The National Commission of Audit has handed down its report into the scope for efficiency and productivity improvements across all levels of Commonwealth Government activities.
Commission Chair, Tony Shepherd said the report, which was the result of the first full scale review for 18 years, showed that without change the budget deficits would place a significant burden on future generations to bring the budget under control.
Mr Shepherd said the Commission recognised that if the budget was not fixed, Australia would have little or no buffer to meet future economic and financial shocks.
Mr Shepherd said the Commission made 86 recommendations - 64 in its Phase 1 Report which deal predominantly with improving the sustainability of the nation's finances and a further 22 recommendations in its Phase 2 Report, which mostly address public sector performance and accountability as well as infrastructure.
He said the recommendations offered savings estimated at $60 to $70 billion per year within 10 years.
Mr Shepherd said the Commission was concerned with the absence of proper program evaluation on Commonwealth programs and it had recommended a system of rigorous independent evaluation with a focus on ensuring spending programs were actually meeting their objectives.
He said it had also recommended the elimination of costly and ineffective duplication and a reduction in the significant administrative burden the Commonwealth imposes on the States through hundreds of COAG agreements.
Mr Shepherd said the Phase 2 report found greater scrutiny of program performance and effectiveness and continuing appropriateness was achievable through three discrete measures: incorporating new and mandatory program evaluation arrangements; revamping the system of strategic reviews of selected programs; and a new rolling process of comprehensive Portfolio Agency Audits of selected agencies.
He said the Commission also considered that a major overhaul of the number of advisory bodies should be undertaken
Mr Shepherd said over the medium term, if the Commission's recommendations to reform the Federation were progressed and a fundamental re-alignment of roles and responsibilities occurred, the reduction in duplication would mean fewer Federal Public Servants.
He said this had particular implications for Departments such as the Department of Education and the Department of Health.
Mr Shepherd said as a broad guide, the Commission expected that some 15,000 fewer Public Servants could be required.
The Commission also recommended that changes be made to the Public Service Act and associated arrangements, including that the Public Service Act 1999 be amended to ensure an overriding obligation of those working in the Public Service to serve the Government was to be highly productive; the role and responsibilities of the Public Service Commissioner be assumed by the Secretary of the Department of Employment and the role of the Merit Protection Commissioner be abolished.
According to the report the average management structures in the Australian Public Service are top heavy, and the Commission recommended that spans of management control be improved.
Other key recommendations included: consolidating 150 Commonwealth Indigenous programs into no more than seven programs; abolishing 35 government bodies, merging six bodies; and consolidating 57 bodies; and the short-term privatisation of Snowy Hydro Limited, Australian Hearing Services, Defence Housing Australia, Australian Submarine Corporation.
The Australian Government said the National Commission of Audit report was not a report by the Government but a report to the Government and was one important input to the Government's considerations for the upcoming Budget.
It said the Government's response to the Report would be in the Budget on 13 May.
The National Commission of Audit report is available online at www.ncoa.gov.au
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