Business grants may be subject to audits under bill to extend powers of auditor general

A bill introduced to Parliament by independent member Rob Oakeshott that would allow the Government to audit private recipients of Government funds under contracts is set to be put to a vote in the House of Representatives, but the Coalition believes the extension of power is unnecessary.

The bill is designed to amend the power of the Auditor General in order to track Government funds to their point of delivery, including funds that have been provided to private enterprises “under contract”, which may include funds handed out through Government grants.

The bill was created in response to the waste incurred through the Building the Education Revolution and Home Insulation Program, according to Oakeshott, who said in a statement in July that extending the powers of the Auditor-General would “maximise value for money outcomes and minimise waste”.

A spokesperson for Oakeshott’s office this morning told SmartCompany that previously the Auditor General has been hampered by some barriers that prevent it from investigating fully. “This attempts to break those barriers down and do his job basically,” the spokesperson said.

However, the Coalition says the bill is “anti-business”, in that it put private businesses up for audit instead of attacking the waste that provided the funds in the first place.

“This is essentially Oakeshott reacting to all the concerns that arose out of the waste in some of the Government stimulus money, and deciding the way to address that would be to extend the brief of the auditor general,” says opposition small business spokesman Bruce Billson.

“The bill does a number of things, allowing the auditor general to reach into local territory and state governments, their agencies, and also into businesses that have been awarded contracts.”

The Coalition put forward an amendment to introduce a Government agency that would oversee where money is sent, but that was rejected. Billson says the focus should be on avoiding waste, instead of “going after private contractors”.

“Our proposition has been that the Government should do its work properly. It’s anti small business, anti the private sector. The spotlight should be on the Government’s processes, and not increasing the compliance cost for small businesses.”

However, the spokesperson for Oakeshott’s office said it cannot be imagined that any business involved in an audit would need to keep any more records than would be expected for a business receiving Government funds.

“It would be the same account process that any business or government agency would be expected to maintain when they have been provided with public monies. This bill will remove current blocks on the auditor general, allowing the office to have a look at areas it couldn’t previously look at.”

“We don’t believe it will be an impost.”