Ministerial directions and policy orders

The PGPA Rule provides that the Minister for Health may give directions to the Agency about the performance of its functions or the exercise of its powers. In addition, the Minister for Finance, under the PGPA Act, may notify the Board of any general Australian Government policies that apply to the Agency.

No ministerial directions or notifications were given during the 2019–20 reporting period.

Compliance with finance law

The PGPA Rule requires that the Agency report on any significant non-compliance during 2019–20 with finance law (encompassing the PGPA Act, any delegated legislation under that Act, or an Appropriation Act).

The Agency has not identified any significant non-compliance issues during the 2019–20 reporting period.

Significant activities and changes

The PGPA Rule also requires the Agency to provide details of significant activities and changes that affected the operations or structure of the entity during the reporting year. The PGPA Rule requires the Agency to notify the Minister for Health of events such as proposals to form a company, partnership or trust, to acquire or dispose of a significant shareholding in a company or commence or cease business activities or to make other significant changes. No significant events of that nature arose during 2019–20.

Related entity transactions

The Agency is an Australian Government controlled corporate Commonwealth Agency. It has a governing Board of members, a CEO and ELT members and a Portfolio Minister. Pursuant to the Australian Accounting Standard AASB 124 Related Party Disclosures, the Agency key management personnel are asked to provide details of where any of their close family members, or a controlled Agency/entities has/have transacted with the Agency. Where any doubt exists, the information is to be recorded and collected in any event. AASB 124 requires disclosure of related party relationships that include transactions where significant influence exists between the Agency and other parties. The Standard identifies that ‘key management personnel (KMP)’ have the capacity to influence the operations of the Agency, and therefore parties related to KMP become related parties to the Agency and require disclosure in the annual financial statements.

The Agency has determined that all board members, the CEO and ELT members constitute key management personnel where in a role for three months or more continuously. Officers acting in the CEO or an ELT role, have been assessed against the criteria of whether their acting role allowed them to plan, direct and control the activities of the Agency. Given the breadth of Government activities, related parties may transact with the government sector in the same capacity of ‘common citizens’. Common citizen or ‘open contest’ transactions are not requested or recorded as they reflect those transactions that may be undertaken with the Agency under the same terms and conditions as any other citizen.

The Agency transacts with other Australian Government controlled entities consistent with normal day-to-day business operations provided under normal terms and conditions, including the payment of workers compensation and insurance premiums. These are not considered individually significant to warrant separate disclosure as related party transactions. Giving consideration to relationships with related entities, and transactions entered into during the reporting period by the Agency, it has been determined that there are no related party transactions to be separately disclosed.

Insurance and indemnities

The PGPA Rule requires the Agency to provide details of any indemnity that applied to the Agency Board, any member of the Board or officer of the Agency against a liability (including premiums paid, or agreed to be paid, for insurance against the Agency Board, member or officer’s liability for legal costs). In 2019–20 the Agency maintained directors’ and officers’ liability insurance, which covers Board members, as part of its overall insurance arrangements with the Commonwealth’s self-managed insurance fund, Comcover. The premium paid for this coverage for 2019–20 was $24,755 (GST inclusive).