The auditor general has rejected arms manufacturer Thales’ allegations that his partially suppressed report on a $1.3bn military deal with the multinational failed to meet basic standards.
The auditor general, Grant Hehir, appeared before Senate estimates on Tuesday, a day after revelations that the attorney general, Christian Porter, blacked out findings that Australia could have saved hundreds of millions of dollars in its deal to purchase 1,100 locally built Hawkei light protected vehicles from French-based Thales.
Porter used powers to suppress part of Hehir’s report after he was approached by Thales, justifying the intervention on grounds of national security and the protection of the company’s commercial interests.
Thales was angry at what it said was the auditor’s insinuation that Australia could have paid half as much for a comparable vehicle from the United States, court documents reveal. The documents also show Thales had accused Hehir of failing to apply auditing standards in his report and inappropriately comparing the Thales Hawkei vehicle to the joint light tactical vehicle (JLTV) produced out of the United States.
“The ANAO in its conduct of the performance audit did not comply with relevant auditing standards, including because it failed to obtain sufficient and appropriate audit evidence,” Thales argued in court documents.
But Hehir on Tuesday rejected any notion that his work was substandard. He said earlier concerns about his work from the defence industry – expressed anonymously to the media – had prompted an internal review that backed in his office’s findings in three years of defence audits.
“We operate under standards,” he said. “We have, I believe, a very robust quality regime within our organisation to test that auditors followed the standards.
“There was nothing in [the Thales] report that I was uncomfortable with, that was presented in a way that was not consistent with auditing standards.
“I reject the view that we didn’t undertake audit work according to standards. People disagree with analysis. People have different views about what evidence they think is important and what they don’t. I don’t know where [Thales] are coming from, it never got to that point. But a suggestion that we didn’t apply our standards to this audit would be inaccurate as far as I’m concerned.”
Hehir also said that two new government agencies have formally advised the auditor general they are considering suppressing his findings in the three months since Porter intervened by issuing a certificate to suppress findings in the Thales audit.
Similar powers had only been used once before, in 1987, and that was under old legislation.
Hehir would not name the agencies, despite being pressed by the crossbench senator Rex Patrick and the Labor senator Jenny McAllister.
Hehir said he accepted the government’s power to suppress his work was a necessary check and balance. He also said it was clear that Porter had acted within the legislation.
But he said the powers required greater transparency and accountability. Hehir said he had proposed measures that would ensure that occurs, including parliament seeing his unredacted findings, rather than just the executive.
“At the end of the day, what I do reports for is to provide information to the parliament,” he said. “The nature of a certificate under the current processes is that it denies parliament access to information.
“Am I concerned? My concerns are about whether parliament gets the full use of my work … I’m not really stressed about a big breakout of these certificates.”