1. ARAPAC Annual Meeting Maldives 11 – 13 October 2012 The PAC – AG Relationship Presenter: Professor Peter Loney Legislative Leadership and Governance Group, Alfred Deakin Research Institute

2. The PAC – AG Relationship “The PAC and Auditor-General are separate organizations, with separate mandates and complimentary roles….Together, PACs and Auditors-General are essential components of democratic accountability….The exact way in which they work together (and to a greater or lesser extent they do always work together) varies from Parliament to Parliament.” David McGee, The Overseers, 2001

3. The PAC – AG Relationship : The PAC Role The role of Public Accounts Committee (PAC) in the Westminster model holding governments to account, stewardship and accountability for public money, parliamentary scrutiny of public finances. AG Independence The Auditor general is an ‘independent officer of Parliament’ This means that the AG has complete discretion in the performance or exercise of his or her functions or powers and, in particular, is not subject to direction from anyone.

4. The AG – PAC Relationship PAC should be the pre-eminent parliamentary committee AG an Officer of Parliament – NOT a government auditor – so is responsible and reports to Parliament and is available to all committees, not just the PAC Constitutional or at least legislated role Australian legislation a decade ago gave responsibility to PAC to safeguard AG’s independence Freedom of Information is a less powerful procedure than the legislated authority of either the PAC or the Auditor-General

5. The AG – PAC Relationship AG reports to Parliament The AG can advise other committees but not at the expense of its PAC work – in New Zealand, for example, there is no PAC as accounts, budgets and programmes are all scrutinized by the relevant departmentally related committee. The AG should establish a parliamentary liaison office, possibly even in Parliament, if the resources are available The AG should participate in induction courses for MPs Broadest possible mandate – including performance audits and new forms such as environmental audits

6. The AG – PAC Relationship Support for the Auditor General The relationship between PACs and Auditors General is fundamental to effective Parliamentary scrutiny of the executive. PAC role to bolster the independence and effectiveness of the AG and the work of the AG should guide the work of the PAC – but each as a separate and significantly different role Different relationships between the two in different Parliaments No model is preferred, but all models stress the interdependence of both and their joint goal of ensuring propriety and effectiveness in government spending

7. The AG – PAC Relationship The Auditor General’s close relationship with the PAC is one means of maintaining its independence. Formal rules describe the nature of this independence, but local circumstances are also essential in this determination. It is the PAC however, that has primary responsibility in safeguarding the independence of the Auditor General by exercising oversight of its work, including taking evidence on the resources available to its office. Parliament and Financial Scrutiny – the Role of the PAC Commonwealth Parliamentary Association

8. The AG – PAC Relationship Ontario – AG briefs PAC in private, sits almost as a committee member at hearings where he or she can question witnesses and assists PAC in drafting reports Canada – AG appears as a witness, if called by the PAC U.K. – AG appears as a witness and assists the PAC in its deliberations Solomon Islands – Ag sits with PAC and acts as Secretary The AG’s evidence must be open to testing by those it affects and AG as advisor must not bias PAC reports unfairly PAC “political” advice on areas for special audit attention is proper, as is the PAC conducting its own investigations of areas not covered in detail by the audit

9. The AG – PAC Relationship Adding Value To Audit Reports PACs have the opportunity to do things that Auditors cannot, and by taking up that opportunity can play a significant role in driving improved practices throughout the public sector. PACs can not only look into issues raised during audits, but can also hold inquiries into the implementation status of Audit and PAC recommendations. ARAPAC could ensure that ‘value adding’ is a constant theme in its conferences so that members are kept up to date with good practice within the region and internationally

10. The AG – PAC Relationship Critical that a constructive ‘partnership’ be forged – Audit provides the ‘ammunition’ PAC provides the ‘force’ (Des Pearson, Auditor General, Victoria)

11. THANK YOU