An audit of a support program for telecommunications companies required to keep records of customer usage for security reasons has found the program was not “fully effective”.
In his report, Administration of the Data Retention Industry Grants Program, Auditor-General, Grant Hehir found that although the program was intended to meet 50 per cent of the telcos’ costs in complying with the data retention laws, it exceeded that limit due to poor design and implementation.
Mr Hehir said the audit’s objective was to assess the effectiveness of the Attorney-General’s Department’s design of the program, including performance monitoring, reporting, evaluation and assurance arrangements.
“In April 2015 the Government decided to establish a demand-driven grants program that would fund 50 per cent of the mid-point of an estimate of industry’s capital cost of implementing a mandatory data retention regime,” Mr Hehir said.
“The program was intended to make a one-off contribution towards existing service providers’ costs in adjusting to meet the new obligations.
“The program had a budget of $131.3 million.”
He said program guidelines were issued in December 2015 and 210 applications were received. After vetting, 180 grants totalling $128.4 million were awarded.
Mr Hehir said the Attorney-General’s Department was responsible for the design and implementation of the program assisted by the Business Grants Hub in the Department of Industry, Innovation and Science.
“The design of the (program) by the Attorney-General’s Department was not fully effective,” he said.
“In aggregate the Department has funded 79 per cent of provider costs, substantially above the 50 per cent level identified as reasonable when the decision was taken to establish the program.”
He said some providers had all their costs paid for by the Government.
“The design of the program exposed the Australian Government to the risk that it would make a more generous contribution than the 50 per cent of total industry costs the Government had considered reasonable. This risk was realized,” Mr Hehir said.
The Auditor-General’s 57-page report can be accessed at this PS News link and the audit team was Hannah Conway, Amanda Reynolds and Brian Boyd.
