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Auditor hesitant about reporting on $122m contract

Auditor hesitant about reporting on $122m contract

The auditor hints at significant reservations about the appropriateness of the ACT Policing annual report, and on how expenditure of about $122m is accounted for. As well, the report contains some hard-to-reconcile figures. The ACT Legislative Assembly needs to take a fresh and close look at the policing contract.

Police murder ‘em on statistics, but lose 62 officers

What a year for ACT Policing!  Police management clear more murders than were committed; they lose 62 uniformed officers; and the auditor qualifies the accounts…again.

But at least operational policing:

  • improves response times,
  • gets better at clearing some types of crime; and
  • generally improves community interaction.

The ACT Policing Annual Report 2007-08 is an interesting read.

The Un-Audited Accounts

ACT Policing clearly make the point in the annual report that they are a business arm of the AFP and they are directly accountable to the ACT Minister for Police and Emergency Services.

However, that accountability and transparency apparently has limitations. The auditor (Australian National Audit Office) continues the past practice of qualifying the accounts.  The auditor tells us that he:

… disclaims any assumption of responsibility for any reliance on this report to any person other than the Chief Police Officer of the ACT and the ACT Government.

The very same auditor places no such qualification on the annual report of the AFP. 

The ANAO auditor also states:

No opinion is expressed as to whether the accounting policies used and described in Note 1 are appropriate to the needs of the parties to the Arrangement.

The auditor not only disclaims responsibility for the audited figures but won’t even agree that the accounting used to prepare the annual report is right.  Again, no such qualification is made by the same auditor in the AFP financial statements. 

This effectively means that we, the ACT public, cannot place reliance in the Annual Financial Statement of ACT Policing.  The ACT community has no real assurance that the spending of $122m has been properly accounted for, or that the accounting policies are right.

This contract was not let through a transparent competitive process where market forces could determine the price. The AFP tell us what the cost is and we pay on a set of financial figures the auditor qualifies.  And the ACT Government appears powerless to do anything about this state of affairs.

CLA has raised this issue in previous years when analysing the ACT Policing annual reports, but still the qualifications continue and the ACT Government continues to renew its Purchase Agreement with the inadequate reporting requirements.  As the AFP identifies ACT Policing in its audited accounts, it raises the question of why such accounts are not available for ACT Policing.  

Also noteworthy is that the cost per person for ACT Policing is the 3rd highest in Australia [1], only eclipsed by NT and WA, both of whom have to cover large expanses of land not applicable to the ACT.

When is a Member of the ACT Legislative Assembly going to demand that the ACT Government accounts in a much better fashion for the annual expenditure of $122 million?

The Performance Measures

Well, if we cannot place any reliance on the financial information, can we gain some assurance from the performance information in the Annual Report?

Some 39% of the performance measures are based on a telephone survey undertaken by Roy Morgan, the research company.  Apart from the appropriateness of measuring police performance based on a telephone survey, the results can be dubious.  One measure about the number of people who drive while using mobile phones was reported as 15%, a slight under-performance against the target of 14% target.  Yet the Australian Transport Safety Bureau [2](a federal agency) funded study found that more than 40% of a sample of drivers use a mobile phone while driving.  Clearly, there is some divergence of views on what actual mobile phone usage is.

Also, these same measures use ‘National Average or less’ as the performance target, which is set by a telephone survey conducted at the end of the reporting.

ACT Policing cannot realistically manage meeting the target if they don’t know what it is until they’ve completed the year. These measures are a sham and provide no realistic basis ACT citizens to pay a $122m performance fee.

Also the Productivity Commission provides some very insightful views on the reliability [3] of such survey data and how susceptible the data is to other influences.

Of course we have other measures where there is no performance level.  The ACT Government has agreed with ACT Policing that this is a “base year” and that whatever happens this year will be the basis for the future.  In particular, this relates to complaints against police and complaints relating to persons in custody.  It is not as though this information has not been available in the past – no reasoning is given as to why we need to restart the performance measures for these two very important measures of police integrity and compliance with the law.

Of significance is that while there is no performance data provided on complaints against police, the Productivity Commission is able to report such data for the current financial year.

In the absence of any note to the contrary, it would appear that a “base year” is declared so that embarrassing comparisons can’t be made.

Also we continue to compare the ACT police performance against the national average in 39% of measures when it is acknowledged by many that the ACT is different from the national average in so many ways: tiny area to police, better educated people, wealthier, better cars, etc.  Shouldn’t ACT Policing be striving to achieve better than the national average in its performance?

The Productivity Commission reports and compares jurisdictions on a range of key crime performance indicators [4] which provide an insight into how well police go about investigating crime and identifying, apprehending offenders, the extent of crime in the community and assesses the number of crimes reported to police.  This performance data should be seriously considered as part of the Purchasing Agreement reporting requirement.

Clear-up rates

Even the reporting of basic information needs better consideration.  The success rate in clearing up murders was 200% – more murders were cleared than committed in the year.  Clearly, the basis of the reporting is simplistic and superficial, and gives a silly picture of events. 

What is happening is reporting of successful clear-up of past years offences are being counted against this year’s crime which makes the success rate look far better than it really is.  And given that all crime performance figures are reported using the same methodology, all information on crime clear-up rates for offences in the ACT must be treated with healthy scepticism. 

What is clearly missing from the statistics to enable them to become meaningful is the inclusion of what the backlog/uncleared rate of offences was.  The clear-up rate report is misleading and needs to be expressed as a percentage of total uncleared offences.  An alternative would be for the clear-up rate being only for those offences occurring in the reporting period.

Where are the missing 62 police officers?

The Annual Report advises that ACT Policing had 692.1 sworn (uniformed) police officers in the year.  However, the AFP’s Annual Report tells us there were 754, but then there is also a 64 civilians discrepancy.  How can this be?


ACT Policing


Sworn (Uniformed) Officers



Unsworn (civilians)






The Productivity Commission advised that the staffing number was 750 [5].  Clearly, the auditor’s qualifications are justified and someone can’t add up or report consistently to Ministers.  Are we getting more than we paid for or is a uniformed AFP officer not the same as an ACT Policing officer?

But, somewhere we also gained experience uniformed officers that the AFP does not know about.  The length of service profiles that both ACT Policing and AFP reported on varies by between 3-4% across some age categories. 

Notwithstanding the discrepancies, the ACT still has a very inexperienced police force.  No matter which age profile you wish to believe, some 60% of the uniformed police officers in the ACT have less than 5 years experience compared with previous NSW Police levels of 40%.

And while ACT Policing took on 175 new recruits it seemed to only manage to retain the equivalent of 97; or is this a trick of presentation.  Does the ACT Government have any better information on police movements between ACT Policing and the AFP during the course of the year?

Public Interest Disclosure

The Annual Report declines to report under the ACT Public Interest Disclosure legislation on the basis it is a Commonwealth agency, being a business unit of the AFP, and that due to the nature of its business it does not need to report.  Broadly, the legislation requires a report to the ACT Legislative Assembly of wrong doing, criminal or disciplinary offence by officials or agencies.  It requires transparency, accountability and integrity of its agencies and officials, values shared by ACT Policing.

Effectively, there is no public information available similar to the AFP Annual Report’s (2007-08) breakdown on Corporate Integrity; ACT Policing is included but not detailed separately in these figures.  If the AFP can provide the information, it does leave unanswered why ACT Policing could not adopt the same practice as its parent body and report in a similar manner?

The good news

The annual report does indicate that ACT Policing is meeting its targets for attendances at incidents, especially the high priority ones.  Also the success in meeting the target of 80% of cases being finalised by a successful prosecution in court is a better outcome, potentially reflecting on improvements in investigative matters.

Achievements in restorative justice outcomes by police and the Restorative Justice Unit are also encouraging.

[1] Productivity Commission – Report on Government Services 2009 – Figure 6.5
[2] Executive Summary, Pg x
[3] Productivity Commission – Report on Government Services 2009 – Box 6.7
[4] Ibid., Chapter 6.5 Crime
[5] Ibid., Table 6.1

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