Governance & compliance

The Public Governance, Performance and Accountability Act 2013 (PGPA Act) establishes a system of governance and accountability that applies across Commonwealth entities.

The PGPA Act applies to all accountable authorities and officials of Commonwealth entities. It establishes rules not only for financial management, but also for the broader governance, performance and accountability for the Commonwealth public sector.

Commonwealth companies have some obligations under the PGPA Act, but are primarily governed by the Corporations Act 2001 and any enabling legislation. This guide does not cover Commonwealth companies in detail. 

Topics covered in this section of the guide:

  • Government bodies subject to the PGPA Act
  • Obligations under the PGPA Act and the Public Service Act 1999 (PS Act)
  • Accountable Authority Instructions (AAIs)
  • Delegations
  • Rules for spending money
  • Procurements, grants and investments
  • Corporate Plans and Portfolio Budget Statements
  • Annual Performance Statements and Annual Reports
  • Audit Committees
  • Fraud prevention
  • Public Interest Disclosure
  • Complaint handling
  • Legal Services Directions
  • Child Safe Framework
  • Human rights and anti-discrimination

Useful resources and contact information are available in the tables below.
 

Government bodies subject to the PGPA Act

The Australian Government is made up of many different types of government bodies.

Commonwealth entities and companies are government bodies that are subject to the PGPA Act.

Different rules may apply depending on the type of government body.

Types of government bodies

Type of body

Explanation

Resources

Contact

Non-corporate Commonwealth entity

Legally and financially part of the Commonwealth.

 

Includes departments of state, parliamentary departments and listed entities.

 

Government policies automatically apply unless enabling legislation overrides government policy.

Types of Australian Government bodies

 

Flipchart of Commonwealth entities and companies

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

Corporate Commonwealth entity

Body corporates, legally separate from the Commonwealth, but still part of the Australian Government.

 

Generally have enabling legislation that establishes the scope of their activities and a multi-member accountable authority (such as a board of directors).

 

Generally not required to comply with policies of the Australian Government except where there is a direction from the responsible Minister under the enabling legislation or a government policy order.

Types of Australian Government bodies

 

Flipchart of Commonwealth entities and companies

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

Commonwealth company

Companies established under the Corporations Act 2001 that the Commonwealth controls.

They are legally separate from the Commonwealth.

As a part of the Australian Government, may be subject to government policy via a government policy order. Must conform with the Corporations Act 2001 and also Chapter 3 of the PGPA Act and Rule.

The Commonwealth can solely or partly own a Commonwealth company.

Types of Australian Government bodies

Flipchart of Commonwealth entities and companies

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

Government Business Enterprises (GBE)

A Commonwealth entity or Commonwealth company that is prescribed under the PGPA Rule.

While a GBE has a specific mandate, the principle objective for each GBE is to add to shareholder value by operating and pricing efficiently and earning a commercial rate of return.

Commonwealth Government Business Enterprises – Governance and Oversight Guidelines

Role of Directors in Commonwealth Government Business Enterprises Guide

Government Businesses Branch

GBO@finance.gov.au

Switchboard: 02 6215 2222

 

 

Obligations under the PGPA Act and the PS Act

The PGPA Act establishes general duties and obligations for all accountable authorities and officials in relation to the use and management of public resources.

The PS Act requires APS employees and agency heads to behave at all times in a way that upholds the APS Values and the APS Code of Conduct.

The duties in the PGPA Act are consistent with duties in the APS Code of Conduct. For APS employees, following the APS Code of Conduct will ordinarily meet the requirements of the PGPA Act duties.

Key Tasks

Task

Explanation

Resources

Contact

Ensure that you discharge your duties as an accountable authority and/or official

Accountable authorities and officials who do not discharge their general duties can be subject to employment sanctions, including termination of employment.

Duties of accountable authorities and officials

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

Uphold the APS Values and Code of Conduct as an APS employee or agency head

APS employees and agency heads must at all times uphold the APS Values and Code of Conduct.

APS Values and Code of Conduct in practice

Australian Public Service Commission

StaffingPolicy@apsc.gov.au

Switchboard: 02 6202 3500

 

Accountable Authority Instructions and Delegations

Accountable Authority Instructions (AAIs) are written instruments that may be issued by the accountable authority to instruct officials on matters. Issued AAIs form part of the finance law, and officials are required to understand and follow them.

AAIs assist the accountable authorities in meeting their general duties under the PGPA Act and establishing appropriate internal controls for their entity.

Delegations

The Finance Minister has delegated some powers and functions in the PGPA Act to accountable authorities of non-corporate Commonwealth entities. Accountable authorities can further delegate these powers, functions or duties to officials.

Delegation of powers for corporate Commonwealth entities will depend on their enabling legislation. 

The AAIs are a good place for accountable authorities to record the powers, functions or duties they have delegated to officials.

For more information on powers that can be delegated under the PGPA Act see the Finance website.

Key Tasks

Task

Explanation

Resources

Contact

Issue instructions establishing appropriate internal controls for officials in the entity

AAIs include instructions that the accountable authority expects officials to follow when exercising powers and carrying out functions and duties under the PGPA Act.

RMG 206 - Accountable Authority Instructions

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

 

Rules for spending money

Officials of Commonwealth entities need authority before they can enter into arrangements or commit relevant money. Officials often enter an arrangement or make a commitment when they are spending money including under contracts or purchase orders.

  • Non-corporate Commonwealth entities – authority is usually delegated to officials by the accountable authority (possibly in their AAIs).
  • Corporate Commonwealth entities – authority is usually in their enabling legislation and from their body corporate nature.

Under the PGPA Act, officials who approve a commitment of relevant money must record it in writing. Officials may verbally approve a commitment of relevant money, but must record it in writing as soon as practicable after giving it.

Key Tasks

Task

Explanation

Resources

Contact

Always ensure you have appropriate authority before entering arrangements or committing relevant money and record all commitments in writing

Officials of Commonwealth entities need authority before they can enter into arrangements or commit relevant money.

Officials who approve a commitment of relevant money must record it in writing.

Entering arrangements and committing relevant money

RMG 400 – Commitment of relevant money

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

 

Other frameworks that may apply to spending money

Different types of arrangements and commitments may also have their own additional requirements.

Procurement

The Commonwealth Procurement Rules are the keystone of the Government's procurement policy framework. They are supported by a range of tools including the AusTender system, guidance material and templates developed and maintained by the Department of Finance.

For more information on the Commonwealth procurement framework visit the Finance website.

Grants

The Commonwealth Grants Rules and Guidelines 2017 (CGRGs) establish the Commonwealth grants policy framework. The CGRGs contain the key legislative and policy requirements, and explain the better practice principles of grants administration. They are supported by a range of tools including the GrantConnect, guidance material and templates developed and maintained by the Department of Finance.

For more information on the Commonwealth grants framework visit the Finance website.

Investments

The Commonwealth Investment Framework was developed in order to support a coordinated and whole-of-life asset management approach to balance sheet investment proposals. The Framework supports officials of Commonwealth entities responsible for any stage of an asset in the Commonwealth investment lifecycle.

For more information on the Commonwealth investment framework visit the Finance website.

 

Performance Reporting

All Commonwealth entities must publish corporate planning and reporting documents under the PGPA Act. Specific requirements for each document are set out in the performance framework.

Corporate Plans and Portfolio Budget Statements

  • Commonwealth entities and companies must prepare corporate plans each financial year.
  • Commonwealth entities must include performance information in portfolio budget statements for each program, which map to the purposes and activities presented in corporate plans.

Annual Performance Statements and Annual Reports

  • Commonwealth entities must report an Annual Performance Statement in their annual report on actual results achieved against the performance measures published in their corporate plans and portfolio budget statements.
  • Commonwealth companies, who are also subject to annual reporting requirements in the Corporations Act 2001, have flexibility to present actual performance results as appropriate for their organisation.

Key Tasks

Task

Explanation

Resources

Contact

Publish performance expectations in corporate plans 

Commonwealth entities and companies must prepare and publish corporate plans each financial year.

Commonwealth Performance Framework

Accountability and Reporting

PGPA@finance.gov.au

Switchboard: 02 6215 2222

Report actual results against performance expectations in annual reports

Commonwealth entities and companies must prepare and publish annual reports each financial year, including on the Transparency Portal.

Annual report guidance

 

Transparency Portal

Accountability and Reporting

PGPA@finance.gov.au

Switchboard: 02 6215 2222

 

Audit Committees

The PGPA Rule requires accountable authorities of Commonwealth entities establish an audit committee to review the appropriateness of their entity’s financial and performance reporting, and systems of risk and internal controls systems.

Task

Explanation

Resources

Contact

Establish an audit committee

The PGPA Rule requires accountable authorities of Commonwealth entities establish an audit committee.

Guide on the role of audit committees

PGPA Advisory

PGPA@finance.gov.au

Switchboard: 02 6215 2222

 

Commonwealth Fraud Prevention Centre

Many Commonwealth entities may be at risk of vulnerability to fraud, including theft, fraudulent accounting, false or misleading information, cartel conduct and misuse of Commonwealth assets.

The Commonwealth Fraud Prevention Centre partners with government to provide information and advice on fraud prevention initiatives and changes in legislation and policy to improve fraud prevention across Australia.

For more information on fraud prevention visit the Commonwealth Fraud Prevention Centre.

Other policies and frameworks

There are other governance and compliance requirements that may apply to Commonwealth entities that do not fall under the PGPA Act.

 

Public interest disclosure scheme

Commonwealth entities have obligations under the Public Interest Disclosure Act 2013 in handling public interest disclosures concerning their agency and from their officials. This includes responsibility for investigating suspected wrongdoing, taking appropriate action in response, and managing any related reprisal risk to the discloser.

The Act applies to Australian Government agencies, corporate Commonwealth entities, Commonwealth companies, public authorities and Commonwealth contracted service providers.

The Commonwealth Ombudsman is responsible for administering the public interest disclosure scheme and investigating complaints about agencies’ handling of public interest disclosures.

Key Tasks

Task

Explanation

Resources

Contact

Appoint Authorised Officers to receive public interest disclosures

You are required to ensure public interest disclosures received by your entity are handled in accordance with the Public Interest Disclosures Act.

Public Interest Disclosure – Information for agencies

Agency Guide to the Public Interest Disclosure Act 2013

PID Team

PID@ombudsman.gov.au

02 6276 3777

Publish public interest disclosures procedures for your entity

You are required to ensure public interest disclosures received by your entity are handled in accordance with the Public Interest Disclosures Act.

Public Interest Disclosure – Information for agencies

Agency Guide to the Public Interest Disclosure Act 2013

PID Team

PID@ombudsman.gov.au

02 6276 3777

 

Complaint handling

Complaint handling is a predictable and necessary part of program and service delivery. Errors, misunderstandings, client dissatisfaction and unexpected problems occur in all administrative systems. Good administration involves regular review of existing programs, and the lessons learnt from complaints can feed into that process.

Visit The Commonwealth Ombudsman website for more information on complaint handling.

The Ombudsman also runs complaints handling workshops for agencies on request. 

 

Legal Services Directions

Commonwealth entities providing legal services have obligations under the Legal Services Directions 2017.

The Attorney-General’s Department assists Commonwealth entities to comply with the Legal Services Directions, through its Compliance Framework, Guidance Notes and education program.

The Office of Legal Services Coordination conducts training and awareness seminars on an as needed basis to help Government agencies to understand their obligations and how to comply with them.

For more information see the legal services directions guidance notes.

The Australian Government Solicitor is the Australian Government’s central legal service with expertise in areas of law of importance to the Commonwealth. For more information visit the Australian Government Solicitor website

 

Commonwealth Child Safe Framework

The Commonwealth Child Safe Framework is a whole-of-government policy that sets minimum standards for creating and embedding a child safe culture and practice in Commonwealth entities.

The Framework applies to all non-corporate Commonwealth entities. It is recommended for application to corporate Commonwealth entities and wholly owned Commonwealth companies.

For more information please contact the National Office for Child Safety at CommonwealthChildSafe@pmc.gov.au.

 

Human rights and anti-discrimination

New entities need to be aware of their human rights and anti-discrimination obligations.

For more information on human rights obligations and Australia's federal anti-discrimination legislation, including the Australian Government Guidelines on the Recognition of Sex and Gender, visit the Attorney-General's Department wesbite
 


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