Independence is such a critical imperative for SAIs that the Pacific Association of Supreme Audit Institutions (PASAI) AI has a whole Strategic Priority devoted to it:
PASAI supports and encourages its members to be independent and sustainable institutions that make a difference to the quality of the public sector governance and service delivery for the benefit of their people. A strong independent SAI is essential for a country’s good governance and public financial management.
With the technical support of PASAI’s legal consultant Robert Buchanan, and information sources like PASAI’s web-based Independence Resource Kit, the route to independence has been well-charted and successfully followed, to the achievement of elements of independence for several Pacific SAIs. Their stories of success are shared in detail in the page of the Resource Kit.
For one SAI, however, it’s not yet time to report a happy ending to their years of gathering advice, information and momentum. Instead, Junior Patrick, the Auditor-General of the Republic of the Marshall Islands, tells a tale of a near-miss – or worse, a frustrating almost-win - that caused him to reconsider the SAI’s options for independence and reach some different conclusions instead.
For some months, Patrick and his office had been working with Buchanan and legal advisor Craig Neil to amend the state’s Audit Act and the Constitution of the RMI. The goal was to enable the SAI to manage its own Human Resources (HR) function, with full responsibility for all ‘people’ processes including recruitment and development. This would shift SAI HR management from the Public Service Commission, which oversees HR for all members of government, including the SAI.
The ability to hire, pay, grow and deploy its own staff is seen as a major factor in underpinning SAI independence, as reflected in INTOSAI’s Mexico Declaration of 2007 for all SAIs which Patrick quoted during his campaign.
The most frustrating aspect for the SAI was the inability to compensate staff at the right levels under civil service pay scales, despite the auditors’ highly specialised skillsets and investment in their training. When another opportunity arose, staff would leave the office. Patrick wanted the opportunity to retain strong players in his team, and even carry out some succession planning, by removing the SAI from the jurisdiction of the Public Service Commission.
And it seemed achievable, even though the Constitution provides that the Auditor-General’s staff are provided by the Commission.
‘Robert and I had drawn up the Bill to change the structure of the department,’ says Patrick. ‘It was a strong proposal, and the Executive agreed to support it and sponsor the Bill. It went through Parliament with a unanimous vote – two thirds of the total membership.’
However, while an amendment to the Audit Act in RMI only required a majority vote in Parliament amendments to the RMI Constitution can only be changed through a referendum.
As a proposal to change the constitution, the Bill still needed to be considered by the Constitutional Convention, but given the efforts the Auditor-General had gone to in ensuring the right checks and balances were brought into the Bill, modelled on the government’s existing practices, Patrick’s optimism seemed reasonable. There were certainly some legitimate concerns raised during the consultation period – a few MPs had questions about the staff appeal process, and the Speaker felt that it might be creating ‘a government within a government’ – but overall there was no strong objection and therefore a high likelihood of the Bill going through.
The problem came on Voting Day. Normally, 45 elected parties from different RMI districts would gather to consider and vote. A unanimous vote would be required – so 30 positive votes.
On the day the Bill was tabled, eleven members were out of the country, otherwise engaged, or not available in some way. Junior Patrick tried to talk to the leadership to see if they could delay, but it was not to be. Of the normal 45 members, only 34 were present. The Bill received 28 votes – more than two thirds of the membership present at the meeting.
Sadly, though, it was two less than the required vote of 30 to pass the Bill.
That day, Patrick returned to the Audit Office in a haze, not quite able to take in that the Bill had fallen, more or less, on a technicality. He admits that he returned, sorely disappointed, to an equally sad Office. ‘This is a democratic government,’ he told his employees. ‘The majority rules and we have to respect that.’ Still, there is no doubt he saw it as a failure. ‘We could have done more on awareness. The Constitution Convention was not Parliament. It was a different set of people with different levels of understanding.’
It took a while to gather himself together again for a renewed approach with any kind of vigour, and Patrick credits legal advisors Buchanan and Neil with providing the support need to enable him and the Office to move on.
With hindsight, however, he’s able to view it all in a different light and extract the positive impact.
‘Even though the vote was too low, the message went out across the Government,’ Patrick states. ‘I got a call immediately afterwards from the Public Services Commissioner, who asked to work with me on the issues our Bill had highlighted. We now have a new Communications Officer and three new investigators, and we’ve been able to increase the pay scales.’
He continues, ‘The relationship with the Public Service Commission has changed. SAI staff still remain in the Public Service, but now we should be able to retain them in the longer term, whereas before we had high staff turnover.’
The Bill even influenced other government departments into change. ‘Now everyone’s trying to make some reforms,’ jokes Patrick. ‘There was even a proposal to get rid of the PSC altogether! That one was defeated unanimously.’
He’s pleased that the Bill led to such open discussions. After a full half-day’s coverage on TV and radio of the televised debate, fellow citizens reported to the Office that it was a shame the Bill didn’t go through. As a result of their independence endeavours, the perception of the Audit Office has changed in the eyes, not just of the Government and the PSC, but of the public at large.
Moving forward, what has come about for the RMI Office of the Auditor-General is a more sanguine, softly-trodden approach. After the low vote he received good counsel, notably from Robert Buchanan whose clearest message was ‘your clients are the ones in control of resources and that doesn’t give you independence as an auditor.’
So rather than waiting for another constitutional review which would only take place ever ten years, Patrick and Buchanan are now working on a bill to amend the Audit Act such that it will only require a vote in Parliament. This time, they are focussing their attention on a few key areas which are not changes to the constitution – financial autonomy; the vital issue of immunity from prosecution and, hopefully, HR autonomy.
For other SAIs going through this process, the RMI Auditor-General has two clear messages from what he’s learnt. ‘Firstly, don’t underestimate your leaders. They are working for the betterment of your country. And secondly, understand your framework. The RMI Constitution is 40 years old – but thing have changed and it’s time to reflect that.’
The Office has come a long way since the dark day of the vote. The SAI still works closely with Robert Buchanan – who strongly advises SAIs to ‘work with what they’ve got’ as the Marshall Islands OAG is doing - to achieve ‘independence in mind’ while continuing to promote legislative changes. Independence is a long term goal – an ‘ongoing process requiring law reforms,’ as Patrick reports.
The drive and commitment to a major shift in the political climate around SAI independence, however, comes from the AG himself. ‘We need to have good staff who are exempt from certain restrictions. As long as I’m here, I’ll continue to align the office.’
It’s a salutary tale for all SAIs. It signals that independence is a ‘journey’, and that modernizing a SAI’s legal framework is not the only way of achieving independence in practice.
As for Junior Patrick – what happens if it’s not possible to achieve the desired legislative reform? ‘We’ll get up and start running again at the next opportunity.’
It seems very likely that the RMI Audit Office will do just that - as a next step on the ‘journey’ of SAI independence.
