Federal grants watchdog’s funding is a short leash: report

Acting auditor-general Rona Mellor said in the Australian National Audit Office (ANAO) report that “ongoing sustainability of funding for the ANAO remains an issue”, especially with Parliament’s expectation that the number of performance audits will grow to 48 per year, up from 42 last year.

Ms Mellor noted that the Parliament’s public administration oversight body, the Joint Committee of Public Accounts and Audit, had written that “the Committee has been grappling with the unsustainability of ANAO’s long term financial position and the risk arising to its operational independence and ability to perform its vital statutory roles at an appropriate level of output”.

The committee said the ANAO would need more funding to meet its obligations but had instead been hit with an efficiency dividend, a reduction in funding based on the expectation of increased efficiency.

Ms Mellor wrote, “Achieving sustainable funding will be a priority for the ANAO in 2024–25, in an environment of increasing costs of delivering high-quality audit products to the Parliament, the growth in the performance and performance statements audit programs, maintaining the security of sensitive information, and the prospect of new audit requirements”.

“As the number of performance audits completed each year grows, it will be a challenge to ensure that we remain suitably and skilfully resourced.”

Grants program administration is among seven focus areas of the ANAO’s work program for 2024–25.

The ANAO’s 2024 audit of grants administration found that almost half of the country’s federal grants programs, worth $118 billion over nearly seven years, were not “fully effective”.

Read the annual report