Introduction

1. Advertising is an important and legitimate element of government communication and information strategies. Governments use advertising to inform the public about government policies, programs and services which affect their entitlements, rights and obligations. In 2011–12, total campaign advertising² expenditure by Financial Management and Accountability Act 1997 (FMA Act) agencies was some $224 million.³

2. While campaign advertising is a legitimate and accepted element of government communication and information strategies, there have long been concerns that governments may use, or may be perceived to use, taxpayer funds to gain political advantage, rather than to meet the genuine information needs of citizens.⁴

The campaign advertising framework

3. The Australian Government significantly enhanced the arrangements applying to government advertising in 2008.⁵ The new arrangements made it clear that campaign development was to be wholly undertaken by the commissioning department or agency, addressing one of the most challenging areas in relation to earlier campaigns, that of achieving clarity in the roles of Ministers and their offices on the one hand and agencies on the other.⁶ The 2008 Guidelines provided that campaigns could be approved for launch only when the responsible agency chief executive had certified that the campaign complied with the Guidelines and relevant government policies. At that time, for campaigns with expenditure over $250 000, the Auditor‐General provided a report to the responsible minister on the proposed campaign’s compliance with the Guidelines, based on a limited assurance approach.⁷ The Government decided in early 2010 to revise the 2008 arrangements by not continuing the Auditor‐General’s review role and establishing an Independent Communications Committee (ICC) to provide advice on compliance to agency chief executives, who would in turn provide a certification to the relevant Minister.⁸ The Auditor‐General was requested to undertake performance audits of the administration of government advertising, and has agreed to do so.

4. As part of the revised arrangements in 2010, the Government updated the Guidelines on Information and Advertising Campaigns by Australian Government Departments and Agencies (the 2010 Guidelines/the Guidelines) to reflect its revised policy position, replacing the guidelines introduced in 2008. The Guidelines, combined with certain advertising‐specific procurement arrangements and the Australian Government’s financial management requirements, make up the campaign advertising framework applying since March 2010 to all departments and agencies subject to the FMA Act.

5. The 2010 Guidelines outline the following three underlying principles governing the use of public funds for all government information and advertising campaigns:

(a) members of the public have equal rights to access comprehensive information about government policies, programs and services which affect their entitlements, rights and obligations;

(b) governments may legitimately use public funds to explain government policies, programs or services, to inform members of the public of their obligations, rights and entitlements, to encourage informed consideration of issues or to change behaviour; and

(c) government campaigns must not be conducted for party political purposes.

6. The Guidelines also include five ‘Information and Advertising Campaign Principles’ (the Principles) as a basis for regulating the probity and cost‐effectiveness of campaign advertising. The principles are:

Principle 1: Campaigns should be relevant to government responsibilities;

Principle 2: Campaign materials should be presented in an objective, fair and accessible manner and be designed to meet the objectives of the campaign;

Principle 3: Campaign materials should be objective and not directed at promoting party political interests;

Principle 4: Campaigns should be justified and undertaken in an efficient, effective and relevant manner; and

Principle 5: Campaigns must comply with legal requirements and procurement policies and procedures.⁹

7. The ICC established under the revised Guidelines considers campaigns worth $250 000 or more¹⁰ and provides a report to the relevant agency chief executive on compliance with Principles 1 to 4. Principle 5 is considered to relate to a chief executive’s normal responsibilities and is not subject to ICC advice. Following the receipt of ICC advice, agency chief executives certify compliance against Principles 1 to 5 and provide the certification to the relevant minister, who may decide to launch the campaign or approve its launch. Specific publication and reporting requirements are also set out in the 2010 Guidelines, with the aim of promoting transparency and accountability.

8. The Special Minister of State is responsible for the administration of the campaign advertising framework, including the Guidelines. The Special Minister of State is supported by the Department of Finance and Deregulation (Finance), which provides secretariat support to the ICC and is available to provide advice to agencies on the framework.

9. Since the introduction of the 2010 Guidelines, there have been changes in the campaign advertising framework. In August 2011, the Peer Review Group (PRG) was introduced to provide advice on the development of campaigns worth $250 000 or more. Agencies are required to submit a campaign communications strategy to the PRG for review, and may return to the PRG at later stages of campaign development. At the time of the introduction of the PRG, Finance’s role was amended—agencies were no longer required to seek campaign development advice from Finance, or involve Finance in campaign advertising tender processes.

ANAO audits of government advertising

10. As previously indicated, the Auditor-General was requested to consider undertaking periodic performance audits of the administration of government advertising following the introduction of the revised arrangements in 2010. The first report on the revised arrangements concluded that where the revised certification process for agencies subject to the FMA Act had applied, it had been generally effective in promoting compliance with the 2010 Guidelines.¹¹ However, the report also identified areas for improvement in agencies’ administration of advertising campaigns, including: documenting the source(s) of campaign statements; assessing the overall cost‐effectiveness of the media buy for campaigns; giving and recording financial approvals; signing‐off ministerial briefs and record keeping; procuring services; and evaluating campaigns. The report made five recommendations and a range of suggestions aimed at strengthening the integrity and transparency of the campaign advertising framework. This audit continues the ANAO’s examination of government advertising arrangements.

11. The ANAO had also undertaken a series of audits on the administration of government advertising in prior years, including:

• Audit Report No.38, 2009–10, Campaign Advertising Review July 2009–March 2010;
• Audit Report No.2, 2009–10, Campaign Advertising Review 2008–09;
• Audit Report No.24, 2008–09, The Administration of Contracting Arrangements in relation to Government Advertising to November 2007;
• Audit Report No.12, 1998–99, Taxation Reform Community and Education Programme; and
• Audit Report No.30, 1994–95, Commonwealth Government Information and Advertising—an audit of Commonwealth Government advertising.

Audit objectives, criteria and scope

12. The audit objectives were to:

• assess the effectiveness of selected agencies’ administration in developing advertising campaigns and implementing key processes against the requirements of the campaign advertising framework, and other key legal and administrative requirements; and
• assess the effectiveness of the ongoing administration of the Australian Government’s campaign advertising framework.

13. To form a conclusion against the audit objectives, the audit considered the:

• compliance of four campaigns against the requirements of the campaign advertising framework, including the five information and advertising campaign principles of the Guidelines;
• procurement practices adopted to give effect to the four advertising campaigns, including related legal and process requirements;
• progress made towards addressing the recommendations and suggestions made in ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011; and
• effectiveness of the revised campaign advertising framework, including the new PRG; the revised role for Finance; and the ongoing review of advertising campaigns by the ICC.

14. Three campaigns were initially selected for review on the basis of their financial materiality, and the importance and visibility of the policy initiatives. The campaigns selected were the:

• Household Assistance Package (HAP) advertising campaign—administered by the Department of Families, Housing, Community Services and Indigenous Affairs (FaHCSIA);
• Regional National Broadband Network advertising campaign—administered by the Department of Broadband, Communications and the Digital Economy (DBCDE); and
• Metropolitan National Broadband Network advertising campaign—also administered by DBCDE.

15. The audit was extended in March 2013, following correspondence from two members of the Australian Parliament, to include the Commonwealth funding of Victorian hospitals advertising campaign administered by the Department of Health and Ageing (DoHA). In the same month, the audit scope was also extended to include an examination of campaign-related promotional materials, following correspondence from a member of the Australian Parliament.

16. The audit involved the following six agencies: FaHCSIA; DBCDE; DoHA; Finance; PM&C; and the former Department of Climate Change and Energy Efficiency (DCCEE).¹² The audit examined the administration of the campaign advertising framework from the end of the period examined by the previous ANAO performance audit (August 2011) until March 2013.

Overall conclusion

17. This audit continues the ANAO’s periodic review of government advertising arrangements, an area of public administration that has been sensitive because of concerns, at times, that political considerations have been given undue weight in decisions on whether to run an advertising campaign and the nature of the campaign. While the Guidelines are based on now well-established principles, judgements are necessarily required about whether the principles have been reasonably applied in the development of campaigns.

18. This audit involved an examination of four advertising campaigns:

• the HAP campaign administered by FaHCSIA;
• DBCDE’s regional and metropolitan NBN campaigns; and
• DoHA’s Commonwealth funding of Victorian hospitals campaign.

The first three of these campaigns were valued over $250 000 and were therefore reviewed by the ICC, while DoHA’s lower-valued campaign was not. The audit also examined the ongoing administration of the campaign advertising framework, including progress against the recommendations of the ANAO’s 2011–12 performance audit report on government advertising.

19. In 2008 the Government introduced an enhanced framework for the administration of advertising campaigns in response to issues highlighted by Parliamentary inquiries and ANAO reports. While a subsequent review of the framework led to some softening of the arrangements¹³, the revised framework and Guidelines introduced in 2010 maintained the core elements of the earlier arrangements, namely: the certification of major campaigns by agency chief executives against written guidelines; third party review of campaigns against those guidelines; and the need for campaigns to be justified and undertaken in an efficient, effective and relevant manner.¹⁴

20. The first three campaigns mentioned above, administered by FaHCSIA and DBCDE, generally had regard to the requirements of the campaign advertising framework. The ICC’s campaign review process generated significant discussion between the committee and the relevant agency, and together with the certification of campaigns by chief executives, led to the strengthening of the campaigns’ compliance with the Guidelines.

21. Overall, FaHCSIA generally implemented the $40 million HAP advertising campaign in compliance with the Guidelines, within a particularly short timeframe. Importantly, the department provided the ICC with sufficient and relevant evidence to verify all factual statements used in the campaign. While the HAP was intended to help low and middle income households adjust to the cost impacts of the carbon price, the campaign advertisements focused on the financial assistance available under the package and did not mention that this assistance was in response to the introduction of carbon pricing.¹⁵ In support of this approach, FaHCSIA cited research which suggested that including content about the carbon price would impair the effectiveness of the campaign. Overall, the campaign performed well in increasing awareness and understanding of the payments, tax cuts and entitlements. However, the department’s decision not to mention the link between the HAP and the introduction of a carbon price was noteworthy, and meant that the advertisements did not fully inform the public about the reason for the government assistance. While information on the reasons for the assistance could have been expected given the underlying government advertising principle that ‘members of the public have equal rights to access comprehensive information about government policies, programs and services which affect their entitlements, rights and obligations’¹⁶, such information was available from the website referenced in the advertisements. On this issue, FaHCSIA informed the ANAO that it did not receive any instructions or take soundings from the Government regarding the proposed focus of the campaign.

22. DBCDE’s administration of the regional and metropolitan NBN advertising campaigns, with a combined cost of $49 million, in the main met the requirements of the campaign advertising framework. There were some technical inaccuracies in a small number of statements made in the regional NBN campaign as part of unscripted case studies. While recognising that there will generally be less precision in unscripted material, there would have been benefit in DBCDE taking additional steps to verify the unscripted statements, which featured prominently in the campaign. Other areas for improvement were DBCDE’s approach to assessing the cost-effectiveness of the media buy for the regional NBN campaign, and its procurement practices for both campaigns. The need for agencies to exercise care in these routine aspects of campaign development has been observed in previous ANAO audits.

23. While the NBN campaigns generally complied with the Guidelines, they were also noteworthy as the first time a Department of State has conducted advertising campaigns in an area in which a Government Business Enterprise has charter responsibilities—in this case NBN Co Limited (NBN Co).¹⁷ NBN Co communications policy is guided by its charter responsibilities and is designed to ensure Australians are aware of the NBN construction schedule, to promote the potential benefits of NBN services and to inform people about how to connect to the network when it is available in their area.¹⁸ The responsible portfolio department, DBCDE, sought to differentiate its communications activities from NBN Co by focusing on matters of government policy.¹⁹ Nonetheless, the department was advertising in a market in which a Government Business Enterprise and retail service providers have commercial incentives to promote the benefits of the NBN to drive uptake by consumers when it becomes available in different areas. While it was open to the Government and DBCDE to conduct campaigns under the Guidelines, the closely related communications objectives²⁰ and activities of a Department of State and a Government Business Enterprise with a commercial charter raises questions about the overall efficiency of publicly funded advertising on the NBN, particularly given the focus, scale and timing of the departmental advertising effort. There would have been benefit in DBCDE assessing the cost-effectiveness of its proposed NBN campaigns, as part of its original advice to Ministers, to inform government decisions on the campaigns’ targeting, scale and timing.²¹ The scope for tension between advertising of a Department of State and Government Business Enterprise is also a matter that would benefit from consideration by Finance as it further develops the campaign advertising framework.

24. The fourth campaign examined by the ANAO was the Commonwealth funding of Victorian hospitals advertising campaign, which cost less than $250 000 and was not subject to ICC review.²² The compliance of this sensitive campaign with the requirements of the framework was mixed. There was no documented approval of the advertisement by the Health Minister, the DoHA Secretary or a responsible departmental delegate.²³ Further, DoHA did not document its assessment of the campaign’s compliance with the Guidelines during its (three day) development phase or subsequently.²⁴ Staff in the offices of the Health Minister and Prime Minister were significantly involved in the campaign’s development, contributing actively to the drafting and editing of the advertisement. This process led to the removal of contextual information from the advertisement, and clouded responsibility for the campaign’s development, which nonetheless remained formally with the department.

25. The Victorian hospitals advertisement appeared in the context of an active and public debate between the Australian and Victorian governments over a downward revision in October 2012 of $107 million in Commonwealth healthcare funding to Victoria. In February 2013, the Australian Government decided to pay an equal amount of funding directly to Victorian Local Hospital Networks, and subsequently advertised the funding in Victorian newspapers.²⁵ Within this context, one of the four statements in the advertisement: ‘This [Injecting $107 million into Victorian hospitals] will reverse cuts made by the Victorian Government’, was not presented in an objective manner. The statement attributed full responsibility for the consequences of the $107 million downward funding revision to the Victorian Government, when: the exact amount of funding to be provided directly to Victorian Local Hospital Networks was equal to the original Commonwealth funding revision; and the original revision was a consequence of the application of a funding formula agreed to by both the Australian and Victorian governments. Further, there are likely to be a range of views about the campaign’s compliance with the requirement that government advertisements not directly attack or scorn the policies or actions of ‘others’—in this case, aspects of the Victorian Government approach.²⁶

26. In relation to the ongoing administration of the campaign advertising framework, Finance has responded in a timely manner to the majority of recommendations and suggestions in the 2011–12 ANAO audit report on government advertising. One recommendation, however, remains yet to be acted upon—that Finance provide guidance to agencies to clarify which parts of the Guidelines are mandatory and which are sound practice.²⁷ In addition, Finance has not yet addressed the suggestion in the previous audit report that it report consolidated information on total Australian Government campaign advertising expenditure. As a consequence, this audit recommends that Finance publish consolidated information in its biannual reports on campaign advertising expenditure by FMA Act agencies, to further strengthen the transparency of its reporting on government advertising expenditure. Another aspect of government advertising for which transparency could be improved is the use and effectiveness of campaign-related promotional materials. In this respect, FaHCSIA produced 20 000 families kits using funding from the public relations component of the budgets of three of its advertising campaigns: the HAP campaign; the Dad and Partner Pay campaign; and the Schoolkids Bonus campaign. However, there was not as strong a link between the ‘families kits’ and the HAP, as was the case for Dad and Partner Pay and the Schoolkids Bonus.²⁸ Future ANAO audits on government advertising will maintain a focus on the use of campaign-related promotional materials.²⁹

27. A review of the Australian Government’s campaign advertising framework has been delayed beyond September 2013, with a final decision regarding the need for a review to take into account the findings of this audit. While a series of ANAO audits has found that the certification process and third party review applying since 2008 have promoted compliance with the framework, there remains scope to further refine and strengthen elements of the framework. The ANAO has made two recommendations in this audit directed towards Finance: clarifying the application of an aspect of the Guidelines; and further strengthening the transparency of reporting on government advertising expenditure.

28. While the audit observed a range of compliance issues which agencies should continue to have close regard to in applying the framework, a feature of the campaigns examined was a tendency to push the boundaries of the Guidelines in some areas, with insufficient weight being given to the underlying principles governing the use of public funds for government advertising campaigns.³⁰ While recognising that the primary purpose of the HAP campaign was to raise awareness of the financial assistance available under the HAP, FaHCSIA’s decision not to directly refer to the introduction of carbon pricing meant that the major advertisements did not fully inform the public about the particular reason for the assistance—to assist with the cost impacts resulting from a carbon price. In the case of the two NBN campaigns, a new situation arose in which a Department of State undertook advertising which was closely related to communications undertaken by the responsible Government Business Enterprise, NBN Co, raising questions about the overall efficiency of publicly funded advertising on the NBN and the value for money of such an approach. Further, in the context of an active and public debate between the Australian and Victorian governments, one of the four statements in the Commonwealth funding of Victorian hospitals advertisement was not presented in an objective manner.

29. The audit draws attention to an emerging risk of campaign advertising not clearly meeting the enhanced expectations and arrangements established by the Government from 2008, with the specific purpose of ensuring that Government advertising and information campaigns ‘provide objective, factual and explanatory information, free from partisan promotion of government policy and political argument’.³¹ The Government deserves credit for lifting the bar on the standards expected when it introduced the new arrangements. However, the arrangements need to be supported by Ministers so that Australian Government advertising campaigns are directed to meeting the genuine information needs of citizens. Agencies also have a direct responsibility under the framework to meet the principles of the Guidelines, which were introduced to strengthen confidence in the integrity and value of government communication and information activities. As with any framework, a decline in standards is likely in the absence of ongoing reinforcement of its central features and their continued application.

Key findings by chapter

Chapter 2—Household Assistance Package Advertising Campaign

30. Following the Government’s decision in March 2012 not to proceed with a second phase of the Clean Energy Future (CEF) campaign³², FaHCSIA developed the first phase of the Household Assistance Package (HAP) campaign within seven weeks. This was a challenging timeframe because the campaign involved the development of television advertisements. The first phase of the campaign ran from mid-May to late June 2012. The second phase ran from late June to July 2012, and was developed in a similar timeframe to the first phase. Overall, FaHCSIA’s implementation of the HAP campaign generally complied with the Guidelines, with support for the approach adopted. Importantly, FaHCSIA provided the ICC with sufficient and relevant evidence to verify the factual statements used in the campaign.

31. The HAP was intended to help low and middle income households adjust to the impact of the carbon price. The campaign advertisements focused on the financial assistance available under the package and did not mention that the reason for this assistance was to assist with the cost impacts resulting from the carbon price. In supporting this approach, FaHCSIA cited research which suggested that including content about the carbon price would impair the effectiveness of the campaign. Irrespective of the creative concept testing drawn upon by the department, the decision not to mention the link between the HAP and the introduction of carbon pricing meant that the advertisements did not fully inform the public about the particular reason for this assistance. The advertisements attracted significant media and parliamentary scrutiny for not directly mentioning the carbon price, which would otherwise have been avoided.³³

32. The evaluation of the HAP campaign showed that it performed well in increasing awareness and understanding of the payments, tax cuts and entitlements. Unprompted awareness of the HAP and recall of key campaign messages rose substantially over the course of the campaign. The evaluation also showed that respondents had variable understanding about the types of ‘everyday expenses’ that the advertisements referred to.

Chapter 3—Regional National Broadband Network Advertising Campaign

33. DBCDE was tasked with delivering an advertising campaign focused on regional and remote areas of Australia, to improve public understanding, address misconceptions, and provide updated information about the NBN. The regional NBN campaign was developed within 11 weeks, a challenging timeframe as the campaign involved the development of television advertisements. The campaign ran from late April 2012 to late June 2012.

34. In the main, DBCDE’s administration of the regional NBN advertising campaign met the requirements of the campaign advertising framework. However, on several occasions DBCDE provided campaign materials and supporting documentation to the ICC late, which did not effectively support the third party review of the campaign. There were some technical inaccuracies in a small number of statements made in the regional NBN campaign as part of unscripted case studies. In approving the campaign media buy, DBCDE relied on the Master Media Agency’s advice.³⁴ DBCDE did not make its own assessment of the cost-effectiveness of the media buy, in accordance with the requirements of the financial framework and the Guidelines.³⁵

35. It has long been recognised that it is legitimate for government to use public funds to explain government policies, programs or services, to inform members of the public of their obligations, rights and entitlements, to encourage informed consideration of issues, or to change behaviour. DBCDE identified a need for communications activities to address ‘misunderstandings and misconceptions’ about the NBN. While acknowledging that the decision to conduct the two NBN campaigns was a matter for the Government and DBCDE, this was the first time a Department of State has conducted advertising campaigns in an area in which a Government Business Enterprise has charter responsibilities. NBN Co is responsible for designing, building and operating the NBN, and conducts its own communications activities to ensure Australians are aware of the NBN construction schedule, to promote the potential benefits of NBN services and to inform people about how to connect to the network when it is available in their area. While DBCDE sought to differentiate its activities from NBN Co by focusing on matters of government policy, the closely related communications objectives and activities of a Department of State and a Government Business Enterprise with a commercial charter raises questions around the focus, scale and timing of the departmental advertising effort. Of particular note, with the NBN rollout ongoing until 2021³⁶, for a substantial number of households and businesses DBCDE’s large scale NBN advertising took place years before the NBN is due to become available in their area. There would have been benefit in DBCDE assessing the cost-effectiveness of its proposed NBN campaigns to inform government decisions on the campaigns’ targeting, scale and timing.

36. The evaluation report for the regional NBN advertising campaign was finalised in July 2012. The evaluation noted improvements in understanding and attitudes against the majority of the campaign’s objectives. For example; understanding that the ‘NBN rollout is now underway prioritising regional Australia’ rose from 37 to 52 per cent as a result of the campaign; understanding that the ‘NBN will deliver high speed reliable broadband to all of Australia’ rose from 42 to 51 per cent; and the proportion of respondents who believed that ‘the NBN would bring a lot of benefits to my community’ rose from 47 to 49 per cent.

Chapter 4—Metropolitan National Broadband Network Advertising Campaign

37. DBCDE was tasked with delivering an NBN advertising campaign focused on the metropolitan areas of Australia, where access to the network is to be provided through optical fibre. The objectives of the campaign were to: increase understanding about the NBN; engage, inform and educate by explaining facts, dispelling myths and showcasing the benefits of the NBN; and direct people to further information about the NBN. DBCDE developed the first phase of the campaign within 11 weeks, drawing on its experience in developing the regional NBN campaign. The campaign ran from November 2012 to mid-January 2013.

38. DBCDE’s administration of the metropolitan NBN advertising campaign generally met the requirements of the campaign advertising framework. For this campaign, DBCDE improved its administration by: providing the ICC with sufficient and relevant evidence to verify factual statements used in the campaign; and assessing and refining the cost‑effectiveness of the proposed media buy.

39. As part of its review of the campaign, the ICC identified the need for additional testing of print materials, as the materials had generally tested poorly. Additional testing indicated relative improvement in the advertisements, but did not make it clear that the advertisements were engaging or expected to perform well against the objectives of the campaign (which is encouraged under the Guidelines). Following the initial use of the materials, DBCDE decided to discontinue their use, as they were underperforming relative to other media. In this respect, DBCDE’s monitoring of the effectiveness of the campaign materials enabled it to redirect some expenditure on print materials to a better performing media channel. The department’s experience demonstrates the value of creative concept testing as a means of indicating whether creative materials are engaging and performing well against campaign objectives.

40. The evaluation report for the first phase of the metropolitan campaign was completed in January 2013. After being provided with tailored descriptions of metropolitan NBN campaign advertisements for different media, 33 per cent of the respondents recalled having seen campaign advertisements on television, 17 per cent recalled hearing campaign advertisements on the radio, and nine per cent recalled seeing a campaign advertisement in the print media. The evaluation also measured changes in respondents’ attitudes towards key campaign messages, which had sought to clarify misperceptions about the NBN. For example, respondents’ agreement to the statement ‘the NBN is delivering fibre optic all the way to the home’ rose from 39 per cent before the campaign, to 47 per cent in the final week of the evaluation. In relation to the campaign objective to direct people to further information about the NBN, both the campaign and NBN Co websites saw a significant increase in site visits during the campaign.

Chapter 5—Commonwealth Funding of Victorian Hospitals Advertising Campaign

41. In October 2012, the Treasurer made two announcements which involved a downward revision in Commonwealth funding of health services. In Victoria, the revision amounted to $107 million for 2011–12 and 2012–13. The funding revision was the result of the application of a funding formula which had been agreed to by both the Australian and Victorian governments. The revision and its consequences for healthcare services were the focus of active debate between the Commonwealth and State Health Ministers, and generated extensive media coverage. In February 2013, the Australian Government announced it would provide $107 million in funding directly to Victorian Local Hospital Networks. DoHA was tasked with developing a print advertising campaign to follow the announcement of the funding. The campaign was developed in approximately three days, and ran in Victorian newspapers over two weekends.

42. Ministers are responsible for authorising campaign development in their portfolios and for authorising the launch of a campaign; and agencies remain responsible for campaigns, including compliance with the Guidelines. However, there was no documented approval of the advertisement by the Health Minister, the DoHA Secretary or a responsible departmental delegate.³⁷ In addition, DoHA made no direct representations to the Minister about the campaign’s compliance with the Guidelines in relevant briefings.³⁸ Staff in the offices of the Health Minister and Prime Minister were significantly involved in the campaign’s development, including actively contributing to drafting and editing the advertisement. This process led to the removal of contextual information from the advertisement, and clouded responsibility for the campaign’s development, even though this responsibility remained with the department.

43. The advertisement appeared in the context of an active and public debate between the Australian and Victorian governments over the October 2012 healthcare funding revision. Within this context, one of the four statements in the advertisement was not presented in an objective manner: ‘This [Injecting $107 million into Victorian hospitals] will reverse cuts made by the Victorian Government’. The statement attributed full responsibility for the consequences of the $107 million downward funding revision to the Victorian Government, when: the exact amount of funding to be provided to Victorian Local Hospital Networks was equal to the original Commonwealth funding revision; and the original revision was a consequence of the application of the funding formula agreed to by both the Australian and Victorian governments. The advertisement highlighted only one perspective—that the Victorian Government was responsible for the reduction in public hospital funding because it decided to pass on the revision in Commonwealth funding to Local Hospital Networks, rather than maintain the previous level of funding by replacing the $107 million through the use of own-source funds.

44. The advertisement contained no overt promotion of party political interests, and was therefore compliant with the main thrust of Principle 3 of the Guidelines. Nevertheless, there are likely to be a range of views about the campaign’s compliance with the spirit of the Principle, as the advertisement may be interpreted as directly attacking or scorning the policies or actions of ‘others’—in this case, aspects of the Victorian Government approach. The Guidelines have been framed in an Australian Government context and do not explicitly address campaign statements which refer to other governments. This is an area of the Guidelines that would benefit from further review in light of this campaign.

Chapter 6—Administration of the Campaign Advertising Framework

45. Finance has responded in a timely manner to the majority of recommendations and suggestions in the 2011–12 ANAO audit report on government advertising.³⁹ In particular, Finance’s publication of the Campaign Planning Guide⁴⁰ in September 2012 has assisted in clarifying administrative responsibilities under the Guidelines, and Finance has reviewed its chief executive certification template for alignment with the Guidelines. Finance has also actively participated in and supported the new Peer Review Group (PRG) process, contributing its experience in campaign advertising. In a similar fashion, Finance has provided sound advice to the ICC to support its review of the compliance of campaigns with Principles 1 through 4 of the Guidelines.

46. Overall, in its initial 15 months, the PRG has assisted agencies in developing their communication activities, and has provided a useful forum for sharing communications experience and building the capability of agencies and their staff. The ICC’s review of the HAP and NBN campaigns resulted in a range of improvements by the relevant departments to creative materials and supporting campaign documentation, thereby strengthening campaign compliance with the Guidelines. While there will always be scope for debate about the appropriate level of external involvement in agency campaigns, and the potential ‘compliance burden’ this may represent, the ANAO continued to observe, as in the previous audit, that there is benefit in third party scrutiny and advice for campaigns which are viewed as being more sensitive. From an agency perspective, the Commonwealth funding of Victorian hospitals advertising campaign highlighted the potential benefit in agencies seeking independent advice for more sensitive campaigns valued at less than $250 000 to inform their application of the Guidelines. For example, this may involve seeking advice from Finance or the ICC.⁴¹

Summary of agency responses

47. Extracts of the proposed report were provided to FaHCSIA, DBCDE, DoHA, Finance, the ICC, PM&C and NBN Co. FaHCSIA, DBCDE, DoHA, Finance, and NBN Co provided a formal response. Summary responses of the agencies subject to audit are provided below. The full responses of these agencies and NBN Co are provided at Appendix 1.

Department of Families, Housing, Community Services and Indigenous Affairs

48. The Auditor-General's report acknowledges that the HAP campaign was developed within challenging timeframes, and provided the Independent Communications Committee (ICC) with sufficient and relevant evidence to verify the factual statements used in the campaign. Accordingly the ICC's review found the campaign to be fully compliant with Principles 1-4 of the Guidelines on Information and Advertising Campaigns by Australian Government Departments and Agencies.

49. However, FaHCSIA has concerns about some of the issues raised and provides the following formal response.

• The report states there is not a strong link between the families kits and HAP. We strongly disagree with this statement. An overarching plan for communicating with families was developed because most of the target audience (families receiving Family Tax Benefit Part A) would be receiving a range of targeted payments in 2013. These included the Schoolkids Bonus, HAP, Dad and Partner Pay (DaPP) and Family Tax Benefit supplements. Some of the payments would be new, such as the Schoolkids Bonus, and the timing of some payments would overlap. For example, the second instalment of the Schoolkids Bonus coincides with the payment to eligible families of the Clean Energy Supplement as an ongoing entitlement forming part of the Clean Energy Future Household Assistance Package. With a range of payments being delivered to families, the Department identified a risk that they may become confused about the purpose of some payments or fear they have been overpaid. Developmental research highlighted the need for mass media communications to mitigate risk of confusion, as well as fulfil the information needs of the target audience.
• Development of the families kit was designed to provide information on each of the payments and to direct people to the families.gov.au website for further information. One of the inclusions in the kit, the 2013 calendar, contains four specific references to HAP payments. No specific materials were developed for the HAP campaign. However, the families webpage provides information about HAP and links to the HAP webpage. At the time of the ANAO audit (February 2013), the campaign was not active and did not feature prominently on the families.gov.au website as other campaigns were active at that time (DaPP, Schoolkids Bonus). Phase three of the HAP campaign launched in March 2013 and has featured prominently on the website since.
• Second, the report states several times that, as the link between HAP and carbon pricing was not mentioned in advertising, the public was not fully informed about the reason for government assistance. On this basis, ANAO finds that FaHCSIA 'generally implemented' the campaign in compliance with the Guidelines. Based on significant research, FaHCSIA took the decision to use channels (such as public relations and the website) other than advertising to contextualise HAP as part of the carbon pricing mechanism. This research indicated that simple messages about the detail of HAP, independent of references to and explanation about the carbon pricing mechanism, was the most effective way of increasing mass understanding and awareness (ie. the advertising treatment). However, this research also indicated that it was necessary to contextualise HAP in terms of the Clean Energy Future plan through activities other than advertising. Following review of the campaign on several occasions, the ICC found that the campaign conformed with Principles 1 to 4 of the Guidelines. In response to ANAO's assessment, FaHCSIA believes the campaign was fully implemented in compliance with the Guidelines.

Department of Broadband, Communications and the Digital Economy

50. The report does identify that the NBN campaigns were in market during a period of time where NBN Co. and retail service providers were advertising. The Department would reiterate that the extent of cross over in advertising was extremely limited and occurred through different communication channels. Government NBN advertising focused on overarching policy messaging and dispelling myths and misconceptions identified in developmental research conducted by Open Mind (2012). NBN Co. and RSPs, on the other hand, focused primarily on roll-out, migration and commercial imperatives. As noted in the report, DBCDE coordinated its activities with NBN Co. as required by the Government and supported by the ICC to ensure carefully targeted, complementary messaging.

Department of Health and Ageing

51. The 'Commonwealth Funding of Victorian Hospitals Advertising Campaign' was developed to address an issue of significant concern, specifically to inform residents of Victoria about the availability of public hospital services through changed Commonwealth funding arrangements.

Department of Finance and Deregulation

52. The Department of Finance and Deregulation (Finance) welcomes the ANAO's assessment that since the tabling of ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011, it has further strengthened its strategies and processes for supporting agencies in developing campaigns which meet the requirements of the Government's campaign advertising guidelines. Finance also welcomes the acknowledgement that its expertise in campaign advertising has been of benefit to the review processes of both the Independent Communications Committee (ICC) and to the Peer Review Group (which it co-chairs).

53. However, Finance does not concur with the ANAO's remarks in the Overall Conclusion section of report, specifically the suggestion that there is ‘ ... an emerging risk of campaign advertising not clearly meeting the enhanced expectations and arrangements established by the Government from 2008.’ While Finance notes the ANAO's view that the four campaigns included within the scope of the audit tended to push the boundaries of the Guidelines, it does not accept that there is strong evidence of emerging risks to the campaign framework as a whole.

54. Indeed, a key finding of the audit is that the ICC's reviews of campaigns ‘... resulted in a range of improvements by the responsible departments to campaign materials and supporting documentation, which led to the strengthening of each campaign's compliance with the 2010 Guidelines.’ Accordingly, the audit report tends to suggest that the independent review arrangements for advertising campaigns are operating as intended, including as a means to ensure that the responsible agencies are considering and adopting strategies to better demonstrate compliance with the Government's campaign advertising guidelines.

ANAO comment

55. The ANAO recognised in its overall conclusion to this report that where it applied, the ICC’s campaign review process together with the certification of campaigns by chief executives, led to the strengthening of the campaigns’ compliance with the Guidelines (refer to paragraph 20). However, one of the four campaigns reviewed by the ANAO was not subject to ICC review and chief executive certification. More broadly, across the campaigns reviewed there was a tendency to push the boundaries of the Guidelines in some areas, which draws attention to an emerging risk of campaign advertising not clearly meeting the enhanced expectations and arrangements established by the Government from 2008 (refer to paragraphs 28 and 29).

Recommendations

The ANAO has made two recommendations directed towards Finance: clarifying the application of an aspect of the Guidelines; and further strengthening the transparency of reporting on government advertising expenditure.

In addition, one recommendation of the 2011–12 ANAO audit report on government advertising remains relevant—that Finance provide guidance to agencies to clarify which parts of the Guidelines are mandatory and which are sound practice. Finance advised the ANAO that the clarity and interpretation of the Guidelines would be examined when the Government’s campaign advertising framework is next subject to review.

Footnotes

[1] Department of Finance and Deregulation, Campaign Planning Guide for Australian Government Departments and Agencies, September 2012, p. 51.

[2] Campaign advertising is defined as involving: ‘paid media placement and is designed to inform, educate, motivate or change behaviour’. Non-campaign advertising is defined as: ‘simple, informative advertising that generally appears only once or twice, contains factual statements and typically has a low creative content’. Source: Department of Finance and Deregulation, Guidelines on Information and Advertising Campaigns by Australian Government Departments and Agencies, March 2010, paragraphs 9 and 10.

[3] The total campaign advertising expenditure includes media placement costs, ‘consultants, services and other costs’ and GST. See paragraph 6.7 for further discussion. In 2011–12, media placement costs were reported by the Department of Finance and Deregulation to be $139.7 million, ‘consultants, services and other costs’ were $63.6 million, and GST costs were $20.3 million. Media placement costs for the 2012 calendar year were reported to be $111.9 million.

[4] Senate Finance and Public Administration References Committee, Government advertising and accountability, 2005, p. xiii.

[5] The arrangements were informed by recommendations of the Joint Committee of Public Accounts and Audit and a Senate Inquiry. See ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011, paragraph 3.

[6] ANAO Report No.2, 2009–10, Campaign Advertising Review 2008–09, p. 9.

[7] The review of a proposed advertising campaign’s compliance, undertaken by the ANAO as the basis for the Auditor‑General’s report, was designed to provide limited assurance in accordance with the relevant Australian Standard on Assurance Engagements. The limited assurance approach was designed to ensure sufficient appropriate evidence was obtained to enable an assurance conclusion to be formed in relation to an advertising campaign’s compliance with the Guidelines.

[8] ANAO Report No.38, 2009–10, Campaign Advertising Review July 2009–March 2010, provides further background on the changes.

[9] The five principles are expanded in 18 sub-paragraphs which, as observed in a previous ANAO audit, contain a mix of mandatory and sound practice requirements. See ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011, Chapter 2.

[10] For campaigns of less than $250 000, chief executives can request ICC advice. Further, the 2010 Guidelines make provision for the Special Minister of State to exempt campaigns from their operation on the basis of a national emergency, extreme urgency or other compelling reason. Finance has advised that a total of three exemptions have been agreed—two in 2009 and one in 2010.

[11] ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011. Further, the ANAO reviewed the Swap It, Don’t Stop It advertising campaign in the context of Audit Report No.12, 2012–13, Administration of Commonwealth Responsibilities under the National Partnership Agreement on Preventive Health.

[12] DCCEE planned an advertising campaign for the second phase of the Clean Energy Future plan, of which communications about the HAP was to be a component. The Government decided not to proceed with the campaign, and instead approved a campaign specifically relating to the HAP. This audit considered the approval of the HAP campaign and DCCEE’s progress in response to a recommendation of the ANAO’s previous report. In machinery of government changes announced on 26 March 2013, the functions of DCCEE were allocated to other departments.

[13] A 2009–10 ANAO audit report noted that: ‘It is apparent that while the March 2010 Guidelines provide a greater level of specificity in some areas, other areas are less specific than before. This is particularly so in the case of Principle 1, which provides a broader scope in determining the suitable uses of government advertising campaigns, Principle 3, which provides less guidance in interpreting whether campaign materials promote party political interests, and Principle 4, which no longer requires a cost‐benefit analysis to support the proposed campaign. As previously indicated to the Government, these changes represent a general softening in the application of requirements on agencies. Nevertheless, these are matters that rest with Government for decision’. Source: ANAO, Audit Report No.38, 2009–10, Campaign Advertising Review July 2009 – March 2010, p. 15.

[14] The campaign advertising Guidelines operate in the context of the Australian Government’s wider financial management framework.

[15] The advertisements directed viewers to the campaign website which linked the HAP to the carbon price, and provided a link to a related website.

[16] Finance, Guidelines on Information and Advertising Campaigns by Australian Government Departments and Agencies, March 2010, paragraph 8(a).

[17] In response to ANAO inquiries, Finance advised that it was not aware of a similar case since the introduction of the current campaign advertising framework in 2008.

[18] NBN Co, 2012 Annual Report, pp. 25 and 26.

[19] DBCDE advised the ICC that: ‘A failure to communicate more accurate information to the Australian public on the NBN would result in a continuation of … misunderstandings and misconceptions which will ultimately leave Australians exposed with little understanding and less likely to opt in or experience the personal, commercial and community benefits of the NBN in coming years. Overwhelmingly, the research found that re-engaging the public with the NBN initiative and tangible benefits would decrease misconceptions and ensure consumers were more accurately informed about this policy initiative and able to take appropriate action when it rolls out in their area.’ DBCDE, Statement of Compliance against the Information and Advertising Principles, signed 23 April 2012, p. 10.

[20] For example: the objectives of DBCDE’s metropolitan NBN advertising campaign included to ‘build and maintain visibility by showing the personal, business, community and national benefits of connecting to the NBN’, and to ‘direct people to where they can get more information about how and when they can get connected (call to action)’; and NBN Co’s communications seek to promote the potential benefits of NBN services and to inform people about how to connect to the network when it is available in their area.

[21] A March 2012 update of the Cabinet Handbook included a requirement that proposals for information campaigns include justification of the cost-effectiveness of the campaign. The proposal for the metropolitan NBN campaign was considered by Ministers following this update. For further discussion on cost-effectiveness and advertising campaigns, see ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011, pp. 69–77.

[22] DoHA’s Commonwealth funding of Victorian hospitals advertising campaign was not subject to the certification process as it was valued at less than $250 000, and the department did not exercise its discretion, under paragraph 6 of the Guidelines, to request ICC advice.

[23] DoHA had corresponded with the Health Minister’s office and the Prime Minister’s office, and relevant office staff had indicated their agreement to the advertisement. DoHA advised the ANAO that it was the department’s ‘clear understanding that the Minister's office was providing the Minister's approval to us’. DoHA advice to ANAO, 2 May 2013.

[24] While DoHA advised that it was not practicable to document compliance in the limited time available for development—a total of three days—there was scope to do so subsequently but this had not occurred at the time of preparation of this report.

[25] A local hospital network is an organisation that provides public hospital services in accordance with the National Health Reform Agreement. A local hospital network can contain one or more hospitals, and is usually defined as a business group, geographical area or community. Every Australian public hospital is part of a local hospital network.

[26] Paragraph 28(b) of Principle 3 provides that: ‘campaign materials must not directly attack or scorn the views, policies or actions of others such as the policies and opinions of opposition parties or groups’.

[27] Finance indicated that this recommendation would be considered as part of the planned March 2012 review of the framework, however, a decision about the conduct of this review has been delayed until at least September 2013.

[28] The audit also examined promotional materials for the regional NBN advertising campaign.

[29] While the families kits contained brochures on Dad and Partner Pay and the Schoolkids Bonus, they did not contain similar specific information on the HAP.

[30] Refer to paragraph 5, see underlying principles (a) and (b).

[31] Senator the Hon John Faulkner and the Hon Lindsay Tanner MP, Joint Media Release, New Advertising Guidelines, 2 July 2008, p. 1.

[32] The first phase of the campaign was examined in ANAO Audit Report No.24, 2011–12, Administration of Government Advertising Arrangements: March 2010 to August 2011, Chapter 8.

[33] See for example: Sydney Morning Herald, Carbon ads don’t tax the viewer; 14 May 2012, and The Australian, Shhh … don't mention the carbon tax: government's compo ads omit mention of the measure, 14 May 2012.

[34] The Master Media Agency is part of the Australian Government’s Central Advertising System (CAS), which consolidates government advertising expenditure to secure optimal media discounts on Commonwealth-wide media rates. Under the CAS, the responsible Master Media Agency assists in media planning, placement and rates negotiations with media outlets.

[35] In this regard, Finance’s September 2012 Campaign Planning Guide states that: ‘Financial delegates should treat the approval of [a Media Booking Authority] in the same way as they would treat any other spending proposal. That is, the delegate must be satisfied that the spending proposal would be a proper use of Commonwealth resources. To demonstrate this, you need to clearly document the process undertaken to select the recommended media channels and the volume/cost of advertising’, p. 60.

As discussed in Chapter 4, the department improved this aspect of its administration for the metropolitan NBN campaign.

[36] Refer to the NBN Co website for details of the NBN rollout schedule, available at: <http://www.nbnco.com.au/when-do-i-get-it/index.html>, [accessed 9 June 2013].

[37] DoHA had corresponded with the Health Minister’s office and the Prime Minister’s office, and relevant office staff had indicated their agreement to the advertisement. DoHA advised the ANAO that it was the department’s ‘clear understanding that the Minister's office was providing the Minister's approval to us’. DoHA advice to ANAO, 2 May 2013.

[38] DoHA referred to the Guidelines in a covering email to a member of the Minister’s office in which a copy of the brief seeking financial approval to conduct the campaign was included. DoHA specifically noted: ‘It is important that the advertising content remains consistent with the principle of the Australian Government Advertising Campaign Guidelines (ie. strictly factual, etc)’. The relevant DoHA officer advised the ANAO that: ‘In addition to face to face discussions with staff from the Minister's office, where I discussed the requirements of the Advertising Guidelines, I also discussed the Guidelines over the phone, and clearly in the email providing the Minute seeking expenditure approval’.

[39] In addition, the 2011–12 ANAO audit report (paragraphs 2.32–2.34) noted that the 2010 review of the campaign advertising framework recommended that information regarding the cost‐effectiveness of proposed campaigns be mandatory at the initial approval stage (with the Cabinet Handbook revised accordingly). At the time of that audit, PM&C advised that an updated draft of the Cabinet Handbook reflecting the recommendation was before the Government for consideration. The March 2012 edition of the Cabinet Handbook includes the requirement that proposals for information campaigns include justification of the cost-effectiveness of the campaign.

[40] Department of Finance and Deregulation, Campaign Planning Guide for Australian Government Departments and Agencies, September 2012, p. 51.

[41] As previously noted, agency chief executives have the discretion to seek consideration of these campaigns by the ICC.