only after applying complex statutory tests
(such as the registration tests for claims ($17,882 per decision) and ILUAs ($13,858 per
decision). However, the Government could consider whether statutory complexity, and
therefore cost of performance, could be reduced for these functions.
6.39 At the same time, a substantial minority of the NNTT’s workload is effectively
discretionary. Such a wide range of discretionary functions, and the wide discretion in the
level of resourcing of those functions, is unusual for bodies of this type.
6.40 In broad terms, much of the pioneering work performed by the NNTT, including public
information, planning and outreach has now delivered a mature and well understood regime.
In these circumstances, it would be appropriate for the Government to give further
consideration to whether all of the NNTT’s discretionary functions are necessary within this
more mature native title system.
6.41 Some of the discretionary functions (such as geospatial/mapping and negotiation of
ILUAs) continue to underpin the successful performance of other native title functions such
as determination of claims. These functions are important to the continued success of the
native title system, particularly the resolution of claims.
6.42 On the other hand, the ongoing need for some other discretionary functions, such as
regional planning and research, is not clear. In consultation with the Review the Federal
Court indicated, and the NNTT did not contest, that the regional planning work separately
done by the NNTT is now primarily handled through the Federal Court’s priority list.
6.43 In the time available to it, and given the complexity and sensitivity of the issues, the
Review has not been able to form any clear view on whether there are savings that should be
achieved in this area, or of the magnitude of them.
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6.44 The Review thus recommends that the Government should give further consideration to
the extent to which the NNTT’s discretionary functions should continue to be performed, and
to what extent those functions should be funded. To this end, the NNTT and the AttorneyGeneral’s Department (in consultation with the Department of Families, Housing,
Community Services and Indigenous Affairs (FaHCSIA)) should develop for consideration
by Government a plan for expenditure on discretionary native title functions. That plan
should deal with:
a.
the extent to which the NNTT’s discretionary functions should continue to be
performed, particularly strategic planning and research and publications; and
b.
whether resourcing should be reduced for any discretionary functions.
Cost recovery
6.45 Under the Expenditure Review Principles, consideration should also be given to
whether part or all of the cost of a Government activity should be recouped directly from the
beneficiaries of that activity. Given the comparatively high cost of native title discretionary
functions, it is particularly important that those functions are appropriately valued by native
title system participants.
6.46 However, while cost recovery by the NNTT for some or all discretionary functions may
be appropriate, this is by no means clear at this stage.
6.47 An example of a function where full or partial cost recovery may possibly be
appropriate is negotiation of ILUAs. Assistance with negotiation of ILUAs:
a.
is a service that can be provided by the private sector;
b.
is not necessarily linked to determination of a claim;
c.
often leads to financial advantage for parties to an ILUA; and
d.
is resource intensive (total cost of $1.78m in 2010-11).
6.48 The NNTT bases its decision on whether to provide assistance to such negotiations on
guidelines developed by it. Implementing cost recovery may enable extension of the
circumstances in which the NNTT is able to provide assistance where application of the
assistance guidelines would currently preclude it. Cost recovery may also extend the extent
and range of assistance that the NNTT is able to provide. But equally cost recovery may also
encourage participants to focus on achieving outcomes efficiently without recourse to the
NNTT.
6.49 However, the administrative impost of introducing cost recovery would not be
worthwhile if the effect was simply to lead to increased funding claims by representative
bodies on FaHCSIA. It is not clear that a cost recovery system could be implemented that
would avoid this outcome – further consideration is required. It is also likely that
introduction of cost recovery would require legislative change, at least for some functions.
6.50 Accordingly, the Review recommends that the plan referred to in the preceding
recommendation should also consider the efficiency of pursuing options for full or partial
cost recovery for NNTT discretionary functions designed to extend the NNTT’s capacity to
provide expert assistance and encourage parties to reach outcomes efficiently.
Chapter 6 – Native title functions and administration
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Possible new native title functions
6.51 In consultations with the Review, FaHCSIA indicated that consideration is being given
to introducing an agreements registration function to collect and analyse certain native title
agreements, and to report to Government on key trends and issues in agreement making. One
of the issues under current consideration is which body should perform this function if it were
to be implemented.
6.52 In the view of the Review, if Government does decide to introduce this function, the
NNTT could be a suitable body to perform it (subject to provision of appropriate resourcing).
This is because the function would be complementary to its existing functions and would
draw on the NNTT’s existing expertise and established role in the native title system.
6.53 However, the Review also notes that FaHCSIA and the Attorney-General’s Department
have identified that this registration function could also be allocated to the Office of the
Registrar of Indigenous Corporations, which also has some existing complementary functions
through its close work on governance of Aboriginal and Torres Strait Islander corporations.
Interaction between the Federal Court and NNTT
6.54 It is clear from the Review’s consideration of native title issues that effective
interaction between the Federal Court and NNTT is crucial to the functioning of the native
title system overall. The need for the two bodies to act in a coordinated fashion with respect
to planning, priorities and reporting, and the performance of complementary and
interdependent functions, is vital.
6.55 The question is how this should be best achieved, given that the Court and the NNTT
are and, under the preceding Review recommendations, would remain as separate entities.
6.56 In the following section, the Review recommends integration of the administration of
the Federal Court and the NNTT. The Review considers that, in addition to generating
savings and increased effectiveness of administration, that integration would of necessity
promote and foster that closer interaction between the Court and the NNTT in relation to the
mutually complementary substantive functions.
Administration
6.57 The preceding analysis of functions concluded that there is a continuing need to provide
most of the functions performed by the NNTT, and that, with the exception of mediation of
claims, the NNTT remains the appropriate body to perform those functions. However, that
does not mean that the corporate support services necessary for the performance of ongoing
NNTT functions should necessarily be provided by the NNTT itself.
6.58 A number of potential options for the future administration of the NNTT have been
considered by the Review. These are:

Option 1 – Status quo – the NNTT would remain as an independent, selfadministering FMA Act agency (albeit that its claim mediation function and
resource would be transferred to the Federal Court).

Option 2 – Informal cooperation with Commonwealth courts – without any
structural or legislative change, the NNTT could work cooperatively with the
Chapter 6 – Native title functions and administration
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various Commonwealth courts with a view to adopting and implementing any
identified economies or efficiencies in the operations of those bodies (as
discussed in Chapter 5).

Option 3 – Shared services (Attorney-General’s Department) - substantive
functions would remain with the NNTT but support services necessary for the
performance of those substantive functions would be provided by the AttorneyGeneral’s Department.

Option 4 – Shared services (other portfolio agency) - substantive functions
would remain with the NNTT but the support services necessary for the
performance of those substantive functions might be purchased by it from another
portfolio agency. Within the Attorney-General’s portfolio, the agency with the
greatest relevance to the NNTT is quite clearly the Federal Court.

Option 5 – Administration by another body - the NNTT would remain as a
separate statutory entity but would not be an FMA Act agency in its own right
and the funding necessary to enable the performance of its substantive functions
and corporate support for them would be included within the appropriation of
either the Department or another agency. Again, within the Attorney-General’s
portfolio the agency with the greatest relevance to the NNTT is quite clearly the
Federal Court.
Analysis of administration options
6.59 The above options need to be analysed against the Expenditure Review Principles.
Most relevantly:

Effectiveness:
activities have clear and consistent objectives, are effective in achieving
their objectives, and represent value for the expenditure of taxpayer money.

Efficiency:
programs are administered and delivered in the most efficient way
achievable, taking into account both short and long term economic and
fiscal consequences, and consideration is given to whether part or all of the
cost should be recouped directly from program beneficiaries.

Integration:
government agencies should work together effectively to consistently
deliver the Government’s policy objectives within clearly defined lines of
responsibility.
6.60 The Review does not support Option 1 – analysis and consultation as part of the
Review make it clear that there is scope for increasing the efficiency and effectiveness of the
NNTT’s administration through closer relationships with other bodies.
6.61 Given the potential for increased effectiveness already identified in respect of the
Commonwealth Courts (see under Option 4 of Chapter 5), Option 2 could be expected to
lead to some efficiencies in the area of corporate services if the NNTT participated in that
model. For example, the NNTT might be included in consolidation of libraries, finance or
HR services, and there may also be options for accommodating NNTT officers in Court
buildings in Adelaide, Sydney and Brisbane.
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6.62 However this option would not optimise the efficiencies that may be available and
would provide no guarantee to Government that, to the extent available, they would be
achieved. As a result, it is not preferred.
6.63 The Review does not support Option 3 – while it may be possible to achieve some
efficiencies through this approach, the capacity of the Attorney-General’s Department to
provide effective shared services to the NNTT is untested and can be expected to be affected
by the lack of complementarity of locations. The Department is heavily centralised and
located primarily in the ACT, while the NNTT has no ACT presence and is primarily located
in Western Australia. This option is also not supported because it is expected to lead to fewer
efficiencies than Options 2, 4 or 5.
6.64 Initial analysis by the Federal Court and the NNTT suggests that there would be
meaningful savings in having the NNTT receive administration services from the Federal
Court on a shared services basis under Option 4. The Federal Court is well-placed to provide
services to the NNTT because, with the exception of the NNTT’s Cairns office, the Court has
registries in each NNTT location, and is located in the same building in Perth and Melbourne.
In addition, the close links between the work of the Federal Court and the NNTT mean that
there would be a natural complementarity to the activities that are being supported.
6.65 The Federal Court has estimated savings of approximately 7-8 corporate services
positions under such an arrangement (although some of these savings are already anticipated
in the NNTT’s workforce plan for 2011-14). Similarly, the NNTT has estimated savings of
8-10.5 positions with the possibility of some further savings in IT. The potential savings
would however be limited by the extent to which relevant systems (particularly IT) and
processes could be efficiently and effectively coordinated, and would not avoid the costs that
arise from the NNTT being a separate FMA Act agency.
6.66 The Federal Court has indicated that Option 5 can be expected to create the efficiencies
identified in Option 4 as a minimum and that additional efficiencies could be created through
primarily using the Federal Court’s existing IT infrastructure, migrating only those parts of
the NNTT’s IT systems that are required to deliver core functions. Integrating the NNTT’s
administration into the Federal Court would also have the advantage of avoiding the cost of
maintaining an additional FMA Act agency. It would also create greater possibilities for
savings in areas such as accommodation, records management and other corporate areas. By
extension, NNTT corporate services would be included in cooperative arrangements between
the Commonwealth Courts under Option 4 for court administration (see Chapter 5).
6.67 The NNTT has raised concerns under this model for the continued capacity for the
President to manage the substantive work of the NNTT as required under the NTA.
However, the Federal Court already administers the Copyright Tribunal of Australia, the
Australian Competition Tribunal and the Defence Force Discipline Appeals Tribunal within
its FMA Act agency. Albeit on a smaller scale, the capacity of the head of each of those
tribunals to manage the affairs of the tribunal within the Federal Court FMA Act agency has
not raised concerns. Removing the FMA Act architecture around the NNTT would not
prevent the President from properly administering and directing its substantive functions.
6.68 Nevertheless, given the broader scope and responsibilities of the NNTT when
compared to those other tribunals, the Review considers that under this option the NNTT
should be recorded as a separate “sub-program” item within the Federal Court’s appropriation
as detailed in the Attorney-General’s Portfolio Budget Statement. In this way, Parliament
would indicate an “order of magnitude” expectation about likely expenditure on NNTT
functions and the Court should then report separately on that expenditure as part of its annual
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report. This would limit the potential that NNTT funding might be redirected to Federal
Court activities without proper oversight.
6.69 Other advantages of this system would include increased flexibility with staffing, so
that some officers might work on both Federal Court and NNTT substantive activities,
maximising utilisation of their expertise on key priority projects and increasing career
opportunities for staff in both organisations.
6.70 Very importantly, as noted in the preceding section, the resultant need for ongoing
liaison on matters of administration should mean that the relationship between the Federal
Court and the NNTT would be strengthened, allowing the two bodies to be substantially
coordinated with respect to planning, priorities, reporting and performance of their
complementary/interdependent substantive functions.
6.71 There would of course be some challenges in implementing this option associated with
the integration of systems, particularly in IT, which would require close management and
may cause some delay in realisation of some of the medium to long term efficiencies. While
that needs to be factored in to Government expectations, it is not a reason for rejecting the
option.
6.72 A further matter that Government would need to consider in implementing Option 5 is
the number of Members that the NNTT would need on an ongoing basis, and whether some
of the positions should be filled (as provided for under the NTA) by Federal Court judges.
This approach could increase flexibility in deployment of Member resources to meet
fluctuating workloads and further integrate the work of the two bodies. However, it is
important to note that some Member functions under the NTA are not capable of being
performed by Members who are also judicial officers – the continued performance of those
functions would need to be sufficiently resourced.
6.73 As a result of the above analysis, the Review believes that Option 5 is the option likely
to garner the most meaningful savings and enhance the overall effectiveness of the native title
system.
6.74 The Review therefore recommends that, while it should continue to exist as a separate
statutory entity, the NNTT should no longer be a separate FMA Act agency but should,
instead, be serviced from within the Federal Court administration (albeit with the Portfolio
Budget Statements for the Attorney-General’s portfolio showing an anticipated expenditure
by the Court on NNTT functions). This change can be expected to generate not only savings
in the provision of “back office” support services – some immediate and some over time –
but also a closer relationship between the two bodies which should promote more cohesive
substantive native title operations of each. It needs to be stressed that this option does not
involve abolition of the NNTT, any reduction in its statutory role, functions or powers, or any
change to its statutory office-holder structure. The purpose of the change is simply to achieve
increased efficiency in the provision of support services to the substantive work of the
NNTT.
6.75 The Review further recommends that, due to timing limitations affecting this Review,
the extent of financial savings that would accrue from the integration of the NNTT and
Federal Court administration, and the timing on which those savings might reasonably be
expected to become available, should be resolved in more detailed consultation between the
NNTT, the Federal Court, the Attorney-General’s Department and the Department of Finance
and Deregulation in consultation with FaHCSIA.
Chapter 6 – Native title functions and administration
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Recommendations
Recommendation 6.1
The funding and resources for the native title mediation function should be transferred from
the NNTT to the Federal Court. This does not require any substantive amendment to the
Native Title Act 1993 (NTA). The Federal Court would, at an appropriate time, simply order
NNTT mediation of relevant claims to cease and then, as appropriate, allocate them to
mediation by Federal Court staff or an external party. However, for certainty and clarity, it
would be preferable to amend the NTA within a reasonable timeframe to align the
legislation with the change in administrative practice.
Recommendation 6.2
Further work should be undertaken by the Federal Court and the NNTT, in consultation
with the Attorney-General’s Department and the Department of Finance and Deregulation,
to identify the quantum of the savings that would be achieved by conducting current
mediation activity levels in the Federal Court rather than the NNTT.
The Government should then decide whether those savings be reinvested in native title
mediation, reallocated to other priorities in the native title system or harvested to the
Budget.
Recommendation 6.3
Other NNTT functions that are ancillary to the judicial function should remain with the
relevant administrative agency performing closely connected administrative functions.
Recommendation 6.4
The NNTT should continue to exist as a separate statutory entity, subject to
recommendation 6.7 below, albeit with its mediation function and resources transferred to
the Federal Court as set out in Recommendation 6.1.
Chapter 6 – Native title functions and administration
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Recommendation 6.5
The Government should give further consideration to the extent to which the NNTT’s
discretionary functions should continue to be performed, and to what extent those functions
should be funded. To this end, the NNTT and the Attorney-General’s Department (in
consultation with FaHCSIA) should develop for consideration by Government a plan for
expenditure on discretionary native title functions. That plan should deal with:
a.
the extent to which the NNTT’s discretionary functions should continue to be
performed, particularly strategic planning and research and publications; and
b.
whether resourcing should be reduced for any discretionary functions.
Recommendation 6.6
The plan referred to in Recommendation 6.5 should also consider the efficiency of pursuing
options for full or partial cost recovery for NNTT discretionary functions designed to
extend the NNTT’s capacity to provide expert assistance and encourage parties to reach
outcomes efficiently.
Recommendation 6.7
While the NNTT should continue to exist as a separate statutory entity, the NNTT should
no longer be a separate FMA Act agency but should, instead, be serviced from within the
Federal Court administration (albeit with the Portfolio Budget Statements for the AttorneyGeneral’s portfolio showing an anticipated expenditure by the Federal Court on NNTT
functions).
Recommendation 6.8
The extent of financial savings that would accrue from the integration of the NNTT and
Federal Court administration, and the timing on which those savings might reasonably be
expected to become available, should be resolved in consultation between the NNTT, the
Federal Court, the Attorney-General’s Department and the Department of Finance and
Deregulation in consultation with FaHCSIA.
Chapter 6 – Native title functions and administration
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Chapter 6 – Native title functions and administration
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CHAPTER 7 - COMMONWEALTH TRIBUNALS
This chapter sets out the results of the Review’s consideration of the Commonwealth’s
administrative review tribunals generally, and of the Administrative Appeals Tribunal and
other tribunals in the Attorney-General’s portfolio in particular.
7.2 It does not deal with the National Native Title Tribunal (NNTT), which is not an
administrative review body. The NNTT is considered separately in Chapter 6.
7.3 Tribunal-specific detail is set out in Appendices 5 (Administrative Appeals Tribunal),
20 (Migration Review Tribunal and Refugee Review Tribunal), 21 (Social Security Appeals
Tribunal) and 22 (Veterans’ Review Board).
Commonwealth Tribunals generally
Introduction
7.4
The Terms of Reference for the Review relevantly provide that:
With regard to the ... tribunals in the Attorney-General’s portfolio, the review will consider
options for improving efficiency and flexibility in ... tribunal administration, including service
delivery, whether the ... tribunals are financially viable in their current form, including
options for shared services and administration arrangements.
In addition to those matters ..., the review should consider the potential for shared services
and administration arrangements between the tribunals within the Attorney-General’s
portfolio and administrative review bodies in other portfolios. (emphasis added)
7.5 The Terms of Reference do not define the term “tribunal”. A preliminary issue for the
Review was thus to adopt an interpretation for use in the work of the Review. In this regard
it is noted that:
a.
There are a variety of bodies that are titled as tribunals but that have
fundamentally different functions. For example, while the Administrative
Appeals Tribunal provides a mechanism for appeal on the merits against
decisions already made by primary decision-makers elsewhere within
Government:
i.
the National Native Title Tribunal acts both as a mediator to assist in the
making of a primary decision by the Federal Court of Australia, or as a
primary decision maker on other issues (such as future use) and does not
review the decisions of other primary decision-makers within Government;
ii.
the Remuneration Tribunal is both a primary decision-maker in its own
right and an adviser to other primary decision-makers within Government,
and does not review the decisions of other Government decision-makers;
iii.
the Superannuation Complaints Tribunal deals with complaints against
decisions made by superannuation providers in the private sector; and
iv.
the Patent and Trade Marks Attorneys Disciplinary Tribunal is a primary
decision-maker which decides disciplinary proceedings instituted by the
Professional Standards Board for Patent and Trade Marks Attorneys.
b.
There is a variety of bodies that are not titled as tribunals but that do perform the
function of reviewing on the merits of decisions made by primary Government
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c.
d.
decision-makers, such as the Veterans’ Review Board and the Trade Measures
Review Officer.
There are bodies that, while said to be “review” bodies, nevertheless are primary
decision-makers - for example, Medicare Participation Review Committees are
independent statutory committees established to determine whether a practitioner,
or where relevant, a person, should maintain the right to participate in Medicare,
in circumstances, for example, of a conviction of a relevant criminal offence or
where a practitioner has been found to have engaged in inappropriate practice.
There are a variety of bodies that have a mixture of functions that may include
review on the merits of decisions made by primary Government decision-makers
but also include other quite different functions – for example, the Office of the
Australian Information Commissioner conducts merits review of freedom of
information decisions, but also has a wide range of policy and oversight
functions.
7.6 Noting that the Terms of Reference refer to “tribunals” and “administrative review
bodies” as apparently interchangeable terms, the Review has confined itself to a
consideration of those bodies that “stand in the shoes of”, and conduct merits review of
decisions made by, primary decision-makers within Government23 and that are generally
able, on completion of a review, to affirm or vary such decisions or set them aside and
substitute a new decision.24
7.7
At least the following bodies would appear to fit this description:
a.
Agriculture, Fisheries and Forestry portfolio: Statutory Fishing Rights Allocation
Review Panel.
b.
Attorney-General’s portfolio:
i.
Administrative Appeals Tribunal;
ii.
Classification Review Board;
iii.
Copyright Tribunal of Australia;
iv.
Defence Force Discipline Appeal Tribunal; and
v.
Trade Measures Review Officer.
c.
Defence portfolio: Veterans’ Review Board.
d.
Families, Housing, Community Services and Indigenous Affairs portfolio
(FaHCSIA): Social Security Appeals Tribunal.
e.
Health and Ageing portfolio: General Practice Recognition Appeal Committee.
f.
Immigration and Citizenship portfolio:
i.
Migration Review Tribunal; and
ii.
Refugee Review Tribunal.
iii.
Treasury portfolio: Australian Competition Tribunal.
23
Such bodies may be constrained to consider only material that was before the original decision-maker, while
others may be able to have regard to new or additional evidence.
24
While the Review is of course required to include the National Native Title Tribunal, it is not within the
definition of “tribunal” adopted in this chapter of the Review report. It is dealt with separately in Chapter 6 of
the Report.
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7.8 Of these, by far the overwhelming majority of Commonwealth merits review25 is
undertaken by the following bodies (in alphabetical order):
a.
Administrative Appeals Tribunal (AAT);
b.
Migration Review Tribunal (MRT);
c.
Refugee Review Tribunal (RRT);
d.
Social Security Appeals Tribunal (SSAT); and
e.
Veterans’ Review Board (VRB).
7.9 The Review has thus focussed on this group of tribunals. If there is scope to achieve
material gains in efficiency and effectiveness in the delivery of tribunal services, it is most
likely that such gains would be of greater magnitude amongst this group than among tribunals
more generally.
7.10 These five tribunals are all markedly different not just in their areas of jurisdiction but
also in their structure and organisational form:
a.
The AAT is a separate FMA Act agency within the Attorney-General’s portfolio.
It is self-supporting, not acquiring any corporate services from elsewhere within
Government. It reviews decisions made across Departments and agencies in a
wide variety of other portfolios, and not just those made within the AttorneyGeneral’s portfolio.
b.
The MRT and RRT are a combined FMA Act agency which is largely selfsupporting. Both tribunals only review decisions made within the Immigration
and Citizenship portfolio.
c.
The SSAT is not an FMA Act agency. While it is a separate statutory entity, it is
within the FMA Act agency constituted by FaHCSIA. It is nevertheless largely
treated by that Department as though it were an FMA Act agency in the sense
that, once given an annual funding allocation, it is left to utilise that resource
independently. While self-supporting in many respects, it does obtain some of its
corporate services from the portfolio Department. It does not review decisions
made within the FaHCSIA portfolio, but decisions made in the Centrelink and
Child Support programs in the Human Services portfolio (although these include
decisions for which FaHCSIA has underlying policy responsibility).
d.
The VRB is not an FMA Act agency and, while it is a separate statutory entity, it
is treated very much as though it were a Division of the Department of Veterans’
Affairs from which it obtains the entirety of its corporate services. The decisions
it reviews are made entirely within the Defence portfolio of which it is a part whether decisions of DVA officers who are delegates of the Repatriation
Commission, or decisions of the Military Rehabilitation and Compensation
Commission.
Recent history of Commonwealth “reform”
7.11 In 1994 the Administrative Review Council (ARC), in a report entitled Better
Decisions: review of Commonwealth Merits Review Tribunals (ARC report), proposed that
the main Commonwealth tribunals should be merged into a new Administrative Review
25
Comparative tribunal statistics are at Appendix 23.
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Tribunal (ART)26. The ARC proposals were designed to enable efficiencies to be gained
across multiple tribunal administrations, to rationalise appeal rights as between tribunals, and
to facilitate ease of access for persons seeking to challenge decisions of Commonwealth
officers.
7.12 The ARC report’s detailed recommendations are set out in Appendix 24. The ARC
depicted its recommended ART structure as follows:
7.13 In 1997 the then Howard Government announced that it would legislate to establish an
ART. The Veterans’ community lobbied vigorously against including the VRB within an
ART as proposed by the ARC. The then Government conceded that the VRB would not be
incorporated into its proposed ART. The welfare “lobby” strongly opposed the reduction in
review rights that was involved in the ARC proposal, and further objected to the then
Government’s proposed different treatment of welfare and veterans’ cases
26
In the interests of avoiding any perception of conflict of interest, it should of course be noted that the Review
Leader was a member of the ARC at the time of its Better Decisions report, and pressed for and fully supported
its recommendations.
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7.14 In June 2000 the then Government introduced an Administrative Review Tribunal Bill
2000 into the Parliament. While it would nominally have created the ART, it went far
beyond the course of action recommended by the ARC.
7.15 The then Shadow Attorney-General, the Hon. Robert McClelland MP, opposed the
proposals set out in that Bill on a number of scores:
a.
the structure of the ART as proposed in that Bill;
b.
the proposed funding arrangements;
c.
the provisions relating to appointment, qualifications and removal of tribunal
members;
d.
the criteria for availability of second-tier review within the proposed ART;
e.
the proposed limitation on the right of legal representation before the tribunal;
and
f.
the intended degree of Ministerial control over the practice and procedure of the
ART.
7.16 In the light of further disquiet about the proposal, the Bill was eventually defeated in
the Senate in 2001.
7.17 The then Government subsequently announced in 2003 that it was abandoning the ART
proposal. However, it then required a Tribunal Efficiencies Working Group (Working
Group) to report to the Prime Minister, the Attorney-General, the Minister for Family and
Community Services, the Minister for Finance and Administration, the Minister for
Immigration and Multicultural and Indigenous Affairs and the Minister for Veterans’ Affairs.
The Working Group was to:
Investigate, evaluate and actively plan measures to achieve administrative efficiencies
between the key Commonwealth merits review tribunals ... while recognising that they are
separate statutory agencies with separate and distinct statutory functions and clients.
7.18 The Working Group comprised the head of each of the key tribunals and
representatives of the Departments’ of the Attorney-General, Family and Community
Services, Immigration and Multicultural and Indigenous Affairs, and Veterans’ Affairs. It
reported in May 2004, and identified a wide range of areas in which efficiencies and
effectiveness might be achieved/enhanced. A list of the Working Group’s recommendations
is at Appendix 25.
7.19 However no governance/reporting arrangements were put in place to provide for a
systemic pursuit (or dismissal) of all the matters identified by the Working Group. While
some of the identified initiatives have been pursued by some tribunals, either individually or
cooperatively with others, there has been no comprehensive assessment by Government,
affected Departments or the tribunals that collectively prepared the Tribunal Efficiencies
Working Group Report (Working Group Report) in response to its recommendations.
7.20 In contrast, over the same period there have been various moves to consolidate multiple
tribunals into separate “super” tribunals within State and Territory jurisdictions:
a.
in Victoria the Victorian Civil and Administrative Tribunal (VCAT) was created
on 1 July 1998 and amalgamated 15 boards and tribunals to offer a one stop shop
dealing with a range of disputes;
b.
in Western Australia the State Administrative Tribunal (SAT) was established in
2005 and amalgamated some, or all, of the review, civil and disciplinary
functions of nearly 50 industry and public sector boards and tribunals;
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c.
d.
e.
in the Australian Capital Territory the ACT Civil & Administrative Tribunal
(ACAT) commenced on 2 February 2009 and consolidated 16 former
jurisdictions and tribunals of the ACT;
in Queensland the Queensland Civil and Administrative Tribunal (QCAT)
began operation on 1 December 2009 amalgamating 18 tribunals and 23
jurisdictions into one tribunal; and
in New South Wales the Government is reportedly actively contemplating a
similar move at present.
Options for Commonwealth Tribunals generally
7.21 The Review would not support any proposal to reform Commonwealth tribunals in a
manner designed solely to achieve fiscal savings without maintaining or improving
effectiveness of the administrative review machinery. Nor would it support reforms that were
designed to:
a.
reduce existing rights of access to independent merits review or rights of
assistance in representation in pursuing that access;
b.
reduce the actual or perceived capacity of merits review bodies to perform their
functions “without fear or favour” and independently of direction by those whose
decisions were subject to review; or
c.
lower the standards for membership of merits review bodies so as to deprive them
of the expertise needed to undertake that task.
7.22 However, the Review does not consider that this means that maintenance of the status
quo is the only viable option. To the contrary, there is considerable scope, consistent with the
above matters of principle, to achieve greater efficiency and effectiveness in the delivery of
merits review processes. This section considers those options.
Option 1 - Implement the ARC proposal for an ART
7.23 Viewed from the perspective of simplicity, ease of access and policy purity, the Review
recommends that the ART proposal as recommended by the ARC should be endorsed as the
Government’s desired end-state (subject to a resolution of the reduction in appeal rights issue
discussed below). Indeed, the Review also recommends extension of the ARC model so that,
unless a compelling case was made to the contrary, all Commonwealth merits review bodies
should be “rolled into” the ART and not just the five major tribunals.
7.24 Despite this, however, there are a variety of reasons why the Review does not favour
attempting to reach that end-state at this time:
a.
First, meaningful gains in efficiency and effectiveness would only be achieved in
the short- to medium-term if the creation of the ART was supported by a
substantial up-front capital investment in accommodation and IT systems
development and deployment. Such an investment is understood not to be
available in the present financial climate. Without that investment, trying to
operate the ART using the diverse and disparate premises and systems of the
current separate tribunals would be an unreasonably demanding management
challenge - in the vernacular, it would be like “herding cats” - and, at least in the
medium term, would likely result in a reduction in present levels of efficiency and
effectiveness.
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b.
c.
Second, achieving reform along these lines would likely be protracted and
politically difficult, particularly in light of the previous Government’s abandoned
ART proposal, and opposition could be expected from some key stakeholders.
Third, the limitations inherent in the ARC’s ART proposal on rights of access
from the lower tiers of the ART to its upper tier would be seen to be, and would
probably act as, a curtailment of existing rights of appeal for persons dissatisfied
with “first-tier” SSAT and VRB decisions. Under the current arrangements, these
persons have a right to access a “second-tier” merits review in the more “senior”
AAT. Under the ART proposal, they would only have potential access, and no
right, to “second-tier” review in very limited circumstances27. There is still a
material volume of SSAT and VRB decisions appealed to the AAT that result in
more favourable outcomes for appellants28. This is not necessarily because the
SSAT or VRB is found to have been wrong - it may simply be that the first-tier
outcome has prompted further investigation. However the crucial point is that it
is the availability of the second-tier right that creates the environment in which
that more favourable outcome can be achieved.
7.25 Accordingly, the Review does not recommend implementing the ARC report at this
time.
Option 2 - Retain existing separate Tribunals but establish a common administration to serve
them all
7.26 An alternative option would be to retain the existing separate bodies but combine their
individual administrative units into one common administration that would serve them all.
7.27 Because each tribunal would continue to exist, the second and third disadvantages of
pursuing the ARC’s ART proposal as outlined above would or should be avoided. There
would be no reduction in rights of appeal, and the continued existence of separate tribunals,
and particularly the VRB, might defuse or avoid any community concern.
7.28 However, this option would still confront the first disadvantage - without a substantial
up-front investment in premises and information technology, there would likely be no short to
medium term gain in efficiency and effectiveness, and indeed it may be counter-productive.
7.29 Accordingly, the Review does not recommend this option either.
Option 3 - Actively pursue the Tribunal Efficiencies Working Group Report
7.30 As noted above, the previous Government did not put in place any governance or
reporting arrangement to provide for a systemic pursuit (or dismissal) of all the matters
identified by the Working Group Report.
7.31 In consultation with the Review, the MRT/RRT, the SSAT and FaHCSIA have either
queried the utility of, or opposed now revisiting, the recommendations of the Working Group
Report.
7.32 The Review on the other hand considers that the Government should have the benefit of
a proper assessment of the merits of the recommendations that were made in this substantial
27
Where, in the opinion of the ART President, the case raised a principle or issue of general significance, the
decision of the ART division involved a manifest error of fact or law that was likely to have materially affected
the outcome, or new information existed which could not reasonably have been discovered prior to the
finalisation of the case before the ART division and which would have materially affected its decision.
28
See the comparative tribunal statistics at Appendix 23.
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piece of work. This is particularly the case with respect to those recommendations that appear
to offer scope for achieving efficiencies in resource usage by and amongst the tribunals. At
least Recommendations 2.1, 3.1, 4.1, 6.1, 9.1 and 9.2 fall into this category. Those
recommendations were in the following terms:
Recommendation 2.1
The tribunals, in consultation with relevant decision-making agencies, should examine
the potential for harmonising procedures between two or more tribunals relating to:
 the electronic notification to decision-making agencies of applications for
review
 the electronic transmission to tribunals of documents relating to the decision
under review
 the electronic storage of documents, and
 the electronic transmission of other documents between tribunals and
decision-making agencies.
Recommendation 3.1
The tribunals should work through the Heads of Tribunal forum to consider the colocation opportunities identified by the Working Group, and implement those
opportunities where possible and economical, noting the significant costs involved.
Recommendation 4.1
The Heads of Tribunals forum should continue to investigate facilities that can be shared
between the tribunals or provided on a cost-recovery basis, whether or not the tribunals
are co-located.
Recommendation 6.1
The tribunals should, where appropriate, jointly provide appropriate training to their
members and staff.
Recommendation 9.1
The AAT, and the MRT and RRT, should work together to develop similar chief
executive instructions to assist with any future combined or cost-recovery approach to
financial services.
Recommendation 9.2
The AAT should investigate with the MRT and RRT the viability of delivering financial
services as appropriate on a combined or co-operative basis.
7.33 The Review acknowledges that it is now over seven years since the Working Group
Report was compiled. It is understood that some of the identified initiatives have been
pursued by some tribunals, either individually or cooperatively with others. Further the
circumstances of individual tribunals will have changed in many respects since that time.
And there have been changes in whole-of-Government procurement since that time that may
have been of relevance to tribunal efficiency.
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7.34 All of this means that there should be no necessary presumption that initiatives that
were recommended at that time would still be suitable for implementation. But equally there
should be no presumption either:
a.
that initiatives that were rejected at that time might not now be found to be
sensible; or
b.
that a further exercise might not disclose additional and better possibilities.
7.35 Accordingly, the Review supports Option 3 and recommends that, at the very least, the
Government should now formally require the heads of the AAT, MRT, RRT, SSAT and VRB
to jointly:
a.
review each initiative identified and either supported or rejected in the Working
Group Report;
b.
identify further initiatives for other efficiencies or improvements that might be
achieved by cooperative or shared efforts between them; and
c.
report each six months to each relevant portfolio Minister, and to the Minister for
Finance and Deregulation, on progress and in particular:
i.
identify which Working Group Report or other initiatives have been
implemented, and the benefits thereby gained;
ii.
identify which Working Group Report or other initiatives have been fully
analysed and the conclusion drawn that they should not be implemented,
and set out the reasons why; and
iii.
advise the forward work plan for examining these matters.
7.36 Consistent with the subsequent recommendations of this report, the Review
recommends that the President of the AAT should be designated as the convenor and chair of
this group. However, as the current President will retire in May 2012, the Review
recommends, in the interests of continuity in an exercise that may take some time, that the
work of the group not commence until the new President takes up office.
7.37 The Review also recommends that the Government should decide that:
a.
A representative of each Tribunal’s portfolio Department should participate in the
work identified above in order (a) to avoid any divergence between tribunal
administration and the underlying merits review policy objectives of the
Government, and (b) to provide practical input and advice in relation to such
matters as the potential availability of support services that might be provided by
those Departments; and
b.
Ministers should consult and then:
i.
either accept or reject those periodic reports; and
ii.
provide feedback and any necessary or desirable direction to the heads of
the tribunals and their Departments.
7.38 In this way, Ministers can either be satisfied that their portfolio tribunals are making
best use of the resources made available to them or, if necessary, more actively drive that
pursuit.
7.39 Given the Attorney-General’s responsibility for administrative law under the
Administrative Arrangements Orders and the cross-portfolio financial responsibility of the
Minister for Finance and Deregulation, it would seem appropriate for these Ministers to be
jointly responsible for coordinating decisions by all relevant Ministers in response to these
reports.
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7.40 There are two other issues affecting tribunals generally that the Review considers
warrant attention.
Designate the AAT as the Commonwealth’s senior and “lead” tribunal
7.41 The fact that the Working Group Report has largely remained as “unfinished business”
for more than seven years highlights not just the need for pro-active decision making by
Government in response to such reports, but also a lack of any official hierarchy and
leadership amongst the Commonwealth’s various tribunals.
7.42 While heads of Commonwealth tribunals and their heads of administration meet from
time to time in various configurations, no one tribunal has any officially recognised
leadership or coordinating role amongst the group. As a result, no office holder had any
authority to seek to drive the initiatives identified in the Working Group Report in the
absence of Government direction. Accordingly, while they may have provided interesting
forums for the exchange of information about what was happening within individual
tribunals, these meetings have not proved to be effective in promoting cooperative ventures
or research or the promulgation of best practice in tribunal administration.
7.43 The AAT was from its inception intended to be the Commonwealth’s “premier”
tribunal. It is clearly senior to the SSAT and the VRB, and by law is headed by a more senior
office holder than any of the other major Commonwealth tribunals. It also has the widest and
most diverse jurisdiction of any Commonwealth tribunal.
7.44 Accordingly, and consistent with the need for joint action by the heads of Tribunal
identified above, the Review recommends that there should be conferred on the President of
the AAT the role of promoting cooperation between, and the identification and adoption of
best practice tribunal administration by, all Commonwealth merits review bodies (i.e., not
just the five largest tribunals). This would be a “leadership” role without power of direction
over other tribunals, but it should be made clear that their active participation and support
was expected by the Government. It would be a role that would need to be sensitive to and
respect the different levels and jurisdictions of the various tribunals and should not proceed
on the basis that “one size fits all”. While preferably this role would be conferred by
amendment to the Administrative Appeals Tribunal Act 1975, the Government should now
agree that the AAT President should assume, and other tribunals should accept, this role on
an administrative basis.
Adopt a prima facie policy against the creation of any new tribunals
7.45 Consistent with a renewed recognition of the AAT as the Commonwealth’s most senior
tribunal, the Review also recommends that the Government should now take a decision that,
except in exceptional circumstances, no new Commonwealth merits review body should be
established and that any new merits review jurisdiction should instead be conferred on the
AAT.
Tribunals of, or administered in, the Attorney-General’s Portfolio
7.46 There are four merits review bodies that are either agencies of the Attorney-General’s
portfolio or that are administered by agencies within that portfolio. The next part of this
Chapter considers matters specific to those tribunals.
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Australian Competition Tribunal - Copyright Tribunal of Australia Defence Force Discipline Appeal Tribunal
7.47 These specialist tribunals are each separate legal entities but none is an FMA Act
agency and none has a budget or resources of its own. Each is headed by a Justice of the
Federal Court and funding for each is administered by the Federal Court registry. This
arrangement provides flexibility for funds and resources to be moved between the Court
registry and the Tribunals, and vice versa, on an as-needed basis.
7.48 Given the low volume of cases within these tribunals, there would be no efficiency to
be gained, and only cost to be incurred, in establishing these tribunals as separate FMA Act
agencies. There would be no efficiency to be gained, and probably only inefficiency, in
moving their administration into the Attorney-General’s Department (which has no relevant
expertise and no material presence in the relevant cities). Further, there is no other tribunal
into which they should be subsumed, having regard to their specialist jurisdictions and
standing.
7.49 Accordingly, the Review recommends that there should be no change to the present
arrangements in respect of these bodies. Elsewhere in this report the Review makes separate
recommendations designed to generate efficiency and effectiveness in the Federal Court
registry, and those benefits would flow through to these Tribunals in the ordinary course.
Administrative Appeals Tribunal
7.50 The AAT, in contrast to the other tribunals within the Attorney-General’s portfolio:
a.
is an FMA Act body;
b.
is not administered by the Federal Court even though its President is Justice of
that Court (and some other presidential members are also Judges);
c.
is a general rather than specialist tribunal; and
d.
is fully self administering.
7.51 As mentioned above, the AAT is generally regarded as the most senior of the
Commonwealth Tribunals, because it has jurisdiction to review decisions made by the SSAT
and the VRB, because it is headed by a Judge, because remuneration for its other members is
higher than for other Commonwealth tribunals and because it reviews decisions across the
breadth of Commonwealth administration and not just those made within the portfolio in
which it resides. Notwithstanding this general recognition, there has hitherto been no
legislative recognition of this seniority. The Review has recommended above that this should
be changed so that the AAT President has a role to play in promoting best practice and
administrative effectiveness across all Commonwealth Tribunals.
7.52 Like other major Commonwealth tribunals, the AAT’s legislation contains a provision
stating that:
In carrying out its functions, the Tribunal must pursue the objective of providing a
mechanism of review that is fair, just, economical, informal and quick.29
7.53 Despite this, it was frequently commented to the Review that the AAT had adopted a
culture and approach in its hearings that was “too formal”, and was markedly more formal
than the approach adopted with success by other Commonwealth tribunals. The President of
29
Section 2A, Administrative Appeals Tribunals Act 1975
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the AAT rejected these views in his comments to the Review. He said that such comments
were based on an unfounded perception and not on reality. Whether this concern with excess
formality is a matter of perception or reality, it is nevertheless an issue that needs to be dealt
with.
7.54 There is no doubt that the AAT (and each other tribunal) should conduct itself with
decorum and in a manner that earns respect for its expertise and, as far as possible,
acceptance of its decisions. However, there is equally no doubt that the AAT (and each other
tribunal) needs to be mindful of the background of those that have business before the
tribunal so that it maintains its accessibility and understandability to them. In the opinion of
the Review, the AAT should not seek to be “Court-like” – it should unashamedly seek to be
“tribunal-like” – that is, less formal.
7.55 While a higher degree of formality may be appropriate in a major tax appeal in which
all parties are represented by senior and junior counsel and a phalanx of solicitors, a far lesser
degree should be exhibited in cases where self-represented or lay-represented applicants are
pressing matters that may be of far lesser monetary value but of great personal significance.
Further, in no case should the AAT and its members lose sight of the fact that the AAT (and
each other tribunal) is a part of the Executive and not of the Judiciary. Traditional (and some
would say anachronistic) features and practices of courts should have no role in the AAT (or
any other tribunal).
7.56 While respecting the views of others who favour doing so, the Review does not believe
that resolution of perceived excess formality necessitates that Judges no longer be the
President or presidential members of the AAT, or that lawyers only be allowed to appear
before the AAT with leave from the AAT. Judges and lawyers can bring great skill and
efficiency to the proper resolution of applications before the AAT, which most generally turn
upon questions of legal interpretation or the proper assessment of factual evidence. Rather,
the Review considers that the issue is more one of the conduct and self-perception of tribunal
members on the one-hand, and of their control of those who appear before them.
7.57 In this latter regard the observation of Professor Harry Whitmore in relation to the AAT
in 1981 remains as apposite today as it was then:
..counsel prefer to play adversarial tactics. This means that the basic objectives of the
Tribunal are ... being subverted to some degree by the legal profession. .. It is so difficult to
persuade lawyers to get out of ingrown habits. The result is inevitable - extended hearings,
delays and much higher costs, and of course these are the very things that the tribunal was set
up to avoid.30
7.58 The Government has advertised for expressions of interest in, and nominations for,
appointment as the next President of the AAT. The review recommends that the AttorneyGeneral communicate to the new appointee the desirability of the incoming President as a
matter of early priority giving consideration to these questions of culture and approach and to
make clear her expectations of AAT members and staff in this regard.
7.59 The Review has considered whether AAT administration functions should be merged
with those of the Commonwealth Courts and whether the AAT should be located within
Commonwealth Law Courts buildings (which is currently the case in Brisbane and Hobart).
However, the Review is concerned that such merger or co-location would take the AAT too
far “up-market”, would be likely to further entrench what is an undesirable level of formality,
and would work against accessibility for many applicants. In any event, tribunal case
30
H Whitmore 'Commentary' (1981) 12 Federal Law Review, 117-119
Chapter 7 – Commonwealth Tribunals
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management and judicial case management have little in common, and tribunal hearings
should generally be conducted in hearing rooms quite different in size and design from court
rooms – this is especially the case given the very low level of AAT applications that proceed
to a contested hearing, with most applications being resolved through alternative dispute
resolution processes.
7.60 Accordingly, the Review recommends that AAT administration functions should not be
merged with those of the Commonwealth Courts and, unless it would be inefficient and
uneconomic to do otherwise, the AAT should not be co-located with the Commonwealth
Courts. [In Chapter 5 the Review recommends the preparation of a detailed plan for the use
of the Commonwealth Law Courts buildings. As the AAT is currently a tenant of such
buildings in Brisbane and Hobart, it should be a party to the development of that plan.]
7.61 The AAT has over the last 12 months undertaken a process of review and
reorganisation. That, however, is still “unfinished business”. Its Strategic Plan is in only a
recent form. It does not set out a program of work or allocation of responsibility for the
achievement of the very appropriate aspirations set out in it. The Review was advised,
however, that such detail was included in various other documents that had not been provided
to it. Ensuring the active pursuit of the aspirations in the Plan should be a matter of priority
for the AAT. While no doubt the current President will pursue these matters in the time
remaining to him in his tenure as President, it should not be expected that he will be able to
bring these matters to finality before the end of his term.
7.62 In these circumstances the Review recommends that the Attorney-General should
communicate to the new appointee the need for the incoming President as a matter of early
priority to review the detailed work plan, attribution of responsibility and governance
structure for reporting on and monitoring of the implementation of the AAT’s Strategic Plan.
7.63 Finally, in Chapter 3 the Review recommended that the Attorney-General’s Department
should prepare a business-like proposal setting out in a “corporate services business
offering”:
a.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
b.
the service level specifications at which those services would be provided;
c.
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
d.
the financially justifiable price at which each such service would be provided.
7.64 This was so that, once that material was available, soundly based decisions would be
able to be made, within agencies and across the portfolio, as to whether or not individual
agencies should, in conformity with the Expenditure Review Principles, provide their own
corporate support services, acquire those services from a commercial provider, or acquire
them from their portfolio department or other portfolio agency provider.
7.65 Accordingly, the Review further recommends that, once the Attorney-General’s
portfolio “corporate services business offering” is available, the AAT should review its then
existing corporate services provision arrangements and report to the Attorney-General and
the Minister for Finance and Deregulation on whether or not it intends to access that offering
and its rationale for doing so.
Chapter 7 – Commonwealth Tribunals
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Recommendations
Recommendation 7.1
a.
The Administrative Review Tribunal proposal as recommended by the
Administrative Review Council should be endorsed as the Government’s
desired end-state (subject to a resolution of the reduction in appeal rights
issue).
b.
The Administrative Review Council model should be extended so that, unless a
compelling case was made to the contrary, all Commonwealth merits review
bodies should be “rolled into” the Administrative Review Tribunal and not just
the five major tribunals.
Recommendation 7.2
The Government should now formally require the heads of the Administrative Appeals
Tribunal, Migration Review Tribunal, Refugee Review Tribunal, Social Security Appeals
Tribunal and the Veterans’ Review Board to jointly:
a.
review each initiative identified and either supported or rejected in the Tribunal
Efficiencies Working Group Report (Working Group Report);
b.
identify further initiatives for other efficiencies or improvements that might be
achieved by cooperative or shared efforts between them; and
c.
report each six months to each relevant portfolio Minister, and to the Minister
for Finance and Deregulation, on progress and in particular:
i.
identify which Working Group Report or other initiatives have been
implemented, and the benefits thereby gained;
ii.
identify which Working Group Report or other initiatives have been fully
analysed and the conclusion drawn that they should not be implemented,
and set out the reasons why; and
iii.
advise the forward work plan for examining these matters.
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Recommendation 7.3
The President of the AAT should be designated as the convenor and chair of the group of
tribunals identified in Recommendation 7.2. However, as the current President will retire
in May 2012, in the interests of continuity in an exercise that may take some time, that the
work of the group should not commence until the new President takes up office.
Recommendation 7.4
The Government should decide that:
a.
A representative of each Tribunal’s portfolio Department should participate in
the work identified in Recommendation 7.2 in order (a) to avoid any
divergence between tribunal administration and the underlying merits review
policy objectives of the Government, and (b) to provide practical input and
advice in relation to such matters as the potential availability of support
services that might be provided by those Departments; and
b.
Ministers should consult and then:
i.
either accept or reject those periodic reports; and
ii.
provide feedback and any necessary or desirable direction to the heads of
the tribunals and their Departments.
Recommendation 7.5
The Government should confer on the President of the AAT the role of promoting
cooperation between, and the identification and adoption of best practice tribunal
administration by, all Commonwealth merits review bodies (i.e., not just the five largest
tribunals).
Recommendation 7.6
The Government should now take a decision that, except in exceptional circumstances, no
new Commonwealth merits review body should be established and that any new merits
review jurisdiction should instead be conferred on the AAT.
Recommendation 7.7
There should be no change to the present arrangements in respect of the Australian
Competition Tribunal, the Copyright Tribunal of Australia and the Defence Force
Discipline Appeals Tribunal.
Recommendation 7.8
The Attorney-General should communicate to the incoming AAT President the desirability
of giving consideration to questions of culture and approach as an early priority and to
make clear her expectations of AAT members and staff in this regard.
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Recommendation 7.9
AAT administration functions should not be merged with those of the Commonwealth
Courts and, unless it would be inefficient and uneconomic to do otherwise, the AAT
should not be co-located with the Commonwealth Courts.
Recommendation 7.10
The Attorney-General should communicate to the incoming AAT President the need as a
matter of early priority to review the detailed work plan, attribution of responsibility and
governance structure for reporting on and monitoring of the implementation of the AAT’s
Strategic Plan.
Recommendation 7.11
Once the Attorney-General’s portfolio “corporate services business offering” is available,
the AAT should review its then existing corporate services provision arrangements and
report to the Attorney-General and the Minister for Finance and Deregulation on whether
or not it intends to access that offering and its rationale for doing so.
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CHAPTER 8 – COMMONWEALTH LEGISLATIVE DRAFTING
This Chapter considers the following options:
a) whether the Office of Parliamentary Counsel should remain as a separate
statutory entity or become part of the Attorney-General’s Department;
and
b) whether the currently separate offices for the drafting of Bills and of
Regulations/other subordinate legislative instruments should be
combined.
Background
8.2 There are two Commonwealth offices charged with drafting Commonwealth
legislation:
a.
the Office of Parliamentary Counsel (OPC), an independent FMA Act
agency within the Attorney-General’s portfolio, which drafts Government
Bills; and
b.
the Office of Legislative Drafting and Publication (OLDP), which is
simply a division within the Attorney-General’s Department, which:
i.
drafts Regulations made under Acts of the Parliament, a range of
other “tied” legislative instruments and (on request on a fee for
service basis) other “untied” legislative instruments;
ii.
operates the Federal Register of Legislative Instruments (FRLI)
(upon which all legislative instruments other than Acts must be
registered if they are to have legal validity and effect) and ComLaw
(the Commonwealth’s electronic database of all legislation and
related materials);
iii.
compiles and publishes consolidations of Acts as they have been
amended by Bills passed by the Parliament and Regulations as
amended by the Governor-General with advice of the Executive
Council, other “tied” legislative instruments and (on request on a
fee for service basis) other “untied” legislative instruments; and
iv.
publishes Acts and Select Legislative Instruments as made, annual
volumes of Acts, and the Government Notices Gazette.
8.3 The days are long gone when Regulations simply provided minor
implementation detail for legislative schemes otherwise wholly contained in Acts of
the Parliament – for example, by prescribing forms, fees and places for lodgement.
Regulations and other “subordinate” legislative instruments now commonly contain
major elements of the substantive law that is only “foreshadowed” by Acts.
Increasingly, Regulations and other “subordinate” legislative instruments do the
“heavy lifting” in legislative schemes – for example, in the national regulation of the
gas and electricity markets, in the Commonwealth’s greenhouse gas and energy
reporting scheme, or in such areas of high potential consequence as the control of
drug and alcohol use by aviation personnel.
Chapter 8 – Commonwealth Legislative Drafting
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8.4 It is thus increasingly necessary that the entirety of the Commonwealth’s
“legislation book” be of a consistently high and integrated standard if the
Government’s policy objectives are to be best assured of effective attainment in a
manner best understood by all affected parties.
8.5 This is not currently the case. There has been, and remains, no consistency of
drafting standards and styles between OPC and OLDP. Nor is there a formal
mechanism for OLDP consultation with OPC in relation to drafting of Bills that
require OLDP to prepare major Regulations integral to the success of the overall
legislative package. And OLDP does not use the purpose-built drafting software
developed by OPC. These are each problems that place the overall quality of the
Commonwealth’s “legislation book” at risk.
8.6 Recently the heads of OPC and OLDP have begun working cooperatively with a
view to developing and adopting common drafting standards between OPC and
OLDP, and exploring the potential for common use of the IT systems developed by
OPC for that purpose. However, the current bifurcated management structure
mitigates against this being achieved either at all or on a sustained basis.
8.7 This is because the current arrangements are dependent entirely on the mutual
goodwill and respect of the individuals who currently head OPC and OLDP. There is
no structure that provides a power of decision as a “circuit-breaker” if they are unable
to agree, or to prevent future deviation from previously agreed standards. Nor is there
a structure that provides unified professional leadership or optimum opportunities for
career advancement for Commonwealth legislative drafters generally.
8.8 In other Australian jurisdictions, it is the usual practice for the one office to both
draft Bills and draft (or at least settle) Regulations/other subordinate instruments. In
some jurisdictions, that office is within the Premier’s Department or AttorneyGeneral’s Department (or equivalent); in others it is a part of that Department but
headed by a statutory officer; and in some jurisdictions it is a separate agency
independent of the Department. The Commonwealth is aberrant in having separate
offices for the drafting of Bills and Regulations.
8.9
The above necessarily raises obvious questions:
a.
if OPC is appropriately an independent statutory agency, why is OLDP
not also an independent statutory agency and, conversely, if OLDP is
appropriately a division of the Attorney-General’s Department, why is
OPC not also a part of the Department; and
b.
whichever is the preferable structure, why are OPC and OLDP not
combined in the one organisation?
Should OPC be part of the Attorney-General’s Department?
8.10 Until 1970, both Bills and Regulations were drafted within the AttorneyGeneral’s Department. When OPC was established by the Parliamentary Counsel Act
1970, it was charged with the drafting of both Bills and Regulations/other subordinate
legislation. Responsibility for the drafting of Regulations and other subordinate
legislation was subsequently returned to the Attorney-General’s Department in 1973
(although it seems that the Parliamentary Counsel Act 1970 was only amended to
reflect this transfer many years later).
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8.11 The rationale for the creation of OPC outside the Attorney-General’s
Department in 1970 was stated to be the need to create a structure that facilitated the
recruitment and retention of appropriately skilled and experienced legislative drafters.
There was perceived to be a “crisis in Commonwealth drafting”. At that time,
departmental structures were generally “bottom-heavy” pyramidal hierarchies created
under strict control of the then Public Service Board, whereas legislative drafting was
seen as requiring a more “top-heavy” and relatively unique structure.
8.12 The rationale for moving the drafting of Regulations out of OPC and back to the
Attorney-General’s Department in 1973 was stated to be a result of pressure to deploy
drafters too heavily to Bills with a resultant increasing backlog in the drafting of
Regulations.
8.13 There are a number of arguments that might be made against the OPC being
placed in the Attorney-General's Department:
a.
It would not be possible to deliver the Government’s legislative agenda on
a sustainable basis if OPC became a part of a Department of State as the
temptation to remove funding, positions or actual staff from the drafting
function to address shortages elsewhere in the Department would be too
great.
However, this was apparently not the general experience prior to1970
when Bills were drafted within the Attorney-General’s Department, and it
is also not the current experience when other legislation is drafted within
that Department. Two very practical matters warrant recognition:
i.
it is the experience of the Review leader over 40+ years working in
and with Government in relevant areas that, with the occasional
notable exception, good legislative drafters, like other good “blackletter” lawyers such as solicitors and barristers, seldom make good
legal policy advisers. Reflecting this, there has traditionally been
very little movement from OPC, OLDP or AGS to the policy areas
that are the mainstream legal areas of the Attorney-General’s
Department; and
ii.
it would be a severely “career-limiting” move for any Secretary of
the Attorney-General’s Department to allow the human or financial
resource of the legislative drafting capability to be so depleted as to
threaten the capacity of the Government to fulfil its legislative
program – more likely, he or she would be pressured to increase that
capability. While Budget funding for the Regulation drafting
function has declined over time, it has been more than replaced by
other funding sources such as payment for “untied work” and fees
for FRLI lodgements.
b.
Many aspects of OPC’s operations involve a whole of Government
perspective which could be compromised by OPC being part of a
Department that is a user of OPC’s drafting services. OPC’s separate
statutory existence means that, while being responsive, OPC is not under
the direct control or influence of its portfolio Department. This is
important when assigning relative priorities across portfolios,
determining issues related to the policy authority for Bills, and ensuring
appropriate consultation with areas outside the Department.
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However, precisely the same issues could arise in the drafting of
Regulations and other subordinate legislation – and potentially with far
less constraint as such drafting is seldom governed by express Cabinet
decision and is not undertaken within the priority order allocated by the
Parliamentary Business Committee. So far as the Review leader is aware,
there is no legitimate concern that the Attorney-General’s Department is
abusing its position of power over OLDP as the drafter of Regulations and
other subordinate legislation to afford undue priority to its own
legislation, to claim policy authority that it does not have, or to fail in the
need to consult other Departments.
c.
d.
e.
In any event, incorporation of OPC within the Attorney-General’s
Department would not necessarily mean abolition of the statutory office of
First Parliamentary Counsel, which could retain its present independent
responsibilities in these respects.
OPC has a very distinct staffing structure. As compared to the traditional
bureaucratic “bottom-heavy” pyramid, it is very “flat” with a
preponderance of drafting staff at or towards the SES levels. This
structure would be unsustainable within a more traditionally structured
Department.
While this factor may have been influential in establishing OPC outside
the Attorney-General’s Department at a time when the then Public Service
Board strictly controlled the creation of both structures and positions,
those days are long gone. The relevant controls are now the Classification
Rules and the SES Cap to which OPC is already subject. The
Classification Rules allow structural design by reference to functional
justification, without any pre-determined “template”. And with respect to
the SES Cap, if OPC were a part of the Department, there would be
greater flexibility to deploy SES resources to it than there is currently for
a separate OPC to increase its own SES numbers.
The survey of OPC staff reflects a healthy and highly effective
organisation and the results are substantially better than for the APS as a
whole.
However, there is no obvious reason why current OPC leadership,
operating within a Departmental structure rather than as a separate
statutory agency, could not inspire the same satisfaction amongst staff as
they do now. OPC staff would be doing exactly the same work, under the
same supervision. Only the legal nature of the organisational structure
would necessarily change. OPC could be retained as a discrete
identifiable grouping with the same OPC title.
OPC has a very low staff turnover, while the Attorney-General’s
Department has a much higher staff turnover.
However, there is no reason to believe that incorporation of OPC within
the Attorney-General’s Department would induce OPC staff to leave jobs
with which they express high satisfaction levels. They would still be
located within a discrete identifiable grouping which could retain the same
OPC title. Within Canberra, the only serious opportunities for legislative
drafters are within OPC, OLDP and the ACT Government’s drafting
office, with the former perceived as being of higher standing due to the
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national nature of its work. While some drafters have moved on to
prominence in non-drafting careers, they are the exception rather than the
rule and there is no reason to believe that more people of this calibre
would suddenly be recognised just because OPC had become a part of the
Department.
OLDP has experienced a higher staff turnover rate than OPC, but this is
likely to reflect the lack of a coherent career structure for Commonwealth
legislative drafters and dissatisfaction with other problems arising from
the current bifurcation in drafting offices. There seems to be nothing
inherent in the nature of the Department itself that drives this outcome.
f.
g.
By contrast, talented policy staff within the mainstream areas of the
Attorney-General’s Department would have far more transportable skills
across the breadth of the Australian Public Service and higher turnover
rates would be expected without there being any cause for inference
adverse to the Department.
OPC currently provides corporate services to itself at a far higher level
than that at which it previously received services from within the
Attorney-General’s Department.
While corporate services in the Attorney-General’s Department (and
perhaps service wide) in the 1980s may have left much to be desired from
the perspective of an independent portfolio agency, the relevant
comparator for present purposes is the standard of the Department’s
provision of corporate services to itself. Clearly that is at a level that
allows the Department to acquit its present responsibilities satisfactorily.
As a free-standing agency, OPC is able to ensure that it obtains the
specialised, customised facilities that it requires, especially through
development of its own legislative drafting software (which it has hitherto
not been used by OLDP, although following the recent review of that
office it is now being actively considered).
However, there is no reason to believe that this could not occur within a
departmental framework. It is noteworthy that the Attorney-General’s
Department has, directly or through contracted-in services, secured
numerous bespoke systems for elements of itself (the legislation-related
FRLI and ComLaw systems being a case in point) or of the portfolio more
generally (such as the Personal Property Security Register about to be
handed over to Insolvency and Trustee Service Australia).
8.14 The above analysis indicates that the reasons in support of the retention of OPC
as an independent statutory agency are not strong. Moreover, the other criteria
discussed elsewhere in this report as providing a rationale for independence from
Government have no relevant application – for example, because OPC does not draft
Private Member Bills (which are drafted by or through the relevant Clerk’s Office), its
functions are 100% those of the Executive and there can be no perception of conflict
of interest.
8.15 Over the years, various other reviews have supported the retention of OPC as a
separate statutory entity. Generally however these have not provided any close or
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critical analysis of the underlying rationale. Rather they have instead expressed a
desire to retain the perceived high standard of OPC performance.
8.16 Such a concern is of course appropriate. Indeed, it is a desire equally shared by
this Review (albeit with a desire for its extension to all legislation, not just Bills). The
real question is whether or not continued existence of a separate agency outside the
Department is necessary for that purpose.
8.17 OPC is a highly regarded agency which appears to be well managed and to
make effective use of the financial resources available to it (see Appendix 6).
However, being a separate FMA Act agency outside the Department comes at a notinsignificant cost in terms of the separate accounting, reporting and auditing
obligations that flow from that status. The fact that OPC may now be well managed
does not of itself justify its retention as a separate statutory and FMA Act agency.
8.18 To the extent that the arguments at 8.13 do have validity, they apply equally to
the drafting of all legislation and not just to the drafting of Bills. As noted above,
Regulations and other subordinate legislative instruments are becoming an
increasingly important element of the Commonwealth’s “legislation book”. The
effective implementation of Government policy is increasingly dependent on quality
drafting not just of Bills but of subordinate legislation. Organisational structures that
do not foster consistent high quality across all legislation are necessarily suspect.
8.19 OLDP also wins high praise from many of its drafting clients, and generally
appears to be well managed and to make effective use of the financial resources
available to it. But there is, in the opinion of the Review, no justification for
establishing OLDP as a separate statutory and FMA Act agency. This is because of
the attendant costs and because such action would do nothing to improve the overall
state of the Commonwealth’s “legislation book”.
8.20 Instead, the real question is whether or not OPC and OLDP should be merged
into one entity.
Should OPC and OLDP be combined?
8.21 Arguments available against moving OLDP into OPC as a separate independent
agency outside the Attorney-General’s Department include:
a.
A merger could imperil the Government’s legislative programme –
individual Ministers could ask that resources be moved from drafting
Regulations to the more pressing task of drafting Bills and the production
of Regulations would suffer.
b.
However, this argument ignores the fact that the priority order for Bills is
already set by the Parliamentary Business Committee, not individual
Ministers, and the Attorney-General could readily specify in a Letter of
Expectation a process for resource reallocation between Bills and other
legislative instruments that ensured that the overall legislative priorities of
the Government were met.
OLDP has a larger, lower classified and less experienced staff than OPC
and a merger would dilute the quality of OPC’s capacity to produce
quality Bills.
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c.
d.
However, a merger could still retain discrete (although properly
coordinated and cohesively led) groupings for the drafting of Bills on the
one hand, and subordinate legislation on the other. Bringing both groups
under the one organisation does not necessarily require full intermingling,
but it does offer the capacity to develop, evolve and enforce common
drafting standards and it has the potential to provide a career structure
offering advancement from drafting subordinate legislation to drafting
primary legislation, which would be expected to enhance the skill base of
both groups and broaden the Commonwealth’s drafting resource base.
The OLDP functions of operating FRLI and ComLaw could be an
'overhead' or 'distraction' for the executive of a merged entity. .
However, the head of OLDP advises that both these systems are now
mature and consume only 15-20% of his time. Within a merged entity
these functions could remain the primary responsibility of the head of the
non-Bill drafting group and would be expected to impact on the time of
First Parliamentary Counsel marginally, if at all. Moreover, having
overall responsibility for FRLI would place First Parliamentary Counsel
in an enhanced position to undertake the role envisaged in section 16 of
the Legislative Instruments Act 2003 of causing “steps to be taken to
promote the legal effectiveness, clarity, and intelligibility to anticipated
users, of legislative instruments”, a role completely consistent with the
need to improve the overall quality of Commonwealth legislation.
While all of OPC’s work is Budget funded, only a portion of OLDP’s work
is Budget funded – it relies on fees revenue to sustain FRLI and client
revenue to sustain the drafting of “untied” subordinate legislation – and
this aspect of any merger would place yet another burden on OPC.
However, the head of OLDP advises that OLDP has well established timerecording and billing systems and that these streams of work provide a
generally steady revenue flow that is (or with already planned extensions
will be) adequate to sustain resource commitments (and, because charges
are only made within the Commonwealth, that revenue stream is capable
of adjustment over time without any constraint from the need to avoid
setting fees at a level that would constitute an impermissible taxation, but
subject to the usual rules on cost-recovery).
8.22 The abovementioned arguments are not strong.
8.23 There is nevertheless no doubt that bringing together OPC and OLDP in the one
independent portfolio agency would carry its own challenges. These would include:
a.
Agreeing upon the quantum of resources to be transferred from the
Attorney-General’s Department to the merged body. Clearly this needs to
be properly determined, and some expert advice may be necessary. But
the fact that direct Budget-funding would not cover all OLDP functions is
irrelevant, given that the charging regimes available would be sufficient to
allow all costs to be met.
b.
A decision would need to be made about resourcing for the drafting of the
“untied” subordinate legislation needs of the Attorney-General’s
Department. Such legislation is currently drafted by OLDP but there is no
cost recovery from the relevant line area of the Department. Either the
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c.
d.
applicable staff resource would need to remain with the Department and it
would draft its own “untied” instruments, or the staff would transfer to
OPC and the Department would in future pay for its “untied” drafting
requirements. Whatever arrangement is adopted should be ‘Budget
neutral’.
There would of course be a need to carefully develop the culture of the
merged entity so that subordinate legislation and those that draft it were
not looked down upon as the “poor cousins”. But a focus on the
professional nature of legislative drafting as a unified discipline, stressing
the need to enhance the quality of the Commonwealth’s overall
“legislation book”, and strong personal leadership both of the combined
group and within its component groups should achieve this.
Ideally it would be desirable if the merged groups were co-located. OLDP
is already scheduled to move to new premises currently being constructed
in National Circuit, Barton. There is sufficient uncommitted space in that
building to accommodate OPC, and its lease in Brisbane Avenue, Barton
(where it has a now-dated but still functional fitout) expires in October
2012. There is certainly present scope to consider co-location.
8.24 Resolution of the above issues would necessarily take some time. While that
process is in train, it would obviously be desirable if First Parliamentary Counsel and
the head of OLDP concurrently continued their present efforts to settle common
drafting standards for application by both offices as this is something that should be
done in any event. Moreover, resolution of this issue before the eventual merger of
the two offices occurs would minimise the chance (albeit slight) of any detrimental
impact on the Government’s legislative program. Given that work on common
standards is already advanced and having regard to the nature of the other issues
referred to above, the Review believes that the Government could confidently set a
1 July 2012 date for the merger to occur.
8.25 There is one other significant issue that needs to be resolved. It is not however
an issue that would arise from any merger of OPC and OLDP. It is an issue that will
inevitably confront the Attorney-General and her portfolio in any event.
8.26 The Legislative Instruments Act 2003 specifies that all non-exempt subordinate
legislation (whether Regulations or other instruments) is “sunsetted” so that, at a predetermined point in time, it ceases to operate unless remade. The purpose behind this
regime is to compel a process that requires periodic examination of non-Act
legislation to determine whether or not it is still required. Commencing in early to
mid-2015, significant volumes of subordinate legislation will either lapse or have to
be remade – Chart 8.1 below provides an indicative guide as to the impact.
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Chart 8.1: Outcome of sunsetting rules – pages per year –
2014 - 202031
8.27 The need to decide the fate of each affected legislative instrument will fall
initially on the portfolio administering the instrument:
a.
To the extent that the relevant portfolio decides that the instrument is
“spent” and does not need to be remade, there will be no impact on the
Commonwealth’s drafting resource - the instrument will simply move
from “current” to “historical” in the FRLI database.
b.
To the extent that the relevant portfolio decides that the instrument needs
to be “rolled over” in its current form, it will have a replacement
instrument prepared (by OLDP or elsewhere), have it remade by the
relevant authority and then register it as a new instrument in the FRLI
database for which a registration fee will be payable to cover the
associated cost, so that there will again be a limited impact on the
Commonwealth’s drafting resource.
c.
To the extent that the relevant portfolio decides that the instrument needs
to be “rolled over” but in an amended form, a resource issue will arise:
i.
If the instrument is “untied”, the administering portfolio can prepare
the amendments (or have OLDP prepare them on a fee for service
basis), have the amended instrument made by the relevant authority
and then register it as a new instrument in the FRLI database (for
which a registration fee will be payable), so that there will again be
no adverse impact on the Commonwealth’s drafting resource.
ii.
If the instrument is “tied”, there will be an adverse impact on the
Commonwealth’s drafting resource as it will be required to prepare
any necessary amendments but will not be able to charge for doing
31
Based on FRLI data (as at 21 October 2011) provided by the Office of Legislative Drafting and
Publishing.
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so. However, alternative funding sources may be available e.g. a
sunsetting surcharge on the registration of instruments on FRLI.
8.28 Clearly there are some decisions that need to be taken by the Government in
advance of sunset-driven drafting demand emerging. There are various options,
which may include one or more of the following:
a.
The Attorney-General’s Department (or the Government more generally)
could conceivably decide to make any necessary additional money
available to the Commonwealth drafter.
b.
A policy could be adopted that instruments sought to be “rolled-over”
would not be re-drafted simply to recast them in current drafting-style and
that only substantive problems with their operation would be remedied by
redrafting – if substantive problems have become evident, they are likely
to have been the subject of instructions issued to the Commonwealth
drafter in the ordinary course, so adoption of this might remove much if
not all of the potential demand. Alternatively, instruments could be
revised editorially by OLDP to achieve minimum levels of updating and
drafting resources conserved for matters that required substantive
redrafting.
c.
The definitions of “tied” and “untied” work could be adjusted to allow
some greater scope for administering portfolios to draft at least some
types of presently “tied” instruments, perhaps subject to them being
settled by the Commonwealth drafter before being finally made.
d.
A new category of tied but chargeable drafting could be established (on a
budget neutral basis), assuming of course that it is possible to recruit any
necessary additional drafting resource (such specialised skills not being
readily available at the best of times).
8.29 The Review expresses no preference for any one of the above options, and
indeed there may be others that should be considered.
8.30 The need to confront these issues will arise inevitably, quite apart from any
consideration of a merger of OPC and OLDP. These issues do not provide a reason
for not proceeding with such a merger. They are however matters on which both OPC
and OLDP should be provided with some early assurance – the former before any
merger proceeds, and the latter in any event.
8.31 If the drafting functions of OPC and OLDP are to be combined, there is a
question as to whether or not all other associated but non-drafting functions of OLDP
should also be brought together in that one office. These other functions include the
operation of FRLI and ComLaw, the preparation of compilations of amended Acts
and Regulations, and arranging hard-copy publication of Acts and Regulations.
8.32 The preparation of compilations requires more than mere clerical skill and, as
compilations are relied upon as definitive statements of Parliamentary resolution, they
should be prepared in an environment that recognises their significance. Similarly,
the operation of FRLI involves pre-registration vetting of submitted instruments to
ensure their formal legal effectiveness, and this should not be done separately from
the promulgation of drafting standards and acquittal of the associated function under
section 16 of the Legislative Instruments Act 2003. If these functions are to be within
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the combined office, it would be impractical and inefficient to place ComLaw and
hard-copy publication elsewhere.
8.33 Finally, some issues around the level of fees charged by OLDP were raised with
the Review at a late stage. Information provided by the Attorney-General’s
Department tended to indicate that overall revenue from OLDP services is
appropriate, and that fees charged to other agencies do not subsidise services provided
to the Attorney-General’s Department. However, a participant in the Review’s
Reference Group raised concerns about whether the charging arrangements are
consistent with the Government’s Cost Recovery Guidelines to the greatest possible
extent (as required for intra-agency or inter/intra-governmental charging), and
whether some adjustment between the levels of fees might be required (i.e. that some
may be set too high, and others too low). While the Review has no reason to
anticipate that further consideration would necessarily lead to substantial changes in
OLDP fee levels or total revenue, these issues should be resolved before any transfer
of OLDP functions to OPC.
Conclusion
8.34 The predominant concern with the structure of the Commonwealth’s legislative
drafting resource should be to ensure that all legislation, whether Bills, Regulations or
other subordinate instruments, are drafted to sustainably high and consistent
standards.
8.35 This does not occur at present, and cannot be assured under the present separate
OPC and OLDP structures. The prospect of enhancing the quality and effectiveness
of the entire Commonwealth “legislation book” would be optimised by bringing the
drafting of Bills and Regulations/other subordinate instruments together in the one
office. The Review is convinced not only that this would not pose any material risk to
the Government’s program for the preparation of Bills but also that it would present
an optimal opportunity to enhance the quality of the Government’s overall legislation
program by advancing the quality of Regulations and other subordinate instruments
and improving consistency and inter-operability between them.
8.36 The arguments for OPC being an independent statutory agency outside the
Attorney-General’s Department are, at best, weak.
8.37 Those arguments may have some greater force if OLDP were merged into OPC
so that the one agency had the responsibility and capacity to develop and enforce
those sustainably high and consistent standards.
8.38 Should there be concerns about OPC assuming this role, then the case for
moving OPC back into the Attorney-General’s Department would become very
strong, given that it would ensure the opportunity for the Executive to take control of
the process to improve the standard of Commonwealth legislative drafting overall.
The financial savings of such a move may only be minimal, but having one less
agency with separate budgeting, accountability, financial and other reporting
requirements would be of benefit to the Attorney-General’s Department and central
agencies.
8.39 On balance, the Review’s preferred option is not only the bringing together of
the OLDP and OPC functions, but also the retention of an independent FMA Act
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agency for the performance of those combined functions. The drawing of this balance
has had regard to the following factors:
a.
there is no perceived problem with the governance, quality or cost
effectiveness of the OPC agency;
b.
the savings that might arise from moving it back into the AttorneyGeneral’s Department (if that were not necessary to achieve the merger of
functions) would likely be only minor;
c.
it would be preferable for OPC management to be able to focus heavily on
managing the merger of the OPC and OLDP functions without at the same
time having to cope with the distraction and “teething problems” that
would inevitably arise during reintegration into the Department and its
systems; and
d.
consistent with the policy reasons discussed in Chapter 2, legislative
drafting is now a relatively routine (albeit specialized and highly skilled)
transactional-type business that does not require the close attention and
active responsibility of the Minister and Departmental executive, which
should be left free to concentrate on what are perceived as other higher
priority issues.
8.40 The Review therefore recommends that:
a.
OPC remain a separate statutory and FMA Act agency outside the
Attorney-General’s Department but solely on the condition that the
drafting functions of OLDP are transferred to it;
b.
to allow resolution of transitional issues and the adoption in advance of
common drafting standards across both OPC and OLDP, the Government
should set a 1 July 2012 transfer date;
c.
when the drafting functions of OPC and OLDP are combined, that
combination should include all other associated functions of OLDP;
d.
sufficient Budget funding should be transferred to OPC from the
Attorney-General’s Department so that, in combination with other
revenue sources including user-pays drafting and (properly set) FRLI
registration fees, OPC is properly resourced to undertake all its functions;
e.
First Parliamentary Counsel, as head of the combined office, should
replace the Secretary of the Attorney-General’s Department as the person
designated in section 16 of the Legislative Instruments Act 2003 as
responsible to “cause steps to be taken to promote the legal effectiveness,
clarity, and intelligibility to anticipated users, of legislative instruments”;
f.
the Attorney-General should issue an appropriate Letter of Expectation to
the head of the combined office in relation to the deployment of the
combined resource with a view to ensuring that all elements of the
Commonwealth’s legislative drafting requirements are appropriately met
within overall resource availability; and
g.
early decisions should be taken on the manner in which the “sunsetting”
of legislative instruments is to be resolved, and on how any necessary
requirements for additional resourcing are to be met.
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8.41 Finally, in Chapter 3 the Review recommended that the Attorney-General’s
Department should prepare a business-like proposal setting out in a “corporate
services business offering”:
a.
those (properly defined) corporate services that it (or another agency
within the portfolio) is able and prepared to provide to other agencies
within the portfolio;
b.
the service level specifications at which those services would be provided;
c.
the remediation or other compensatory consequences that would flow
from a failure to meet a service level specification; and
d.
the financially justifiable price at which each such service would be
provided.
8.42 This was so that, once that material was available, soundly based decisions
would be able to be made, within agencies and across the portfolio, as to whether or
not individual agencies should, in conformity with the Expenditure Review Principles,
provide their own corporate support services, acquire those services from a
commercial provider, or acquire them from their portfolio department or other
portfolio agency provider.
8.43 Accordingly, the Review further recommends that, once the Attorney-General’s
portfolio “corporate services business offering” is available, OPC should be required
to review and compare the offering to its existing corporate services provision
arrangements and report to the Attorney-General and the Minister for Finance and
Deregulation on whether or not OPC intends to access that offering and its rationale
for doing so.
Recommendations
Recommendation 8.1
OPC should remain a separate statutory and FMA Act agency outside the AttorneyGeneral’s Department, but solely on the condition that the drafting functions of OLDP
are transferred to it.
Recommendation 8.2
To allow resolution of transitional issues and the adoption in advance of common
drafting standards across both OPC and OLDP, the Government should set a 1 July
2012 transfer date.
Recommendation 8.3
When the drafting functions of OPC and OLDP are combined, that combination should
include all other associated functions of OLDP.
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Recommendation 8.4
Sufficient Budget funding should be transferred to OPC from the Attorney-General’s
Department so that, in combination with other revenue sources including user-pays
drafting and (properly set) FRLI registration fees, OPC is properly resourced to
undertake all its functions.
Recommendation 8.5
First Parliamentary Counsel, as head of the combined office, should replace the
Secretary of the Attorney-General’s Department as the person designated in section 16
of the Legislative Instruments Act 2003 as responsible to “cause steps to be taken to
promote the legal effectiveness, clarity, and intelligibility to anticipated users, of
legislative instruments”.
Recommendation 8.6
The Attorney-General should issue an appropriate Letter of Expectation to the head of
the combined office in relation to the deployment of the combined resource with a view
to ensuring that all elements of the Commonwealth’s legislative drafting requirements
are appropriately met within overall resource availability.
Recommendation 8.7
Early decisions should be taken on the manner in which the “sunsetting” of legislative
instruments is to be resolved, and on how any necessary requirements for additional
resourcing are to be met.
Recommendation 8.8
Once the Attorney-General’s portfolio “corporate services business offering” is
available, OPC should be required to review and compare the offering to its existing
corporate services provision arrangements and report to the Attorney-General and the
Minister for Finance and Deregulation on whether or not OPC intends to access that
offering and its rationale for doing so.
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CHAPTER 9 – THE LAW ENFORCEMENT AGENCIES
This Chapter considers the following agencies:
a.
Australian Commission for Law Enforcement Integrity (ACLEI); which
investigates corruption issues, as well as collects, analyses and disseminates
information and intelligence in relation to corruption issues generally in, or the
integrity of staff members of, both law enforcement and other agencies.
b.
Australian Institute of Criminology (AIC); which promotes justice and
reducing crime by conducting, administering and publicising criminological
research.
c.
Australian Transaction Reports and Analysis Centre (AUSTRAC); the two
core functions of which are to regulate and enforce financial transaction reporting
to facilitate the detection of crimes of terrorism, money-laundering, etc., and to
analyse and disseminate the data thereby collected to authorised Commonwealth,
state and territory agencies.
d.
CrimTrac Agency (CrimTrac); which develops and maintains law enforcement
information services, including background checking services.
9.2 Detailed information about each of these agencies is included at Appendices 7
(ACLEI), 8 (AIC), 9 (AUSTRAC) and 10 (CrimTrac).
Independence from the Attorney-General’s Department
9.3 As indicated in Chapter 2, the continued performance of the functions of each of these
agencies outside the Attorney-General’s Department can be supported by reference to the
principles discussed in that Chapter.
9.4
In relation to ACLEI:
a.
Avoidance of Conflict of Interest – The performance of some functions, if
undertaken within the Executive, may give rise to a perception that the
Government would manage the function to ensure that the benefit accrued to
itself rather than to affected citizens. Claims of government accountability and
transparency are clearly enhanced when there are mechanisms to test those
claims, such as that provided by ACLEI.
b.
To Secure the Conferral of Extra-ordinary Powers – It is often the case that
Parliament will only agree to confer highly intrusive or coercive powers on an
agency independent of the Executive – for example, the information gathering
powers of bodies such ACLEI.
9.5
In relation to AIC, those issues are:
a.
To Ensure Government Access to Best Advice – The Public Service has an
accepted role in providing “frank and fearless” advice having regard to the best
information available within and to the Service, which also encompasses
community views. However, there are occasions when the Government wishes to
obtain a more in-depth consideration of issues from advisers such as the AIC,
who are unencumbered by other potentially contradictory or competing demands
and who can more readily formulate advice based on wider and more detailed
community consultative mechanisms, in the process obtaining views that may not
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b.
otherwise be made known, or obtaining assistance or input that might not
otherwise be provided to the Executive itself. Additionally, such bodies are often
able to access, at no or minimal cost, input and advice that could not be expected
to be made available to a Department of State on the same basis.
To Ensure Participation by Stakeholders – Vital stakeholders (State and Territory
police and justice agencies) are only induced to participate and provide an
essential contribution (access to criminal justice data and policing operations
which are the foundation of much of the AIC’s research) because of the AIC’s
independence. Jurisdictions have made it clear that they would cease to support
the AIC and no longer provide the same access to data if the agency was no
longer independent and was only a part of the Attorney-General’s Department.
9.6
For AUSTRAC:
a.
To Distance Government from Regulatory Intrusion – On occasions responsible
government requires the imposition of significant restraints on the pursuit by
business or other private individuals of what would otherwise be lawful activity.
However, at the same time it may properly be desired that responsibility for such
activity not be directly attributable to a Government Minister but rather to an
independent agency. Agencies that regulate business affairs such as AUSTRAC
fall into this category.
9.7
In relation to CrimTrac:
a.
To Ensure Participation by Stakeholders – On occasions, it is only by creating a
separate independent agency that vital stakeholders can be induced to participate
and provide an essential contribution to the achievement of a common goal. It is
understood that it was only by establishing CrimTrac as an agency independent of
both the Attorney-General’s Department and other portfolio agencies that State
and Territory Police Commissioners could be persuaded to make available their
individual crime-related data-sets that collectively generate the highly desirable
national database administered by CrimTrac.
9.8 While, as noted in Chapter 2, meeting criteria such as those noted above does not
necessitate that an agency should remain as a separate independent body, the Review
nevertheless considers that the criteria do carry considerable strength in respect of these
particular agencies. In particular:
a.
ACLEI’s role as an integrity “watchdog” is essential to public trust in major
Commonwealth law enforcement agencies and that level of trust could not, in the
view of the Review, be generated if the function were performed by the
Executive.
b.
The claims that States and Territories would not provide their information to a
Commonwealth Department are understood by the Review to be real and on that
basis the benefits of the well-regarded work of AIC and CrimTrac would be lost
if their functions were not conferred upon independent agencies.
c.
The regulatory role undertaken by AUSTRAC is highly intrusive upon the affairs
of significant numbers of entities in the financial services community and the
information about individuals collected by AUSTRAC is highly detailed and
personal, and the Review understands that Government would want to distance
itself from such matters.
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9.9 On these bases the Review recommends that none of ACLEI, AIC, AUSTRAC or
CrimTrac should be “rolled into” the Attorney-General’s Department.
Merging agencies
9.10 It is next necessary to consider whether or not any of these agencies should be merged
with any other independent agency. In this regard, the Review has concluded as follows:
a.
ACLEI – There is no other agency in the Attorney-General’s portfolio with which
ACLEI’s functions could be properly merged. As ACLEI is the integrity
“watchdog” for the Australian Federal Police, the Australian Crime Commission
(ACC) and the Australian Customs and Border Protection Service, it would be
completely unacceptable to move the function into any of those bodies.
Moreover, the function has no synergy with those of any other portfolio agency.
Beyond the Attorney-General’s portfolio there are a number of other integrityrelated agencies, such as the Commonwealth Ombudsman and the InspectorGeneral of Intelligence and Security, as well as a commitment to establish a
parliamentary integrity agency. While future consideration could be given to the
merger of some or all of these bodies into a whole-of-Commonwealth integrity
agency, this is beyond the Terms of Reference of this Review.
b.
AIC – This agency works within a recognised and specialised discipline that is
quite separate from those in which other portfolio agencies work. For example,
while the AIC and the Australian Law Reform Commission undertake detailed
research, the AIC is not primarily a law reform body and thus there would be no
substantive gain to be had in a merger of the two given that there is no synergy in
their functions. And while the AIC undertakes research into crime-related issues
that are investigated by the Australian Federal Police, its mandate extends far
beyond the Commonwealth crimes with which the AFP is predominantly
concerned (i.e., outside ACT community policing) and it is not a crime
investigation agency.
c.
AUSTRAC – AUSTRAC works in aid of numerous Commonwealth and State
agencies, including the Australian Federal Police, State and Territory police
forces and a large number of other Commonwealth, State and Territory law
enforcement and regulatory agencies. It has no particular synergy with any one
of the agencies whose work it assists, and merging it with one or other of them
may cause needless concern that its data and/or resources would be preferentially
made available to or skewed towards the particular interests of that agency.
Further, linking AUSTRAC with Commonwealth agencies primarily concerned
with financial regulation, such as APRA or ASIC, could bring with it potentially
disruptive risks to the criminal focus of its work.
d.
CrimTrac – This agency is fundamentally dependent upon continued access to
data that is generated and held by State and Territory law enforcement agencies
and the sensitivities they (and other agencies of their Governments) hold about
the release and use of that information. At least at this stage, merger into another
agency such as the Australian Federal Police would probably spell the end of
what is a particularly valuable function.
9.11 On these bases, the Review recommends the continued existence of each agency in its
present separate form.
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Integration and working more effectively
9.12 The Review notes that one of the Expenditure Review Principles provides that:
Integration:
government agencies should work together effectively to consistently deliver the
Government’s policy objectives within clearly defined lines of responsibility…
9.13 This principle is of particular relevance to this chapter. The law enforcement
community comprises a number of separate and independent agencies and optimal outcomes
will only be achieved if each member of that community is interacting to the full extent
necessary with each other member. The past history of Australian law enforcement exhibits
numerous occasions where inter-agency rivalries or inefficiencies have arisen. This leads to
the question of whether or not each of these agencies is cooperating as fully as it should with
each other law enforcement agency.
9.14 Consistent with this principle, priority should be given to developing a greater
understanding of the opportunities for enhanced data exchange, information sharing and
connectivity between those agencies currently collecting and disseminating criminal
information and/or intelligence that relates to serious and organised crime.
9.15 For example, CrimTrac, AUSTRAC and the ACC all collect data, information and
intelligence that is increasingly important in understanding the full impact of, and better
responding to, the activities of serious and organised crime.
9.16 Domestic serious and organised criminal activities include money laundering, illicit
drug importations and increasingly there is a threat from non-state actors utilising the cyber
environment to support criminal activities.
9.17 CrimTrac’s national holdings of police records, including DNA and fingerprints,
AUSTRAC’s financial intelligence unit and the ACC’s national criminal holdings would
provide a greater degree of protection for the Australian community if enhanced data sharing
could be achieved.
9.18 However, the Review was advised that there are particular issues that affect the
capacity of CrimTrac to disseminate its information as widely as may be desirable. For
example, while negotiations are at an advanced stage, the ACC does not yet have access to all
CrimTrac data bases. This limits the Commission’s capacity to pursue its investigations. The
Review found this a matter for some concern, especially given the significant degree of
commonality between the Boards of CrimTrac and the ACC.
9.19 It appears however that the limitations on dissemination of or access to CrimTrac data
do not emanate from any necessary reluctance on the part of Police Commissioners to see
their data used for wider purposes, nor from any desire to optimise the fee revenue generated
by it. Instead, the concern is to ensure compliance with State and Territory laws governing
the permissible uses of information held by the various police forces. These vary jurisdiction
by jurisdiction, and in some cases impose significant practical and other limitations. Because
there is no Commonwealth legislation that establishes CrimTrac or authorises its use or
disclosure of information in particular ways, there must be compliance with each of those
jurisdictional requirements.
9.20 The Review is aware that the Government is actively considering a range of issues
relating to CrimTrac governance, financing and IT development and understands that this
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issue is included within that process. Accordingly, the Review makes no specific
recommendations in this regard.
9.21 In regard to inter-agency relationships more generally, the Review was informed by a
number of those it consulted that HOCOLEA (the Heads of Commonwealth Operational Law
Enforcement Agencies) is an increasingly effective forum for marshalling inter-agency
cooperation amongst Commonwealth law enforcement agencies both within and outside the
Attorney-General’s portfolio. The Review was also impressed by the arrangements that exist
for dissemination of AUSTRAC data and research, and the increasingly interactive role that
AIC is playing with other agencies. The Review has no concerns in this regard in relation to
ACLEI.
Shared services
9.22 The Review next needs to consider whether or not the services necessary to support the
substantive functions of each of these agencies should be supplied internally (as they are
largely now), or obtained on some shared services or similar external basis. In this latter
regard, the Review notes that the Attorney-General’s Department currently provides the
majority of ICT support for ACLEI.
9.23 The Review’s analysis (set out in the relevant appendices) suggests that ACLEI,
AUSTRAC and AIC are, on the available data, relatively cost effective in their corporate
support arrangements. It is thus not possible, at this time, to say that there would likely be
any saving or any appreciable increase in effectiveness or efficiency in requiring any change
to the present arrangements.
9.24 The situation with respect to CrimTrac is less clear. The Review’s analysis suggests
that its corporate support is more expensive that the average of other agencies within the
scope of the Review. While CrimTrac receives no direct Parliamentary appropriation, any
lack of full cost-effectiveness on its part still may have a significant impact on the
Commonwealth Budget, as its fees in many cases are being paid by other agencies dependent
on Commonwealth, State or Territory public purses. It should therefore have no lesser focus
on optimising its use of its resources than other agencies within the scope of the review.
9.25 CrimTrac advised the Review that it had not to date embarked on any internal or
external review of its support service provision arrangements with a view to assessing current
efficiency and effectiveness, seeking savings, benchmarking against other agencies, market
testing, testing shared services viability, etc. While there will be Ministerial oversight of the
level of fees CrimTrac is able to charge under the reforms currently proposed to CrimTrac’s
governance and funding, this will not be focussed directly on underlying costs and will thus
not of itself ensure that CrimTrac is focussed on optimising the use of its resources.
9.26 Accordingly the Review recommends that a suitably qualified external consultant be
engaged to report to CrimTrac, the Minister for Home Affairs and Justice and the Minister for
Finance and Deregulation on whether or not CrimTrac’s corporate support services costs are
reasonable, both absolutely and having regard to the best available benchmarking data. This
exercise can be undertaken concurrently with, but without delay to, the processes currently in
train to resolve the governance issues of relevance to CrimTrac.
9.27 Finally, in Chapter 3 the Review recommended that the Attorney-General’s Department
should prepare a business-like proposal setting out in a “corporate services business
offering”:
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a.
b.
c.
d.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
the service level specifications at which those services would be provided;
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
the financially justifiable price at which each such service would be provided.
9.28 This was so that, once that material was available, soundly based decisions would be
able to be made, within agencies and across the portfolio, as to whether or not individual
agencies should, in conformity with the Expenditure Review Principles, provide their own
corporate support services, acquire those services from a commercial provider, or acquire
them from their portfolio department or other portfolio agency provider.
9.29 Accordingly, the Review further recommends that, once the Attorney-General’s
portfolio “corporate services business offering” is available, each of ACLEI, AIC,
AUSTRAC and CrimTrac should review their then existing corporate services provision
arrangements and report to the Minister for Home Affairs and Justice and the Minister for
Finance and Deregulation on whether or not they intend to access that offering and their
rationale for doing so.
Recommendations
Recommendation 9.1
ACLEI, AIC, AUSTRAC and CrimTrac should each continue to exist in their present
separate form.
Recommendation 9.2
Without delaying the changes to CrimTrac’s governance that are currently in train, a
suitably qualified external consultant be engaged to report to CrimTrac, the Minister for
Home Affairs and Justice and the Minister for Finance and Deregulation on whether or not
CrimTrac’s corporate support services costs are reasonable, both absolutely and having
regard to the best available benchmarking data.
Recommendation 9.3
Once the Attorney-General’s portfolio “corporate services business offering” is available,
each of ACLEI, AIC, AUSTRAC and CrimTrac should review their then existing
corporate services provision arrangements and report to the Minister for Home Affairs and
Justice and the Minister for Finance and Deregulation on whether or not they intend to
access that offering and their rationale in doing so.
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Chapter 9 – The Law Enforcement Agencies
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CHAPTER 10 – THE REMAINING AGENCIES
This Chapter considers the following agencies:
a.
Australian Human Rights Commission (AHRC); which has statutory roles and
responsibilities pursuant to federal anti-discrimination and human rights laws.
b.
Australian Law Reform Commission (ALRC); which reviews and provides
reports on proposals to reform Commonwealth, State and Territory laws.
c.
Insolvency and Trustee Service Australia (ITSA); which provides trustee,
information and other services in relation to personal debt and insolvency, and
also undertakes regulatory functions in relation to personal insolvency
practitioners.
10.2
Detailed information about each of these agencies is included at Appendices
11(AHRC), 12 (ALRC) and 13 (ITSA).
Independence from the Attorney-General’s Department
10.3
As indicated in Chapter 2, the continued performance of the functions of each of
these agencies outside the Attorney-General’s Department can be supported by reference to
the principles discussed in that Chapter.
10.4
In relation to AHRC:
a.
International comity – Australia has agreed, in an international forum, that it will
establish a separate independent human rights body. Under the Principles relating
to the Status of National Institutions (the ‘Paris Principles’)32, Australia agreed
that its national human rights agency:
...shall have an infrastructure which is suited to the smooth conduct of its activities, in
particular funding. The purpose of this funding should be to enable it to have its own
staff and premises, in order to be independent of the Government and not subject to
financial control which may affect its independence”
b.
10.5
This provides a clear justification for the maintenance of AHRC as a separate
independent agency.
Avoidance of conflict of interest – the performance of various functions of the
AHRC, if undertaken within the Executive, would give rise to a perception of
conflict of interest, and claims of government accountability and transparency are
clearly enhanced when an independent AHRC is available as a mechanism to test
those claims.
For the ALRC:
a.
To Ensure Government Access to Best Advice – The Public Service has an
accepted role in providing “frank and fearless” advice having regard to the best
information available within and to the Service, which also encompasses
community views. However, there are occasions when the Government wishes to
obtain a more in-depth consideration of issues from independent advisers such as
Principles relating to the Status of National Institutions (The Paris Principles) –
http://www2.ohchr.org/english/law/parisprinciples.htm
32
Chapter 10 – The Remaining Agencies
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the ALRC (or other bodies such as Companies and Markets Advisory Committee
or the Productivity Commission) who are unencumbered by other potentially
contradictory or competing demands and who can more readily formulate advice
based on wider and more detailed community consultative mechanisms, in the
process obtaining views that may not otherwise be made known, or obtaining
assistance or input that might not otherwise be provided to the Executive itself.
Additionally, such bodies are often able to access, at no or minimal cost, input
and advice that could not be expected to be made available to a Department of
State on the same basis. For example, the ALRC estimates that, in respect of its
Discovery Inquiry, it received at no or only incidental cost services with a market
value of approximately $200,000 (this estimate excludes contributions received
from federal court justices and community service providers or representatives
from non-government organisations). Based on ALRC undertaking two to three
inquiries per annum this would equate to approximately $400,000 to $600,000
per annum in pro bono contributions to inquiries. The Review doubts that “free
goods” of anything like this value would be available to the Attorney-General’s
Department if it were to assume the role of the ALRC. It is the very
independence of the ALRC from the Executive that is understood to be a
significant attractor for those who freely make their expertise and time available
to it.
10.6
In relation to ITSA:
a.
Avoidance of conflict of interest – The performance of some functions, if
undertaken within the Executive, may give rise to a perception that the
Government would so manage the function to ensure that benefit accrued to itself
rather than to affected citizens. So far as ITSA is concerned, the management of
bankrupt estates in which the Australian Taxation Office may be a major creditor
could give rise to a claim of favouritism towards taxation revenues if undertaken
by the Executive rather than by an independent body such as ITSA.
b.
To Distance Government from Regulatory Intrusion – On occasions responsible
government requires the imposition of significant restraints on the pursuit by
business or other private individuals of what would otherwise be lawful activity.
However, at the same time it may properly be desired that responsibility for such
activity not be directly attributable to a Government Minister but rather to an
independent agency. Agencies that regulate business affairs such as fall into this
category. ITSA regulates private sector personal insolvency practitioners.
c.
To allow ministers and departments to focus on higher priorities – Sometimes, the
reason for moving a function out of a Department into, or maintaining it in, a
separate agency may be as simple as allowing the Minister and Department to be
able to concentrate on what are perceived at the time to be other higher priority
issues without the need to carry active responsibility for more routine,
transactional-type business.
10.7
The Review accepts that the arguments that the AHRC should not be “rolled into”
but should remain separate from the Attorney-General’s Department have considerable
weight.
10.8
With respect to the ALRC and ITSA, however, while the above would support the
retention of separate agencies, that is not a necessary outcome. Other alternatives may be
available.
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10.9
So far as the ALRC is concerned, a mid-course might be to maintain independent
statutory Commissioner(s) but subsume the Commission itself within the Attorney-General’s
Department so that its entire staff became Departmental officers. This is essentially the way
in which the Administrative Review Council (ARC) is structured and operates, and similarly
the Classification Board and the Classification Board of Review (each of which have very
different roles to the ALRC and the ARC and affected parties have effectively no choice but
to deal with these bodies).
10.10 However, the Review doubts that Commissioners under such a structure would be
able to attract the same access to the voluntary expertise and advice that the ALRC currently
enjoys. Moreover, because the Department has virtually no presence in Sydney where the
ALRC is based (and where much of its voluntary assistance emanates), the Review perceives
that there would be no increase in the efficiency and effectiveness of corporate support to
Commissioners. Accordingly, the Review does not favour this model.
10.11 So far as ITSA is concerned, the case for an independent agency outside the
Department is not so strong. This is because ITSA existed for some decades within the
Department (albeit with departmental officers occupying statutory offices) without there
being either generalised complaint about perceptions of conflict of interest, or a concern to
distance government from regulatory intervention. Indeed, it is apparent that the motivation
for moving ITSA out of the Department and establishing it as an Executive Agency in 2000
was predominantly a desire to allow the Department to concentrate its efforts more on policy
development and advice than on routine operational issues. That same motivation was not so
readily apparent when the function Emergency Management Australia was moved from an
independent agency and brought into the Department, notwithstanding that its business is not
heavily policy-oriented but more transaction oriented (albeit of high public and political
interest, especially in more recent years).
10.12 Despite this, the Review perceives that there would be no great advantage, if any,
from reintegrating ITSA into the Department. The cost of separating it out and requiring it to
establish its own systems and processes has been significant, and absent some other
compelling reason, should be tested over a more extended period than has elapsed since 2000.
Reintegration would also come at an additional cost in moving away from those systems and
processes to those now operative in the Department (although this could possibly be done
gradually). Perhaps more importantly, ITSA is about to assume responsibility for a major
new Government initiative – the Personal Property Securities Register. Implementation of
this initiative is not without risk for the Government and it would be most undesirable for the
attention of senior ITSA management to be diverted from ensuring its success by having to
simultaneously manage reintegration into the Department.
10.13 For these reasons and on balance, the Review recommends the continuation of ITSA
as a separate independent portfolio agency.
Merging agencies
10.14 It is next necessary to consider whether or not any of these agencies should be
merged with any other independent agency. In this regard, the Review has concluded as
follows:
a.
AHRC – Quite apart from the argument for AHRC being a stand-alone body that
flows from the Paris Principles quoted above, there is no other agency in the
Attorney-General’s portfolio or elsewhere in the wider government structure with
which AHRC’s functions have such close synergy that they could be
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b.
conveniently merged. For example, it is not a merits review administrative body
and so merger with any of the Commonwealth’s tribunals would not be a “good
match”.
ALRC – This agency is a generalist law reform adviser that, over the years, has
been given references covering areas of the law that are the concern of many
portfolios. While there are some other law reform/advisory agencies (such as the
Companies and Markets Advisory Committee and the Administrative Review
Council), these work within recognised and specialised disciplines and have no
necessary synergy with the broader and more general functions of the ALRC.
This means that there is no other body with which its functions have any
particular synergy and with which it would be sensibly merged.
10.15 On these bases, the Review recommends the continued existence of both the AHRC
and the ALRC in their present separate forms.
10.16 In respect of ITSA, it is notable that it deals only with personal insolvency while the
Australian Securities and Investments Commission (ASIC) regulates corporate insolvency.
Given the essentially similar nature of these two functions, there is an obvious question as to
why the insolvent estate management functions of each are not co-located within the same
agency. Indeed, recently a Productivity Commission research paper33 recommended that the
case for making one regulator responsible for both corporate and personal insolvency should
be explored, and further, a Parliamentary Committee report34 recommended that ASIC’s
corporate estate management function should be transferred to ITSA. While such an
approach would be consistent with the position in at least the UK, Canada, New Zealand,
Singapore and Hong Kong, the Government has rejected both these recommendations.
10.17 As these are recent decisions of the Government, the Review has not further
considered the case for combining insolvency functions.
10.18 At the same time, the Review does note that one of the Expenditure Review
Principles specifically provides that:
Integration:
government agencies should work together effectively to consistently deliver the
Government’s policy objectives within clearly defined lines of responsibility…
10.19 Accordingly, even though personal and corporate insolvency may remain the
separate responsibilities of ITSA and ASIC respectively, it should be the case that both
agencies work closely together to implement consistent Government policy. The CEO of
ITSA informed the Review that this is increasingly occurring, with both agencies seeking to
minimise unnecessary differences in their operations.
Shared services
10.20 The Review next needs to consider whether or not the support services necessary to
support the substantive functions of each of these agencies should be supplied internally (as
they are largely now), or obtained on some shared services or similar external basis.
Productivity Commission Research Report – Annual Review of Regulatory Burdens on Business: Business
and Consumer Services – August 2010.
34
Economics References Committee – The regulation, registration and remuneration of insolvency practitioners
in Australia: the case for a new framework – September 2010.
33
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10.21 The Review’s analysis (set out in the relevant appendices) suggests that AHRC,
ALRC and ITSA are, on the available data, relatively cost effective in their corporate support
arrangements. In particular:
a.
the ALRC has been the subject of recent significant reductions to its budget that
prompted a review by a Parliamentary Committee and a Government response in
reply. Those reductions have forced the ALRC to review and refine all its
operations, but especially its corporate support arrangements. It is now colocated with the Australian Government Solicitor in Sydney and gains significant
cost benefits from the associated arrangements (as further detailed in Appendix
12);
b.
as discussed in Chapter 3, the AHRC currently provides the support services for
IT, personnel and finance to the Office of the Australian Information
Commissioner (OAIC) and, in so doing, gains both income and benefits of scale
for itself; and
c.
ITSA has participated with a number of other public sector agencies in some
limited benchmarking of various corporate support functions and the results,
while far from definitive, do not highlight any particular issue with ITSA’s
provision of services to itself.
10.22 It is thus not possible, at this time, to say that there would likely be any saving or
appreciable increase in effectiveness or efficiency in requiring any change to the present
arrangements for the support of these agencies.
10.23 However, in Chapter 3 the Review recommended that the Attorney-General’s
Department should prepare a business-like proposal setting out in a “corporate services
business offering”:
a.
those (properly defined) corporate services that it (or another agency within the
portfolio) is able and prepared to provide to other agencies within the portfolio;
b.
the service level specifications at which those services would be provided;
c.
the remediation or other compensatory consequences that would flow from a
failure to meet a service level specification; and
d.
the financially justifiable price at which each such service would be provided.
10.24 This was so that, once that material was available, soundly based decisions would be
able to be made, within agencies and across the portfolio, as to whether or not individual
agencies should, in conformity with the Expenditure Review Principles, provide their own
corporate support services, acquire those services from a commercial provider, or acquire
them from their portfolio department or other portfolio agency provider.
10.25 Accordingly, the Review recommends that, once the Attorney-General’s portfolio
“corporate services business offering” is available, each of AHRC, ALRC and ITSA should
review their then existing corporate services provision arrangements and report to the
Attorney-General and the Minister for Finance and Deregulation on whether or not they
intend to access that offering and their rationale for doing so.
10.26 Finally, and consistent with the recommendation made in Chapter 3, the Review
recommends that the AHRC should negotiate with the OAIC service level standards for the
provision of the various support services that it provides to the OAIC.
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Recommendations
Recommendation 10.1
AHRC, ALRC and ITSA should each continue to exist in its present separate form.
Recommendation 10.2
Once the Attorney-General’s portfolio “corporate services business offering” is available,
each of AHRC, ALRC and ITSA should review their then existing corporate services
provision arrangements and report to the Attorney-General and the Minister for Finance
and Deregulation on whether or not they intend to access that offering and their rationale
for doing so.
Recommendation 10.3
AHRC should negotiate with the OAIC service level standards for the provision of the
various support services that it provides to the OAIC.
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APPENDIX 1 – FEDERAL COURT OF AUSTRALIA
Established by/under:
Federal Court of Australia Act 1976
Financial framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency functions:
The Federal Court of Australia is a superior court of record and a court of law and equity.
The Federal Court has jurisdiction to hear and determine any civil matter arising under laws
made by the Federal Parliament, as well as any matter arising under the Australian
Constitution or involving its interpretation. The Federal Court also has original jurisdiction in
respect of specific subject matter conferred by over 150 statutes of the Australian Parliament.
The Federal Court has a substantial and diverse appellate jurisdiction. It hears appeals from
decisions of single judges of the Federal Court, and from the Federal Magistrates Court in
non-family law matters. The Federal Court also exercises general appellate jurisdiction in
criminal and civil matters on appeal from the Supreme Court of Norfolk Island.
Governance structure:
The Federal Court was established by the Parliament in accordance with Chapter III of the
Constitution. The Federal Court of Australia Act 1976 provides that the Federal Court
consists of a Chief Justice and other judges as appointed. The Chief Justice is the senior judge
of the Federal Court and is responsible for ensuring the orderly and expeditious discharge of
the business of the Federal Court.
In practice, the Federal Court’s governance involves two distinct structures: the judges’
committee structure which facilitates the collegiate involvement of the judges of the Federal
Court; and the management of the Federal Court through its registry structure.
The Chief Justice is the judicial and administrative head of the Federal Court, and is assisted
in the administrative functions by a Registrar. The Registrar is the Chief Executive of the
Federal Court for the purpose of the Financial Management and Accountability Act 1997 and
has the powers of a Secretary in respect of officers and staff of the Federal Court, who are
employed under the Public Service Act 1999.
Appendix 1 - Federal Court
Page 137
Staff profile:
Table A1.1: Federal Court ASL in 2010-11
Federal Court
Federal Court
APS Average
ASL
(%)
(%)
APS Employees
238
77%
73%
EL Employees
60
20%
25%
SES Employees
10
3%
2%
Statutory office holders
52
The Federal Court indicated in their questionnaire response that 82 per cent of their staff
(including statutory office holders) undertake substantive activities of the agency; the
remaining 18 per cent undertake support activities.
Annual funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
The Federal Court is completely budget funded and has one Outcome as follows:
Outcome 1 – Through its jurisdiction, the Court will apply and uphold the rule of law to
deliver remedies and enforce rights and in so doing, contribute to the social and economic
development and well-being of all Australians.
Budgeted departmental appropriations and agency receipts for the 2008-09 to 2010-11
financial years and estimated departmental appropriations and agency receipts for the
2011-12 to 2014-15 financial years (based on Portfolio Budget Statements and Annual
reports) are as follows:
Table A1.2: Federal Court actual and estimated appropriation
Actual (‘000)
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
Appropriation (excl DCB)
78,206
88,410
88,325
85,505
80,731
81,090
82,207
Other Agency Receipts
10,251
11,380
2,532
2,073
1,908
1,927
2,254
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The 2011-12 appropriation includes rent supplementation ($4.5m) for the Commonwealth
Law Courts Buildings. Rent supplementation has not been included in the forward estimates
and is currently being reviewed by the Department of Finance and Deregulation.
The Federal Court appropriation in 2009-10 includes $7.604m that was paid to the Federal
Magistrates Court (recorded as an ‘other agency receipt’ in that Court). The Federal Court
appropriation in 2010-11 includes $7.328m that was paid to the Federal Magistrates Court
Appendix 1 - Federal Court
Page 138
(recorded as an ‘other agency receipt’ in that Court).35 These payments result from the delay
in implementation of the court restructure which was included in the 2009-10 Budget.
Other agency receipts in 2008-09 include revenue of $8.652m from the Federal Magistrates
Court for registry and migration services. Other agency receipts in 2009-10 include revenue
of $8.721m from the Federal Magistrates Court for registry and migration services. 36 The
Federal Magistrates Court’s expenses in 2010-11 include $4.381m that was paid to the
Federal Court for registry and migration services in the first half of the financial year.37 In
the second half of 2010-11 these services were provide free of charge to the Federal
Magistrates Court. In 2011-12 and future years these services are budgeted to be provided
free of charge by the Federal Court to the Federal Magistrates Court.
Financial viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A1.3: Federal Court actual operating results
Actual (‘000)
08-09
Actual Operating Results
1,838
09-10
1,242
10-11
-5,522
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
Federal Court estimated operating results
The Federal Court’s estimate of its operating results for the 2011-12 to 2014-15 financial
years (excluding depreciation and other non-cash items, and assuming no further initiatives
are taken to address the situation) is as set out below:
35
Federal Magistrates Court of Australia Annual Report 2010-11, note 4A, 4B page 100. Note that the Federal
Court of Australia has netted payments from the restructure and registry and migration and services in their
annual report. .
36
Federal Magistrates Court of Australia Annual Report 2009-10, note 3B page 114. Note that these payments
are netted in the Federal Court annual report and therefore payment amounts may not match.
37
This is calculated using the court registry and migration services expenses from the Federal Magistrates Court
of Australia Annual Report 2010-11, note 3B, page 99 minus resources received free of charge from the Federal
Court in note 4D. Note that these payments are netted in the Federal Court annual report and therefore payment
amounts may not match.
Appendix 1 - Federal Court
Page 139
Table A1.4: Federal Court’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
-1,000
-2,500
-4,000
-4,500
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The forecast levels of deficit in 2012-13 to 2014-15 assume that rent supplementation of the
order of that provided for 2011-12 will be continued in those years. Clearly, if that is not the
case, the Federal Court would be estimating even more significant deficits over the Forward
Estimates period.
The Federal Court noted in its 2010-11 Annual Report that estimated operating deficits in the
out years are substantially related to fixed costs. Recent and projected deficits, if they
eventuate, will erode accumulated reserves.
As discussed in Chapter 4, it has not been possible, in the time available, for the Review to
fully examine, analyse and test the material provided in order to conclude one way or the
other with adequate confidence that the Federal Court is financially viable to operate at
acceptable service levels within its current and Forward Estimates appropriations and at
currently experienced and anticipated activity levels.
Even with a decision to provide full supplementation for the rent of special purpose
Commonwealth Law Courts Buildings, it is likely that the Federal Court will need to take
significant action, possibly including the reduction of its current service levels, to avoid
running future deficits. The recommendations made in Chapter 5 of this report for achieving
further efficiencies and effectiveness across the Federal Court, the Family Court and the
Federal Magistrates Court as a “group” may contribute to achieving ongoing financial
viability and avoiding or minimising cuts to service levels, but are unlikely to provide a
complete answer.
In Chapter 4 the Review concludes that it would be appropriate for the Attorney-General’s
Department to undertake a further, more detailed, analysis of the Commonwealth Courts’
financial position, including identifying possible expenditure reductions and other measures,
and the likely impact of those measures on financial viability and service delivery.
Appendix 1 - Federal Court
Page 140
Shared/outsourced services:
The Federal Court provides registry and library services (in general federal law) to the
Federal Magistrates Court. The Federal Court also provides registry services to the
Administrative Appeals Tribunal in Hobart and the High Court in Brisbane, Darwin, Perth
and Adelaide.
The Federal Court, the Family Court and the Federal Magistrates Court are working together
in the ongoing development of a web-based Commonwealth Courts Portal initiative (the
recommendations in Chapter 5 for close cooperation between the Courts are expected to
enhance the future development and utility of that initiative).
The Federal Court has a number of outsourced service arrangements in place, including:

information technology services are outsourced to consultants as required;

the support services for the Casetrack database are provided by the Family
Court;


payroll processing is partly outsourced to Aurion; and
Internal Audit function from O’Connor Marsden and Associates (from May 2011
- previously this was provided by Deloitte).
The Federal Court has, as required, utilised AGIMO arrangements under a number of whole
of Government contracts for the supply of various goods and services.
Expenditure analysis:
An analysis of the Federal Court’s 2010-11 expenditure by select activities is as follows:
Table A1.5: Federal Court 2010-11 expenditure by select activities
Federal Court
Review Agencies
Average
IT Expenditure per ASL
18,457
9,973
HR Expenditure per ASL
1,660
3,869
679
1,285
65,048
28,095
Support Activities (excl Rent)/Total
Expenditure
25%
22%
Substantive Activities/Total Expenditure
56%
66%
Rent/Total Expenditure
19%
12%
Payroll Expenditure per ASL
Property Expenditure per ASL
As is apparent, the Federal Court is reasonably comparable in expenditure per support
activity with other agencies within the scope of this Review, with the exception of human
resources (where the Federal Court spend is significantly lower), information technology
(where the Federal Court spend is significantly higher) and property (where the Federal Court
is higher due to the special purpose nature of the Commonwealth Law Courts Buildings).
Appendix 1 - Federal Court
Page 141
Property analysis:
The Federal Court occupies Commonwealth Law Courts Buildings where they exist, with the
exception of Parramatta. Only in Sydney and Darwin is accommodation co-located with the
State Courts.
Since its inception, the Federal Magistrates Court has occupied space provided by the Federal
Court and the Family Court.
In Chapter 5 the Review has recommended the development of a “whole-of-building” plan
for the use and management of each of the Commonwealth Law Courts Buildings. The
development of that plan will necessitate more detailed analysis of Federal Court property
requirements.
Recent reviews/material considered by Review Team:

Joint Committee of Public Account and Audit in relation to the efficiency
dividend on small agencies (2008)

Improving access to justice – a better framework for federal courts – AttorneyGeneral’s Department (November 2008)

Shared services business case. Prepared by KPMG for the Attorney-General’s
Department (June 2011)

Organisational Health Check Review. Prepared by O’Connor Marsden for the
Federal Court (July 2011)

Federal Court of Australia Annual Report 2008-09

Federal Court of Australia Annual Report 2009-10

Federal Court of Australia Annual Report 2010-11

Federal Court of Australia response to Review Questionnaire – (2011)
Appendix 1 - Federal Court
Page 142
APPENDIX 2 – FAMILY COURT OF AUSTRALIA
Established by/under:
Family Law Act 1975
Financial framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency functions:
The Family Court of Australia, through its specialist judges and staff, assists Australians to
resolve their most complex legal family disputes.
The purpose of the Family Court, as Australia’s superior court in family law, is to:

determine cases with the most complex law and facts;

cover specialised areas in family law; and

provide national coverage as the appellate court in family law matters.
Governance structure:
The Family Court was established by the Parliament in accordance with Chapter III of the
Australian Constitution. The Family Law Act 1975 defines the Family Court as being a Chief
Justice, a Deputy Chief Justice and the judges appointed to the Family Court, who have
responsibility for the administration of the Family Court. By delegation from the Chief
Justice, designated judges assist in administering judicial functions in particular areas such as
case management.
The Chief Justice is the judicial and administrative head of the Family Court, and is assisted
in the administrative functions by a Chief Executive Officer. The Chief Executive Officer is
the Chief Executive of the Court for the purpose of the Financial Management and
Accountability Act 1997 and has the powers of a Secretary in respect of officers and staff of
the Family Court, who are employed under the Public Service Act 1999.
Staff profile:
Table A2.1: Family Court ASL in 2010-11
Family Court
Family Court
APS Average
ASL
(%)
(%)
APS Employees
398
71%
73%
EL Employees
155
28%
25%
SES Employees
8
1%
2%
Statutory office holders
34
The Family Court indicated in their questionnaire response that 83 per cent of their staff
(including statutory office holders) undertake substantive activities of the agency; the
remaining 17 per cent undertake support activities.
Appendix 2 – Family Court
Page 143
Annual funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
The Family Court is completely budget funded and has one Outcome as follows:
Outcome 1 – As Australia’s specialist superior family court, determine cases with complex
law and facts, and provide national coverage as the appellate court in family law matters.
Budgeted departmental appropriations and agency receipts for the 2008-09 to 2010-11
financial years and estimated departmental appropriations and agency receipts for the 201112 to 2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are
as follows:
Table A2.2 Family Court actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
127,293
152,566
145,601
119,491
114,086
114,047
113,137
5,334
7,074
4,256
2,000
2,000
2,000
2,000
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The 2011-12 appropriation includes rent supplementation ($5.727m) for the Commonwealth
Law Courts Buildings. Rent supplementation has not been included in the Forward Estimates
for the out years and is currently being reviewed by the Department of Finance and
Deregulation (see below).
The Family Court appropriation in 2009-10 includes $25.363m that was paid to the Federal
Magistrates Court (recorded as an ‘other agency receipt’ in that Court). The Family Court
appropriation in 2010-11 includes $26.139m that was paid to the Federal Magistrates Court
(recorded as an ‘other agency receipt’ in that Court).38 These payments result from the delay
in implementation of the court restructure which was included in the 2009-10 Budget.
Financial viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A2.3: Family Court actual operating results
Actual (‘000)
Actual Operating Results
38
08-09
09-10
10-11
527
1,034
-1,240
Federal Magistrates Court of Australia Annual Report 2010-11, page 100.
Appendix 2 – Family Court
Page 144
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
The Family Court notes that, if depreciation funding and expenses were excluded, its
operating result would be -$3.098m in 2008-09 and -$2.346m in 2009-10.
Family Court estimated operating results
The Family Court’s current estimate of its operating results for the 2011-12 to 2014-15
financial years (excluding depreciation and other non-cash items, and assuming no further
initiatives are taken to address the situation) is set out below:
Table A2.4: Family Court’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
-2,181
-5,764
-7,827
-9,566
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
In its questionnaire response, the Family Court noted that in 2008-09 and 2009-10 it received
depreciation funding of approximately $9.0m per annum; however, actual depreciation
expenses were in the range of $6.0m per annum, which would suggest that without
depreciation funding the Family Court would have been facing operating deficits earlier than
2010-11.
The forecast levels of deficit in 2012-13 to 2014-15 assume that rent supplementation of the
order of that provided for 2011-12 will be continued in those years. Clearly, if that is not the
case, the Family Court would be incurring even more significant deficits over the Forward
Estimates period.
The Family Court has advised the Review that estimated operating losses in the out years are
also related to the pressures associated with maintaining existing service levels and increasing
Appendix 2 – Family Court
Page 145
property costs in other commercial premises. Recent and projected losses will erode
accumulated reserves.
The Family Court has advised the Review that it has provided the Attorney-General with a
list of initiatives designed to address these projected deficits. These initiatives include
potentially significant reductions to current service levels through:

closure of a number of rural and regional locations upon lease expiry or earlier
(including Coffs Harbour, Rockhampton, Dandenong, Wollongong, Alice
Springs, Launceston, Dubbo, Lismore, and Albury); and

further ongoing staff reductions including registrars, family consultants, and
other general administrative positions.
As discussed in Chapter 5, the Family Court (and Federal Magistrates Court) delivered net
savings of some $6.3m over four years, which were returned to the Budget, through the
implementation of the single administration between the Family Court and Federal
Magistrates Court.
As discussed in Chapter 4, it has not been possible, in the time available, for the Review to
fully examine, analyse and test the material provided in order to conclude one way or the
other with adequate confidence that the Family Court is financially viable to operate at
acceptable service levels within its current and Forward Estimates appropriations and at
currently experienced and anticipated activity levels.
Even with a decision to provide full supplementation for the rent on special purpose
Commonwealth Law Courts Buildings, it is likely that the Family Court will need to take
significant action, possibly including the reduction of its current service levels, to avoid
running future deficits. The recommendations made in Chapter 5 of this report for achieving
further efficiencies and effectiveness across the Federal Court, the Family Court and the
Federal Magistrates Court as a “group” may contribute to achieving ongoing financial
viability and minimising cuts to service levels, but are most unlikely to provide anything like
a complete answer.
In Chapter 4 the Review concludes that it would be appropriate for the Attorney-General’s
Department to undertake a further, more detailed, analysis of the Commonwealth Courts’
financial position, including identifying possible expenditure reductions and other measures,
and the likely impact of those measures on financial viability and service delivery.
Shared/outsourced services:
The Family Court and the Federal Magistrates Court have integrated their corporate and
information technology services and registry services in family law into a single
administration to support both Courts. In Chapter 5 the Review recommends that the Federal
Magistrates Court no longer be a separate agency under the Financial Management and
Accountability Act 1997, which would allow the attaining of resultant savings that have
already been returned to the Budget.
The Family Court, the Federal Court and the Federal Magistrates Court are working together
in the ongoing development of a web-based Commonwealth Courts Portal initiative (the
recommendations in Chapter 5 are designed to enhance the future development and utility of
that initiative).
The Family Court has a number of outsourced service arrangements in place, including:
Appendix 2 – Family Court
Page 146

facilities management is provided by United Group Services (for
Commonwealth Law Courts Buildings) and Jones Lang Lasalle (for commercial
leases);

information technology services are outsourced to consultants as appropriate ;

payroll disbursements are outsourced to Aurion; and

Internal Audit function is provided by the Oakton Group.
The Family Court has, as required, utilised AGIMO arrangements under a number of whole
of Government contracts for the supply of various goods and services.
Expenditure analysis:
As noted in the previous section, the Family Court and Federal Magistrates Court are
supported by a single administration, although they currently remain separate agencies under
the Financial Management and Accountability Act 1997. The majority of the combined staff
and resources ‘belong’ to the Family Court for employment purposes. To provide the most
accurate representation of the single administration and expenditure by selected activity, the
Review has generated the following table:
Table A2.5: Family Court 2010-11 expenditure by select activities
Family Court and
Federal Magistrates
Court
Review Agencies
Average
IT Expenditure per ASL
8,927
9,973
HR Expenditure per ASL
1,878
3,869
865
1,285
55,421
28,095
Support Activities (excl Rent)/Total
Expenditure
20%
22%
Substantive Activities/Total Expenditure
61%
66%
Rent/Total Expenditure
19%
12%
Payroll Expenditure per ASL
Property Expenditure per ASL
The Family Court and Federal Magistrates Court combined are reasonably comparable in
expenditure per activity with other agencies within the scope of this Review, with the
exception of human resources (where the Family Court and Federal Magistrates Court spend
is significantly lower) and property (where the Family Court and Federal Magistrates Court is
significantly higher due to the special purpose nature of the Commonwealth Law Courts
Buildings).
Property analysis:
The Family Court occupies Commonwealth Law Courts Buildings where they exist, but even
then requires additional space in commercial premises in Canberra (which accommodates
staff performing back office functions). Commercial accommodation is leased in Albury,
Alice Springs, Cairns, Coffs Harbour, Dandenong, Darwin, Dubbo, Launceston, Lismore,
Newcastle, Rockhampton, Townsville and Wollongong where there are no Commonwealth
Law Courts Buildings. Only in Rockhampton is accommodation shared with State Courts.
Appendix 2 – Family Court
Page 147
Since its inception, the Federal Magistrates Court has occupied space provided by the Federal
Court and the Family Court.
In Chapter 5 the Review has recommended the development of a “whole-of-building” plan
for the use and management of each of the Commonwealth Law Courts Buildings. The
development of that plan will necessitate more detailed analysis of Family Court property
requirements.
Recent reviews/material considered by Review Team:

Strategic review of leased accommodation. Prepared by Alan Piper Consulting
for the Family Court of Australia (updated 2007)

Semple Review – future governance options for federal family law courts in
Australia – Attorney-General’s Department (2008)

Joint Committee of Public Account and Audit in relation to the efficiency
dividend on small agencies (2008)

Improving access to justice – a better framework for federal courts. AttorneyGeneral’s Department (November 2008)

IT Costs Review. Prepared by Acumen Alliance for the Family Court of
Australia (January 2008)

National Support Office Health Check – Family Court of Australia. Prepared by
PricewaterhouseCoopers (March 2008)

Shared services business case. Prepared by KPMG for the Attorney-General’s
Department (June 2011)

Family Court of Australia and Federal Magistrates Court of Australia Financial
Health Check. Prepared by Oakton (March 2011)

Family Court of Australia Annual Report 2008-09

Family Court of Australia Annual Report 2009-10

Family Court of Australia Annual Report 2010-11

Family Court of Australia response to Review Questionnaire – (2011)
Appendix 2 – Family Court
Page 148
APPENDIX 3 – FEDERAL MAGISTRATES COURT OF
AUSTRALIA
Established by/under:
Federal Magistrates Act 1999
Financial framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency functions:
The objective of the Federal Magistrates Court is to provide a simple and more accessible
alternative to litigation in the Family Court of Australia and the Federal Court of Australia
and to relieve the workload of the superior federal courts.
The provisions of the Federal Magistrates Act 1999 enable the Federal Magistrates Court to
operate as informally as possible in the exercise of judicial power, use streamlined procedures
and make use of a range of dispute resolution processes to resolve matters without judicial
decisions.
Governance structure:
The Federal Magistrates Court was established by the Parliament in accordance with Chapter
III of the Australian Constitution. The Federal Magistrates Act 1999 provides that the
Federal Magistrates Court consists of a Chief Federal Magistrate and such other federal
magistrates as appointed.
The Chief Federal Magistrate is the judicial and administrative head of the Federal
Magistrates Court, and is assisted in the administrative functions by a Chief Executive
Officer. The Chief Executive Officer is the Chief Executive of the Court for the purpose of
the Financial Management and Accountability Act 1997 and has the powers of a Secretary in
respect of officers and staff of the Federal Magistrates Court, who are employed under the
Public Service Act 1999.
Staff profile:
Table A3.1: Federal Magistrates Court ASL in 2010-11
Federal Magistrates
Court
Federal Magistrates
Court
APS Average
ASL
(%)
APS Employees
142
90%
73%
EL Employees
14
9%
25%
SES Employees
1
1%
2%
Statutory office holders
62
(%)
The Federal Magistrates Court indicated in their questionnaire response that 99.5 per cent of
their staff (including statutory office holders) undertake substantive activities of the agency.
Appendix 3 – Federal Magistrates Court
Page 149
The corresponding and exceptionally low figure of 0.5 per cent of staff undertaking support
functions is due to these being provided by the Family Court and the Federal Court.
Annual funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
The Federal Magistrates Court has one Outcome as follows:
Outcome 1 – To provide the Australian community with a simple and accessible forum for
the resolution of less complex disputes within the jurisdiction of the Federal Magistrates
Court of Australia.
Budgeted departmental appropriations and agency receipts for the 2008-09 to 2010-11
financial years and estimated departmental appropriations and agency receipts for the
2011-12 to 2014-15 financial years (based on Portfolio Budget Statements and Annual
reports) are as follows:
Table A3.2: Federal Magistrates Court actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
08-09
56,524
5,447
09-10
28,130
33,142
Estimate (‘000)
10-11
22,144
33,473
11-12
51,980
-
12-13
51,926
-
13-14
52,506
-
14-15
52,270
-
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
Over the last couple of years, the Federal Magistrates Court has had a complex funding
arrangement, while awaiting the outcome of the future governance arrangements for the
Courts. In 2009-10 and 2010-11, the Federal Magistrates Court operated under a combination
of appropriation from government, and receipts (funding transfers) and services provided free
of charge from the Federal Court and Family Court.
The Federal Magistrates Court appropriations:
a. in 2008-09 included $8.652m that was paid to the Federal Court (recorded as an
‘other agency receipt’ in that Court) for registry and migration services.
b. in 2009-10 included $8.688m that was paid to the Federal Court (recorded as an
‘other agency receipt’ in that Court) for registry and migration services.39
c. in 2010-11 included $4.381m that was paid to the Federal Court for registry
and migration services in the first half of the financial year.40 In the second half
of 2010-11 these services were provide free of charge to the Federal
Magistrates Court. In 2011-12 and future years these services are budgeted to
be provided free of charge by the Federal Court to the Federal Magistrates
Court.
39
Federal Magistrates Court of Australia Annual Report 2009-10, note 3B page 114. Note that these payments
are netted in the Federal Court annual report and therefore payment amounts may not match.
40
This is calculated using the court registry and migration services expense from the Federal Magistrates Court
of Australia Annual Report 2010-11, note 3B, page 99 minus resources received free of charge from the Federal
Court in note 4D. Note that these payments are netted in the Federal Court annual report and therefore payment
amounts may not match.
Appendix 3 – Federal Magistrates Court
Page 150
Other agency receipts in 2009-10 include revenue of $25.363m from the Family Court and
$7.604m from the Federal Court. Other agency receipts in 2010-11 include revenue of
$26.139m from the Family Court and $7.328m from the Federal Court.41 These payments
result from the delay in implementation of the court restructure which was included in the
2009-10 Budget.
Financial viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A3.3: Federal Magistrates Court actual operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
-5,005
-2,201
-2,496
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
Also, for 2010-11, the Federal Magistrates Court did not have a Departmental Capital
Budget. Consequently, pursuant to the Finance Minister Orders, depreciation expenses should
be included in calculating its operating result. If depreciation expenses were included, the
Federal Magistrates Court’s operating result in 2010-11 would be -$3.960m.
Federal Magistrates Court estimated operating results
The Federal Magistrates Court’s estimate of its operating results for the 2011-12 to 2014-15
financial years (excluding depreciation – although it should be noted that the Federal
Magistrates Court does not have a Departmental Capital Budget and as a result according to
the Finance Minister Orders the depreciation expense is to be included in the operating loss
for the agency – and assuming no further initiatives are taken to address the situation) is as
set out below:
Table A3.4: Federal Magistrates Court’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
-2,312
-3,678
-3,586
-4,320
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
41
Federal Magistrates Court of Australia Annual Report 2010-11, note 4A, 4B page 100. Note that the Federal
Court of Australia has netted payments from the restructure of the registry and migration services in their annual
report.
Appendix 3 – Federal Magistrates Court
Page 151
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The Federal Magistrates Court has advised the Review that estimated operating deficits in the
out years are significantly related to pressure to maintain current service levels. Recent and
projected deficits will erode accumulated reserves.
The Federal Magistrates Court has advised the Review that it has provided the AttorneyGeneral with a list of initiatives designed to address these projected deficits. These initiatives
include potentially significant reductions to current service levels through:

mandating the electronic filing of divorces;

applying a quota for the provision of family reports in children’s matters; and

referral of parties to external conciliation and counselling where they have the
financial capacity to pay.
As discussed in Chapter 5, the Federal Magistrates Court (and the Family Court) delivered
net savings of some $6.3m over four years, which were returned to the Budget, through the
implementation of the single administration between the Family Court and Federal
Magistrates Court.
As discussed in Chapter 4, it has not been possible, in the time available, for the Review to
fully examine, analyse and test the material provided in order to conclude one way or the
other with adequate confidence that the Federal Magistrates Court is financially viable to
operate at acceptable service levels within its current and Forward Estimates appropriations
and at currently experienced and anticipated activity levels.
Even with a decision to provide full supplementation for the rent of special purpose
Commonwealth Law Courts Buildings, it is likely that the Federal Magistrates Court will
need to take significant action, possibly including the reduction of its current service levels,
to avoid running future deficits. The recommendations made in Chapter 5 of this report for
achieving further efficiencies and effectiveness across the Federal Court, the Family Court
and the Federal Magistrates Court as a “group” may contribute to achieving ongoing financial
viability and avoiding or minimising cuts to service levels.
In Chapter 4 the Review concludes that it would be appropriate for the Attorney-General’s
Department to undertake a further, more detailed, analysis of the Commonwealth Courts’
financial position, including identifying possible expenditure reductions and other measures,
and the likely impact of those measures on financial viability and service delivery.
Appendix 3 – Federal Magistrates Court
Page 152
Shared/outsourced Services:
The Federal Magistrates Court and the Family Court have integrated their corporate and
information technology services and registry services in family law into a single
administration to support both Courts. In Chapter 5 the Review recommends that the Federal
Magistrates Court no longer be a separate agency under the Financial Management and
Accountability Act 1997, which would allow the attaining of resultant savings that have
already been returned to the Budget.
The Federal Magistrates Court, the Federal Court and the Family Court are working together
in the ongoing development of a web-based Commonwealth Courts Portal initiative (the
recommendations in Chapter 5 are designed to enhance the future development and utility of
that initiative).
The Federal Magistrates Court has a number of outsourced service arrangements in place,
including:

Facilities management is provided by United Group Services (Commonwealth
Law Courts ) and Jones Lang Lasalle (commercial leases);

Information technology services are provided by the Family Court and Federal
Court, or outsourced to consultants as appropriate; and

Internal Audit function is provided by the Oakton Group.
The Federal Magistrates Court has, as required, utilised AGIMO arrangements under a
number of whole of Government contracts for the supply of various goods and services.
Expenditure analysis:
As noted in the previous section, the Family Court and Federal Magistrates Court are
supported by a single administration, although they currently remain separate agencies under
the Financial Management and Accountability Act 1997. The majority of the combined staff
and resources ‘belong’ to the Family Court for employment purposes. To provide the most
accurate representation of the single administration and expenditure by selected activity, the
Review has generated the following table:
Table A3.5: Federal Magistrates Court 2010-11 expenditure by select
activities
Family Court and
Federal Magistrates
Court
Review Agencies
Average
IT Expenditure per ASL
8,927
9,973
HR Expenditure per ASL
1,878
3,869
865
1,285
55,421
28,095
Support Activities (excl Rent)/Total
Expenditure
20%
22%
Substantive Activities/Total Expenditure
61%
66%
Payroll Expenditure per ASL
Property Expenditure per ASL
Appendix 3 – Federal Magistrates Court
Page 153
Rent/Total Expenditure
19%
12%
The Family Court and Federal Magistrates Court combined are reasonably comparable in
expenditure per support activity with other agencies within the scope of this Review, with the
exception of human resources (where the Family Court and Federal Magistrates Court spend
is significantly lower) and property (where the Family Court and Federal Magistrates Court is
significantly higher due to the special purpose nature of the Commonwealth Law Courts
Buildings).
Property analysis:
The Federal Magistrates Court occupies Commonwealth Law Courts Buildings where they
exist, but even then requires additional space in commercial premises in Sydney. The Federal
Magistrates Court shares commercial accommodation leased by the Family Court in Albury,
Alice Springs, Cairns, Coffs Harbour, Dandenong, Darwin, Dubbo, Launceston, Lismore,
Newcastle, Rockhampton, Townsville and Wollongong where there are no Commonwealth
Courts Buildings. Only in Rockhampton is accommodation shared with State Courts.
Since its inception, the Federal Magistrates Court has occupied space provided by the Federal
Court and the Family Court.
In Chapter 5 the Review has recommended the development of a “whole-of-building” plan
for the use and management of each of the Commonwealth Law Courts Buildings. The
development of that plan will necessitate more detailed analysis of Federal Magistrates Court
property requirements.
Recent reviews/material considered by Review Team:

Semple Review – Future governance options for federal family law courts in
Australia – Attorney-General’s Department (2008)

Joint Committee of Public Account and Audit in relation to the efficiency
dividend on small agencies (2008)

Improving access to justice – a better framework for federal courts – AttorneyGeneral’s Department (November 2008)

Shared services business case. Prepared by KPMG for the Attorney-General’s
Department (June 2011)

Family Court of Australia and Federal Magistrates Court of Australia Financial
Health Check. Prepared by Oakton (March 2011)

Federal Magistrates Court of Australia Annual Report 2008-09

Federal Magistrates Court of Australia Annual Report 2009-10

Federal Magistrates Court of Australia Annual Report 2010-11

Federal Magistrates Court of Australia response to Review Questionnaire –
(2011)
Appendix 3 – Federal Magistrates Court
Page 154
APPENDIX 4 - NATIONAL NATIVE TITLE TRIBUNAL
Established by/under:
Native Title Act 1993 (NTA)
Financial Framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency Functions:
The National Native Title Tribunal (NNTT) has a diverse range of native title system
responsibilities under the NTA, including:

mediating various types of applications;

mediating, arbitrating and conducting inquiries about certain future acts;

testing claimant applications for registration purposes;

providing assistance to parties (including geospatial information and historical,
anthropological and linguistic research services);

assisting with the negotiation of indigenous land use agreements (ILUAs) and
assessing them for registration;

conducting reviews and inquiries about native title issues; and

maintaining registers of claims, determinations of native title and ILUAs.
Governance Structure:
The NTA provides that the NNTT is constituted by:

the President; and

as many Deputy Presidents and other members as appointed.
It further provides that the President is responsible for managing the administrative affairs of
the NNTT, assisted by the Native Title Registrar.
For the purposes of the Financial Management and Accountability Act 1997, the Registrar is
the Chief Executive of the NNTT, which comprises the Registrar, Deputy Registrars and
other staff. Other than the Registrar, NNTT staff are engaged under the Public Service Act
1999.
Staff Profile:
Table A4.1: NNTT ASL in 2010-11
NNTT
NNTT
APS Average
ASL
(%)
(%)
APS Employees
137
79%
73%
EL Employees
35
20%
25%
Appendix 4 - NNTT
Page 155
SES Employees
2
Statutory office holders
9
1%
2%
The NNTT have advised that total ASL has reduced to 158 full-time equivalent staff as at
30 June 2011.
The NNTT indicated in their questionnaire response that 76 per cent of their staff (excluding
statutory office holders) undertake substantive agency activities; the remaining 24 per cent
undertake support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
The NNTT is completely budget funded and has one Outcome as follows:
Outcome 1 – Facilitation of native title determinations, agreements and the disposition of
related matters for claimants and others with interests in land and waters through mediation,
agreement-making and administrative decisions
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual Reports) are as
follows:
Table A4.2: NNTT actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
32,156
29,682
26,925
25,844
23,799
23,468
23,624
75
3542
61
93
97
97
80
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The decrease in appropriation between 2008-09 and 2012-13 reflects savings harvested by
Government to fund other priorities. Other agency receipts are minimal.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A4.3: NNTT actual operating results
Actual (‘000)
08-09
09-10
10-11
42
This figure is derived from the Annual Report 2010-11, which differs from the figure in the Annual Report
2009-10.
Appendix 4 - NNTT
Page 156
Actual Operating Results
1,155
-706
-3,055
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
The NNTT received approval for an operating loss in 2010-11 to fund downsizing strategies
aimed at enabling the NNTT to return to a balanced budget as soon as possible – the total cost
of these one-off savings in the financial year was $4.7m.
NNTT estimated operating results
The NNTT’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items) is as set out below:
Table A4.4: NNTT’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
2,156
1,173
354
-194
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The NNTT has recently revised its estimated surplus for 2011-12 from $854,000 to $2.1m,
following the surrender in November 2011 of leased premises (Eastpoint Plaza, Perth) on
favourable terms.
The estimated operating results in 2012-13 to 2014-15 assume that rent supplementation for
the NNTT’s occupancy of Commonwealth Law Courts Buildings, in the order of that
provided for 2011-12, will be continued in those years. If that is not the case, the NNTT’s
operating result would be affected accordingly.
The NNTT intends to return to a balanced budget in 2011-12 through a variety of strategies
including:
Appendix 4 - NNTT
Page 157



continuing to monitor and strategically adjust human and other resources in
NNTT registries and offices, and to review existing lease arrangements consistent
with the objectives of the NNTT’s ‘East/West’ organisational orientation;
seeking alternative accommodation in Sydney and Cairns;
implementing its Workforce Plan 2011-14, produced in August 2011. Measures
to date include:
- decision to merge three sections (Legal, Research and Library) into
one section, as at 26 September 2011;
- decision to further reduce staffing levels in Finance and Human
Resources;
- two additional involuntary redundancies.

continuing to further reduce staff numbers, through natural attrition wherever
possible;

continuing to exercise strict control over all forms of discretionary expenditure
and fixed costs wherever possible; and

continuing to simplify and streamline all NNTT functions, procedures and
processes.
As at 30 June 2011 the NNTT had total liabilities of $7.7 million (including employee
provisions but excluding future capital expenditure) and total appropriation receivable of
$14.0 million.
On the basis of the Review’s assessment of the information before it, the Review considers
the NNTT to be financially viable.
Shared/Outsourced Services:
The NNTT does not currently have any shared services arrangements.
The NNTT utilises whole of government contracts in relation to security clearances, travel
and recruitment services and has ‘piggy backed’ off the Department of Finance and
Deregulation’s salary packaging arrangements. The NNTT also utilises panel arrangements
e.g. for external information and communications technology or legal services.
The NNTT is co-located with the federal courts in Perth and Melbourne, and the AAT in
Adelaide.
Expenditure Analysis:
An analysis of the NNTT’s 2010-11 expenditure by select activities is as follows:
Table A4.5: NNTT 2010-11 expenditure by select activities
NNTT
Review Agencies
Average
IT Expenditure per ASL
9,299
9,973
HR Expenditure per ASL
6,138
3,869
Payroll Expenditure per ASL
1,378
1,285
Appendix 4 - NNTT
Page 158
26,24643
28,095
Support Activities (excl Rent)/Total
Expenditure
28%
22%
Substantive Activities/Total Expenditure
58%
66%
Rent/Total Expenditure
14%
12%
Property Expenditure per ASL
The NNTT is broadly comparable in expenditure per activity with other agencies within the
scope of this Review, with the exception of human resources (where their expenditure is
higher) and property (where their expenditure is higher than non-court agencies). The higher
than average human resource expenditure may in part be linked with strategically downsizing
the agency.
Property Analysis:
The NNTT’s Principal Registry is located in Perth. It also has offices in Sydney, Melbourne,
Brisbane, Adelaide and Cairns. The NNTT has indicated that it is seeking cheaper/alternative
accommodation in Sydney and Cairns.
Recent Reviews/Material Considered by Review Team:

Fellows Medlock Review of NNTT Structure, Functions and Service Delivery
(2010)

NNTT Annual Report 2009-10

NNTT Annual Report 2010-11

NNTT response to Review Questionnaire – (September 2011)

Other documentation provided by NNTT
43
Does not include outstanding lease obligations for vacated property which are provided for in the 2010-11
accounts. As indicated above, this lease was surrendered on favourable terms in November 2011. Accordingly,
those obligations will be reversed in 2011-12 after accounting for settlement costs and asset write offs.
Appendix 4 - NNTT
Page 159
APPENDIX 5 - ADMINISTRATIVE APPEALS TRIBUNAL
Established by/under:
Administrative Appeals Tribunal Act 1975
Financial Framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency Functions:
The Administrative Appeals Tribunal (AAT) reviews a wide range of administrative
decisions made by Australian Government ministers, departments, agencies, authorities and
other tribunals. In limited circumstances, the AAT can also review administrative decisions
made by state government and non-government bodies.
The AAT does not have a general power to review decisions made under Commonwealth
legislation. The AAT can only review a decision if an Act, regulation or other legislative
instrument states that the decision is subject to review by the AAT.
The AAT has jurisdiction to review decisions made under more than 400 Acts and legislative
instruments. These include decisions in the areas of:

Family assistance and social security;

Taxation;

Veterans’ affairs;

Workers’ compensation;

Bankruptcy;

Civil aviation;

Citizenship and immigration;

Corporations law;

Customs;

Freedom of information;

Industry assistance; and

Passports and security assessments by the Australian Security Intelligence
Organisation.
Many AAT members are authorised to issue warrants under the telephone interception
legislation and other statutes. Each year, over 85 per cent of all applications for such
warrants are dealt with by AAT members.
Governance Structure:
The AAT consists of the President, other presidential members (some of whom are Judges or
Deputy Presidents), Senior Members and Members. The President, with the assistance of the
Registrar, is responsible for managing the AAT and its resources.
Appendix 5 - AAT
Page 161
The Registrar is the Chief Executive of the AAT for the purpose of the Financial
Management and Accountability Act 1997 and has the powers of a Secretary in respect of
officers and staff of the AAT, who are employed under the Public Service Act 1999.
Staff Profile:
Table A5.1: AAT ASL in 2010-11
AAT
AAT
APS Average
ASL
(%)
(%)
APS Employees
105
78%
73%
EL Employees
28
21%
25%
SES Employees
1
1%
2%
Statutory office holders
31
The AAT indicated in their questionnaire response that 79 per cent of their staff (including
statutory office holders) undertake the substantive activities of the agency; the remaining
21 per cent undertake support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
The AAT is completely budget funded and has one Outcome as follows:
Outcome 1 – Access to a fair, just, economical, informal and quick review mechanism for
applicants through reviews of government administrative decisions, including dispute
resolution processes and independent formal hearings.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and departmental appropriations and agency receipts for the 2011-12 to 2014-15
financial years (based on Portfolio Budget Statements and Annual reports) are as follows:
Table A5.2: AAT actual and estimated appropriation
Actual (‘000)
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
Appropriation (excl DCB)
32,267
32,772
32,732
33,186
32,590
32,587
32,630
Other Agency Receipts
1,029
1,122
1,116
1,085
1,085
1,085
1,085
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations. Other agency receipts are minimal and
reflect the sale of goods and rendering of services.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Appendix 5 - AAT
Page 162
Table A5.3: AAT actual operating results
Actual (‘000)
08-09
09-10
10-11
368
-1,050
-373
Actual Operating Results
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
AAT estimated operating results
The AAT’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items, assuming no further initiatives are taken to
address the situation, and assuming no rent supplementation and full PRODAC savings) is as
set out below:
Table A5.4: AAT’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
-758
-1,755
-2,504
-3,222
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The AAT advised the Review that the forecast deficits are likely if it does not reduce staff or
current programs. The AAT has identified savings in some areas of its administrative budget,
such as library subscriptions and travel. However, it has indicated these savings measures
will be insufficient to offset the projected deficits, which are expected to increase in 2015-16,
2016-17 and 2017-18 when the full impact of the property savings takes effect. Other options
identified by the AAT to reduce costs to remain financially viable are to significantly reduce
staffing numbers and the use of part-time Members, which may result in a decline in the level
of service to the public and the timeliness and quality of the AAT’s work.
Appendix 5 - AAT
Page 163
The Review’s assessment is that AAT expenditure requires very careful management if the
AAT is to achieve financial viability within acceptable service levels. This highlights the
need for a clear focus on strategic planning by the AAT, as recommended by the Review in
Chapter 7. Any economies or efficiencies that the AAT may be able to generate through the
recommendation in that Chapter for further assessment of the efficiencies amongst the major
Commonwealth tribunals would obviously also be important.
Shared/Outsourced Services:
The AAT currently has a number of shared service delivery and outsourcing arrangements in
place including:

Registry services are provided to the AAT by the Federal Court of Australia in
Hobart;

the AAT provides registry services and hearing rooms to the Migration Review
Tribunal and the Refugee Review Tribunal in Brisbane, Adelaide and Perth – in
Adelaide and Perth it also provides office accommodation for Members of the
Tribunals;

the AAT provides hearing rooms and related facilities to the Veterans’ Review
Board in Canberra, Perth and Adelaide; and to the Independent Protection
Assessment Office in Brisbane, Sydney, Melbourne, Adelaide, Perth and
Canberra;

recording and transcription services are provided by Auscript;

payroll processing is provided by Aurion; and

Internal Audit function is provided by GS Corporate Services.
The AAT as required utilises AGIMO arrangements under a number of whole of Government
contracts for the supply of various goods and services.
Expenditure Analysis:
An analysis of the AATs 2010-11expenditure by select activities is as follows:
Table A5.5: AAT 2010-11 expenditure by select activities
AAT
Review Agencies
Average
IT Expenditure per ASL
11,555
9,973
HR Expenditure per ASL
2,933
3,869
Appendix 5 - AAT
Page 164
Payroll Expenditure per ASL
1,70744
1,285
Property Expenditure per ASL
46,238
28,095
Support Activities (excl Rent)/Total
Expenditure
31%
22%
Substantive Activities/Total Expenditure
53%
66%
Rent/Total Expenditure
16%
12%
Generally, the AAT’s expenditure by support activity was reasonably consistent with the
averages across all the agencies within the scope of the Review with the exception of
property, which is substantially higher due to the rent associated with having to provide
hearing and conference rooms, public waiting areas and appropriate accommodation for full
and part time members (that is, special purpose properties including the accommodation in
the Commonwealth Law Courts in Brisbane and Hobart).
The AAT is also slightly above the average in IT expenditure. This is affected by the large
number of part-time Members and staff that must be provided with the appropriate level of IT
services. As the actual number of IT users at any one time is significantly higher than the
ASL, there is a significant difference between the expenditure per ASL and the expenditure
per user.
Property Analysis:
The AAT’s commercial property leases do not begin to expire until 2014-15 with most
expiring in 2015-16 and 2016-17. According to the AAT, they would require additional funds
to meet the costs of relocating/refitting to reduce the property it occupies.
The Review recommends in Chapter 7 that, unless it would be inefficient and uneconomic to
do otherwise, the AAT should not be co-located with the Courts, and in Chapter 5 the Review
recommends the preparation of a detailed plan for the use of the Commonwealth Law Courts
Buildings. As the AAT is currently a tenant of such buildings in Brisbane and Hobart, it
should be a party to the development of that plan.
Recent Reviews/Material Considered by Review Team:



Better Decisions: Review of the Commonwealth Merits Review Tribunals –
Administrative Review Council (1995)
Tribunal Efficiencies Working Group Report (May 2004)
Functions and Workload Review – Prepared by Bendelta Pty Ltd for the
Administrative Appeals Tribunal (May 2010)

Administrative Appeals Tribunal Strategic Plan 2011-2014

Administrative Appeals Tribunal Annual Report 2010-11

Administrative Appeals Tribunal response to Review Questionnaire – 2011

Additional information provided by the Administrative Appeals Tribunal
44
The ASL performing payroll functions also perform some general HR and learning and development
functions.
Appendix 5 - AAT
Page 165
APPENDIX 6 - OFFICE OF PARLIAMENTARY COUNSEL
Established by/under:
Parliamentary Counsel Act 1970
Financial Framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency Functions:
The functions of the Office of Parliamentary Counsel (OPC) are as follows:

the drafting of proposed laws for introduction into either House of the
Parliament; and

the drafting of amendments of proposed laws that are being considered by either
House of the Parliament.
The functions of drafting proposed laws and drafting amendments of proposed laws is
essential to enable the Government to carry out its legislative program.
Governance Structure:
The Parliamentary Counsel Act 1970 provides for three statutory officer positions:

the First Parliamentary Counsel; and

two Second Parliamentary Counsels.
The First Parliamentary Counsel, under the Minister, controls OPC.
OPC staff are engaged under the Public Service Act 1999.
Staff Profile:
Table A6.1 OPC ASL in 2010-11
OPC
OPC
APS Average
ASL
(%)
(%)
APS Employees
11
24%
73%
EL Employees
22
48%
25%
SES Employees
13
28%
2%
Statutory office holders
3
The higher proportion than APS average of SES to non-SES staff is a result of the specialist
nature of legislative drafting, which has led OPC to maintain a more top heavy structure in
order to recruit and retain appropriately skilled and experienced legislative drafters.
OPC indicated in their questionnaire response that 85 per cent of their staff undertake
substantive agency activities; with the remaining 15 per cent undertaking support activities.
Appendix 6 - OPC
Page 167
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
OPC is completely budget funded and has one Outcome as follows:
Outcome 1 – Laws that give legal effect to the intended policy and form a coherent and
readable body of Commonwealth legislation through the drafting of Bills and amendments
for passage by the Commonwealth Parliament.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A6.2: OPC actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
9,363
9,986
10,679
11,288
11,123
11,130
10,130
92
104
90
86
89
91
94
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The decrease in appropriation between 2011-12 and 2012-13 is due to application of property
savings.
The decrease in appropriation from 2014-15 onwards is due to the termination of the 2010-11
Budget measure: Stronger, Fairer, Simpler tax reform – development and implementation
(which provided $3.8m over four years to meet increased demand for legislative drafting
arising from the government’s taxation reform agenda).
Other agency receipts are minimal and reflect recovery of the cost of providing legislation
process courses to other Government departments and some other minor cost recovery.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A6.3: OPC actual operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
196
129
710
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
Appendix 6 - OPC
Page 168
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
OPC estimated operating results
OPC’s estimate of its operating results for the 2011-12 to 2014-15 financial years (excluding
depreciation and other non-cash items) is as set out below:
Table A6.4: OPC’s estimate of its operating results
Estimated (‘000)
11-12
12-13
13-14
14-15
0
0
0
0
Estimated Operating Results
The small surplus in 2010-11 is a result of a small number of current staff being on leave
without pay and timing issues in recruiting new staff.
OPC have forecast a breakeven position in the current and each of the three forward financial
years. OPC is completely dependent on budget funding, with funding over time being
relatively stable and with small increases in appropriation to assist OPC manage additional
drafting workloads.
As at 30 June 2011 OPC had total liabilities of $3.3m (including employee provisions) and
total appropriation receivable of $4.9m.
On the basis of the Review’s assessment of the information before it, the Review considers
OPC to be financially viable.
Shared/Outsourced Services:
OPC has a number of outsourced service arrangements in place, including:

Secure internet access and disaster recovery services from Verizon;

Ad-hoc specialist IT support from OPCIT;

Payroll processing from Aurion; and

Internal audit function from Deloittes.
Expenditure Analysis:
An analysis of the OPC’s 2010-11 expenditure by select activities is as follows:
Table A6.5: OPC 2010-11 expenditure by select activities
OPC
Review Agencies
Average
IT Expenditure per ASL
13,498
9,973
HR Expenditure per ASL
2,508
3,869
496
1,285
18,031
28,095
Support Activities (excl Rent)/Total
Expenditure
18%
22%
Substantive Activities/Total Expenditure
73%
66%
Payroll Expenditure per ASL
Property Expenditure per ASL
Appendix 6 - OPC
Page 169
9%
Rent/Total Expenditure
12%
OPC indicated that their IT Expenditure is high as they employ three full time IT staff to
manage a continual program to improve functionality of the word template used for drafting
legislation and adapting TRIM for OPC use. Word is the core business application for OPC
and has provided substantial efficiencies.
Property Analysis:
Table A6.6: Summary of OPC’s property position
Location
Barton, Canberra
Term
Comments
Lease Start Date:
2 October 2002
Total Lease Space: 1,953 sqm
Lease End Date:
2 October 2012
Total Lease Cost: approximately $0.8 million
per annum
Total ASL Supported at this location: 49
OPC does not have in place property sharing arrangements with any other department or
agency.
While OPC has plans to take up a final five year lease option at their current location, which
would take their current lease through to 2 October 2017, this will be subject to Government
consideration of the Recommendations in Chapter 8 of the Review Report.
Recent Reviews/Material Considered by Review Team:

Review of the Legislative Drafting and Publishing Function with the AttorneyGeneral’s Department by Rayne de Gruchy AM PSM – 10 September 2010

Clearer Commonwealth Law – Report of the Inquiry into Legislative Drafting by
the Commonwealth – September 1993

OPC Submission to Strategic Review of Small to Medium Agencies in the
Attorney-General’s Portfolio – 12 October 2011

OPC Annual Report 2010-11

OPC response to Review Questionnaire – 2011
Appendix 6 - OPC
Page 170
APPENDIX 7 - AUSTRALIAN COMMISSION FOR LAW
ENFORCEMENT INTEGRITY
Established by/under:
Law Enforcement Integrity Commissioner Act 2006
Financial Framework:
The Australian Commission for Law Enforcement Integrity (ACLEI) is a Statutory Agency
under the Financial Management and Accountability Act 1997
Agency Functions:
The Integrity Commissioner has the following functions:

to investigate and report on corruption issues;

to refer corruption issues, in appropriate circumstances, to a law enforcement
agency for investigation;

to manage, oversee or review, in appropriate circumstances, the investigation of
corruption issues by law enforcement agencies;

at the request of the Minister, to conduct public inquiries into:
corruption issues; or
corruption generally in, or the integrity of staff members of, law
enforcement agencies;

to collect, correlate, analyse and disseminate information and intelligence in
relation to corruption generally in, or the integrity of staff members of, both:
law enforcement agencies; and
other Commonwealth government agencies that have law enforcement
functions;

on the Integrity Commissioner’s own initiative, or on request by the Minister, to
make reports and recommendations to the Minister in relation to any matter that
concerns the need for or the desirability of legislative or administrative action on
issues in relation to corruption generally in, or the integrity of staff members of,
law enforcement agencies; and

any other function conferred on the Integrity Commissioner by other provisions
of the Law Enforcement Integrity Commissioner Act 2006 or by another Act.
Governance Structure:
The Integrity Commissioner is appointed by the Governor-General and is the head of ACLEI
as a Statutory Authority.
Appendix 7 - ACLEI
Page 171
ACLEI staff are engaged under the Public Service Act 1999.
Staff Profile:
Table A7.1: ACLEI ASL in 2010-11
ACLEI
ACLEI
APS Average
ASL
(%)
(%)
APS Employees
9
39%
73%
EL Employees
12
56%
25%
SES Employees
1
5%
2%
Statutory office holders
1
ACLEI indicated in their questionnaire response that 76 per cent of their staff undertake
substantive agency activities (investigations), with the remaining 24 per cent undertaking
support activities (including legal services).
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
ACLEI is completely budget funded and has one Outcome as follows:
Outcome 1 – Independent assurance to the Australian Government that Commonwealth law
enforcement agencies and their staff act with integrity by detecting, investigating and
preventing corruption.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A7.2: ACLEI actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
2,821
4,127
4,781
5,150
5,102
5,175
5,227
0
0
0
0
0
0
0
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The increases in appropriation from 2008-09 onwards are the result of:

a 2008-09 Budget measure providing increased operational resourcing of $7.5m
over four years; and
Appendix 7 - ACLEI
Page 172

a 2010-11 Budget measure providing additional operational resourcing of $1.6m
over four years to accommodate an expanded jurisdiction.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A7.3: ACLEI actual operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
-142
-165
419
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
ACLEI’s estimated operating results
ACLEI’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items) is as set out below:
Table A7.4: ACLEI’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
0
0
0
0
As at 30 June 2011 ACLEI had total liabilities of $1.2m (including employee provisions) and
total cash and receivables of $4.3m (including appropriation receivable of $3.7m).
On the basis of the Review’s assessment of the information before it, the Review considers
ACLEI to be financially viable.
Shared/Outsourced Services:
ACLEI has a Memorandum of Understanding with the Attorney-General’s Department to
receive ICT services on a cost recovery basis. ACLEI also receives library and mail
screening services from the Department.
ACLEI has outsourced payroll processing to Aurion.
Expenditure Analysis:
An analysis of the ACLEI’s 2010-11 expenditure by select activities is as follows:
Table A7.5: ACLEI 2010-11 expenditure by select activities
ACLEI
Appendix 7 - ACLEI
Review Agencies
Average
Page 173
IT Expenditure per ASL
14,229
9,973
HR Expenditure per ASL
7,401
3,869
Payroll Expenditure per ASL
1,542
1,285
Property Expenditure per ASL
17,885
28,095
Support Activities (excl Rent)/Total
Expenditure
30%
22%
Substantive Activities/Total Expenditure
61%
66%
Rent/Total Expenditure
9%
12%
ACLEI’s IT expenditure levels reflect the sophisticated investigative systems employed by it.
ACLEI’s HR expenditure was unusually high in 2010-11 due to one-off recruitment costs
associated with expansion from 17 ASL in 2009-10 to 24 ASL in 2010-11.
ACLEI’s Property Expenditure is impacted by operational requirements over and above
standard office accommodation, such as, interview and witness reception facilities,
surveillance monitoring facilities, evidence room, and security buffer zones.
Property Analysis:
Table A7.6: Summary of ACLEI’s property position
Location
Moore Street,
Canberra
Term
Lease Start Date: 8 June 2009
Lease End Date: 7 June 2012
Comments
ACLEI does not share any office space due
to security and space requirements.
Recent Reviews/Material Considered by Review Team:

Review of the Australian Commission for Law Enforcement Integrity’s
Capabilities, Operating Arrangements and Resources prepared by P Hamburger –
February 2011

Parliamentary Joint Committee on ACLEI – Inquiry into the Operation of the
Law Enforcement Integrity Commissioner Act 2006

Parliamentary Joint Committee on ACLEI – Inquiry into law enforcement
integrity models

ACLEI Annual Report 2010-11

ACLEI response to Review Questionnaire – 2011
Appendix 7 - ACLEI
Page 174
APPENDIX 8 - AUSTRALIAN INSTITUTE OF CRIMINOLOGY
Established by/under:
Criminology Research Act 1971
Financial Framework:
On 1 July 2011 the Criminology Research Council (CRC) was merged with the Australian
Institute of Criminology (AIC) to form a single Statutory Agency under the Financial
Management and Accountability Act 1997.
Prior to 30 June 2011 the AIC was a body under the Commonwealth Authorities and
Companies Act 1997.
Agency Functions:
The AIC has the following functions:



to promote justice and reduce crime by:
conducting criminological research; and
communicating the results of that research to the Commonwealth, the
States, the Australian Capital Territory, the Northern Territory and the
community;
to assist the Director in performing the Director’s functions;
to administer programs for awarding grants, and engaging specialists, for:
criminological research that is relevant to the public policy of the States, the
Australian Capital Territory and the Northern Territory; and
activities related to that research (including the publication of that research,
for example).
Governance Structure:
The Criminology Research Act 1971 provides that the AIC consist of the Director
(a Statutory Officer holder) and the staff.
AIC staff can be engaged under the Public Service Act 1999 or the Criminology Research Act
1971. Employment under the Criminology Research Act 1971 was retained for flexibility to
recruit for specific projects and to attract specialised skills. The majority of staff are
employed under the Public Service Act 1999.
Appendix 8 - AIC
Page 175
Staff Profile:
Table A8.1 AIC ASL in 2010-11
AIC
AIC
APS Average
ASL
(%)
(%)
APS Employees
36
64%
73%
EL Employees
18
32%
25%
SES Employees
2
4%
2%
Statutory office holders
1
AIC indicated in their questionnaire response that 87 per cent of their staff undertake
substantive agency activities; with the remaining 13 per cent undertaking support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
AIC receives funding from the Australian Government, contributions from the States and
Territories and revenue from third parties for the sale of goods and the rendering of services.
AIC has one Outcome as follows:
Outcome 1 – Informed crime and justice policy and practice in Australia by undertaking,
funding and disseminating policy-relevant research of national significance; and through the
generation of a crime and justice evidence base and national knowledge centre.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A8.2: AIC actual and estimated appropriations
Actual (‘000)
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
Appropriation (excl DCB)
7,496
7,592
6,975
5,432
5,476
5,479
5,535
Other Agency Receipts
2,751
2,163
2,508
1,985
1,660
1,667
1,547
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The historical appropriation and agency receipts data provided above includes the CRC
which was merged with the AIC from 1 July 2011.
Revenue from government appropriations decreased by $0.6m from 2010-11 and a further
$1.5m from 2011-12. This reduction primarily reflects the impact of a whole-of-government
departmental efficiency measure and termination of the Anti-Money Laundering/CounterTerrorism Financing measure.
Appendix 8 - AIC
Page 176
Other Agency Receipts revenues have increased from 2009–10 reflecting an increase in
secretariat services provided by the AIC combined with additional research services provided
on a fee for service basis to third parties. The Other Agency Receipt estimates from 2012-13
onwards do not include the grant component of the National Drug Law Enforcement
Research Fund (NDLERF) which the AIC administers on behalf of the Department of Health.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A8.3: AIC actual operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
-527
112
392
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
AIC estimated operating results
AIC’s estimate of its operating results for the 2011-12 to 2014-15 financial years (excluding
depreciation and other non-cash items) is as set out below:
Table A8.4: AIC’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
0
0
0
0
AIC is seeking opportunities to continue to grow Other Agency Receipts over the coming
years to supplement departmental appropriations.
As at 30 June 2011 AIC had total liabilities of $4.4 million (including employee provisions)
and total cash and receivables of $5.6 million.
On the basis of the Review’s assessment of the information before it, the Review considers
AIC to be financially viable.
Shared/Outsourced Services:
AIC provides:

secretariat and auspicing services to Department of Health/ NDLERF Board;

secretariat services to the Australian and New Zealand Society of Criminology
(which include management of its website and annual conference);

website management/update services to the Indigenous Justice Clearinghouse in
partnership with the NSW Department of Attorney General and Justice; and
Appendix 8 - AIC
Page 177

website hosting services for CrimeStoppers Australia and CrimeStoppers
International.
AIC has outsourced selected support services including payroll processing which it receives
from Aurion and IT backup support.
Expenditure Analysis:
An analysis of the AIC’s 2010-11 expenditure by select activities is as follows:
Table A8.5: AIC 2010-11 expenditure by select activities
AIC
Review Agencies
Average
IT Expenditure per ASL
4,745
9,973
HR Expenditure per ASL
2,629
3,869
421
1,285
Property Expenditure per ASL
8,753
28,095
Support Activities (excl Rent)/Total
Expenditure
16%
22%
Substantive Activities/Total Expenditure
79%
66%
Rent/Total Expenditure
5%
12%
Payroll Expenditure per ASL
Property Analysis:
Table A8.6: Summary of AIC’s property position
Location
Griffith, Canberra
Term
Lease Start Date:
9 December 2007
Lease End Date:
8 December 2012
Comments
Total Lease Space: 1,729 sqm
Total Lease Cost: approximately
$0.5 million per annum
AIC does not have in place property
sharing arrangements with any other
department or agency
Recent Reviews/Material Considered by Review Team:

AIC Submissions to Strategic Review of Small and Medium Agencies in the
Attorney-General Portfolio – 9 September 2011 and 28 October 2011

AIC Annual Report 2010-11

AIC response to Review Questionnaire – 2011
Appendix 8 - AIC
Page 178
APPENDIX 9 - AUSTRALIAN TRANSACTION REPORTS AND
ANALYSIS CENTRE
Established by/under:
The Australian Transaction Reports and Analysis Centre (AUSTRAC) was established under
the Financial Transaction Reports Act 1988 (FTR Act). It continues in existence under the
Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).
Financial Framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency Functions:
AUSTRAC’s functions can be divided into two broad roles, regulatory and intelligence.
AUSTRAC’s functions are primarily set out in the AML/CTF Act; however, AUSTRAC
continues to administer some residual obligations under the FTR Act.
Under the AML/CTF Act the functions of AUSTRAC are:

to retain, compile, analyse and disseminate information collected under the
AML/CTF Act;

to provide advice and assistance, in relation to AUSTRAC information, to the
persons and agencies who are entitled or authorised to access AUSTRAC
information under Part 11 of the AML/CTF Act;

to advise and assist reporting entities in relation to their obligations under the
AML/CTF Act, the regulations and the AML/CTF Rules;

to advise and assist the representatives of reporting entities in relation to
compliance by reporting entities; and

to promote compliance with the AML/CTF Act, the regulations and the
AML/CTF Rules.
It is expected that the residual obligations of the FTR Act administered by AUSTRAC will be
repealed once a decision is made by Government on the regulation of a second tranche of
entities currently not regulated under the AML/CTF Act.
Governance Structure:
The AML/CTF Act provides for the appointment of a Chief Executive Officer who is the
head of AUSTRAC as a Statutory Agency.
AUSTRAC staff are engaged under the Public Service Act 1999.
Appendix 9 - AUSTRAC
Page 179
Staff Profile:
Table A9.1: AUSTRAC ASL in 2010-11
AUSTRAC
AUSTRAC
APS Average
ASL
(%)
(%)
APS Employees
166
60%
73%
EL Employees
103
37%
25%
SES Employees
9
3%
2%
Statutory office holders
1
AUSTRAC indicated in their questionnaire response that 77 per cent of their staff undertake
substantive agency activities; with the remaining 23 per cent undertaking support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
AUSTRAC is primarily budget funded and has one Outcome as follows:
Outcome 1 – A financial environment hostile to money laundering, financing of terrorism,
major crime and tax evasion through industry regulation and the collection, analysis and
dissemination of financial intelligence.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A9.2: AUSTRAC actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
54,095
57,336
54,314
53,260
54,990
55,740
56,369
621
2,624
2,736
2,558
423
151
151
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
From 2011-12 onwards more than half of AUSTRAC’s appropriation will be recovered
through cost recovery mechanisms, with entities regulated by AUSTRAC paying for the
performance of that regulatory function.
AUSTRAC has received new funding in recent years to continue work addressing tax haven
abuse, funding to implement the cost recovery initiative as well as capital funding to develop
and implement advanced analytical systems. AUSTRAC has also provided savings/efficiency
measures in the 2009-10 and 2011-12 Budgets.
Other agency receipts primarily reflect funding received from AusAID to undertake technical
assistance and capacity building initiatives in the Asia-Pacific regions.
Appendix 9 - AUSTRAC
Page 180
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A9.3: AUSTRAC actual operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
-2,396
709
286
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
AUSTRAC estimated operating results
AUSTRAC’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items) is as follows:
Table A9.4: AUSTRAC’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
0
0
0
0
As at 30 June 2011 AUSTRAC had total liabilities of $20.0m (including employee provisions
of $7.7m) and total cash and receivables of $25.6m (including appropriation receivable of
$19.0m).
On the basis of the Review’s assessment of the information before it, the Review considers
AUSTRAC to be financially viable.
Shared/Outsourced Services:
From October 2011, AUSTRAC began sharing accommodation with the Attorney-General’s
Department in Canberra. Through this arrangement, AUSTRAC utilises shared services in its
Canberra office with Attorney-General’s Department for cleaning, security and mail.
AUSTRAC is currently trialling an arrangement with the Australian Taxation Office for the
provision of call centre services, relating to new obligations for reporting entities to enrol and
register with AUSTRAC.
Expenditure Analysis:
An analysis of the AUSTRAC’s 2010-11 expenditure by select activities is as follows:
Table A9.5: AUSTRAC 2010-11 expenditure by select activities
AUSTRAC
Appendix 9 - AUSTRAC
Review Agencies
Page 181
Average
IT Expenditure per ASL
4,345
9,973
HR Expenditure per ASL
5,398
3,869
Payroll Expenditure per ASL
1,186
1,285
Property Expenditure per ASL
17,483
28,095
Support Activities (excl Rent)/Total
Expenditure
20%
22%
Substantive Activities/Total Expenditure
73%
66%
Rent/Total Expenditure
7%
12%
AUSTRAC has developed quite a sophisticated IT system in order to execute their regulatory
and intelligence functions. In responding to the questionnaire, AUSTRAC have split IT
expenditure between support and substantive activities. The IT expenditure per ASL
recorded above reflects the support component of AUSTRAC’s IT activities; further IT
expenditure is included within substantive activities.
Property Analysis:
Table A9.6: Summary of AUSTRAC’s property position
Location
Chatswood,
Sydney
Term
Lease Start Date: varying start
dates
Lease End Date: 31 May 2012
Comments
Total Lease Space: 5,245 sqm
Total Lease Cost: approximately $2.4 million
per annum
Total ASL Supported at this location: 160
William Street,
Victoria
Lease Start Date: varying start
dates
Lease End Date: varying end
dates between 30 April and 30
May 2013
Allara Street,
Canberra
Total Lease Space: 1,651 sqm
Total Lease Cost: approximately $0.8 million
per annum
Total ASL Supported at this location: 77
Lease Start Date: 15 August 2007
Total Lease Space: 590 sqm
Lease End Date: 15 August 2014*
Total Lease Cost: approximately $0.3 million
per annum
Total ASL Supported at this location: 19
*AUSTRAC advises that this lease was
assigned to AusAID in October 2011 after
AUSTRAC entered a shared accommodation
arrangement with AGD in Barton, ACT.
Club Tower,
Brisbane
Lease Start Date: 1 May 2007
Total Lease Space: 509 sqm
Lease End Date: 30 April 2013
Total Lease Cost: approximately $0.3 million
per annum
Total ASL Supported at this location: 20
Appendix 9 - AUSTRAC
Page 182
Recent Reviews/Material Considered by Review Team:

AUSTRAC Submission to Strategic Review of Small and Medium Agencies in
the Attorney-General’s portfolio - 23 September 2011

AUSTRAC Annual Report 2010-11

AUSTRAC response to Review Questionnaire – 2011
Appendix 9 - AUSTRAC
Page 183
APPENDIX 10 – CRIMTRAC AGENCY
Established by/under:
The CrimTrac Agency (CrimTrac) was established in 2000 under an Inter-Governmental
Agreement between the Commonwealth and each of Australia’s States and Territories.
Financial Framework:
Executive Agency under the Financial Management and Accountability Act 1997
Agency Functions:
CrimTrac has two core functions:

develop, maintain and enhance Law Enforcement Information Services; and

provide Background Checking Services.
A summary of the databases maintained and the services undertaken under each of these
functions is as follows:
Law Enforcement Information Services

National Criminal Investigation DNA Database (NCIDD) – assists police in
establishing identity from human biological samples.

National Automated Fingerprint Identification System (NAFIS) – a finger and
palm print database and matching system which assists police in managing
fingerprint records, confirming identities of persons of interest and resolving
crime.

National Police Reference System (NPRS) – provides nationwide access to
operational policing information on persons of interest.

Australian National Child Offender Register (ANCOR) – enables access to child
offender information, providing a compliance management tool for police
registrars to use in the monitoring and management of registrable offenders.

National Names Index (NNI) – multi-jurisdictional index of persons with
criminal histories, warrants, domestic violence orders, adverse firearms history,
missing persons and other related information for police nationally. CrimTrac
uses the NNI to initiate national background checking for accredited agencies.
NNI enquiries are reducing due to the successful uptake of NPRS.

National Vehicles of Interest (NVOI) – records stolen, recovered, wanted and
suspected vehicle details. This system links to national licensing and registration
authorities’ information held on the National Exchange of Vehicle and Driver
Identification system (NEVDIS, provided by Austroads).

National Firearms Licence and Registration System (NFLRS) – holds
information on past and current firearm licence holders, licensed firearm dealers
and registered, lost or stolen firearms.

Telephone Directory Service (TDS) – enables police to identify names and
addresses allocated to particular phone numbers, verify the addresses of detained
Appendix 10 - CrimTrac
Page 185
suspects and clarify the details of callers to police emergency telephone
operations.
Background Checking Services

National Police Checking Service (NPCS) – the establishment and maintenance
of client relationship and agreements delivering national criminal history
checking services to accredited agencies and police services. NPCS enables the
national checking of the police history of potential employees on behalf of
employers, such as government agencies, and non-government organisations. A
national police check involves identifying and releasing any relevant police
information subject to relevant spent convictions/non-disclosure legislation
and/or information release polices. CrimTrac facilitates about 2.9 million
national police checks a year through a decentralised process involving all
Australian police services evaluating relevant police records with a view to
determining the type and extent of the police information that can be released.
Governance Structure:
The Standing Council on Police and Emergency Management (SCPEM) sets CrimTrac’s
strategic direction and defines key policies. CrimTrac has a Board of Management appointed
pursuant to the Intergovernmental Agreement. SCPEM comprises the Ministers responsible
for police from the Commonwealth, each of the States and Territories, and New Zealand.
SCPEM is advised by a Senior Officers’ Group.
The CrimTrac Board of Management is responsible and accountable for the efficient and
effective delivery of the CrimTrac initiatives. The Board comprises all Australia’s Police
Commissioners, the ACT Chief Police Officer, a Deputy Secretary of the Commonwealth
Attorney-General’s Department, a Financial Adviser and an ICT Adviser. The Financial
Adviser and the ICT Adviser are non-voting members of the Board.
The Commonwealth Minister for Home Affairs and Justice sets the Statement of
Expectations for CrimTrac, which provide clarity about the Government’s policies, objectives
and strategic priorities for CrimTrac, for the year ahead. The CrimTrac CEO is responsible
to the Minister under the Public Service Act 1999 and the Financial Management and
Accountability Act 1997, and is responsible to the Board for the effective delivery of services
in accordance with the Board’s functions and responsibilities.
CrimTrac staff are engaged under the Public Service Act 1999.
Note: The Commonwealth is currently undertaking a separate review of CrimTrac’s
governance arrangements in conjunction with the States and Territories.
Staff Profile:
Table A10.1: CrimTrac ASL in 2010-11
CrimTrac
CrimTrac
APS Average
ASL
(%)
(%)
APS Employees
80
44%
73%
EL Employees
99
55%
25%
SES Employees
2
1%
2%
Appendix 10 - CrimTrac
Page 186
1
Statutory office holders
CrimTrac indicated in their questionnaire response that 72 per cent of their staff undertake
substantive agency activities; with the remaining 28 per cent undertaking support activities
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
CrimTrac is primarily funded through the collection of fees and charges for Background
Checking Services and has one outcome as follows:
Outcome 1 – Access to information that supports law enforcement agencies through
collaborative national information systems and services.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A10.2: CrimTrac actual and estimated appropriation
Actual (‘000)
08-09
Appropriation45
Other Agency Receipts
09-10
Estimate (‘000)
10-11
11-12
12-13
13-14
14-15
6,998
6,650
3,043
4,250
4,446
4,652
4,867
46,897
52,634
56,225
56,240
56,348
57,167
57,999
The appropriation funding received by CrimTrac represents interest equivalency payments
for the Special Account balance.
Other Agency Receipts comprise fees and charges generated from the sale of goods and
services, primarily through the provision of Background Checking Services (approximately
97% of receipts).
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A10.3: CrimTrac actual operating results
Actual (‘000)
08-09
Actual Operating Result
5,968
09-10
9,715
10-11
16,512
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
45
CrimTrac does not receive DCB
Appendix 10 - CrimTrac
Page 187
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
It is important to note that the CrimTrac does not have a Departmental Capital Budget.
Consequently, according to the Finance Minister Orders, depreciation expenses would be
included in calculating its operating result. If depreciation expenses were included,
CrimTrac’s operating result in 2010-11 would be $6.480m.
CrimTrac estimated operating results
CrimTrac’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation – although as CrimTrac does not have a Departmental Capital Budget
according to the Finance Minister Orders the depreciation expense should be included in the
operating loss for the agency) is as follows:
Table A10.4: CrimTrac’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
15,849
19,639
19,906
20,301
These estimated operating results:
a. were provided by the agency;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
CrimTrac has a history of substantial surplus results and is forecasting a surplus in the current
and each of the three forward financial years. As CrimTrac does not receive budget funding
the surpluses retained are used to fund future capital projects, asset replacements and
enhancement costs.
As at 30 June 2011 CrimTrac had a Special Account (cash) balance of $100.1 million and
total liabilities of $13.7 million.
Based on current annual funding forecasts CrimTrac is clearly financially viable.
Note: The Commonwealth is currently undertaking a separate review of CrimTrac’s funding
arrangements in conjunction with the States and Territories.
Appendix 10 - CrimTrac
Page 188
Shared/Outsourced Services:
CrimTrac does not have any shared service or property arrangements in place with any other
department or agency.
Expenditure Analysis:
An analysis of the CrimTrac’s 2010-11 expenditure by select activities is as follows:
Table A10.5: CrimTrac 2010-11 expenditure by select activities
CrimTrac
Review Agencies
Average
IT Expenditure per ASL
2,049
9,973
HR Expenditure per ASL
7,055
3,869
Payroll Expenditure per ASL
1,602
1,285
14,116
28,095
Support Activities (excl Rent)/Total
Expenditure
17%
22%
Substantive Activities/Total Expenditure
78%
66%
5%
12%
Property Expenditure per ASL
Rent/Total Expenditure
CrimTrac’s core function is to develop and maintain systems that enable the collection of law
enforcement information and the provision of background checking services, as such a large
portion of CrimTrac annual expenditure relates to IT. As a result the majority of CrimTrac’s
IT expenditure is recorded under substantive activities. The IT expenditure per ASL recorded
above relates to licences and support IT for corporate systems and the costs of a web
consultant.
CrimTrac’s human resource cost per ASL is higher than the review agency average.
CrimTrac have indicated causes include a HR systems upgrade and the implementation of a
comprehensive learning and development program. This is in addition to the management of
higher than average staff turnover and case management requirements.
Even allowing for these factors, the Review is not satisfied that CrimTrac’s support services
expenditure is fully justified and it has thus recommended that further review and
benchmarking of CrimTrac be undertaken (see Chapter 10).
Property Analysis:
Table A10.6: Summary of CrimTrac’s property position
Location
Lyneham,
Canberra
Term
Lease Start Date:
1 August 2007
Lease End Date:
31 July 2012
Appendix 10 - CrimTrac
Comments
Total Lease Space: 1,961 sqm
Total Lease Cost: approximately
$0.9 million per annum
Total ASL Supported at this location: 0
Page 189
Location
Dickson, Canberra
Term
Lease Start Date:
25 August 2008
Lease End Date:
24 August 2018
Comments
Total Lease Space: 3,872 sqm
Total Lease Cost: approximately
$1.8 million per annum
Total ASL Supported at this location: 183
In 2008 CrimTrac staff were located in three separate locations in Canberra:

243 Northbourne Ave, Lyneham – Lease Expiry August 2012

Cameron Ave, Belconnen - Lease Expiry October 2009

Fernwood Park, Bruce – Lease Expiry December 2008
A decision was taken to find suitable accommodation for all staff and facilities to be
accommodated in one location.
In August 2008 a lease for 496 Northbourne Ave, Dickson, was signed with the intent of
relocating all staff to a single location by October 2009.
From approximately January 2009 the 243 Northbourne Ave property became surplus to
requirements and made was available for sub-leasing based on positive expectations in that
regard. However, due to changes in market conditions, it has remained untenanted.
Recent Reviews/Material Considered by Review Team:

Materials on the ongoing separate review of CrimTrac’s governance and funding
arrangements

CrimTrac Annual Report 2010-11

CrimTrac response to Review Questionnaire – 2011
Appendix 10 - CrimTrac
Page 190
APPENDIX 11 - AUSTRALIAN HUMAN RIGHTS COMMISSION
Established by/under:
Australian Human Rights Commission Act 1986
Financial Framework:
Statutory Agency under the Financial Management and Accountability Act 1997
Agency Functions:
The Australian Human Rights Commission (AHRC) has statutory functions and
responsibilities under the following federal anti-discrimination and human rights laws:

Australian Human Rights Commission Act 1986

Racial Discrimination Act 1975

Sex Discrimination Act 1984

Disability Discrimination Act 1992

Age Discrimination Act 2004
These laws set out the AHRC’s major functions and powers, which include:

investigating and conciliating complaints of discrimination or breaches of human
rights;

holding public inquiries into human rights issues of national importance and
making recommendations to address discrimination and breaches of human
rights;

community education and raising awareness of human rights, which the AHRC
fulfils through developing human rights education programs and resources for
schools, workplaces and the community;

providing independent legal advice to assist courts in cases that involve human
rights principles;

providing advice to the federal Government, and through it, to Parliament, on the
development of laws, policies and programs consistent with human rights; and

undertaking and coordinating research into human rights and discrimination
issues.
Governance Structure:
The Australian Human Rights Commission Act 1986 provides that the AHRC shall consist of:

a President;

a Human Rights Commissioner;

the Race Discrimination Commissioner;

the Aboriginal and Torres Strait Islander Social Justice Commissioner;
Appendix 11- AHRC
Page 191

the Sex Discrimination Commissioner;

the Age Discrimination Commissioner; and

the Disability Discrimination Commissioner.
The President is the Chief Executive Officer under the Financial Management and
Accountability Act 1997 and is responsible for managing the administrative affairs of the
AHRC.
AHRC staff are engaged under the Public Service Act 1999.
Staff Profile:
Table A11.1: AHRC ASL in 2010-11
AHRC
AHRC
APS Average
ASL
(%)
(%)
APS Employees
68
62%
73%
EL Employees
39
36%
25%
SES Employees
2
2%
2%
Statutory office holders
4
AHRC indicated in their questionnaire response that 79 per cent of their staff undertake
substantive agency activities; with the remaining 21 per cent undertaking support activities.
AHRC has a shared service arrangement in place with the Office of the Australian
Information Commissioner (OAIC), whereby AHRC provides a significant portion of
OAIC’s corporate services. When this arrangement and OAIC’s ASL (69 in 2010-11) are
taken into account, the split of ASL undertaking substantive and support activities becomes
85% and 15% respectively.
Since 30 June 2011 AHRC has increased from four statutory office holders to six, with the
appointment of the first Age Discrimination Commissioner from 30 July 2011 and the
appointment of a full time Race Discrimination Commissioner from 5 September 2011. Both
appointments are for a period of five years.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
AHRC has one outcome as follows:
Outcome 1 – An Australian society in which human rights are respected, protected and
promoted through independent investigation and resolution of complaints, education and
research to promote and eliminate discrimination, monitoring and reporting on human rights.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Appendix 11- AHRC
Page 192
Table A11.2: AHRC actual and estimated appropriation
Actual (‘000)
Appropriation (excl DCB)
Other Agency Receipts46
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
13,550
13,711
14,424
16,153
16,869
16,982
17,128
5,213
4,992
5,545
4,775
4,775
4,775
4,775
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The increase in appropriation from 2010-11 onwards is the result of two budget measures. A
2010-11 Budget measure provided $6.6 million over four years to implement a new
framework for the protection and promotion of human rights in Australia. Through recent
Budget measures AHRC was provided $5.7 million over four years to establish the Age
Discrimination Commissioner position and restore the stand alone positions of Race and
Disability Discrimination Commissioners.
AHRC’s Other Agency Receipts primarily comprise income received through a shared
service agreement with the OAIC and funding from AusAID to undertake bilateral human
rights technical cooperation and disability programs in the Asia-Pacific region. In 2010-11
AHRC received $1.4 million revenue for services provided to OAIC (of this $0.3m was direct
cost recovery) and $2.6 million was earned from the delivery of services to AusAID.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A11.3: AHRC actual operating results
Actual (‘000)
08-09
Actual Operating Results
09-10
-755
-614
10-11
128
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
AHRC estimated operating results
The AHRC’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items) is as follows:
46
Excludes rental income from subleased premises
Appendix 11- AHRC
Page 193
Table A11.4: AHRC’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
0
0
0
0
As at 30 June 2011 AHRC had total liabilities of $7.8 million (excluding lease incentives)
and total cash and receivables of $8.9 million (including appropriation receivable of
$6.5 million).
On the basis of the Review’s assessment of the information before it, the Review considers
AHRC to be financially viable.
Shared/Outsourced Services:
AHRC has a shared service MoU in place with the OAIC. Services provided by AHRC to
OAIC include:

Financial Services (including accounting operations, internal reporting, policies
and instructions, asset management, audit committee, procurement, contract
management, insurance and external, special and statutory reporting and liaison);

Administrative Services (including overseas travel, reception, registry, records
management and security);

Information Technology Services (including network application and
maintenance and support services); and

Human Resource Services (including COMCARE services, human resource
advice, induction, maintenance and storage of personnel files, payroll, personnel
policies, recruitment, training and development and workplace relations).
The Review has recommended that service levels should be negotiated for each of the
services provided under the MoU.
AHRC is located in Sydney and subleases office space to OAIC. In addition to the sublease
of office space, the AHRC and OAIC also share meeting rooms, with OAIC contributing
approximately 20 per cent towards the rent of shared facilities.
AHRC has a leasing and shared services arrangement with the Secretariat of the Asia Pacific
Forum. The secretariat is co-located with the AHRC in Sydney.
AHRC also has a shared service arrangement to access the hard copy library of the Australian
Law Reform Commission and the Australian Government Solicitor.
Expenditure Analysis:
An analysis of the AHRC’s 2010-11 expenditure by select activities is as follows:
Table A11.5: AHRC 2010-11 expenditure by select activity
AHRC
Review Agencies
Average
IT Expenditure per ASL
11,108
9,973
HR Expenditure per ASL
2,299
3,869
Payroll Expenditure per ASL
1,749
1,285
Appendix 11- AHRC
Page 194
14,839
28,095
Support Activities (excl Rent)/Total Expenditure
18%
22%
Substantive Activities/Total Expenditure
74%
66%
8%
12%
Property Expenditure per ASL
Rent/Total Expenditure
AHRC’s expenditure incorporates its provision of shared services to OAIC, which is
recouped through charges levied against OAIC. When OAIC ASL are included in the
calculation of IT, HR and Payroll expenditure per ASL, the amounts reduce to $6,906;
$1,429; and $1,087 respectively. The comparative assessment does not attempt to adjust for
any abnormal business expenditure arising from the establishment of OAIC in November
2010, and the relocation of AHRC, OAIC and Asia Pacific Forum to new business premises
in Sydney prior to June 2011.
The cost of the OAIC sublease has been excluded when calculating AHRC’s property
expenditure per ASL.
Property Analysis:
Table A11.6: Summary of AHRC’s property position
Location
Term
Comments
Pitt Street, Sydney
Lease Start Date: 1 July 2011
Total Lease Space: 4,142.2 sqm
Lease End Date: 30 June
2021
Total Lease Cost: $2.2 million per annum
(increment 4 per cent per annum over 10
years)
AHRC subleases 1,237.5 sqm to OAIC at a
rate of $0.650 million per annum (increment 4
per cent per annum over 10 years)
Recent Reviews/Material Considered by Review Team:

AHRC Annual Report 2010-11

AHRC response to Review Questionnaire – 2011
Appendix 11- AHRC
Page 195
APPENDIX 12 - AUSTRALIAN LAW REFORM COMMISSION
Established by/under:
Australian Law Reform Commission Act 1996
Financial Framework:
Prior to 30 June 2011, the Australian Law Reform Commission (ALRC) was a body under
the Commonwealth Authorities and Companies Act 1997. From 1 July 2011, ALRC became a
Statutory Agency under the Financial Management and Accountability Act 1997.
Agency Functions:
Under section 21 of the Australian Law Reform Commission Act 1996, the ALRC has the
following functions in relation to matters referred to it by the Attorney-General:

to review Commonwealth laws relevant to those matters for the purposes of
systematically developing and reforming the law, particularly by:
bringing the law into line with current conditions and ensuring that it meets
current needs;
removing defects in the law;
simplifying the law;
adopting new or more effective methods for administering the law and
dispensing justice; and
providing improved access to justice;

to consider proposals for making or consolidating Commonwealth laws about
those matters;

to consider proposals for the repeal of obsolete or unnecessary laws about those
matters;

to consider proposals for uniformity between State and Territory laws about
those matters;

to consider proposals for complementary Commonwealth, State and Territory
laws about those matters.

to report to the Attorney-General on the results of any review or consideration it
carries out, and to include in the report any recommendations it wants to make.
Governance Structure:
The Australian Law Reform Commission Act 1996 provides for a President and up to six
other members.
The President is also the Chief Executive Officer of the ALRC.
ALRC employees are engaged under the Public Service Act 1999.
Appendix 12 - ALRC
Page 197
Staff Profile:
Table A12.1 ALRC ASL in 2010-11
ALRC
ALRC
APS Average
ASL
(%)
(%)
APS Employees
11
69%
73%
EL Employees
4
25%
25%
SES Employees
1
6%
2%
Statutory office holders
2
ALRC indicated through their questionnaire response that 80 per cent of their staff undertake
substantive agency activities; with the remaining 20 per cent undertaking support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
ALRC is largely budget funded and has one Outcome as follows:
Outcome 1 – Informed government decisions about the development, reform and
harmonisation of Australian laws and related processes through research, analysis, reports
and community consultation and education.
Actual appropriations and agency receipts for 2008-09 to 2010-11 financial years and
estimated appropriations and agency receipts for 2011-12 to 2014-15 financial years (based
on Portfolio Budget Statements and Annual reports) are as follows:
Table A12.2: ALRC actual and estimated appropriations
Actual (‘000)
Appropriation47
Other Agency Receipts
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
3,360
3,387
3,152
2,842
2,831
2,855
2,882
129
63
123
5
5
5
5
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
The decrease in appropriation from 2009-10 onwards is the result of a 2009-10 Budget
decision, which reduced the ALRC’s departmental appropriation by $0.2m in 2010-11 and by
$0.5m from 2011-12 onwards.
Other agency receipts are minimal and primarily reflect interest equivalency payments from
the Government.
47
Depreciation and amortisation was used in the calculations in lieu of DCB
Appendix 12 - ALRC
Page 198
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A12.3: ALRC actual operating results
Actual (‘000)
08-09
09-10
10-11
57
-131
-878
Actual Operating Results
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
ALRC estimated operating results
The ALRC’s estimate of its operating results for the 2011-12 to 2014-15 financial years
(excluding depreciation and other non-cash items) is as follows:
Table A12.4: ALRC’s estimate of its operating results
Estimated (‘000)
11-12
12-13
13-14
14-15
11
12
10
7
Estimated Operating Results
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The losses incurred by the ALRC in 2009-10 and 2010-11 relate to the implementation of
initiatives in order to deliver the savings required through the 2009-10 Budget measure. The
main factor causing the 2010-11 loss is as a result of the ALRC vacating its previous
Appendix 12 - ALRC
Page 199
premises prior to the end of the lease term (30 September 2012) in order to move into a more
affordable lease arrangement.
As at 30 June 2011, the ALRC had total liabilities of $1.3m (including employee provisions
of $0.4m and excluding lease incentives) and total cash and receivables of $1.3m. The
ALRC’s total liabilities currently include a provision for the lease of their former premises
which is not due to end until 30 September 2012.
The ALRC have taken effective steps in order to meet the Budget cuts made in 2009-10 and
to ensure expenditure in the future fits within their revised ongoing appropriation. This was
predominantly achieved by entering into a sublease arrangement with the Australian
Government Solicitor (AGS), the result being a more than 50 per cent reduction in rent
expenditure in future years (the full benefit of which will not be realised until the end of their
previous lease). The ALRC received a six month rent free period as a lease incentive from
the AGS.
On the basis of the Review’s assessment of the information before it, the Review considers
ALRC to be financially viable.
Shared/Outsourced Services:
ALRC has a shared service arrangement in place, where it receives access to the Australian
Government Solicitor’s hard copy library through a memorandum of understanding.
ALRC also has outsourced service arrangements in place covering IT services and website
hosting.
ALRC entered into a subleasing arrangement for office space from the Australian
Government Solicitor in February 2011, and also enjoys the benefit of access to the
Australian Government Solicitor conference and meeting rooms.
Expenditure Analysis:
An analysis of the ALRC’s 2010-11 expenditure by select activities is as follows:
Table A12.5: ALRC 2010-11 expenditure by select activities
ALRC
Review Agencies
Average
IT Expenditure per ASL
4,172
9,973
HR Expenditure per ASL
3,634
3,869
Payroll Expenditure per ASL
1,984
1,285
Property Expenditure per ASL
41,240
28,095
Support Activities (excl Rent)/Total
Expenditure
23%
22%
Substantive Activities/Total Expenditure
56%
66%
Rent/Total Expenditure
21%
12%
ALRC has not been able to sublease their previous premises and as such have had to meet the
cost of the existing lease and the new lease since February 2011. From the end of the
existing lease ALRC’s property expenditure per ASL and rent as a proportion of total
expenditure will reduce significantly.
Appendix 12 - ALRC
Page 200
Property Analysis:
Table A12.6: Summary of the ALRC’s property position
Location
Term
King Street, Sydney Lease End Date:
30 September 2012
Comments
Total Lease Cost: approximately $0.6m per
annum
This office space was vacated by the ALRC in
February 2011; however, the ALRC have been
unable to sublease this space. This lease will
not be renewed.
Martin Place,
Sydney
Lease Start Date: 9 February
2011
Lease End Date: 1 October
2012
Total Lease Space: 390 sqm
Total Lease Cost: approximately $0.3m per
annum
Total ASL Supported at this location: 18
This office space is subleased from the
Australian Government Solicitor.
Recent Reviews/Material Considered by Review Team:

Legal and Constitutional Affairs References Committee – Inquiry into the
Australian Law Reform Commission – April 2011

ALRC Submissions to the Inquiry into the Australian Law Reform Commission
– December 2010 and March 2011

Government response to the Inquiry into the Australian Law Reform
Commission – July 2011

ALRC Annual Report 2010-11

ALRC response to Review Questionnaire – 2011
Appendix 12 - ALRC
Page 201
APPENDIX 13 - INSOLVENCY AND TRUSTEE SERVICE
AUSTRALIA
Established by/under:
The Bankruptcy Act 1966 requires that there be an Inspector-General in Bankruptcy, Official
Receivers and the Official Trustee.
The Official Trustee also has responsibilities under the Proceeds of Crime Act 1987 and the
Proceeds of Crime Act 2002.
Financial Framework:
The Insolvency and Trustee Service (ITSA) is an Executive Agency under the Financial
Management and Accountability Act 1997
Agency Functions:
The Inspector-General of Bankruptcy, Official Receivers and the Official Trustee have
specific functions defined under the Bankruptcy Act 1966.
Broadly ITSA’s functions are as follows:

providing information about options to deal with unmanageable debt;

providing registry services for the lodgement of forms relating to personal
insolvency;

regulating insolvency practitioners and undertaking investigation of alleged
offences under the legislation; and

providing trustee services for the administration of insolvent estates and other
types of trustee administrations, including Proceeds of Crime matters.
From 30 January 2012, ITSA will also be responsible for the administration of the Personal
Property Securities Register (PPSR).
Governance Structure:
The Bankruptcy Act 1966 provides for the Minister to appoint an Inspector-General of
Bankruptcy and such number of Official Receivers as the Minister considers necessary.
The current Inspector-General is also the Chief Executive of ITSA – this practice has existed
since ITSA became an executive agency.
ITSA staff are engaged under the Public Service Act 1999.
Appendix 13 - ITSA
Page 203
Staff Profile:
Table A13.1: ITSA ASL in 2010-11
ITSA
ITSA
APS Average
ASL
(%)
(%)
APS Employees
229
75%
73%
EL Employees
69
23%
25%
SES Employees
5
2%
2%
Statutory office holders
1
ITSA indicated in their questionnaire response that 78 per cent of their staff undertake
substantive agency activities; with the remaining 22 per cent undertaking support activities.
Annual Funding:
(Review methodology in relation to the financial data below is set out in Chapter 1,
paragraphs 1.17 to 1.22.)
ITSA is primarily budget funded (although a large portion of the budget funding is returned
to Government under cost recovery arrangements) and has one Outcome as follows:
Outcome 1 – Improved and equitable financial outcomes for consumers, business and the
community through application of bankruptcy and personal property securities laws,
regulation of personal insolvency practitioners, and trustee services.
From 2011-12 onwards ITSA has two programs under the above outcome:


Program 1.1 Personal Insolvency and Trustee Services; and
Program 1.2 Operation of a National Register of Security Interests in Personal
Property.
Actual departmental appropriations and agency receipts for the 2008-09 to 2010-11 financial
years and estimated departmental appropriations and agency receipts for the 2011-12 to
2014-15 financial years (based on Portfolio Budget Statements and Annual reports) are as
follows:
Table A13.2: ITSA actual and estimated appropriation
Actual (‘000)
Estimate (‘000)
08-09
09-10
10-11
11-12
12-13
13-14
14-15
Appropriation (excl DCB)
36,317
40,485
39,927
46,343
46,915
49,580
52,494
Other Agency Receipts
2,653
2,688
4,591
32,947
36,389
37,495
27,796
Appropriations for 2008-09 and 2009-10 include depreciation funding. Appropriations for
2010-11 and future years exclude Departmental Capital Budgets and are not directly
comparable to 2008-09 and 2009-10 appropriations.
Since 2007-08, ITSA has received bi-annual supplementation to manage growth in personal
insolvency matters. This resulted in budget measures providing additional funding in both
the 2007-08 and 2009-10 Budgets. In the 2011-12 Budget it was agreed that a resource
agreement should be developed and agreed to avoid the requirement for bi-annual NPPs and
to provide greater funding certainty. The resource agreement is currently being developed,
Appendix 13 - ITSA
Page 204
and is required to be settled prior to the May 2012 Budget. The actual amount of
appropriation in the forward years will be affected by the resource agreement once finalised
and will depend on emerging trends in numbers of personal insolvencies.
There are three components to ITSA’s departmental funding:

Funding for cost recovered activities – based on fees and charges raised;

Variable funding – provided by the Government where full cost recovery cannot
be achieved, and the cost of activities are directly linked to changing bankruptcy
activity; and

Fixed funding – provided by the Government to cover overheads and
administration of Proceeds of Crime activities.
In prior years, Other Agency Receipts have mainly been received from three sources:
reimbursement of funds lent to the Official Trustee, receipts from the sale of bankruptcy data,
and proceeds from the sublease of office space to the Department of Infrastructure and
Transport in Hobart. Other Agency Receipts do not include fees and charges returned to the
Consolidated Revenue Fund.
The significant increase in Other Agency Receipts from 2011-12 onwards is a result of the
imminent introduction of the PPSR. ITSA will receive fees and charges for registrations,
searches and other functions relating to the PPSR. These fees and charges include an
allowance for the future replacement of personal property securities assets, as well as an
allowance for the repayment of funding provided in the 2010–11 and 2011–12 Budgets to
finalise the establishment of the PPSR. That funding was provided on the basis that it will be
repaid over the first three years of operation of the PPSR.
It is important to note that the estimates in the table above are based on a launch date of
October 2011. As the launch has been delayed until early 2012, Other Agency Receipts for
2011-12 are likely to be lower than forecast and the timeframe for repaying the budget for the
PPSR will be pushed out.
Financial Viability:
Actual operating results
Actual operating results for the 2008-09 to 2010-11 financial years (based on annual reports)
are as follows:
Table A13.3: ITSA current operating results
Actual (‘000)
Actual Operating Results
08-09
09-10
10-11
52
135
-3,450
The 2008-09 and 2009-10 operating results are not directly comparable with 2010-11. The
earlier figures include depreciation funding and expenses. Due to the introduction of
Departmental Capital Budgets in 2010-11, the Review has excluded depreciation expenses
from the operating result for that year to provide a clearer picture of funding against
operating expenses.
Appendix 13 - ITSA
Page 205
ITSA estimated operating results
ITSA’s estimate of its operating results for the 2011-12 to 2014-15 financial years (excluding
non-appropriated expenses, primarily depreciation from 2010-11) is as follows:
Table A13.4: ITSA’s estimate of its operating results
Estimated (‘000)
Estimated Operating Results
11-12
12-13
13-14
14-15
7,978
8,965
8,965
0
These estimated operating results:
a. were provided by the agency, although the Review notes that an agency cannot
budget for a loss in future years;
b. exclude DCB and depreciation expenses and are based on business as usual, with
agencies asked to separately identify measures proposed or under consideration to
avoid deficits (where deficits were projected). This approach was used to fully
understand the financial viability of agencies at the levels of activity assumed by
agencies and to allow the Review to analyse steps that may be taken in future for
agencies to avoid running deficits;
c. are not Budget Estimates as published by the Government;
d. have not been verified by the Review Team;
e. have not been validated by the Department of Finance and Deregulation; and
f. may differ from authorised forward estimates either held by the Department of Finance
and Deregulation or which are otherwise publicly available.
The loss in 2010-11 is the result of the write-off of software development costs of $3.5m.
ITSA received approval from the Minister for Finance and Deregulation for this loss.
The surplus balances in the 2011-12 to 2013-14 financial years are to enable the repayment to
the Budget of funding provided to establish the PPSR.
Funding for ITSA has been relatively stable over time, with ITSA experiencing growth in
appropriation funding in line with levels of personal insolvency activity in Australia. The
introduction of a resource agreement will provide even greater funding certainty into the
future.
As at 30 June 2011, ITSA had total cash and receivables of $8.9m (including appropriations
receivable of $7.5m) and liabilities of $9.0m (including employee provisions of $6.0m).
On the basis of the Review’s assessment of the information before it, the Review considers
ITSA as financially viable.
Shared/Outsourced Services:
ITSA currently has shared service arrangements in place with the Attorney-General’s
Department for data centre hosting.
ITSA is working with the Attorney-General’s Department on the development and
implementation of the PPSR. Once finalised, the IT infrastructure to support the PPSR will
Appendix 13 - ITSA
Page 206
be hosted by the Department. As a result ITSA and the Department have developed a
Memorandum of Understanding to support the ongoing relationship.
ITSA has recently undertaken a process to identify its various functions and map whether the
function is core or non-core to service delivery and whether non-core functions can be
outsourced or need to be completed in-house. ITSA advises that it will, as capacity avails,
and an appropriate assessment (including risk assessment) is undertaken, look at
opportunities to outsource or share services in respect of non-core functions.
ITSA has a sharing arrangement in place in Hobart where it subleases office space to the
Department of Infrastructure and Transport.
Expenditure Analysis:
An analysis of the ITSA’s 2010-11 expenditure by select activities is as follows:
Table A13.5: ITSA 2010-11 expenditure by select activities
ITSA
Review Agencies
Average
IT Expenditure per ASL
17,289
9,973
HR Expenditure per ASL
2,899
3,869
Payroll Expenditure per ASL
1,812
1,285
Property Expenditure per ASL
11,845
28,095
Support Activities (excl Rent)/Total
Expenditure
31%
22%
Substantive Activities/Total Expenditure
61%
66%
Rent/Total Expenditure
8%
12%
59 per cent of IT expenditure includes applications that facilitate and record ITSA’s
interactions with personal insolvency stakeholders, including the maintenance of a register of
personal insolvencies that is used by credit providers and the Australian community when
deciding whether to extend credit to individuals.
Property Analysis:
Table A13.6: Summary of ITSA’s property position
Location
Barton, Canberra
Term
Lease Start Date: varying
start dates
Lease End Date: 31
December 2013
Appendix 13 - ITSA
Comments
Total Lease Space: 1,284 sqm
Total Lease Cost: approximately $0.5m per
annum
Total ASL Supported at this location: 41
Page 207
Location
Elizabeth Street,
Sydney
Term
Lease Start Date: 1
November 2007
Lease End Date: 31 October
2017
La Trobe Street,
Melbourne
Comments
Total Lease Space: 1,716 sqm
Total Lease Cost: approximately $0.8m per
annum
Total ASL Supported at this location: 63
Lease Start Date: 1 July 2005
Total Lease Space: 1,493 sqm
Lease End Date: 30 June
2014
Total Lease Cost: approximately $0.4m per
annum
Total ASL Supported at this location: 62
Adelaide Street,
Brisbane
Lease Start Date: 1 July 2009
Total Lease Space: 1,438sqm
Lease End Date: 30 June
2014
Total Lease Cost: approximately $0.8m per
annum
Total ASL Supported at this location: 65
King William
Street, Adelaide
Lease Start Date: 1 July 2010
Total Lease Space: 1,455 sqm
Lease End Date: 30 June
2016
Total Lease Cost: approximately $0.5m per
annum
Total ASL Supported at this location: 46
Elizabeth Street,
Hobart
Lease Start Date: 18 October
2007
Lease End Date: 30 June
2015
263 Adelaide
Terrace, Perth
Lease Start Date: 14
December 2007
Lease End Date: 13
December 2012
Total Lease Space: 419 sqm
Total Lease Cost: approximately $0.1m per
annum
Total ASL Supported at this location: 8
Total Lease Space: 815 sqm
Total Lease Cost: approximately $0.2m per
annum
Total ASL Supported at this location: 19
In the first half of 2011, at the end of existing lease obligations, ITSA closed its regional
office in Townsville and transferred functions undertaken by its small Canberra sub-office to
its office in Sydney.
Recent Reviews/Material Considered by Review Team:

ITSA Submission to the Strategic Review of Small and Medium Agencies in the
Attorney-General’s portfolio - received 26 October 2011

Economics References Committee – The regulation, registration and
remuneration of insolvency practitioners in Australia: the case for a new
framework – September 2010

Productivity Commission Research Report – Annual Review of Regulatory
Burdens on Business: Business and Consumer Services – August 2010

ITSA Annual Report 2010-11

ITSA response to Review Questionnaire – 2011
Appendix 13 - ITSA
Page 208
APPENDIX 14 – REVIEW QUESTIONNAIRE
Workbook 1 – Contact details
AGENCY CONTACT DETAILS
Agency:
Contact Officer for this Questionnaire:
Telephone:
E-mail:
REVIEW TEAM CONTACT DETAILS
Review Team Lead Contact Officer:
Telephone: 02 6215 ####
Please return completed surveys to: ###.###@finance.gov.au
Review Team Alternate Contact Officer:
Telephone: 02 6215 ####
Please return completed surveys to: ###.###@finance.gov.au
Appendix 14 – Review Questionnaire
Page 209
Workbook 2: Agency financial analysis
AGENCY FINANCIAL ANALYSIS
1. BUDGET PRIOR YEARS
2008-2009
Financial
Year
$
2009-2010
Financial
Year
$
2010-2011
Financial
Year
$
2008-2009
Financial
Year
$
2009-2010
Financial
Year
$
2010-2011
Financial
Year
$
2011-2012
Financial
Year$
2012-2013
Financial
Year$
2013-2014
Financial
Year$
2014-2015
Financial
Year$
2011-2012
Financial
Year
$
2012-2013
Financial
Year
$
2013-2014
Financial
Year
$
2014-2015
Financial
Year
$
Departmental Appropriation (exclude
Departmental Capital Budget)
Agency Receipts (include s.31 Receipts / Other
Revenue)
2. ACTUAL OPERATING RESULTS
Actual Operating Results attributable for
Agency (exclude Depreciation / Other NonCash Items)
Agency comment on the Actual Operating
Results:
3. BUDGET CURRENT AND FUTURE
YEARS
Departmental Appropriation (exclude
Departmental Capital Budget)
Agency Receipts (include s.31 Receipts / Other
Revenue)
Explanation of reason for changes in funding
between years:
4. FORECAST OPERATING RESULTS
Forecast Operating Results attributable for
Agency (exclude Depreciation / Other NonCash Items) (based on business as usual)
Appendix 14 – Review Questionnaire
Page 210
Identify key factors affecting Forecast
Operating Results attributable for Agency,
including, where a deficit is identified, what
efficiency initiatives are proposed / currently
being considered:
5. CAPITAL BUDGET FUNDING
2011-2012
Financial
Year
$
2012-2013
Financial
Year
$
2013-2014
Financial
Year
$
2014-2015
Financial
Year
$
Actual Departmental Capital Budget
Appropriation
Forecast Departmental Capital Budget
Expenditure
Explanation of difference between Actual and
Forecast Departmental Capital Budget Funding:
6. LAPSING/TERMINATING MEASURES
Does the Agency have any measures that
lapse/terminate in the current financial year or
across the forward estimates (e.g. Expiring
NPPs):
7. BALANCE PRIOR YEAR
APPROPRIATIONS
2010-2011
Financial
Year
$
Balance of Prior Year Appropriations as at 30
June 2011
Analysis of what the balance of Prior Year
Appropriations represents (for example balance
split by increase in employee provisions since
1999-2000, payables as at 30 June 2011,
approved funding for capital expenditures in
2011-12 or future years, accumulated surpluses
etc):
8. OTHER AGENCY COMMENTS
Any other Agency comments:
Appendix 14 – Review Questionnaire
Page 211
Workbook 3: Expenditure and ASL by activity
AGENCY EXPENDITURE AND AVERAGE STAFFING LEVEL BY ACTIVITY
for Financial Year ended 30 June 2011
Activity
Type
Total
Expenditure
2010-2011
by Activity
ASL
designated
to Activity
Are you receiving
or purchasing
services from
another
department/agency/
organisation?
Please provide
detail
Are you
providing
services to
another
department/agen
cy/organisation?
Please provide
detail
Other Agency
Comments/
Explanation
INFORMATION TECHNOLOGY AND MANAGEMENT
System
Management
System
Development
Informatio
n Technology
Consultants
Library
Record
Management
Other
(provide
details)
HUMAN RESOURCE
Recruitme
nt
Payroll
Training
and
Development
Other
(provide
details)
BUDGETING AND FINANCIAL MANAGEMENT
Budgeting,
Analysis and
Financial
Reporting
Appendix 14 – Review Questionnaire
Page 212
Accounts
Payable/
Receivable
Other
(provide
details)
PROPERTY
Rent
Expense
Facilities
Management
SECURITY
In-house
External
Provider
LEGAL
In-house
External
Provider
COMMUNICATIONS
Public
Relations
Publication
s
OTHER SUPPORT
ACTIVITIES
Other
(provide
details)
SUBTOTAL
-
-
SUBSTANTIVE ACTIVITIES OF THE AGENCY
Please
Specify
Appendix 14 – Review Questionnaire
Page 213
SUBTOTAL
-
-
TOTAL
-
-
Appendix 14 – Review Questionnaire
Page 214
Workbook 4: Agency Average Staffing level by Classification level and
location
AGENCY AVERAGE STAFFING LEVEL BY CLASSIFICATION LEVEL AND LOCATION
as at 30 June 2011
ACT
NSW NT QLD SA TAS VIC WA
Other
Locations
APS 1
APS 2
APS 3
APS 4
APS 5
APS 6
EL 1
EL 2
SES 1
SES 2
SES 3
Statutory
Office
Holders
-
-
-
-
Appendix 14 – Review Questionnaire
-
-
-
-
-
Page 215
Workbook 5: Property data
AGENCY PROPERTY DATA
as per March 2011 Property Data Collection (PRODAC)
update
Agency comments
Functions performed at premises
Describe sharing arrangements
Rent Expense
Private Lease / C'wealth Lease / Agency
Owned
Lease end date
Lease start date
Occupied workpoints
Workpoints
Total non-office area (m2)
Leased out area (m2)
Net lettable area (m2)
Address (including street number, street
name, suburb and state)
Building Name
Page 216
Appendix 14 – Review Questionnaire
Workbook 6: Explanations
AGENCY EXPENDITURE AND AVERAGE STAFFING LEVEL BY ACTIVITY - Supporting
Information
Total Expenditure
2010-2011 by Activity
Substantive Activities
of the Agency
Total Expenditure required for the 2010-2011 Financial Year.
Please exclude depreciation and other non-cash expenditure from Total Expenditure
for each activity.
The Total Expenditure should agree to 'Total Expenses' as per 2010-2011 Financial
Statements less depreciation and other non-cash expenditure.
Please provide detail of substantive activities which are specific to your agency.
Substantive activities are those which are critical and specific to the achievement of
an Agency’s purpose.
AGENCY AVERAGE STAFFING LEVEL BY CLASSIFICATION LEVEL AND LOCATION Supporting Information
Average Staffing Level
(ASL):
Extract from EM2011/12 '2011-12 Budget: Average Staffing Level (ASL) Figures
in the General Government Sector'
ASL figures reflect the average number of employees receiving salary or wages over
the financial year, with adjustments for casual and part-time staff, to show the
average full time equivalent. ASL figures also include non-uniformed staff and
overseas personnel.
Agencies should be aware that Full Time Equivalent (FTE) staffing figures can be
different to ASL figures.
• FTE staffing figures, which are entered into the BEAM module of CBMS as part
of the Annual Estimates process, are calculated as at 30 June and do not account for
variations in staffing levels throughout the year.
AGENCY PROPERTY DATA - Supporting Information
Definitions extracted from EM2011/07 'Property Data Collection (PRODAC) Property File - March 2011' and
EM2010/40 'Property Data Collection (PRODAC) Cost File 2010-11'
Building Name
The name of the property or building.
Address
Street Number
The street number of the property or building.
Street Name
The street on which the property is located.
Suburb
The suburb in which the property is located.
State/Territory
The State or Territory in which the property is located.
Net Lettable Area
For leased property, the total Net Lettable Area (NLA) covered by the lease
measured in accordance with the PCA: Method of Measurement For Lettable Area.
For owned property, the total NLA of the building measured in accordance with the
PCA: Method of Measurement For Lettable Area.
Leased-out Area
Total area within the reported NLA of the property which is leased-out to another
agency or another entity, measured in accordance with the PCA: Method of
Measurement of Lettable Area.
Non-office Area
Non-office area is an area within the controlled area of the property, which falls into
one of the following categories in the ‘include’ column.
Appendix 14 – Review Questionnaire
Page 217
Total Non-office Area
Total of all areas within the reported NLA that meet the definition of non-office area
and are not leased-out.
Workpoints
Total number of workpoints within the usable office area of the property at the time
of the walk-through.
A workpoint is a desk, enclosed office or a counter where it would be reasonable to
expect a person to carry out office work on an ongoing basis.
Occupied Workpoints
Total number of occupied workpoints within the usable office area of the property at
the time of the walk-through.
An occupied workpoint is a workpoint that has all essential equipment to do office
work, shows signs of life and could reasonably be assumed to be a place where
office work is regularly undertaken.
Essential equipment is a functional computer, powered monitor, keyboard, mouse, a
functional telephone and a chair. If an agency intentionally provides workpoints
without computers (e.g. for staff who use a laptop or do not require a computer),
essential equipment only includes a working telephone and a chair.
Lease State Date
Lease End Date
Rent Expense
Signs of life are items on or around the workpoint which indicate that it could not be
reallocated to another person. Such items may include a name plate, folders,
stationery and papers, photographs and other personal items, or a person working at
the workpoint during the count.
The date when the current obligation to lease the property began.
The date when the current obligation to lease the property ends.
Total rent expense incurred by the agency in the reporting period for all areas within
the tenancy, associated car parking and onsite storage.
Appendix 14 – Review Questionnaire
Page 218
APPENDIX 15 - QUESTIONNAIRE – SUMMARY OF SELECTED
RESPONSES
Methodology
Each of the 13 agencies within Review scope was asked to complete a questionnaire (see
Appendix 14), which sought details on agency funding, expenditure by activities, average
staffing levels (ASL) and property data. In particular, agencies were asked to:

provide actual and estimated data for prior, current and future financial years;
and

analyse and breakdown their 2010-11 actual expenditure (excluding depreciation
and non cash items) across a number of generic support activities and substantive
activities relevant to their agency.
Based on the information provided, a high level comparative analysis was undertaken in
relation to:
a.
total agency expenditure split by substantive and support activities and rent
expenditure;
b.
budget and financial management, information technology, human resources,
payroll and property expenditure per ASL; and
c.
ASL by classification.
Note:
The Review notes that the breakdown of expenditure across activities also involves a
subjective element, and agencies will by the nature of their operations and accounting
practices differently interpret and allocate expenditure between activities. Hence, the graphs
set out below are an indicative but useful guide only. Further information on each agency
can be found within their relevant appendices within the report.
The Family Court of Australia and the Federal Magistrates Court are treated as one entity as
they have effectively merged their structures.
Appendix 15 – Questionnaire: Summary of selected responses
Page 219
Figure A15.1: Agency expenditure by category
Figure A15.1 shows a breakdown of each agency’s total expenditure for 2010-11, split
between substantive and support activities. Rent is shown separately, as depending on the
location and type of lease arrangement, it can be a significant portion of total expenditure.
Appendix 15 – Questionnaire: Summary of selected responses
Page 220
Figure A15.2: Budget and financial management expenditure as a
percentage of total agency resourcing
Figure A15.2 shows each agency’s level of budget and financial management expenditure as
a percentage of total agency resourcing (excluding equity injections). The graph generally
demonstrates an inverse relationship between agency resourcing and the percentage of
expenditure on budget and financial management activities.

One exception worth noting is AHRC, which provides corporate support to the
OAIC. If OAIC agency resources are included in AHRC’s figures, the
percentage of budget and financial management expenditure for AHRC reduces
to 2 per cent.
Appendix 15 – Questionnaire: Summary of selected responses
Page 221
Figure A15.3: Agency Information Technology expenditure per ASL
Figure A15.3 shows Information Technology (IT) expenditure per ASL. The methodology
agencies used to answer this part of the questionnaire varied – e.g. IT intensive agencies such
as CrimTrac and AUSTRAC classified the majority of their IT expenditure as substantive
activities.
Figure A15.4: Agency human resource expenditure per ASL
Appendix 15 – Questionnaire: Summary of selected responses
Page 222
Figure A15.4 shows agency human resource expenditure (including payroll but excluding
learning and development expenditure) per ASL.
Appendix 15 – Questionnaire: Summary of selected responses
Page 223
Figure A15.5: Agency payroll expenditure per ASL
Figure A15.5 shows agency payroll expenditure per ASL. AIC, OPC and ACLEI each
indicated in their questionnaire response that their payroll processing function has been
outsourced.
Appendix 15 – Questionnaire: Summary of selected responses
Page 224
Figure A15.6: Agency property expenditure per ASL
Figure A15.6 shows agency property expenditure (including rent and facilities management)
per ASL.
Appendix 15 – Questionnaire: Summary of selected responses
Page 225
Figure A15.7: Agency employees by classification
Figure A15.7 shows a breakdown of agency average staffing level by classification. The
APS Average has been included to allow comparison.
Appendix 15 – Questionnaire: Summary of selected responses
Page 226
APPENDIX 16 – EXPENDITURE REVIEW PRINCIPLES
The following principles are for application when reviews of government programs or
activities are undertaken. When assessing programs or activities against the principles,
evidence must be used to demonstrate whether or not they are the most appropriate, efficient
and effective way to achieve the Government’s outcomes and objectives.
1) Appropriateness
a.
b.
Activity is directed to areas where there is a role for government to fill a gap left
by the market:
i.
social inclusion – government activity should address social inequity by
redistributing resources in ways that improve opportunity and support for
individuals, families and communities, allowing them to participate in the
economy and society consistent with the Government’s social inclusion
agenda; or
ii.
market failure – government activity should address market failures by
improving social and economic welfare through improved resource
allocation, where the benefits of government intervention outweigh its cost
(including in the provision of public goods, for example, in environmental
sustainability, national security and defence); and
Activity is undertaken by the most appropriate level of Australian government –
whether expenditure is better undertaken by the Government or a lower level of
government.
2) Effectiveness
a.
Activities to have clear and consistent objectives and be effective in achieving
their objectives and represent value for money for the expenditure of taxpayer
funds; and
b.
Activity involving tax expenditures or financial instruments (for example,
guarantees, loans or investments) to demonstrate why an outlay program is likely
to be less effective in achieving the activity’s objective(s).
3) Efficiency
a.
Government programs to be administered and delivered in the most efficient way
achievable, taking into account both short and long term economic and fiscal
consequences;
b.
Activity targeting market failure in one market to not unnecessarily reduce
economic efficiency in other markets; and
c.
Consideration to be given as to whether part or all of the cost of a Government
activity should be recouped directly from the beneficiaries of that activity.
Appendix 16 – Expenditure Review Principles
Page 227
4) Integration
a.
Government agencies to be able to work together effectively to consistently
deliver the Government’s policy objectives within clearly defined lines of
responsibility.
5) Performance assessment
a.
Government activity to be subject to robust performance assessment and
measurement.
6) Strategic Policy Alignment
a.
Proposals to address whether the activity is consistent with the Government’s
strategic long term policy priorities, in particular to areas that help sustain
economic growth through improved productivity and participation.
Appendix 16 – Expenditure Review Principles
Page 228
APPENDIX 17 – COMMONWEALTH COURTS’ SAVINGS
Table A17.1: Commonwealth Courts’ savings measures 2007-08 to 2010-11
Court
Federal
Court
Family
Court
&
Federal
Magistrates
Court
Reinvested/
Used as Portfolio
offsets/
Returned to
Budget
Estimated
Saving
($'000)
Year
Period
New electricity
contract
660
2010-11
Over 4 years
Reinvested
National cleaning
contract
800
2010-11
Life of
contract
Reinvested
Telecommunications
provider
60
2010-11
Recurrent
Reinvested
Not replacing judicial
officers
2,600
2010-11
Over 4 years
Used as Portfolio
offsets
Not replacing judicial
officers
6,500
2009-10
Over 4 years
Used as Portfolio
offsets
Child Dispute
Services Review
600
2010-11
Recurrent
Reinvested
Interpreter Services
350
2010-11
Recurrent
Reinvested
Guarding Services
80
2010-11
Recurrent
Reinvested
Transcription Services
250
2010-11
Recurrent
Reinvested
Reduction in travel
170
2010-11
Recurrent
Reinvested
Reduction in general
administration
150
2010-11
Recurrent
Reinvested
Not replacing judicial
officers
3,900
2010-11
Over 4 years
Used as Portfolio
offsets
Not replacing judicial
officers
10,600
2009-10
Over 4 years
Used as Portfolio
offsets
Single administration
6,300
2008-09
Over 4 years
Returned to
Budget
Single administration
1,400
2008-09
Over 4 years
Reinvested
390
2007-08
Recurrent
Reinvested
Savings Strategy
Back office review
Appendix 17 – Commonwealth Courts’ savings
Page 229
APPENDIX 18 – COMMONWEALTH COURTS – MATTERS FOR
CONSIDERATION AND REPORT TO THE ATTORNEYGENERAL
The work program outlined in Option 4 of Chapter 5 would involve at least the following:

Corporate services
Human resource
:
:
:
:
:
:
-
Payroll and leave
:
:
:
-
Judicial and staff payroll processing
Leave processing
Term and conditions
Information technology support
:
:
:
:
:
:
:
-
Organisational development
Strategic human resource management
Learning and development
Recruitment
Industrial relations (including enterprise agreements)
Occupational health and safety
Strategic direction
Platforms and architecture (including procurement)
Applications and software
IT security
Helpdesk services
Case management (Casetrack)
Web services (including accessibility to Commonwealth Courts
Portal)
Property allocation and usage
:
:
:
:
:
Courtrooms
Chambers
Hearing rooms
Front office support
Back office support
-
Facilities/Asset Management
-
:
Management of Commonwealth Law Courts
:
Management of leased properties
:
Management of contractors (e.g., cleaning etc)
:
Coordination of capital works projects
Procurement
Appendix 18 – Commonwealth Courts: matters for Attorney-General
Page 231
:
:
-
Records management (archive and storage covering electronic and hard
copy)
:
File creation
:
Storage
:
Archiving
:
Retrieval/recall
-
Libraries
:
:
:
:
-
-
-
Media releases
Publications and forms
Reports (annual and other ad-hoc publishing)
Events management
Internal and external engagement
Brochures and web design
Audit – internal compliance
:
:
:
:
-
Acquisition
Cataloguing
Collections
Shift to electronic subscriptions
Communications and media
:
:
:
:
:
:

Contract tenders and management
Leverage economies of scale in such areas as stores and inventory,
travel and office machinery (e.g., photocopiers etc)
Fraud and risk management
Reporting – PBS
Business continuity
Disaster recovery planning
Protective security
:
Security officers oversight
:
Judicial security services (Marshal and Security)
Finance
:
Processing
:
Management accounting
:
Taxation
Registry services
Joint counters
Appendix 18 – Commonwealth Courts: matters for Attorney-General
Page 232
:
:
-
Reception
Ticketing and queuing
Case initiation
:
:
:
:
Document reception and assistance
Establish case record
Access and collect fees
Document management
Appendix 18 – Commonwealth Courts: matters for Attorney-General
Page 233
APPENDIX 19 – ANALYSIS OF NATIVE TITLE FUNCTIONS
Decision-making
Determination of claimant and non-claimant applications
Description
of function
The Federal Court of Australia has exclusive jurisdiction under the NTA to determine
whether or not native title exists, and the nature and extent of that title.
At 30 June 2010 there were 460 current native title matters filed with the Federal
Court. 33 new matters were filed in 2009-10. As at 1 August 2011, there were 87
current cases on the Court’s priority list. The Court projects that it will resolve 84
cases on its current list by the end of 2011-12, predominantly through consent
determinations in the Northern Territory and Queensland. The Court expects to
resolve the remaining 3 cases within its target of two years of allocation to the list.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a non-discretionary judicial function. It cannot be conferred on an
administrative agency.
Due to the complexity of the legal and practical issues, the function should be
conferred on superior court judges. While it would be possible to confer jurisdiction
on State and Territory Supreme Courts as well as the Federal Court, this could be
expected to reduce expertise, prevent management of the workload on a whole-ofsystem basis, and raise cost-shifting issues between the Commonwealth and the
States/Territories. As a result, maintaining exclusive jurisdiction in the Federal Court
is appropriate.
Registration of claims
Description
of function
Registration confers valuable rights pending the declaration of native title. The
principal purpose of the registration test is to give the claimants access to statutory
rights in the future act regime of the NTA. Under the NTA, the NNTT Registrar is
required to decide whether a claimant application meets the statutory requirement for
registration. In general, the Registrar will apply the full registration test comprising a
series of merit and procedural conditions. In some circumstances, claims made in an
amended application do not require application of the registration test, or a more
limited test may be applied.
This function also includes reconsideration of a claimant application for registration
by a Member of the NNTT, which is a function only exercised occasionally.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory NNTT function under the NTA, and the function is crucial to the
effective operation of the future act regime because registration gives rise to the right
to negotiate.
Consultees have identified that the registration test is resource-intensive to apply, and
noted that there may be scope to re-evaluate the requirements and complexity of the
test, although this may raise concerns for some stakeholders in the native title system.
It is not clear that it would be possible for the Federal Court to administer the
registration test as it may not be ancillary to the judicial function (there being no
necessary link between the application of the registration test and the judicial
determination of native title). Maintaining the registration function within a nonjudicial body rather than as a function carried out by the Federal Court is thus
appropriate.
Appendix 19 – Analysis of Native Title functions
Page 235
Registration of ILUAs
Description
of function
Under the NTA, parties to an ILUA can apply to the NNTT Registrar for the
agreement to be registered on the Register of ILUAs. The effect of registration is to
bind all persons who hold native title for the ILUA area to the terms of the
agreement, whether or not they are parties to the ILUA. Application of the ILUA test
requires the Registrar to:
- check for compliance against NTA and Regulation requirements to decide
whether conditions for registration are satisfied;
- notify those with an interest in the area, and notify the public, (accounted for
separately in this paper); and
- determine any objections or other bars to registration. If an objection is made or
a bar to registration is raised, the parties may request NNTT assistance to
negotiate with the person making the objection.
This function also includes conducting alternative procedure agreement objection
inquiries, and providing assistance to negotiate the withdrawal of objections to the
registration of certain ILUAs
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory NNTT function under the NTA. On registration, an ILUA will
bind all native title holders for the ILUA area even if they are not parties to the
agreement. This function serves to provide certainty for parties to ILUAs.
This function is not connected to the judicial function of determining claims.
Maintaining the registration function within a non-judicial body rather than as a
function carried out by the Federal Court is thus appropriate.
Similar to the test for registration of claims, there may be scope to re-evaluate the
requirements and complexity of the test, although this may raise concerns for some
stakeholders in the native title system.
Appendix 19 – Analysis of Native Title functions
Page 236
Determine objections to the application of the expedited procedure to a future act
Description
of function
The expedited procedure is a process for fast-tracking the approval of certain
minimum-impact future acts. It is triggered when a government party includes a
statement, in a public notice, that the expedited procedure applies to a proposed
future act. Registered native title parties may then lodge an objection to the inclusion
of the statement.
If an objection is lodged, the NNTT determines whether or not the future act attracts
the expedited procedure.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory function under the NTA. The function enables certain minimum
impact future acts to proceed expeditiously.
This function is not connected to the judicial function of determining claims.
Maintaining this determination function within a non-judicial body rather than as a
function carried out by the Federal Court is thus appropriate.
Future act determinations
Description
of function
The NNTT (where it is the relevant arbitral body under the NTA) may determine that
a future act may take place, that it may take place with conditions, or that it may not
take place. The NNTT may also make a preliminary determination whether or not
negotiations in good faith have occurred, where a party contests that fact.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory Tribunal Member function under the NTA and is necessary to
resolve future act proposals where no agreement can be reached.
Under the NTA, the NNTT performs the function only where the relevant
State/Territory has not named another body as the arbitral body for this purpose. If
all States/Territories named other arbitral bodies, the NNTT would no longer perform
the function. Currently, only South Australia has named another arbitral body.
This function is not connected to the judicial function of determining claims – in fact,
section 27(3) of the NTA provides that a judicial member of a tribunal may not make
a future act determination (because the power of the arbitral body to make a
determination can be overridden by the Minister where there is delay in the
determination of the claim). Performing the future acts determination function
within a non-judicial body is appropriate.
Appendix 19 – Analysis of Native Title functions
Page 237
Dispute resolution
Mediation of claimant and non-claimant applications
Description
of function
Under the NTA, the Court refers claims for mediation to be conducted prior to any
declaration of native title by the court (whether by consent or when contested). The
Court can refer the claims to court officers, to the NNTT or to other private persons.
The purpose of mediation of a claim is to assist parties to reach agreement whether or
not native title exists and, where it does, a range of other issues relevant to reaching a
determination. (The issues in a compensation matter are fairly similar, but also include
questions of entitlement and amount of compensation).
The NNTT has reported that multidisciplinary teams (e.g. geospatial, research, legal)
support the work of Members and case managers in mediation of claims.
This function also includes assisting parties to a proceeding to negotiate outcomes in
relation to the proceeding or an application, including non native-title outcomes.
The current arrangements which centralised the management of native title mediation
in the Federal Court are the result of reforms in 2009, reversing 2007 reforms which
gave the NNTT sole responsibility for the mediation of claims.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory function under the NTA, and the function can be performed by
both the Court and the NNTT. The function is crucial to the resolution of claims, as
most claims are finalised by consent following mediation. The NTA requires that,
where a matter is referred to the NNTT for mediation, the mediation is to be conducted
by a member (or, in some circumstances, a consultant engaged in accordance with the
NTA).
The Federal Court and NNTT advised that the decisions about allocation of claims for
mediation are based on resourcing rather than any practical difference in the way the
two bodies mediate claims. Most claims in mediation are currently allocated to the
NNTT, but this is primarily because the NNTT has the funded mediation resource.
It is not clear what benefit is derived from the shared responsibility of the mediation
function for claims. Given that case management and mediation in the Federal Court
has proved successful, leading to a substantial increase in determinations, it may be
clearer and more efficient to consolidate the expertise and functions in the Court. Such
an arrangement would also allow the alignment of the responsibility for managing
claims to resolution with the resources to do so.
Appendix 19 – Analysis of Native Title functions
Page 238
Negotiation of ILUAs
Description
of function
Under the NTA, parties may request the assistance of the NNTT to negotiate an
ILUA. In a related function, parties may also request the assistance of the NNTT to
negotiate access agreements under section 44B of the NTA. In addition, the NNTT
can assist to negotiate the withdrawal of objections to the registration of certain
ILUAs. This function also includes assisting with the making of pastoral access
agreements (s44B(4)) and mediating disputes about rights conferred in relation to
traditional areas (s44F).
Does the
function
need to be
performed?
If so, who
should
perform it?
This function is provided for under the NTA. However the NTA only provides for a
right to request assistance without any accompanying requirement on the NNTT to do
anything in particular. As a result, the function is probably best characterised as
discretionary.
The function is not connected to the judicial function of determining claims, although
ILUAs may also be negotiated as part of reaching a consent determination for claims
before the court. To the extent that negotiation of an ILUA is not part of a mediation
in the Court, maintaining the ILUA negotiation function within a non-judicial body is
appropriate.
Assistance with negotiation of ILUAs is something that may also be provided by the
private sector. Given the finite resources of the NNTT and the potential financial
advantage parties may obtain through negotiation of ILUAs, there may be scope to
consider some fees or cost recovery for Government agency ILUA negotiation
assistance. This may also encourage participants to focus on achieving outcomes
and support efficient use of agency resources.
However, any fee or cost recovery arrangement would need to be carefully designed
to avoid simply rotating money from one government funded entity to another (for
example, if the fees were paid by Native Title Representative Bodies (NTRBs) – who
are funded by Government – this may simply lead to a request for increased resources
for NTRBs rather than reducing costs or affecting incentives for participants).
Appendix 19 – Analysis of Native Title functions
Page 239
Mediation of future acts
Description
of function
Under the NTA, if a negotiation party to a future act requests the arbitral body to do
so, the arbitral body must mediate among the parties to assist in obtaining their
agreement.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory NNTT function under the NTA (where the NNTT is the arbitral
body). However, the NTA does not specify the nature and extent of assistance that
the NNTT must provide.
Under the NTA, the NNTT performs the function only where the relevant
State/Territory has not named another body as the arbitral body for this purpose. If
all States/Territories named other arbitral bodies, the NNTT would no longer perform
the function. At this time, only South Australia has named an arbitral body.
As with negotiation of ILUAs, the mediation of future acts may also be done by the
private sector. Given the finite resources of the NNTT and the potential financial
advantage parties may obtain through negotiation of future acts, there may be scope
to consider some fees or cost recovery for future act mediation provided by a
Government agency. This may also encourage participants to focus on achieving
outcomes and support efficient use of NNTT resources. However, similar design
issues would arise for any fee or cost recovery structure to ensure that the exercise
was worthwhile.
Native title support services
Maintenance of registers
Description
of function
The NNTT maintains the Register of Native Title Claims, the National Native Title
Register and the Register of ILUAs. The NNTT also conducts searches of the
registers.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory function. While the maintenance of the National Native Title
Register (which contains details of determinations) could probably be considered
ancillary to the judicial function and be undertaken by the Federal Court,
maintenance of the other registers would probably not be. As a result, the other
register functions would need to stay with a separate body.
There would be efficiencies in maintaining the registers together rather than dividing
responsibility between the Federal Court and an administrative agency.
Notifications
Description
of function
Under the NTA, the NNTT conducts notifications of all native title claims and nonclaimant applications. The NNTT also conducts notification of ILUAs as part of the
registration process.
Appendix 19 – Analysis of Native Title functions
Page 240
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a mandatory function under the NTA and is required to ensure that affected
persons are aware of native title applications and proposed ILUAs. In the case of
claims, the purpose of notification is to identify the relevant parties to the court case,
and therefore could be considered ancillary to the judicial function. However, there
is no such connection between the judicial function and notification of ILUAs.
In the case of ILUAs, the purpose of notification is to identify all native title holders
for the ILUA area so they can decide whether to authorise the ILUA (this is
important, given a registered ILUA will bind all native title holders).
There may be efficiencies in maintaining the notifications functions together rather
than dividing responsibility between the Federal Court and an administrative agency.
Given that the native title system is now substantially more developed, it may be
worth considering whether a more limited form of notification could be used in some
circumstances.
Strategic/regional planning
Description
of function
In the NNTT, this function appears to encompass regional planning meetings, and
other meetings, and some training of parties/stakeholders. The NNTT has indicated
that Members and cross-disciplinary teams periodically conduct regional planning
with a wide range of stakeholders to discuss regional progress, identify regional
issues, etc., with a view to achieving outcomes such as agreeing priorities.
The Federal Court also has a National Native Title Coordination Unit and Native
Title Practice Committee.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a discretionary function. The Federal Court and NNTT advised that the
NNTT’s work in this area has been very useful in setting up the Federal Court’s
priority list. However, now that the list is operating, the regional and strategic
planning is done by the Court as part of its case management function. As a result,
the regional planning work currently undertaken by the NNTT is no longer required.
Reporting – native title system reports
Description
of function
The NNTT indicate that this function involves providing information for Native Title
Consultative Committee & Native Title Consultative Forum, preparation/publishing
of the biannual Native Title: National Report and ad hoc reporting at request of the
Attorney-General’s Department and others.
The Federal Court also collects data about native title matters before the Court.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a discretionary function. However, performance of the function may possibly
be important to ensuring a strategic approach to the native title system. Given that
both the Federal Court and the NNTT report on the native title system, it is important
that those reports are consistent and complementary. The approach to reporting
between the two bodies is not currently consistent in key areas. Options for the
Federal Court and NNTT to standardise their approach to reporting should be
developed.
Information/assistance (including geospatial/mapping, research)
Appendix 19 – Analysis of Native Title functions
Page 241
Description
of function
This program covers a wide range of Tribunal services to assist claimants and other
participants in native title processes – e.g., help with preparation of applications,
information about native title, geospatial/mapping work, research reports, workshops,
seminars, media.
The Federal Court also provides some limited information/assistance on native title
issues.
Does the
function
need to be
performed?
If so, who
should
perform it?
This is a discretionary function. However, performance of the function may be
important to ensuring a strategic approach to the native title system.
For example, the Federal Court, NNTT and the Attorney-General’s Department all
advise that the geospatial material put together by the NNTT is of high quality and is
essential to native title agreement making and the narrowing of issues in dispute.
On the other hand, it is not clear that the research and publications work undertaken
by the NNTT is as central to achieving native title outcomes. It may be possible to
reduce expenditure on these functions.
Other statutory functions which are not performed in practice
Description
of function
Under the NTA, the NNTT has a range of other functions which it has not been called
on to perform in practice. These include:
 holding special inquiries at the direction of the Attorney-General about a
particular matter or issue relating to native title
 holding native title application inquiries, at the direction of the Federal Court,
about a matter or issue relevant to the determination of native title in a matter
 review (on reference from the Federal Court) whether a native title claim group
holds native title rights and interests
 Assist native title representative bodies to perform their dispute resolution
functions (on a cost recovery basis).
Does the
function
need to be
performed?
If so, who
should
perform it?
No further analysis has been done of these functions as they are not performed in
practice.
Appendix 19 – Analysis of Native Title functions
Page 242
APPENDIX 20 – MIGRATION REVIEW TRIBUNAL AND
REFUGEE REVIEW TRIBUNAL
Established by/under:
Migration Act 1958
Financial Framework:
The Migration Review Tribunal (MRT) and the Refugee Review Tribunal (RRT) are
prescribed as a single agency for the purposes of the Financial Management and
Accountability Act 1997. The MRT and the RRT are statutory agencies, within the portfolio
of the Department of Immigration and Citizenship
Agency Functions:
To provide correct and preferable decisions for visa applicants and sponsors through
independent, fair, just, economical, informal and quick merits reviews of migration and
refugee decisions.
The MRT-RRT provide an independent and final merits review of decisions made in relation
to visas to travel to, enter or stay in Australia. The MRT reviews decisions made in respect of
general visas (e.g. visitor, student, partner, family, business, skilled visas) and the RRT deals
with decisions made in respect of protection (refugee) visas48.
Tribunal Members and Staff Profile:
The MRT-RRT comprise Members who are appointed under the Migration Act 1958.
As at 30 June 2011, the MRT-RRT consisted of a total of 89 members, comprising the
Principal Member, a Deputy Principal Member, 7 Senior Members, 27 full-time members
and 53 part-time members.
The staff employed by the MRT-RRT are public servants under the Public Service Act 1999.
As at 30 June 2011, the MRT-RRT had 284 staff (excluding Members).
Table A20.1: MRT-RRT staff as at 30 June 2011
Staff
(Headcount)
MRT/RRT
APS Employees
223
78.5%
EL Employees
59
20.8%
SES Employees
2
0.7%
Members
89
48
(%)
For further information refer to MRT/RRT website: http://www.mrt-rrt.gov.au/
Appendix 20 – MRT & RRT
Page 243
Governance:
The MRT-RRT is governed by a Management Board, consisting of the Principal Member,
Deputy Principal Member, the Registrar, the Deputy Registrar and eight Senior Members
who are responsible for strategic direction. The Senior Management Group comprises the
Registrar, Deputy Registrar and all Senior Members who monitor the MRT-RRT’s operations
and develop and implement strategies relating to staff support services.
Annual Funding:
The Department of Immigration and Citizenship’s portfolio resources and the appropriation
for the MRT and the RRT are below.
Table A20.2: MRT-RRT and Department of Immigration and Citizenship
appropriations
Dept Immigration & Citizenship (‘000)
Departmental
Appropriation / Other
Agency Receipts
MRT/RRT(‘000)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
1,261,438
1,293,977
1,342,351
41,014
43,418
45,354
Workload:
In 2010-11 there were a total of 10,314 cases lodged with the MRT in 2010-11, and 2966
cases lodged with the RRT. In 2010-11, the MRT finalised 6577 cases and the RRT finalised
2614 cases.
On 25 November 2011, the Minister for Immigration and Citizenship announced that the
Government would be moving to a single protection visa process for both boat and air
arrivals, using the current onshore arrangements for application and independent review
through RRT system, as needed. This can be expected to increase the workload of the RRT.
Locations:
Members are located in New South Wales, Victoria, Queensland and South Australia.
Hearings are conducted in Sydney, Melbourne, Brisbane, Adelaide and Perth.
The MRT-RRT has two registries – the New South Wales Registry located in Sydney is also
the Principal Registry and handles cases from Queensland, the Australian Capital Territory
and the Northern Territory. The Victorian Registry located in Melbourne, also handles cases
from South Australia, Western Australia and Tasmania. The MRT-RRT have an agreement
with the Administrative Appeals Tribunal to receive applications on their behalf in
Queensland, South Australia and Western Australia.
Appendix 20 – MRT & RRT
Page 244
APPENDIX 21 – SOCIAL SECURITY APPEALS TRIBUNAL
Established by/under:
Social Security (Administration) Act 1999
The Social Security Appeals Tribunal (SSAT) was established by Ministerial Instruction in
1975, and became a statutory agency as a result of the Social Security (Review of Decisions)
Act 1988.
Financial Framework:
Although the SSAT is a statutory agency, it is not a separate agency under the Financial
Management and Accountability Act 1997. The SSAT sits within the FMA Act agency
constituted by the Department of Families, Housing, Community Services and Indigenous
Affairs (FaHCSIA). The Secretary of FaHCSIA is ultimately responsible for staff assisting
the SSAT.
Agency Functions:
The SSAT is the first level of external merits review of decisions made by officers in
Centrelink pursuant to social security laws, family assistance laws, paid parental leave laws
and various other statutes. The SSAT is the only level of external merits review for most
decisions about child support made by officers in the Child Support Agency.
The SSAT’s statutory objective is to provide a mechanism of review that is ‘fair, just,
economical, informal and quick’.
Tribunal Members and Staff Profile:
As at 30 June 2011, the SSAT comprised:


177 members of the SSAT (excluding the 24 part-time members who were no
longer sitting but who had not resigned), being the Principal Member, Senior
Members, Assistant Senior Members and full-time and part-time members; and
103 staff employed under the Public Service Act 1999.
Table A21.1: SSAT staff as at 30 June 2010
Staff
SSAT
(Headcount)
(%)
APS Employees
86
83%
EL Employees
17
17%
SES Employees
0
0%
Members
177
Governance:
The SSAT Principal Member is responsible for the overall operation and administration of
the SSAT, and must take reasonable steps to ensure that SSAT decisions are consistent and
that the SSAT efficiently and effectively performs its functions.
Appendix 21 - SSAT
Page 245
Each state registry is led by a Senior Member and a Deputy Registrar. The Senior Members
assist the Principal Member in the management of applications for review and of issues
relating to members. The Registrar assists the Principal Member in the management of the
SSAT’s resources. The Registrar works with the five Deputy Registrars to develop and
monitor national policies to deliver consistency and best practice in work procedures.
The SSAT provides its own annual report to the Minister.
Annual Funding:
There is no separate appropriation from the Budget for the SSAT. The SSAT receives
funding through FaHCSIA appropriations involving two components:


Base funding (for ongoing policies); and
Terminating funding (from policy changes that are considered to have a short
term impact).
Table A21.2: SSAT and FaHCSIA appropriations
FaHCSIA (‘000)
Departmental
Appropriation/ Other
Agency Receipts
SSAT(‘000)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
600,772
570,006
578,396
27,332
29,001
27,933
Workload:
In 2010-11, there were 12,390 applications for review lodged with the SSAT (some of which
sought review of more than one decision). 11,057 decisions were finalised after a hearing was
conducted.
Locations:
There are full-time Senior Members in Adelaide, Brisbane, Melbourne, Perth and Sydney.
The Senior Member in Sydney is also responsible for the Canberra office, the Senior Member
and registry in Adelaide is responsible for the SSAT’s functions in Tasmania and the Senior
Member and registry in Brisbane is responsible for reviews in the Northern Territory.
The SSAT has an office/registry in each capital city except Darwin. The SSAT is likely to
relinquish its Canberra office at the end of 2012 but retain part-time members in Canberra
and hire suitable premises for hearings, consistent with its practice in Darwin, Newcastle,
Wollongong and Launceston.
Appendix 21 - SSAT
Page 246
APPENDIX 22 – VETERANS’ REVIEW BOARD
Established by/under:
Veterans’ Entitlements Act 1986
The Veterans’ Review Board (VRB) was originally established by the Repatriation
Legislation Amendment Act 1984 and commenced in 1985.
Financial Framework:
The VRB is a statutory body whose role is to provide independent merits review. The VRB is
not an FMA agency and, while it is a separate statutory entity, it is treated very much as
though it were a Division of the Department of Veterans’ Affairs from which it obtains the
entirety of its corporate services.
Agency Functions:
To provide a means of review that is fair, just, economical, informal and quick in an
environment which ensures respect for the service of applicants and dignity in the conduct of
proceedings.
The VRB is an independent tribunal that exists to review:


decisions made by the Repatriation Commission under the Veterans'
Entitlements Act 1986; and
determinations under the Military Rehabilitation and Compensation Act 2004.
Tribunal Members and Staff Profile:
As at 30 June 2011, the VRB had a total of 40 members including the Principal Member,
11 Senior Members, 14 Service Members and 14 Members. Only the Principal Member is
full-time.
The Secretary of the Department of Veterans’ Affairs is required to make available any staff
required to assist the VRB in the performance of its statutory functions. The staff of the VRB
are public servants employed under the Public Service Act 1999. As at 30 June 2011, there
was 27 staff (excluding Members).
Table A22.1: VRB staff as at 30 June 2011
Staff
(Headcount)
VRB
(%)
APS Employees
20
74%
EL Employees
7
16%
SES Employees (registrar)
0
0%
Members
40
Governance
The Principal Member of the VRB is responsible for the overall operation and administration
of the VRB. Senior Members of the VRB provide leadership and support for Members and
Appendix 22 - VRB
Page 247
Services Members, by way of mentoring and the quarterly meeting of the Senior Member
Forum.
The National Registrar directs the operations of the VRB at a national level and coordinates
the activities of the state registries. The State Registrars are responsible for the administration
and operation of their respective registries. All State Registrars report to the National
Registrar.
Annual Funding:
As a small statutory body within the Veterans’ Affairs portfolio, the VRB receives its funding
as if it were a division of the Department of Veterans’ Affairs. As a result, it does not have a
budget allocation in the Portfolio Budget Statements and forward estimates are not publicly
available. The VRB provides an estimate of its costs in its annual report.
Table A22.2: VRB and Department of Veterans’ Affairs appropriations
Department of Veterans’ Affairs (‘000)
Departmental
Appropriation / Other
Agency Receipts
VRB (‘000)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
09-10
(actual)
10-11
(actual)
11-12
(estimate)
346,048
342,742
341,504
5,417
5,380
N/A
Workload:
There were 3275 applications lodged with the VRB in 2010-11. The VRB decided 3485
applications in 2010-11.
Locations:
Members are located in all States and Territories except the Northern Territory. The VRB has
registries in Sydney (which is also the Principal Registry), Melbourne, Brisbane, Perth and
Canberra. Applications from Tasmania are managed by Melbourne and applications from
South Australia and the Northern Territory are managed by Brisbane.
Appendix 22 - VRB
Page 248
APPENDIX 23 – COMPARATIVE TRIBUNAL STATISTICS
Table A23.1: AAT statistics
AAT
No.
applications
Applicant
success rate49
No.
matters
resolved
by
decision
Applicant
success
rate: by
decision50
Judicial
review
applications
Appellant
success at
judicial
review51
2010/11
5437
40%
1275
37%
121
26%
2009/10
5787
44%
1318
35%
102
28%
2008/09
6226
38%
1393
35%
110
30%
Applicant
success
rate: AAT
decision55
Appeals/
Judicial
review
applications
from AAT
Table A23.2: VRB statistics
VRB
No.
applications
Applicant
success
rate52
No.
appeals
to AAT53
AAT
varied
or set
aside54
AAT
matters
resolved
by
decision
(No.)
2010/11
3275
43.7%
479
44%
145
33%
15
2009/10
3906
39.9%
491
39%
154
29%
11
2008/09
3929
40.4%
616
43%
179
36%
16
49
Includes matters varied or set aside by consent or decision.
Set aside or varied, by decision only.
51
Allowed or remitted.
52
‘Set aside’ as against ‘affirmed’ from VRB annual report.
53
Not all AAT appeals would have come from VRB decisions, as internal review is sometimes available as an
alternative to VRB review.
54
Includes matters varied or set aside by consent or decision.
55
Only includes matters set aside or varied by decision.
50
Appendix 23 – Comparative Tribunal statistics
Page 249
Table A23.3: SSAT statistics
SSAT
2010/11
2009/10
2008/09
No.
applications
Applicant
success
rate
Not yet
available in
comparable
format60
No.
appeals
to AAT56
AAT
varied
or set
aside57
AAT
matters
resolved
by
decision
(No.)
Applicant
success rate:
AAT
decision58
Appeals/
Judicial
review
applications
from AAT59
Social
security:
1649
Social
security:
28%
Social
security:
444
Social
security:
32%
Social
security: 16
Social
security:
27%
Social
security:
539
Social
security:
27%
Social
security: 16
Social
security:
26%
Social
security:
518
Social
security:
30%
Social
security: 21
Child
support:
51
Social
security:
11203
Social
security:
26.5%
Social
security:
2077
Child
support:
2664
Child
support:
Child
support:
70
Social
security:
13429
Social
security:
26.4%
Social
security:
2234
Child
support:
2890
Child
support:
Child
support:
32
35.7%
34.5%
56
AAT jurisdiction for child support matters is limited to refusal of a request for an extension of time to appeal
a CSA decision and where SSAT makes a care decision (determines the extent of care provided to a child or
children by each parent). Most decisions of the SSAT in child support matters are final and may only be
appealed to a court on a question of law.
57
Includes matters varied or set aside by consent or decision and excludes child support figures. Outcomes of
child support applications are not reported by the AAT.
58
Only includes matters set aside or varied by decision.
59
Outcomes of child support applications are not reported by the AAT. Most decisions of the SSAT in child
support matters are final and may only be appealed to a court on a question of law – 60 SSAT decisions were
appealed to the FMC/Family Court in 2009-10.
60
As at 11 November 2011, the SSAT 2010-11 Annual Report was not yet available. The SSAT advised the
figures provided to the Review were extracted from the Annual Report.
Appendix 23 – Comparative Tribunal statistics
Page 250
Table A23.4: RRT statistics
RRT
No.
applications
Applicant
success
rate61
2010/11
2966
24%
2009/10
2271
24%
2008/09
2538
19%
No.
appeals
to AAT
AAT
varied
or set
aside
Appeals/Judicial
review
applications from
AAT
AAT review is not available for MRTRRT cases. AAT had 305 migration
lodgings in 2009-10, outside the
jurisdiction of MRT-RRT.62
Table A23.5: MRT statistics
MRT
No.
applications
Applicant
success
rate63
2010/11
10314
41%
2009/10
8322
45%
2008/09
7422
48%
No.
appeals
to AAT
AAT
varied
or set
aside
Appeals/Judicial
review
applications from
AAT
AAT review is not available for MRTRRT cases. AAT had 305 migration
lodgings in 2009-10, outside the
jurisdiction of MRT-RRT.64
61
Matters set aside or remitted.
For a precise division of jurisdiction between AAT and MRT-RRT, we would need to talk to DIAC.
63
Matters set aside or remitted.
64
For a precise division of jurisdiction between AAT and MRT-RRT, we would need to talk to DIAC.
62
Appendix 23 – Comparative Tribunal statistics
Page 251
APPENDIX 24 – ADMINISTRATIVE REVIEW COUNCIL’S
BETTER DECISIONS REPORT RECOMMENDATIONS
Recommendation 87
The VRB, SSAT, IRT, RRT and AAT should be united into a new tribunal, to be called the
Administrative Review Tribunal (the ART).
Recommendation 88
The ART should be divided into seven divisions, namely:

Welfare Rights Division;

Veterans’ Payments Division;

Migration Division;

Commercial and Major Taxation Division;

Small Taxation Claims Division;

Security Division; and

General Division (comprising the residual jurisdictions of the AAT).
Recommendation 89
Review Panels of the ART should be able to be constituted in order to review cases that are
referred to them by the ART President or an ART division, or which fall within the grounds
for seeking review by a Review Panel (see recommendation 97).
Recommendation 90
Membership of the ART should comprise a President, Deputy Presidents (including Division
Heads of each division), Senior Members and Members.
Recommendation 91
Save for the President, legal qualifications should not be a prerequisite for appointment to
the ART.
Recommendation 92
ART members should be eligible for appointment to more than one division of the ART.
The minister responsible for the agency with portfolio responsibility for the ART (see
Recommendation 95) should be responsible for recommending appointments to the ART.
However, where an appointment (or cross appointment) is to a division other than the
General Division, that minister should be responsible for recommending the appointment (or
cross appointment) jointly with the minister or ministers who has (or have) portfolio
responsibility for the decisions that are reviewable by that other division.
Appendix 24 – ARC Recommendations
Page 253
Recommendation 93
A Registrar of the ART should be appointed to assist the ART President in discharging the
President’s responsibility for the overall management of the administrative affairs of the
ART.
Recommendation 94
Consistent with Recommendation 85, an ART Executive Board should be established to
facilitate liaison between the various divisions of the ART, and to coordinate strategies and
programs on issues of tribunal-wide interest.
Recommendation 95
Either the Department of Administrative Services, the Attorney-General’s Department or the
Department of the Prime Minister and Cabinet should have portfolio responsibility for the
ART.
Recommendation 96
The ART President should have a discretion to refer a case directly to a Review Panel for
determination without the case first having been considered or decided upon by an ART
division.
Recommendation 97
The grounds for granting permission for review by a Review Panel should be:

that, in the opinion of the ART President, the case raises a principle or issue of
general significance;

that, in the opinion of the ART President, the decision of the ART division
involved a manifest error of fact or error of law that is likely to have materially
affected the decision; or

that new information is brought to the attention of the ART President which, in
the President’s opinion, could not reasonably have been discovered prior to the
finalisation of the case before the ART division, and which would have materially
affected the decision.
Recommendation 98
Where the ART President is satisfied that there is new information within the grounds for
granting permission to seek review by a Review Panel, the President should have the
discretion to remit a case, with directions, to an ART division where to do so would be the
most effective way to determine the case.
Recommendation 99
The ART’s procedures should provide a process whereby new information may be brought
to the attention of the tribunal any time prior to the tribunal finalising its decision, and for
that information to be brought to the attention of other participants in the review for their
comment.
Appendix 24 – ARC Recommendations
Page 254
Recommendation 100
The applicant and the agency whose decision is under review should each be able to apply for
permission to seek review by a Review Panel.
Recommendation 101
Applications for permission to seek review by a Review Panel should be made in writing and
lodged with the ART within 28 days of notification of the ART division.
Recommendation 102
Where an applicant’s case is reviewed by a Review Panel otherwise than at the applicant’s
request, the applicant should be indemnified by the relevant agency for the additional costs
incurred by the applicant as a result of the case being reviewed by the Review Panel.
Appendix 24 – ARC Recommendations
Page 255
APPENDIX 25 – TRIBUNAL EFFICIENCIES WORKING GROUP
REPORT RECOMMENDATIONS
Recommendation 2.1
The tribunals, in consultation with relevant decision-making agencies, should examine the
potential for harmonising procedures between two or more tribunals relating to:




the electronic notification to decision-making agencies of applications for review
the electronic transmission to tribunals of documents relating to the decision
under review
the electronic storage of documents, and
the electronic transmission of other documents between tribunals and decisionmaking agencies.
Recommendation 2.2
The tribunals should also consider harmonising rules and procedures, between two or more
tribunals, where some benefit may accrue, within the bounds of the current legislative
framework and having regard to the decisions being reviewed and the different client groups
serviced by the tribunals.
Recommendation 3.1
The tribunals should work through the Heads of Tribunal forum to consider the co-location
opportunities identified by the Working Group, and implement those opportunities where
possible and economical, noting the significant costs involved.
Recommendation 4.1
The Heads of Tribunals forum should continue to investigate facilities that can be shared
between the tribunals or provided on a cost-recovery basis, whether or not the tribunals are
co-located.
Recommendation 5.1
The AAT, SSAT and VRB should continue to maintain separate case management systems.
Recommendation 5.2
The MRT and RRT should continue with the development of a joint case management
system.
Recommendation 5.3
The tribunals should consult between themselves and their departments to share information
and experience in the maintenance of their systems to foster best case management system
practice for all the tribunals.
Page 257
Recommendation 6.1
The tribunals should, where appropriate, jointly provide appropriate training to their members
and staff.
Recommendation 6.2
The AAT should investigate the possibility of using a human resource system being used by
another agency (such as a federal court or other tribunal) when its current system comes to
the end of its economic life.
Recommendation 6.3
The tribunals should continue to maintain their own systems for managing workplace
injuries.
Recommendation 7.1
The tribunals should continue to maintain their current information technology help desk and
web design arrangements.
Recommendation 7.2
The AAT should work with the MRT and RRT to investigate whether savings could be
achieved by the use of a common telecommunications service provider.
Recommendation 7.3
The AAT, and the MRT and RRT, should, where appropriate, consider jointly purchasing
their hardware and software with each other or with their departments to achieve savings.
Recommendation 7.4
The information technology representatives in each tribunal should continue to meet on a
regular basis to discuss information technology activities within each tribunal, with a view to
sharing experiences and identifying any potential efficiencies and savings that may be
available.
Recommendation 8.1
The AAT, and the MRT and RRT, should consult with each other, or with their portfolio
departments, when considering any change to their current communications strategy, or
ahead of the purchase of any communications services.
Recommendation 9.1
The AAT, and the MRT and RRT, should work together to develop similar chief executive
instructions to assist with any future combined or cost-recovery approach to financial
services.
Recommendation 9.2
The AAT should investigate with the MRT and RRT the viability of delivering financial
services as appropriate on a combined or co-operative basis.
Page 258
Recommendation 10.1
The AAT, SSAT and VRB should continue to undertake their procurement function
separately and where possible, take advantage of the purchasing power of alliances with
departments or other tribunals.
Recommendation 10.2
The MRT and RRT should continue to undertake their procurement function jointly and
where possible, take advantage of the purchasing power of alliances with departments or
other tribunals.
Recommendation 10.3
The tribunals should keep each other informed of any upcoming large purchases in order to
exploit any potential combined purchasing power.
Page 259