La Trobe University

Public Sector Governance & Accountability

Research Centre

Introduction

2009 Annual Report

The Council of La Trobe University resolved to establish the Public Sector Governance andAccountability Research Centre (PSGARC) within the Faculty of Law and Management, on 7June, 2004. The centre was formally launched at a ‘signing’ ceremony at Parliament House, Melbourne,on 29th June 2004.

Participants in the 2009 Annual Summer Residency Program pictured in the Vestibule, Parliament House, Melbourne

This Report, to 31st December 2009, relates to the fifth year of the Centre’s operation.

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Aims

The aims of the Centre are:

(1) To strengthen public accountability and governance by supporting and researching the role and function of public accounts committees or like committees: and the activities of independent Auditors-General.

(2) To promote research, teaching and practice which contributes to accountability, openness and transparency of government in Australia and internationally.

(3) To provide a research focus within the Faculty of Law and Management on issues of accountability and governance and thereby promote the teaching and research activities of members of staff of the University.

(4) To significantly expand the opportunities for research in the field of public sector accountability and governance.

(5) To promote the training of postgraduates in research in the field of public sector accountability and governance.

(6) To enhance the international reputation of La Trobe University by taking a leading role in promoting public sector accountability internationally.

(7) To establish links with academics, practitioners, politicians and institutions and enhance the networks which seek to promote public sector accountability.

(8) To provide research, development and academic support for parliament, parliamentary committees and parliamentary officers in issues of accountability and governance.

(9) To do all such things as are incidental or conducive to the attainment of the above aims.

Membership

Ordinary Members

Professor Raymond Harbridge, Dean, Faculty of Law and Management, (ex officio).

Prof Zahirul Hoque, Professor of Accounting.

Professor John King, Professor of Economics.

Associate Professor Ishaq Bhati.

Ms Joanne Lye, Lecturer, Department of Accounting and Management.

Dr Ewen Michael, Senior Lecturer, School of Sport, Tourism and Hospitality.

Mr Michael Schneider, Visiting Fellow, School of Business.

Professor Gordon Walker, Professor of Law.

Associate Members

Professor Max Aiken, Emeritus Professor of Accounting, La Trobe University;

Professor Geoff Harris, School of Economics & Finance, University of KwaZulu-Natal, South Africa.

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Professor Kerry Jacobs, Professor of Accounting, Australian National University.

Professor John Langmore, Professorial Fellow, Political Science, Sociology andCriminology Department, Melbourne University.

Emeritus Professor Greg O’Brien, Graduate School of Management La Trobe University.

Professor Themba Joseph Sono, Professor Extraordinary, Graduate School ofManagement, University of Pretoria and Member of Gauteng Legislature (South Africa).

Dr Bill Stent, Honorary Associate, Faculty of Law and Management, La TrobeUniversity.

Dr Peter Wilkins, Adjunct Professor, Business School, Curtin University of Technology, WA and Director, Policy Branch, Office of the Auditor General WA.Dr Premasiri Yapa, Associate Professor. Accounting & Law. RMIT University.

Honorary Members

Mr Marcus Bromley.

Hon Clayton Cosgrove MP (NZ), Cabinet Minister, New Zealand Government.

Dr Deb Foskey, Deputy Chair, Standing Committee on Public Accounts, LegislativeAssembly, ACT.

Mr Michael Holford MP (South Africa).

Professor Mark McGillivray, Chief Economist, Australian Agency for InternationalDevelopment (AusAID).

Dr Hunadi Mateme MP(South Africa).

Rt Hon. Mike Moore, Adjunct Professor in Law and Management; LTU. Former PrimeMinister of NZ and Director General of the World Trade Organisation.

Mr Repe Rambe, Secretary to the Public Accounts Committee, National Parliament, Papua New Guinea.

Hon. Tony Sheehan, Member of La Trobe University Council and former Treasurer of the State of Victoria.

Staff

Adjunct Professor Peter Loney, Executive Director Public Sector Governance andAccountability Research Centre, Faculty of Law and Management. (Part-time).

Adj Prof Peter LoneyExecutive Director

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Management of Centre

Board of Management

Adjunct Professor Peter Loney (Executive Director), Professor Zahirul Hoque (Deputy Director), Professor Raymond Harbridge (ex officio), Dr Bill Stent, Professor Gordon Walker.

Advisory Board

Dr Bill Stent (Chair), Adjunct Professor Peter Loney, Hon Clayton Cosgrove MP, Rt Hon Mike Moore, Hon Tony Sheehan, Professor Gordon Walker.

Dr Bill StentChair

Highlights of the Reporting Period

Staff Appointments/Changes

There were no staff changes in 2009.Adjunct Professor Peter Loney continued in the position of Executive Director of the Centre from January throughout 2009. The Centre is located within the Faculty of Law and Management, which has provided infrastructure support.

Deputy Director

Dr Ewan Michael resigned as Deputy Director of the Centre due to a changed role within the university, and was replaced as Deputy Director by Professor Zahirul Hoque.

Potential partnerships and collaborations and donors

AusAID Support for PSGARC Summer Residency Program

The Executive Director met with the Commonwealth Parliamentary Secretary for Internatonal Dvelopment, Mr Bob McMullan, in Canberra in early 2008 to discuss the growing international importance of PSGARC’s Annual Summer residency Program for Public Accounts Committees, and to request AusAID funding support for the program. Assessment of our request was delayed for some time as a result of AusAID conducting a review of its Parliamentary Strengthening Program.

In November 2009, PSGARC was advised that its funding request had been successful and thatAusAID funding of $300,000 was being made available to support the core infrastructure of the2010, 2011 and 2012 Summer Residency Programs. As a condition of the grant PSGARC will be required to undertake in-country-follow up in 6 participating countries over the three years of the

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funding agreement. It will also allow course costs charged to participants to be reduced.This funding is further acknowledgement of the credibility that the Summer Residency Program has gained over its five years, and confirmation that it is now regarded as probably the leading course of its type internationally.

Municipal PAC Training – South Africa

Following the Executive Director’s attendance at the Association of Public Accounts Committees Conference in Capetown, South Africa, in October 2009, The South African training organisations Khalisa and Makweru contacted PSGARC to invite the centre to partner them in tendering for the training of members of Municipal Public Accounts Committees (PACs). These are to be formed in each of the 262 municipalities in South Africa from 2011. Their establishment will require the provision of a comprehensive training program for thousands of councillors. The national government has allocated a significant budget for the program.

The initial contact sought PSGARC’s involvement in the submission of a tender as a partner in the designing and delivering course modules. The time line available was insufficient to clarify a number of issues involved with La Trobe University’s status in South Africa, particularly in regard to the level of academic accreditation, conferral authority and taxation. Consequently, by mutual agreement, we did not participate in the tender. Discussions by email have since taken place with Professor Themba Sono who has indicated that PSGARC is the preferred training partner for the project and work will continue to further a collaborative arrangement

World Bank Institute

The Executive Director met with senior officials of the World Bank Institute in Washington DC in September, 2009 to clarify the proposed collaborative relationship with WBI that had been discussed over the preceding twelve months. Present at the meeting were Mr Ed Campos, Manager, Governance Unit, Ms Deena Philage, Senior Specialist and Dr Rick Stapenhurst, Senior Specialist. None of the WBI officials with whom we had previously discussed collaboration were involved.

Ed Campos and Deena Philage expressed appreciation for PSGARC’s long standing partnership with Rick Stapenhurst and the Parliamentary Program. They also noted our patience while WBI went through changes in staffing and policy which had resulted in a new strategy for the organisation. Discussion centred on the new strategy and approaches and how any collaboration with La Trobe University might fit into it, especially in the East Asia/Pacific Region.

While communication has continued since the meeting there are, as yet, no concrete proposals for collaboration. PSGARC has forwarded potential collaboration programs to WBI for their assessment and advice.

Lecture by Cobus de Swardt, Managing Director Transparency International

On May 20, PSGARC in conjunction with Transparency International (Australia) hosted a public lecture by Cobus de Swardt, Managing Director of Transparency International, the world’s leading non-governmental organisation fighting corruption. As a campaigner for tougher international action against global corruption, Cobus’ efforts have won him international acclaim. The lecture, which was held in the Agora Theatre, was given strong support by the Faculty of Law and Management’s marketing department which co-ordinated advertising and

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invitations. The lecture was also podcast through La Trobe University’s website, and featured in the FLM magazine “Keynote” The lecture was of considerable assistance in raising the PSGARC profile both inside and outside the University.

Redevelopment of PSGARC Website

After some time, the PSGARC website has undergone a total redevelopment with revised and new content, new sections, and up to date information. This was done by Jason Murphy the FLM IT developer and completed in May. Presentations from the 2009 Summer Residency Program are now available through the website, and it is intended, to upload presentation from each of the annual programs. There is now direct access to the KPMG research study on Australasian Public Accounts Committees, and to speeches, presentations and publications by Centre members. It is also intended to put up a Discussion Papers section with the first paper to be Dr Prem Yapa’s research on the use of summons by the Sri Lanka PAC. PSGARC members are welcome to contribute to this section and also have any of their speeches, presentations and discussion papers on the website.

Donor Organisations

Throughout the year the Executive Director held a number of meetings with potential donors both in Australia and overseas. These included United Nations Development Program, World Bank Institute and the Commonwealth Parliamentary Association. As a result, strong relationships have been formed and active collaboration is being pursued in a number of areas. It is expected that each of these organisations will support future PSGARC programs.

PSGARC discussed with the World Bank Institute, Commonwealth Parliamentary Association and the Centre for Democratic Institutions the continuation of our Summer Residency Program in February 2010. All agreed to continue to be involved as partners.

Conducted Programs, research projects, and involvements with other organisations.

2009 Summer Residency Program for Public Accounts Committees

The 2009 Summer Residency Program was held from February 8 – 14. It was originally scheduled to be held on La Trobe’s Beechworth Campus but, as this was the week of the Victorian bushfires it had to be relocated Despite considerable logistical difficulties the entire program was relocated from the Beechworth Campus to Geelong. Although this was done over little more than 24 hours, the change was smooth. The assistance of both the Mercure Hotel and the Geelong-Otway Tourism Authority in achieving this was invaluable.

As in previous years, the program was financially supported by the World Bank Institute, theCommonwealth Parliamentary Association, and the Centre for Democratic Institutions. For the

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first time, the United Nations Development Program (Fiji Multi-Country Office) funded a participant and there were some other individually funded participants. Attending delegations came from both Westminster and non-Westminster style legislatures from Asia and the Pacific – Bangladesh, Indonesia, Kiribati, Laos, Marshall Islands, Samoa, Tonga, Vanuatu and Vietnam Thailand, which accepted to participate, was unable to attend due to the political problems in the country at the time. A number of PSGARC members were used as presenters including Professor Zahirul Hoque, Dr Peter Wilkins and Dr Michael Lawriwsky. A CD of the program was made and distributed to all participants post-program.

Training Program for Members of Parliament – Tuvalu

The Executive Director was invited by the United Nations Development Program (Fiji Multi- Country Office), at the request of the Tuvalu Parliament, to design and deliver a training program for MPs on Enhancing Parliamentary Performance. The program was also to include the involvement of the Victorian Parliament under a Commonwealth Parliamentary Association “twinning” arrangement.

This program, originally scheduled for mid-June, had to be postponed and will now be conducted during 2010.

United Nations Development Program Legislative Needs Assessments – Pacific Region

As reported in the 2008 Annual Report, The Executive Director, Adjunct Professor Loney, was appointed by the UNDP (Fiji Multi-Country Office) as Lead Consultant for its program of Legislative Needs Assessments (LNA). These assessments are a significant part of UNDP programs as they form the basis of their funding support for legislatures in their five-year funding cycles.

The final assessment, that for the Federated States of Micronesia, including the national legislature and four state legislatures was completed in early 2009.

All of the Legislative Needs Assessment reports have now been considered and accepted by the respective legislatures.

Joint KPMG-PSGARC Research into Practice and Procedures of Public Accounts Committees in Australasian Parliaments

The Canadian CCAF-FCVI has used the KPMG/PSGARC study as the basis for further research into the effectiveness of Parliamentary Public Accounts Committees in Canada. Using data from this study CCAF-FCVI has produced a draft report on “Attributes of Effectiveness for Public Accounts Committees” which was presented to the Canadian Council of Public Accounts Committees in Edmonton in September 2009. This Conference was attended by the PSGARC Executive Director as an invited Visiting Specialist.

Small Research Grants Fund

The PSGARC Advisory Board considered the response to the Small Research Grants Fund that it had established and determined not to proceed with it. Despite PSGARC attempts to publicise this fund university wide, it attracted little interest, and only one application. The Advisory

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Board determined that a potentially more productive approach might be through commissioned research or Centre initiated research.

Requests to do Research Through PSGARC

As PSGARC has become better known, it has been receiving more requests from persons wishing to work with it on research pertinent to the Centre’s activities. These requests are coming from outside of La Trobe University and from both Australia and other countries. They have included requests to enroll for PhDs.

These requests have been referred to relevant parts of LTU where appropriate.

Conferences and Seminars conducted by other organisations

Association of Public Accounts Committees Conference – Cape Town, South Africa

Adjunct Professor Loney attended the 2009 APAC Conference held in Cape Town, South Africa in October 2009 as an invited Visiting Specialist. He presented a keynote address on"Greater Service Delivery through increased focus on value for money and performance by public sector departments and entities" The other five keynote presenters were Junias Kandjeke – Auditor General of Namibia, Mike Seloane – Former APAC Treasurer, Hon. Mahlangu – Chairperson of the National Council of Provinces of South Africa, Freeman Nomvalo – Accountant General National Treasury, South Africa and Hon Sicelo Shiceka – Minister of Intergovernmental Relations and Traditional Affairs, South Africa.

Australasian Council of Public Accounts Committees Biennial Conference – Wellington NZ

As a part of the unique relationship between PSGARC and the Australasian Council of Public Accounts Committees, PSGARC Chair, Dr Bill Stent, and Executive Director Adjunct Professor Peter Loney attended the biennial Conference of the Australasian Council of Public Accounts Committees in Wellington NZ in April, 2009. The Conference provided an opportunity to promote the work of the Centre to Australasian parliaments. Adjunct Professor Loney presented a paper on understanding accountability to the conference.

Canadian Council of Public Accounts Committees Annual Conference – Edmonton, Canada

Adjunct Professor Loney attended the 2009 CCPAC Conference in Edmonton, Canada in September2009 as an invited Visiting Specialist. The conference focussed on practice issues for Public Accounts Committees and included a presentation on a CCAV-FCVI follow-up to the PSGARC/KPMG research on Public Accounts Committees. CCAV-FCVI has expanded this to look at “Attributes of Effectiveness for Public Accounts Committees”

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World Bank Institute Seminar on Public Accounts Committees – Dhaka, Bangladesh

PSGARC was invited to take part in a WBI Seminar on Accountability Effective PublicAccounts Committees, hosted by the World Bank Institute in Dhaka in November 2009. TheSeminar was attended by legislative delegations from South Asia, including Afghanistan, Bangladesh, India, Pakistan, Sri Lanka and Thailand. The program was aimed particularly at effective financial oversight of the executive by parliamentary Public Accounts Committees. Adjunct Professor Loney presented two papers at the Seminar – “Enhancing PAC Performance through Self evaluation” and “Regional associations of PACs”..

Publications

Commissioned Book on Public Accounts Committee Practice Internationally

Our understanding of the functioning of the Public Accounts Committee worldwide is limited. Because of this the PSGARC Advisory Board has endorsed a proposal to commission a publication on the international practices of Public Accounts Committees.This will consist of a research-based edited collection of case studies from different nations discussing the rationales for the current roles of their Public Accounts Committees. It is intended that the publication will demonstrate how PACs, by providing financial oversight of government entities, function to strengthen public accountability, financial scrutiny and good governance in the changing public sector environment This book will draw from a wide range of jurisdictionsfrom Africa, Asia, Pacific islands, and Europe with both Westminster and non-Westminster models of government. Paperson the role of the PACs from these regions will identify important issues pertinent to those interested in public sector accounting, accountability and governance. It is intended that the papers be brought together during 2010 for publication as a book in early 2011.

Future developments.

PSGARC will conduct the Fifth Annual Summer Residency Program for Parliamentary Public Accounts Committees at La Trobe’s Beechworth Campus in February 2010. It is expected that the School will be attended by up to 45 members of Public Accounts Committees and Auditors General from mostly Asian and Pacific parliaments. As a result of the funding grant from AusAID, and the consequent lowering of course fees, it is anticipated that the 2010 course should allow greater involvement of self funded delegations.

Collaboration discussions with potential program partners such as the World Bank

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Institute Commonwealth Parliamentary Association, Association of Public Accounts Committees (South Africa) will continue.

Research, through the commissioned book on Public Accounts Committees, and other generated research opportunities will play a greater part in the Centre’s activities than previously. It is expected that these activities will include replicating the CCAV-FCVI research on “Attributes of Effective Public Accounts Committees” and also provide other opportunities for PSGARC members.

The Cobus De Swardt Lecture was instrumental in generating greater awareness of the Centre, its focus and activities, and consideration will be given to conducting a similar annual lecture.

Summary

2009 was a year of consolidation for PSGARC. The major achievement was the gaining of a significant three-year funding commitment from AusAID for our Summer Residency Program. However, some of our hoped for collaborations have progressed more slowly than we had hoped. This is a part of being a small faculty based Centre dealing with major organisations from a distance .. The challenge remains for PSGARC to capitalise on the opportunities that have been identified to extend its programs.

The Advisory Board and Members have been involved to a greater degree than in previous years in guiding the direction of the Centre. We hope to achieve greater recognition throughout the University and in the general public through being able to replicate activities similar to those of the Cobus De Swardt Lecture.

We continue to have strong relationships with existing partner organisations such as World Bank Institute, Commonwealth Parliamentary Association, and the Centre for Democratic Institutions and are developing additional relationships with organisations such as United Nations Development Program. Our new relationship with AusAID is one that has potential for further enhanced.

It is disappointing that the initiative of establishing our own small research grants program did not produce the level of research interest that we had hoped and was discontinued. However, this will enable our funds to be redirected in a potentially more productive research effort through commissioned and initiated research.

Our flagship program, the Summer Residency Program at the Beechworth campus is now recognised as a leader internationally and attracts strong participation. The AusAID funding has ensured that it will continue successfully for the next three years. It also provides an opportunity for expansion.