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  • 03 Risk oversight and management

    We have well-established systems of risk oversight and management, in accordance with section 16 of the Public Governance, Performance and Accountability Act 2013 and the Commonwealth Risk Management Policy.

    Our strategic risks are those that can ultimately affect the achievement of our mission and vision. These risks are monitored and managed by the ATO Executive.

    Risk 1: People and businesses do not trust or use the products and services we have on offer

    Community and client expectations about the services and products we offer continue to change as developments in technology create new ways to interact. As we harness these technologies, we work to stay in tune with client and stakeholder needs and expectations, and understand the experience they expect when interacting with us. We then co-design and develop the services we offer accordingly.

    We tailor our communication so that our services and tools make it easy to participate in the system, are understood and used. We are working to ensure that our website, our technical advice and our correspondence are more easily understood.

    We are identifying new ways of reaching out to our clients to raise awareness of the products and services available. Our concern is that people and businesses may not be aware of the services and tools that make it easier for them to participate.

    Risk 2: The outcomes and planned benefits of our Reinvention Program initiatives fail to materialise

    We are investing significant financial resources and staff expertise into initiatives that transform how our clients and staff experience the tax and superannuation systems.

    These initiatives range from improving our digital infrastructure to provide more contemporary services and products that are streamlined and easy to access, to internal programs that optimise workforce capability and culture. This work will support a whole-of-government experience for the Australian community.

    To ensure change is integrated, balanced and reflects government, client and staff experience priorities, we will undertake quarterly planning and reviews, enabling us to be responsive to environmental changes and resource demands. Together with a strong focus on developing and supporting our internal capability, this will allow us to quickly identify and address risks to successful delivery.

    Failure to achieve the planned benefits and outcomes of our investment may degrade engagement with the tax and superannuation systems and undermine the broader relevance of the ATO to government and the community.

    Risk 3: We fail to work effectively with stakeholders in the tax and superannuation systems, in particular, tax professionals and software providers

    In our administration of the tax system, we rely on the contributions of others.

    Taxpayers have the choice of dealing directly with us or using a tax professional to help them comply with their obligations. The nature of our relationships with our stakeholders will directly influence the delivery of our priorities.

    As we deliver on our reinvention, we must continue to strengthen these relationships and seek new ones, recognising the changing commercial and business environment. We aim to understand the priorities and perspectives of our key stakeholders. We will continue, as far as possible, to align our priorities and direction with their expectations.

    We are focused on strengthening our relationship with the tax profession, particularly as the profession changes with automation and digitisation. Eliminating the more basic transactions and form filling is affecting the business models of many practitioners.

    The electronic lodgment service is being phased out this year, replaced by the new practitioner lodgment service (PLS) which is accessible through agents’ practice management software. There is heightened focus on managing this risk and ensuring the transition works well.

    Given this new approach of providing service through software, it is critical that we work with software providers effectively so they can build, test, refine and market their packages in time to deliver for tax time and other important tax cycle events.

    Risk 4: The community perceives the tax system as unfair and that we may not be aware of, or capable of, pursuing those who play the system or deliberately avoid their obligations

    Given the attention on large corporates and tax avoidance, and on base erosion and profit shifting, there are negative perceptions of the tax system and the ATO in some parts of the community.

    We are concerned that the community is not confident we are taking the necessary action with multinationals, large corporates and high-wealth individuals who are avoiding their tax obligations in Australia.

    We need to actively influence these perceptions to avoid any disengagement from the tax system because others are perceived to be ‘getting away with it’. Disengagement can be assessed using measures like revenue, registrations, lodgments and payments. We need to provide the facts on performance and behaviour so that people can have confidence that the system, and our administration of it, is in good shape.

    We will deliver on the Tax Avoidance Task Force outcomes, reporting regularly to the community and government. We need to continue our efforts internationally to reform tax administrations and effect multilateral compliance action.

    Risk 5: We fail to adequately invest in and manage our organisational capability to deliver on the commitments to government and our transformation

    Cultural change is at the heart of the ATO’s transformation and aims to improve the client and staff experience. We have made progress, but we are yet to realise all-encompassing change. Feedback internally and externally shows positive change, but there is work still to do.

    We are focused on embedding cultural change, so that client focus, service ethic, sensible risk management and outcome orientation are the norm and reflected in everything we do.

    We need to have a concerted and persistent effort to achieve the desired change.

    We use a mix of employment and contract arrangements to achieve our business outcomes. This is increasingly so in the context of caps on average staffing levels, where there are restrictions to employment of permanent APS employees.

    Following a period of significant workforce change, with reductions in numbers, restricted recruitment and shifts in classification profiles, there is pressure on our organisational capability. Workforce strategies through the Australian Public Service Commission, such as the Unlocking Potential strategy, also shape the nature of our workforce and our activities.

    We need to ensure we have the people (including those in leadership roles) with the necessary expertise, professionalism and cultural fit. This applies for our employees, as well as our contracted service providers.

    Risk 6: Our information and communications technology (ICT) systems fail to perform consistently to the standard required

    Our ICT systems need to be able to:

    • handle the demands of new online services and the integrated nature of whole-of-government technologies
    • fend off cyber attacks
    • protect data and information.

    Our foundation systems and IT infrastructure were replaced and upgraded through the Change Program. Since then, we have focused on delivering better online tools and more recently have released products and services to significantly enhance the client experience – like the ATO app, myTax and ato.gov.au. As the community embraces new and emerging technologies and communication channels, the demands for security, convenience, and 24/7 performance of our systems mount.

    We need to ensure the stability of the Tax Agent Portal, as well as a positive experience with the expanded myTax and ATO online services, and a successful transition to the new practitioner lodgment service through practice management software.

    With the evolution of technology for government services, greater interdependencies, new options for cloud services, and new channels for our services, the planning and governance required is more sophisticated, streamlined and integrated.

    Advances in technology provide opportunities for us to provide a better client experience, but there are challenges in meeting community expectations for data security and privacy, and in protecting the integrity of the system.

    As we continue to expand connectivity to systems and institutions – through open-data strategies and connectivity to banking, mobile devices and cloud solutions – we must secure, manage and use data, information and intelligence appropriately.

    There are advanced, persistent, electronic threats and attacks (including hacking, malicious code and denial of service) that could potentially compromise performance, confidentiality, integrity and/or availability of ATO information.

    Risk 7: We fail to influence key APS strategies for services to clients and shared services to other agencies

    Whole-of-government and whole-of-APS agendas are forging ahead in both service provision to the community (such as through myGov), and shared services as part of the contestability program run by Department of Finance.

    The ATO must participate and influence the agenda at a whole-of-government and whole-of-APS level to ensure our own investments and efforts are not in vain, and that we keep our focus on our core business.

    In terms of whole-of-government services to the community, we need to work with Department of Human Services to ensure a positive experience with services such as myTax, voice authentication, Single Touch Payroll and the Australian Business Register (ABR) link-up to myGov.

    We also need to work with the Digital Transformation Office to ensure we leverage opportunities for progressing our products and services, and take advantage of progress and efficiencies across the APS.

    In the shared services arena, we have been selected as a corporate services shared services hub. At this early stage, it is important that we build relationships with our potential clients to ensure they have a positive experience and that our services are effective, efficient and help refine our own internal service offer.

      Last modified: 22 Aug 2016QC 49917