The Official Secretary, in his role as Chief Executive Officer, is responsible for managing the Office in a way that promotes the proper use of Commonwealth resources while achieving high-quality outcomes. Details of this role and the key elements of the governance framework that applies to the Official Secretary are specified in the Financial Management and Accountability Act 1997. The Official Secretary fulfils this role through a range of management processes, including by chairing fortnightly Management Committee meetings (involving the Official Secretary and the heads of the Executive Support, Honours Secretariat and Corporate Management branches) and chairing meetings of the Office's Audit Committee, which are held three times each year.

As shown in Figure 1, the Office is structured into three functional branches that have responsibility for executive support and the household, corporate management and property, and administration of the Australian honours system. Branch managers are responsible for establishing operational priorities within the Office's business plan, using resources efficiently and effectively to achieve agreed outcomes, and monitoring and reporting on team and individual performance through the Office's performance support framework.

In May 2004 the former position of Deputy Official Secretary was re-established to provide policy support to the Official Secretary and manage the day-to-day operations of the Executive Support, Honours Secretariat and Corporate Management branches. At the end of the reporting period, recruitment action to staff the new position was continuing

Corporate Management Branch supports the Official Secretary's overall governance responsibilities by facilitating the development of business plans; establishing policy and accountability frameworks; managing risk, fraud and security planning; setting frameworks for and advising on people management issues; managing industrial relations issues; and overseeing the total budget management of the Office. The branch also manages the two official residences and coordinates physical security services.

The Audit Committee endorses the annual audit programme for the Office, considers the recommendations contained in individual reports, and monitors the implementation of any changes in policies and practices flowing from such recommendations. The committee also receives and approves the Office's annual financial statements and associated audit report.

The Office has a Workplace Consultative Committee, chaired by the corporate manager, and with elected staff representatives from each functional area of the Office, which provides a forum for consulting on pay and employment conditions and for monitoring the implementation of employment policies and practices. The Office also has an Occupational Health and Safety Committee, chaired by the corporate manager, which meets quarterly to monitor health and safety issues.

The Office's Audit Committee comprises the Official Secretary, as chairman, the corporate manager, and one other branch manager on rotation. Representatives of the Australian National Audit Office (ANAO) and the Office's internal audit contractors, WalterTurnbull, also attend committee meetings as observers. The Audit Committee met three times in 2003-04. Matters discussed included: internal audit activity and findings; reports on progress with actions identified in the risk, fraud and security operational plans; redrafted chief executive instructions (CEIs) and financial procedures; asset revaluations undertaken; and ANAO financial statement and audit findings. The committee endorsed the 2004-05 Internal Audit Plan at its June 2004 meeting.

The Office has a contract with WalterTurnbull to provide internal audit services until 30 June 2005. In accordance with the agreed audit programme, WalterTurnbull conducted reviews into the following areas during 2003-04:

The assurance audit noted that some 59 recommendations had been made from the eight audits conducted and that 45 of those recommendations had, to date, been satisfactorily implemented. As at the end of the reporting period, work was continuing on addressing the remaining recommendations.

The performance audits raised a number of issues for the Office to consider. The review of the correspondence and registry systems concluded that there was a need to develop a documented policy and that the software being used should be upgraded to better support the needs of the Office. The Office will be undertaking a comprehensive reassessment of its information management requirements and will then consider the most appropriate systems to support that framework. It is expected that the review will be complete by the end of 2004. The audits in other areas did not identify any areas of major concern.

In August 2004 the Auditor-General's Office provided an unqualified audit opinion on the Office's 2003-04 financial statements. The Office was not the subject of any agency-specific audits, investigations or reviews during the financial year.

Standards of appropriate behaviour for employees of the Office are set out in the Office's code of conduct, which was endorsed in its 2002-05 certified agreement, as well as in the previous agreements. The code of conduct reflects the Australian Public Service Code of Conduct and Values as set out in the Public Service Act 1999. To ensure that staff are aware of the standards, the certified agreement is made readily accessible on the Office's intranet. New starters with the Office are required to sign a statement saying that they have read and understand the Office's code of conduct.

Financial management and accountability requirements for the Office are laid down in CEIs, which are issued by the Official Secretary under the Financial Management and Accountability Act 1997. The CEIs are cross-referenced to relevant parts of the Act to ensure that authorised staff are fully aware of their legal obligations. The CEIs for the Office are available to all staff on the Office's intranet.

In 2003, in response to the Government's request that all agencies develop an environmental management system, the Office established a formal management system to allow the Office to identify and manage environmental risks and improve environmental performance. An Environmental Management Committee has been established to oversight the operation of the system and to increase staff members' awareness of what they can do to help improve the Office's management of its environment.

An environmental audit was conducted in 2003 at both Government House in Canberra and Admiralty House in Sydney. The audit found a high level of awareness and commitment to environmental management across the Office.

One of the major environmental issues identified during the audit was the presence of unused underground fuel storage tanks at both residences. By the end of the reporting period the Office had removed both these tanks. Other recommendations from the audit will be progressively implemented over the coming twelve months.

During the course of investigations the Office found an underground water tank at Admiralty House that had been built in the 1850s and had not been used for quite some time. The Office subsequently had the tank checked by engineers, who found that it was well built and able to be used. The tank was cleaned of over one metre of accumulated debris and a new pump was purchased and installed. Provided rainfall is adequate, the water collected in the tank is now available for the watering of the gardens and lawns. The irrigation system fed by the tank was extended into further garden beds to make the best use of this resource. The tank can hold around 124 000 litres of water and is fed by a piping system that collects rainwater from the roof of Admiralty House.

A new position of information technology manager was established and staffed in January 2004 in order to meet increasing demands on the Office's information technology systems and to better utilise the technology to enhance the efficiency and effectiveness of the Office's operations. This doubled the resources available for information technology support of the Office and has resulted in more assurance in help desk support and project delivery.

In accordance with the Office's Technology Strategic Plan 2003-06, a number of projects were undertaken to enhance the Office's information technology and communications infrastructure. These projects included the following:

In the 2004-05 Budget, the Office was successful in obtaining increased ongoing funding to contribute to the upgrading of the information systems that support the honours and awards business processes. This will better enable the Office to meet the increased workloads in this area. The Office will contribute $600 000 from its cash reserves towards the cost of the development and implementation of new software to support business processes, reporting and analysis, and for the web enabling of some information and nomination processes. It is expected that the new system will be operational by the end of the financial year.

In January 2003 the Office conducted a review of its risk, fraud and security plans. The plans, integral components of the Office's operating environment, are linked to the Office's Business Plan. The Office's Management Committee endorsed action plans for 2003-04 that identified areas for improvement in the risk, fraud and security environment of the Office. Performance against the action plans was reviewed on a quarterly basis and at the end of the financial year by the Office's Audit Committee and Management Committee. Considerable achievements were made against the plans.

In July 2004 the Office commissioned WalterTurnbull to undertake a review of the Office's risk, fraud and security environments and to prepare a three-year strategic plan in each of these areas. An action plan for the implementation of recommendations is also being prepared. The assignment includes the conduct of awareness-raising workshops with staff. All new staff are made aware of their responsibilities in relation to fraud and security through the Office's induction programme.

Consistent with the updating of the CEIs, the Office has updated its policy and procedural statements for risk, fraud and security and prepared an explanatory brochure for staff. The updated policy and procedures will be tabled for consideration at the next Audit Committee meeting.

The Office has complied with the requirements of the Commonwealth Fraud Control Guidelines through preparing fraud risk assessments and fraud control plans, and through developing procedures and processes for the detection, investigation and reporting of fraud.

Significant achievements

The Office recorded a number of significant achievements in the management of human resources during the 2003-04 financial year, including:

Senior executive remuneration

The Office employed no senior executive service (or equivalent level) officers during the financial year. The remuneration of the Official Secretary is determined by the Remuneration Tribunal.

Remuneration arrangements

The remuneration arrangements for staff are set out in the Office of the Official Secretary to the Governor-General Certified Agreement 2002-05. At 30 June 2004, 83 staff were covered by the certified agreement, and there were five Australian workplace agreements in place. The Office's certified agreement does not provide for the payment of bonuses under performance-based pay arrangements.

Staffing changes and statistics

In 2003-04 the average staffing level for the Office was 76.3, slightly lower than the budget estimate of 79.6. During the year there were 20 commencements (seven on short-term contract) and 30 cessations. The number of cessations was a 7.6 per cent increase on the previous financial year and was mainly due to a number of staff resigning to take up offers of employment in other organisations. The rate of turnover is somewhat higher than in other agencies but reflects, in addition to normal attrition cycles, the contract employment arrangements under which the Office operates, the need for specialist skills or expertise for defined periods, and the replacement of staff due to extended periods of leave.

The Office's staffing statistics, including information on gender, part-time and full-time employment and classification levels, as well as information provided in accordance with workplace diversity principles, are in Appendix F.

Developing staff

In May 2004 the Office conducted a two-day middle management workshop for staff with supervisory and management responsibilities. This was the first time such a workshop was conducted, and staff who attended acknowledged the benefits of the material presented and the opportunity to network with their colleagues. A programme of further human resource and financial management workshops and information sessions is being developed to assist in raising the awareness and broadening the knowledge and skills of this important group within the Office.

During the year, training opportunities provided to staff included a variety of management training courses, leadership skills training for women, procurement and contract management training, a range of specialist training workshops and seminars, fire safety training, first aid training, and attendance at a turf management seminar for the gardening staff.

The broad range of training and development opportunities provided was aimed at improving staff skills and knowledge of their duties and providing for personal growth. The training and development that was provided was effective in meeting the needs of a range of staff.

Details of staff training and expenditure by employment category are provided in Table 7.

The Office engages consultants mainly to provide professional and specialist services for building works and architectural services, administrative projects, information technology support and systems development, and to facilitate organisational change and management reforms.

In selecting and engaging consultants, the Office balances the need for open and effective competition with the need to use procurement methods that are cost-effective and efficient. Value for money is always a primary consideration when selecting a consultant. The Office takes advice from the Official Establishments Trust in relation to the choice of appropriately qualified consultants for the provision of professional services for the conservation and development of buildings and grounds.

In general, for projects with a value between $2000 and $25 000, the Office directly approaches a group of known suppliers in the market and consults with other relevant government agencies or professional bodies to develop short lists of consultants. Consultancy projects with a value of more than $25 000 usually involve requests for tenders or invitations to register interest.

Nine consultants were engaged in 2003-04. The total amount paid by the Office for consultancy services was $209 277, a decrease from expenditure of $235 975 in 2002-03.

Details of new consultancy contracts awarded in 2002-03 with a value of $10 000 or more are provided in Appendix G. Details of contracts awarded with a value greater than $100 000 are shown on the Office's website, www.gg.gov.au, in accordance with guidelines issued by the Department of Finance and Administration.

In addition to these consultancies, the Office has ongoing contracts to provide a wide range of contractor services, including in the areas of internal audit, payroll support, and property maintenance and minor works.

Purchasing activities within the Office were conducted in accordance with the Commonwealth Procurement Guidelines and the Office's CEIs. The CEIs were updated and reissued in June 2004, together with new delegations to authorise staff to undertake actions under the Financial Management and Accountability Act 1977. Financial Management Guidelines were also prepared and issued. Collectively, these measures have established a sound framework for the financial operations of the Office.

The Office engaged consultants in January 2004 to conduct a series of purchasing workshops for staff. Twenty-six staff attended the workshops, which ranged from an introduction to simple procurement to advanced purchasing and contracting. The workshops addressed basic purchasing requirements, risk management, Commonwealth Procurement Guidelines, ethics and probity, insurance, tendering, negotiation and performance management.

A number of standing contract arrangements were established in 2003-04 to provide for the supply of printed corporate stationery, and the provision of electrical, plumbing and painting services for Government House.

In accordance with the Office's accounting policy, a number of revaluations of assets were undertaken in 2003-04, involving the household tableware, Rolls Royce motor vehicle and gardening equipment. The Office's valuation policy is outlined in the notes to and the financial statements. In accordance with the Office's assets policy, items with a value greater than $3000 are capitalised.

In 2003-04, a total of $239 957 was spent on items of equipment and motor vehicles that each had an individual value greater than $3000. Significant outlays included $41 670 for gardening equipment, $155 793 for the purchase of replacement motor vehicles, and $37 289 for computer hardware and office machines. An amount of $103 239 was spent on administered assets, other than building works, including $84 929 on infrastructure items and $18 310 on furniture, furnishings and household equipment.

In the context of the Commonwealth Disability Strategy, the Office's main responsibility as an employer is to provide an appropriate workplace and policies. In this regard the Office is an equal opportunity employer. Recruitment information is provided through newspaper advertisements and on the Office's website, and applications can be made online. Special needs of applicants are catered for on request. As human resource management policies are reviewed, the inclusion of the requirements of the Disability Discrimination Act 1992 will be taken into account.

In respect of the Australian Honours and Awards System, Secretariat staff can assist people with disabilities to make nominations as the need arises. The Office has developed a number of brochures providing information on the range of honours and awards that may be granted and how to make a nomination. This information is also available on the Office's website and on the website of the Department of the Prime Minister and Cabinet. The Secretariat may be contacted by telephone on 1800 552 275 to request nomination material.

The Office's occupational health and safety (OH&S) policy aims to provide a safe working environment to protect the health and wellbeing of its employees and contractors from accidents, injury or illness arising in the workplace. The Office's OH&S Committee, which is made up of representatives from each workgroup at Government House and Admiralty House, monitors this policy. Staff-elected representatives to the committee undertake an accredited health and safety practitioner's course. The health and safety of staff remains a high priority for the Office.

The OH&S Committee met four times during the year and discussed issues including the testing of microwave ovens and other electrical appliances, the implementation of an environmental management system, action towards finalising the 2002 Comcare 'planned investigation' recommendations, workstation assessments, a range of new OH&S policies and practices, and feedback on hazard and injury reports.

A programme of flu vaccinations was again offered to all staff under the Office's health and welfare programme, with some 35 people taking up the offer. Workstation assessments continued to be conducted for new employees on their commencement at the Office and for employees who changed their physical location. During the year approximately 30 such assessments were conducted and appropriate action was taken to ensure the wellbeing of office-based staff.

During the year, work continued on the implementation of Comcare's recommendations, resulting from its planned investigation of October 2002. This included finalisation of a system of reporting incidents to Comcare and the development of an induction programme for new staff that includes information on the Office's health and safety policy and procedures. The first of the regular induction courses for new staff was conducted in April 2004.

In addressing Comcare's recommendations, the OH&S Committee endorsed the following policies and processes: Work Practices for Screen Based Equipment; Work Practices for Hazardous Chemicals; Work Practices for Manual Handling; Hazard Inspection Plan and Process; Isolation and Tagging of Plant; and Electrical Cable Tagging Procedures.

Section 8 of the Freedom of Information Act 1982 (FOI Act) requires each Commonwealth agency to publish information about the way it is organised and its functions, powers and arrangements for public participation in its work. Each agency must also provide details of documents that it holds and how members of the public can gain access to them.

Special arrangements apply to the Office. Section 6A of the Freedom of Information Act 1982 includes the following provisions:

The FOI Act does not apply to documents of the Council for the Order of Australia or the Australian Bravery Decorations Council, both of which were established by Letters Patent.

Four FOI Act requests for information were received during 2003-04. Two requests were denied because the matters were exempt under the FOI Act and the application fees were retained. One request was transferred to another agency and the application fee forwarded to that agency. One request was denied in part and the applicant advised of the fee payable for the release of documents for the second part of the information requested. At the end of the reporting period this fee had not been received.

The Office also received one request, transferred from another agency, under the New South Wales FOI Act. Information on the matters raised was provided and the application fee accepted.

There were no FOI requests outstanding at the end of the reporting period.

Further information in relation to the operation of the FOI Act is in Appendix H.

This report is provided in accordance with section 516A of the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act).

Schedule 3 of the EPBC Act provided for the Minister for the Environment and Heritage to include Commonwealth places that were in the Register of the National Estate at 31 December 2003 in the Commonwealth Heritage List. In June 2004, the Minister for the Environment and Heritage determined that Government House, Canberra, and Admiralty House, Sydney, would be included in the Commonwealth Heritage List, as Commonwealth owned or controlled places with significant heritage value.

The listing of Government House and Admiralty House, which the Office manages, places a number of obligations on the Office to protect the heritage value of the properties. The Office will be required within two years to develop heritage strategies, establish inventories of items of heritage significance and develop management plans. The heritage strategies are required to be reviewed every three years.

Over the past decade, the Office has developed a number of conservation management plans for the residences and associated landscapes and is therefore well placed to develop the specific plans required under the new legislative framework. Heritage architects are used for the development of plans and to assist with the management of the properties. The Official Establishments Trust also advises on the development and management of the properties.

It is expected that the Office will have its heritage strategy developed and given to the Minister for the Environment and Heritage for consideration by the end of 2004.

During the financial year, the Office placed recruitment advertisements with an aggregate value of $43 508 through its advertising provider, hma Blaze. No other advertisements were placed and no market research was conducted.

The Office neither made nor administered any discretionary grants during the financial year.