Audit is an integral part of governance - The Vice-President of the SAO, Ms Zdeňka Horníková
Seminar - 20th Anniversary of the SAO, Senate of the Parliament of the CR, 25.7.2013
Good morning,
Dear President of the Senate,
Dear President of the Supreme Audit Office,
Dear Guests and Dear Colleagues,
Today I have the honour of standing before you as the Vice-President of our Supreme Audit Office. I would like to thank the Chamber of Deputies for their trust and our President for appointing me and my colleague, Mr Kala, to our respective offices. I think that both of us are looking forward to this work together. Both of us know that we have a lot of able and decent people supporting us - and the Supreme Audit Office is able to do truly top notch work.
I would like to take this opportunity to greet my colleagues from the Chamber of Deputies, who are taking part in our seminar. Quite a short time ago I was still sitting in the Chamber of Deputies. I have been in my new position for only two short months; for this reason, please allow me to focus more on my experiences from the Chamber of Deputies.
Today we are meeting on what is mainly a festive occasion. We have gathered to congratulate ourselves, to meet with old friends and former colleagues. A host of you have worked at the Supreme Audit Office once upon a time and are now either enjoying a well-deserved rest or doing other work. Gatherings such as these do not only have a pleasant side, where people greet one another and share experience.
They also provide a moment to remember those who are no longer with us. These are people whom we will always hold in high esteem and remember with respect. One such person was Mr Luboš Voleník, the first president of the SAO. He was a personal friend and professional for many of us. Many people have built their work and abilities on Luboš´s work - I believe that if he were here with us, he would be proud of our work.
For today´s seminar, I have prepared a topic that may be complicated, but it is only an introduction to the topic - and so I assume that some of you will disagree with some of the things I have to say or think about them. I would like to lead further discussions about them. Should this be the case, then my presentation is as it should be.
Scrutiny is part of governance. An often little perceived truth and fact. I myself believe in this deeply. Why? My previous experience may be able to answer this question. I have spent seventeen years in the Chamber of Deputies and have been present at seventeen sessions debating and approving the state budget, at seventeen sessions debating and approving the state closing account. At sessions discussing the budgets of various headings, including the Supreme Audit Office heading. In the last few years, I worked in the Committee on Budgetary Control as its deputy chair. The audit findings of the Supreme Audit Office are forwarded to the Chamber of Deputies, particularly to the Committee on Budgetary Control, for discussion and debate. I would like to state at this point that the results are excellent and contain a large amount of information. But to tell you the truth, they deserve much more attention and a much better assessment than they have been receiving. It is my experience from the Chamber of Deputies that leads me to further contemplate to what extent and how the Chamber of Deputies makes use of the findings and conclusions of the Supreme Audit Office. It is here that I think there is much left to be desired. What conclusions have I arrived at? If we wish to make good and economically effective decisions, we have to have good information about how effective our past decisions were. Everyone who knows the work of the Chamber of Deputies and the Supreme Audit Office knows, or at least suspects, where I am getting at.
Nevertheless, I would now like to tell you a bit about the relationship between the Chamber of Deputies, the Government, and the Supreme Audit Office. The Chamber of Deputies decides on legislation and decides and approves the state budget. The Chamber of Deputies checks the Government, and the Government governs. What about the SAO? One of the primary tasks of the SAO is to provide information and supporting documentation to the Chamber of Deputies - and thereby provide it with one of the most valuable services. And it provides this information in the form of audit findings. Before we address the role of the Supreme Audit Office in terms of the system, I still have to go back to the Chamber of Deputies - and about the topic of the state budget and the state closing account. Personally, I consider discussion about these two key items to be of the utmost importance and, unfortunately, I have the feeling that everything is not as it should be at this time.
When I was the deputy chair of the Committee on Budgetary Control, I warned that it is necessary to change the powers enjoyed by the competent committees. If we realise that the state budget is discussed by the Committee on the Budget and then approved by the Chamber of Deputies - it is a political act. If we realise that the state closing account is also approved by the Committee on the Budget and, at the same time, discussed and approved by the Chamber of Deputies, then there is one question that comes to mind - where are the checks and balances? The way the system is currently set up, they are missing. It is therefore important to implement such checks and balances to the Chamber of Deputies itself.
My proposal is simple. I already voiced it in the Chamber of Deputies. And it will be up to the Chamber of Deputies to assess my proposal and to decide what to adopt. Here I only mention it so that we understand that even the Chamber of Deputies has a lot to fix.
My vision is clear. The person who approves the state budget must not be the one who approves changes to the budget during the year - and in particular must not be the one approving the state closing account. The Committee on the Budget should approve and budget and stop there. If we would like to discuss checks and balances, then changes made during the year to the state budget and, in particular, the state closing account should be discussed and approved by a completely different body. Then the act will not be a political one, but one of actual scrutiny. Scrutiny is a job for the Committee on Budgetary Control. The Supreme Audit Office works very well with the Committee on Budgetary Control. The Committee on Budgetary Control´s role of working with the SAO and discussing audit findings was given to it by the Chamber of Deputies.
Now allow me to change the topic directly to our Supreme Audit Office and look at why it is important for the system. The Supreme Audit Office provides information about the effectiveness of the state budget, about the objectives stipulated by the state budget - which are, economy, efficiency and effectiveness. This concerns, for example, investments, IT systems, employment policy and so on. The Supreme Audit Office provides systemic information about the effectiveness, applicability and shortcomings of various laws. Public contracts and budgetary rules are clear examples of this. Conversely, political parties, the Government and the various ministers bear political responsibility for fulfilling the objectives of the state budget. I mentioned that I have been with the Supreme Audit Office for only two months; nevertheless, I have known the work of the office for years - and so what I already knew coming to the Supreme Audit Office has been confirmed. The Supreme Audit Office has to conduct an audit of all departments and of all ministries uniformly and systematically. Thus, in terms of rules and laws. And not in terms of field - healthcare, transport, or defence. An audit has to be not only systemic, but also economic, effective and efficient. And it is. The president has already talked about this, so I am only concurring.
When is an audit effective? In the beginning, the objectives of an audit are clearly defined, so that it brings information about the state of affairs, shortcomings, causes and consequences. In other words, a systemic assessment of the situation. And that is the role for my colleagues, members of the Board - and they, in my opinion, do their job very well. Furthermore, an audit has to be effective, i.e., preparations have to be precise. Primarily objective and professional. Essentially shorter than the on-site inspection itself. Effective set up of audit teams, clear tasks for the audit section. They are specialists, they have a host of able people in their ranks that can be called upon to create these good, professional audit groups. I am looking at another of my colleagues - an audit has to be economic or, as women would say, cheap. So I won´t be discussing in detail transport, accommodation, services and so on. This is simply a job for the administrative section.
Ladies and gentlemen, I am reaching the end of my presentation. I would like to make a brief summary of my thoughts about why scrutiny is a part of governance. The Chamber of Deputies gives the Government a mandate to govern via approved laws. The Government governs and does not control either the Chamber of Deputies or the Supreme Audit Office. The Supreme Audit Office, however, tells the Chamber of Deputies how things really are and how effective its decision-making is. It provides the Chamber of Deputies all important feedback - and the Chamber of Deputies can thus control the government with proper knowledge and systemically. Here were clearly see the correct division and separation of legislative and executive branch. An independent Supreme Audit Office plays an unsubstitutable, key and systemic role in the entire process; which is why the topic of my presentation is: scrutiny is a part of governance.
Ladies and gentlemen, thank you for your attention and I wish that not only this day, but all your days are successful.