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SENATE

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56 SENATE Tuesday, 14 February 2017 I want to conclude with some unfortunate facts—not alternative facts like we have heard from the Greens earlier today. It is from the National Electricity Market Watch, happily provided to me by the Minister for Resources and Northern Australia's office. It is about the electricity that is being generated today at midday. Black coal—50 per cent. Brown coal—18 per cent. Gas—15 per cent. Hydro—five per cent. Wind—0.8 per cent. Today is a day like many days in South Australia and around the country: if the wind is not blowing the power is not being generated, and there needs to be a reliable back-up supply. High-efficiency, low-emissions coal can be the answer. Senator HINCH (Victoria) (17:18): I seek leave to make a personal statement. The ACTING DEPUTY PRESIDENT (Senator Ketter): Leave is granted for one minute. Senator HINCH (Victoria) (17:19): I would like to put on record that last night at the whips meeting it was decided that an MPI would not happen today and that the time would be devoted to our Indigenous Australians to talk about closing the gap. We in my party all thought that was a great idea. We did not submit an MPI this morning. I do not blame the Greens; they won the raffle. But I think the opposition was wrong in going for an MPI today when closing the gap was far more important. We have discussed energy many, many other times in the Senate. DOCUMENTS Consideration The following documents tabled earlier today (see entry no. 2) were considered: Auditor-General—Audit report no. 38 of 2016-17—Performance audit—The approval and administration of Commonwealth funding for the WestConnex project: Department of Infrastructure and Regional Development; Infrastructure Australia. Motion to take note of document moved by Senator McAllister. Debate adjourned till the next day of sitting, Senator McAllister in continuation. Institutional Responses to Child Sexual Abuse—Royal Commission—Report of case study no. 32—The response of Geelong Grammar School to allegations of child sexual abuse of former students. Motion to take note of document moved by Senator McAllister. Debate adjourned till Thursday at general business, Senator McAllister in continuation. Commonwealth Electoral Act 1918—Redistribution into electoral divisions—Northern Territory—Report, together with composite map and compact disc of supporting information. Motion to take note of document moved by Senator McAllister. Debate adjourned till Thursday at general business, Senator McAllister in continuation. COMMITTEES Public Works Committee Report Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (17:20): On behalf of the Parliamentary Standing Committee on Public Works I present report no. 1 of 2017, Referrals made October and November 2016. Education and Employment Legislation Committee Additional Information Senator WILLIAMS (New South Wales—Nationals Whip in the Senate) (17:20): On behalf to the chair of the Education and Employment Legislation Committee, Senator McKenzie, I present additional information received by the committee on its inquiry into the provisions of the Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Bill 2016 and related bills. Public Accounts and Audit Committee Government Response to Report Senator PAYNE (New South Wales—Minister for Defence) (17:21): I present the government's response to report No. 454 of the Joint Committee of Public Accounts and Audit, Early years quality fund: review of Auditor- General reports no. 23 (2014-15) and seek leave to have the document incorporated in Hansard. Leaved granted. The document read as follows— Australian Government response to the Joint Committee of Public Accounts and Audit Report No. 454 Early Years Quality Fund Review of Auditor-General Reports No. 23 (2014–15) FEBRUARY 2017 Response to the recommendation(s) CHAMBER

Tuesday, 14 February 2017 SENATE 57 Recommendation No. 1 The Committee recommends that the Department of Finance amend references to demand-driven grant programs in the Commonwealth Grants Rules and Guidelines to explicitly refer to the implementation risks of a 'first-in first-served' approach, as outlined in ANAO Report No. 23 (2014–15) and the Committee's report. Agree The Commonwealth Grants Rules and Guidelines (CGRGs) are largely principles-based with limited specific requirements. They already provide that: 'Competitive, merit-based processes should be used to allocate grants based upon clearly defined criteria, unless specifically agreed otherwise by a Minister, accountable authority or a delegate' (CGRGs, paragraph 13.10). It is consistent with this principle to note that 'first in first-served' grant programs are associated with higher risks, and to refer to explicit guidance on the risks of demand-driven programs as part of complementary guidance and tools. The Department of Finance (Finance) is currently developing a suite of grant guidelines templates to improve grants administration and to assist entities and non-government stakeholders. One of these templates is designed to be used for demand driven, or 'first-in first-served' processes. Once piloted, Finance will use this template, the related user guidance and information sessions to draw attention to the implementation risks associated with demand driven grants processes. Recommendation No. 2 To encourage more effective departmental advice to ministers on program implementation risks, the Committee recommends the Department of Finance amend the Commonwealth Grants Rules and Guidelines to specify that, where a method other than a competitive merit-based selection process is planned to be used, officials also document, in the policy design phase: how the approach has been developed how implementation considerations have been taken into account in the policy design that a risk management plan has been completed for the proposed process, including on program implementation risks and opportunities to mitigate those risks where possible. The above matters should also be included in departmental ministerial advice. Agree The Commonwealth Grants Rules and Guidelines (CGRGs) already provide that: 'Competitive, merit-based processes should be used to allocate grants based upon clearly defined criteria, unless specifically agreed otherwise by a Minister, accountable authority or a delegate' (CGRGs, paragraph 13.10). Where an alternative method is proposed, the CGRGs provide that officials should document why this approach has been used. The CGRGs will also be updated to indicate that, where demanddriven methods are used, officials should advise Ministers on how the grant allocation method was developed, explain how implementation issues were considered, and outline risk mitigation strategies. It is expected that the CGRGs will be updated for a 1 July 2017 implementation. Officials are also required to have regard to the key principles, which include robust planning and design. The CGRGs note that 'officials should ensure that risk identification and engagement is supported by performance information, procedures and systems that continuously identify and treat emerging risks throughout the grants administration process. In addition, the mandatory provisions in the CGRGs require that officials must provide written advice to Minister, where Ministers exercise the role of an approver, and provide for minimum briefing requirements (CGRGs, paragraph 4.6). Recommendation No. 5 The Committee recommends that the Department of Finance and the Australian National Audit Office (ANAO) work together to strengthen the Commonwealth Grants Rule and Guidelines (CGRGs) and update and expand the Implementing Better Practice Grants Administration guide to reflect the Committee's findings in this report, and also the ANAO findings in Report No. 23 (2014–15). In particular: the CGRGs should state that it is not advisable to include, as members on a grants program advisory board, prospective applicants for that grants program Agree One of the principles of grants administration in the CGRGs is probity and transparency. The CGRGs note that accountable authorities should put in place appropriate mechanisms for identifying and managing potential conflicts of interest for granting activities. This includes, 'where members of expert or advisory panels or committees have a direct or indirect interest in informing a decision about expenditure or providing advice on grants'. The CGRGs will be updated to indicate that it is not advisable to include prospective applicants for a grants program on bodies, which directly input into the grant selection process. It is expected that the CGRGs will be updated for a 1 July 2017 implementation. MINISTERIAL STATEMENTS Closing the Gap Senator PAYNE (New South Wales—Minister for Defence) (17:21): On behalf of the Prime Minister, I table the annual report on closing the gap and accompanying ministerial statement. Pursuant to order, the documents are listed for consideration at item 18 as a government business order of the day and many be considered for not more than two hours today. CHAMBER

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