Even recommendations not immediately acted upon were taken seriously by government entities, Auditor General Charles Deguara said.
The National Audit Office recently conducted its second review of the implementation of recommendations made in a selection of its audits. It found that 47 per cent were fully implemented, partial action was taken in 38 per cent of the cases and there were no developments at all or little progress in 15 per cent of the audits made.
“This is the beginning. If you were to ask me whether I am happy with 80+ per cent of the recommendations that are being tackled, I would say no. We need to improve,” Mr Deguara said.
Because the idea of doing follow-ups is rather new in the world of audit offices, not all of his counterparts internationally have started to do so. And this also means there are no benchmarks against which the Malta audit office can measure itself.
Mr Deguara said that while some of his counterparts reported better uptake, others fared worse.
“Some have 90 per cent implementation. We can only be happy when we say that there is no room for improvement, which can never be the case because we are all human,” he admitted.
“On the whole, it would seem we are on the right track. But if you came back in five years’ time and the implementation rate would be the same, then I would describe that as a disaster. Hopefully, it would not be the case.”
The NAO’s main objective is to provide assurance to Parliament and to citizens that government departments and entities are using their funds well and according to regulations. It takes a detailed snapshot of the situation to assess whether there are any shortcomings, making appropriate recommendations.
“An audit office is only as effective as the uptake of its recommendations. If nothing is taken on board, then the work we do is useless,” Mr Deguara remarked.
The idea of following up on the NAO reports originated from the government side: three years ago, it drew up a governance report, put together by the government’s own Internal Audit Unit, which it is now being published on an annual basis.
We can only be happy when we say that there is no room for improvement
However, the governance report is limited to the financial and compliance audits and annual report and not the full spectrum of the NAO’s output, which includes performance and IT audits as well as investigations.
When the NAO came to do the follow-ups, the choice of audits from the past three categories was not completely random. Mr Deguara said they deliberately chose reports that had a certain importance and relevance to the public.
“One of the most significant audits we did – as indicated also by the extent of media coverage – dealt with primary healthcare, which affects the lives of many ordinary people. We also wanted to review audits that dealt with education and the environment,” he said.
He was quick to point out that the recommendations being tackled were not the quick-wins with the more substantial ones being left till last.
“There were some very tough recommendations which they have already implemented. However, there are also some recommendations which depend on other entities: in this case, for example, the new functions we suggested would need adequate financing, which is the prerogative of the Finance Ministry,” he said.
“All the Health Ministry can do is to make a strong case.”
The NAO can only recommend action; it cannot insist on it. In some cases, Parliament’s Public Accounts Committee takes up the cause, summoning the respective entities to scrutinise their activities. But, in the end, whether the re-commendations are taken up on not depends on the entity itself.
“The best analogy is that of a doctor. He or she could do tests and make a diagnosis when the patient is sick. But when they prescribe pills, it is up to the patient whether to take them or not,” he pointed out.
Asked whether the NAO found resistance from civil servants or ministers, he said one had to distinguish between the responsibilities.
“The politician is elected to carry out the mandate of the party in government and set the policy direction.
“The executive, on the other hand, is responsible for getting there. So one has to see whether the issue is the political direction or the implementation. In our case, we concentrate on the implementation, on how they are put into practice because we cannot comment on political policies, which are the prerogative of the government of the day,” the auditor general noted.
The shortcomings are often down to genuine oversights or negligence but sometimes the findings are more sinister.
The NAO’s remit is to assess good governance, not look for corruption, but when it does come across suspicious activity, it is in duty bound to write to the permanent secretary involved and inform him/her there are strong suspicions of wrongdoing. It is then up to them to decide whether to set up an internal inquiry board or go to the police.
This part of their assessment is not made public but Mr Deguara clearly sees it as an important corollary of their work.
“Do you know who the patron saint of auditors is? St Thomas. That is so apt as we do not just take things at face value but we probe and ask more questions,” he said.