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  • Efficient administrative practices

    The ATO is responsible for the management of substantial Commonwealth funds and must be able to demonstrate sound financial management that accords with the Australian Government’s policies – including open and transparent transactions – and meeting the requirements of other agencies, such as the ANAO.


    Procurement and contract management has been undertaken in accordance with the Public Governance, Performance and Accountability Act 2013 and the Commonwealth Procurement Rules. Our focus is on delivering outcomes that align to the changing nature of the organisation, working across government and pursuing continuous improvement in our procurement and contract management practices and processes.

    The ATO supports small business participation in the Commonwealth Government procurement market. For example, over 50% ($9.6 million) of contract value on base building procurement for the new Gosford office has been awarded to local businesses. Small-to-medium enterprises and small enterprise participation statistics are available at Link. The Australian Government has a target for 10% of contracts (by value) to be awarded to businesses with less than 200 employees, operating independently of a parent organisation.

    The ATO recognises the importance of ensuring small businesses are paid on time. We exceeded the government’s target to pay at least 90% of invoices to small businesses within 30 days, achieving 95% in 2016–17. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury's website at Link.

    The ATO continues to provide strong support to the Australian Government Indigenous supplier diversity strategy by pursuing opportunities for Aboriginal and Torres Strait Islander businesses to supply goods and services to us. In 2016–17, we spent a total of $21.4 million with Indigenous suppliers and were again nominated in the ‘Government Member of the Year’ category at the Supply Nation awards.

    All of our contracts provide for the Auditor-General to have access to the contractor’s premises.

    Disaggregated information on procurement specifically for advertising campaigns is available in Appendix 8 of this report.


    The ATO uses consultancy services to obtain independent advice – for example, developing specialised 'intellectual output' to assist with decision-making at the agency level.

    During 2016–17, 245 new consultancy contracts were entered into, involving total actual expenditure of $10.5 million. In addition, 115 ongoing consultancy contracts were active during 2016–17, involving total actual expenditure of $11.3 million. Prior-year contracts accounted for 52% of current consultancy commitments.

    TABLE 3.1 Consultancy contracts expenditure, 2014–15 to 2016–17

    Consultancy contracts expenditure

    2014-15 $m


    2016-17 $m

    Total value of new consultancy contracts awarded




    Total spent in year




    Expenditure against contracts awarded in prior years




    Expenditure against contracts awarded in the current year




    Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website at Link.

    For consultancies entered into in previous years, the most significant expenditure in 2016–17 involved consultancies relating to:

    • ICT performance testing for Tax Time 2016 and beyond
    • independent ICT assurance of the Tax Time 2016 program.

    For new contracts awarded in 2016–17, the consultancies involved expenditure relating to:

    • a post-incident review of ATO ICT infrastructure
    • advice about the strategic direction for ICT environmental restoration.

    Consultants are engaged through a procurement process, using an open tender, pre-qualified tender, limited tender or an established panel arrangement. All consultants who require unsupervised access to ATO premises or access to ATO information are required to complete mandatory training modules covering security, and work, health and safety.


    The ATO provides a small number of discretionary grants that support our work and outcomes without necessarily providing a direct benefit to us. We may provide financial assistance for mentoring and work experience; sponsorship of activities promoting government policy objectives, and awards for academic achievement. Not all grants will be offered every year.

    All of the ATO’s grant activities meet the requirements and principles of grants administration contained in the Commonwealth grants rules and guidelines, including reporting and publishing of all funding provided throughout the year. We have rated the financial risk for each grant activity as low.

    There were three grants awarded by the ATO during the period 1 July 2016 to 30 June 2017. More information is available on our website at

    Administering GST

    The ATO administers the goods and services tax (GST) on behalf of the Australian states and territories, who reimburse us for our administration costs. Our obligations to the states and territories are set out in the GST Administration Performance Agreement between the ATO and the Council on Federal Financial Relations (the Intergovernmental Agreement on Federal Financial Relations).

    The ATO met the agreed outcomes, including expenditure for administering the GST. In 2016–17, this was capped at the agreed estimate of $682.4 million.

    The GST administration costs will be subject to a special purpose audit by the Australian National Audit Office (ANAO).

    Compliance with other laws

    Public Governance, Performance and Accountability Act 2013

    The Public Governance, Performance and Accountability Act 2013 (PGPA Act) requires that agencies provide a statement of significant issues reported to the Minister under paragraph 19(1)(e) of the Act that relates to non-compliance with finance law and action taken to remedy non-compliance.

    The ATO had no instances of significant non-compliance with the finance law to report to the Minister in 2016–17.

    Environment Protection and Biodiversity Conservation Act 1999

    Section 516A of the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) requires agencies report on certain aspects of ecologically sustainable development and environmental performance.

    The ATO administers appropriations for three energy and fuel schemes that provide credits and grants to reduce the costs of some fuels, or to provide a benefit to encourage recycling of waste oils: Programs 1.7 Fuel Tax Credits Scheme, 1.9 Product Stewardship for Oil and 1.18 Other Administered Programs: Cleaner Fuels Grant Scheme.

    More information about fuel schemes is available on

    The ATO has no departmental funding for work that specifically contributes to ecologically sustainable development. However, in making decisions on expenditure, we apply the Commonwealth procurement rules, which promote the proper use and management of public resources, where 'proper' means efficient, effective, economical and ethical. We use guidance from the Department of Finance on informed decision-making processes and establishing the foundation for efficient, effective, economical and ethical use of Commonwealth property resources.

    In 2016–17, the ATO minimised environmental impact by continuing to exceed the energy efficiency requirements of the Energy Efficiency in Government Operations (EEGO) policy for Tenant Light and Power performance. Additionally, 63% of ATO tenancies have achieved or exceeded the minimum National Australian Built Environment Rating System (NABERS) rating.

    Over the last five years, the implementation of a number of environmental strategies has seen a reduction in total carbon emissions of 32%.

    • Fleet vehicles – In the past 12 months, we have refreshed our fleet of cars with new vehicles and reduced the fleet size by a further 10% with an estimated saving of $250,000 over the 24 month contract term. The replacement program focused on increasing the number of energy efficient vehicles resulting in 64% vehicles that are hybrid cars.
    • Air travel – In line with government policy, air travel is undertaken for official purposes using the most efficient and cost effective means. Our total flight kilometres decreased by more than 10%, reducing from 56.9 million kilometres in 2015–16 to 51 million kilometres in 2016–17. Although this is a reduction from the previous year, it is an increase of 2% (876,600 kilometres) against the 2011–12 base year.
    • Paper use – The ATO has reduced internal paper use by 86% against the 2011–12 base year, exceeding our target of 30%. Paper used for external publications and correspondence has decreased by 65% since 2011–12, resulting in a reduction of 1,600 tonnes over the five-year period.

    National Disability Strategy 2010–20

    Since 1994, Commonwealth departments and agencies have reported on their performance as policy adviser, purchaser, employer, regulator and provider under the Commonwealth Disability Strategy. In 2007–08, reporting on the employer role was transferred to the Australian Public Service Commission’s State of the Service report and the APS Statistical Bulletin. These reports are available at Link. From 2010–11, departments and agencies have no longer been required to report on these functions.

    The Commonwealth Disability Strategy has been superseded by the National Disability Strategy 2010–20, which sets out a 10-year national policy framework to improve the lives of people with disability, promote participation and create a more inclusive society. A high-level two-yearly report tracks progress against each of the six outcome areas of the strategy and presents a picture of how people with disability are faring. The first of these reports was released in late 2014, and is available at Link.

    In May 2017, we launched our Diversity and inclusion plan 2017–2019. This is our commitment to improve employment outcomes, retention, development opportunities and career progression for employees with disability. There has been an increase in the number of employees who identify as having a disability, to 3%. By 2019, we aim to have 5% of our workforce disclose this.

    Our employees with disability are provided with reasonable adjustment and access to site-based disability advisers. We have refreshed our training and information products that help to increase awareness and understanding. We do not undertake specific ongoing recruitment campaigns other than for Indigenous employees. Many of our targets are about staff ‘identifying’ as belonging to a diversity group rather than about recruitment, as we believe this is an indicator of staff feeling accepted and able to bring their ‘whole self’ to work. We support people with disability applying for jobs by using the RecruitAbility scheme.

      Last modified: 30 Oct 2017QC 53664