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Request for audit
Underwriting New Generation Investment (UNGI) program
Response provided
Responded: Friday 24 July 2020
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The Auditor-General responded on 12 May 2020 to correspondence from Ms Zali Steggall OAM, MP dated 23 April 2020, requesting that the Auditor-General consider an audit of the Australian Government’s Underwriting New Generation Investment (UNGI) program. The Auditor-General provided a follow-up response to Ms Steggall OAM, MP on 24 July 2020.
Auditor-General's follow-up response
24 July 2020
Ms Zali Steggall OAM, MP
Federal Member for Warringah, NSW
By email: zali.steggall.MP@aph.gov.au
Dear Ms Steggall
In response to your request of 23 April 2020 I wrote to you on 12 May noting that I had included a potential performance audit topic on the Underwriting New Generation Investment (UNGI) program in the Australian National Audit Offices (ANAO’s) draft 2020-21 Annual Audit Work Program (AAWP). The AAWP has since been finalised and I am writing to inform you that a potential audit topic on the UNGI program is included in the final AAWP.
The AAWP is available from the ANAO’s website at https://www.anao.gov.au/work-program.
It should be noted that the composition of the audit program may change as more detailed planning is undertaken or as other issues emerge or priorities identified over the course of the year. I also intend to undertake further consideration of COVID-19 related topics as the government response to this pandemic is implemented.
Yours sincerely
Grant Hehir
Auditor-General's response
12 May 2020
Ms Zali Steggall OAM, MP
Federal Member for Warringah, NSW
By email: zali.steggall.MP@aph.gov.au
Dear Ms Steggall
Thank you for your correspondence of 23 April 2020 requesting I consider an audit of the Australian Government’s Underwriting New Generation Investment (UNGI) program.
Following a risk assessment, a review of past audit topics undertaken, areas of broader parliamentary interest and consideration of the value of different programs and investments, the Australian National Audit Office (ANAO) has developed a draft annual audit work program (AAWP) for 2020-21. Based on this, I have considered the UNGI program and have included it as a potential audit topic in the draft AAWP.
Consistent with the requirement that I have regard to the audit priorities of the Parliament, the draft 2020-21 AAWP, including an update on the ANAO’s COVID-19 audit approach, has been provided to the Parliament for consultation through the Joint Committee of Public Accounts and Audit (JCPAA). The draft AAWP is currently available on the ANAO website for public consultation and can be accessed here: https://www.anao.gov.au/work-program/draft. Following the ANAO’s consideration of feedback on the draft work program from the JCPAA, accountable authorities of Australian Government entities and the public, the 2020-21 AAWP is expected to be published on the ANAO website in July 2020.
Yours sincerely
Grant Hehir
Auditor-General
Correspondence from Ms Zali Steggall OAM, MP
Transcript of letter from Ms Zali Steggall OAM, MP
Mr Grant Hehir
Auditor-General
Australian National Audit Office
Barton ACT 2600
Dear Mr Hehir,
I am writing to encourage you to consider an audit of the Australian Government’s Underwriting New Generation Investment (UNGI) program as a matter of priority.
In this current context, where the public is focussed on the immediate crisis of COVID-19, it is imperative that the Government operate with integrity and accountability in managing essential services such as electricity. The UNGI program and its potential impact to the power sector, raise many concerns worthy of your attention.
UNGI proposes to provide public financial support to new dispatchable electricity generation, with the stated goal of increasing competition in the electricity market. Support might be offered through loans, grants, guarantees or other financial mechanisms.
The Australia Institute has researched the UNGI program and identified that as of March 2020:
- there is no constitutional or legislative authority for the UNGI program,
- there are no guidelines and criteria for assessment of support, and
- program development and implementation are following no clear process.
Despite these issues, the government has already shortlisted projects, made initial agreements, advanced detailed negotiations with proponents, and entered an MOU with the NSW government to support projects under UNGI.
Detailed information is available in attached Australia Institute research brief.
The lack of transparency around the implementation of UNGI is concerning, especially in light of the recent ANAO audit into the Community Sport Infrastructure Program. Your investigation of this matter would be beneficial to the national interest.
Sincerely,
Zali Steggall, OAM MP
Federal Member for Warringah