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2015-16 ANNUAL REPORT

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2015-16 ANNUAL REPORT

© Queensland Productivity Commission 2016

The Queensland Productivity Commission supports and encourages the dissemination and exchange of information. However, copyright protects this document.

The Queensland Productivity Commission has no objection to this material being reproduced, made available online or electronically but only if it is recognised as the owner of the copyright and this material remains unaltered.

ISSN 2206-8724 (Print) ISSN 2206-8732 (Online)

Table of Contents

Queensland Productivity Commission 2015-16 Annual Report i

Table of Contents

FOREWORD II

THE QUEENSLAND PRODUCTIVITY COMMISSION 1 Responsibilities 1 Organisation 4

OVERVIEW OF KEY ACTIVITIES 5 Highlights 2015-16 5 Public Inquiries 5 Regulatory review 7 Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 9 Competitive Neutrality 10 Publicly available publications 11 Publications submitted to Government 11

CORPORATE MATTERS 12 Governance 12 Financial performance 13 Our EMPLOYEES 13

FINANCIAL STATEMENTS 15

GLOSSARY 39

APPENDIX A : LETTER OF COMPLIANCE 40

APPENDIX B : COMPLIANCE CHECKLIST 41

ANNUAL REPORT ACCESS 43 Additional copies 43 Open Data 43 Government bodies 43 Translating and interpreting assistance 43 Feedback 43

Queensland Productivity Commission 2015-16 Annual Report ii

FOREWORD

I am delighted to have been appointed as the inaugural Principal Commissioner of the Queensland

Productivity Commission.

The Commission's first year has involved a challenging work program across a wide range of areas:

completing two public inquiries into electricity pricing and solar feed-in tariffs; a review of regulatory

arrangements in Queensland's sugar industry; assessing regulatory proposals from all government

departments; and progressing four competitive neutrality complaints.

In providing our advice, the Commission adopts a community-wide approach, which considers all costs and

benefits of a policy, not just the impacts on a particular interest or group. In this way, we aim to advise

government on the best policies and regulation for the Queensland community as a whole.

Central to this process is public consultation. We provide stakeholders with opportunities to contribute to

our work, with public forums held around the state in addition to written submissions. We also publish issues

papers, draft reports and other consultation documents, allowing public scrutiny of our work to ensure

evidence is tested and brought to bear in our findings and recommendations to the Queensland Government.

In its first year, the Commission has tackled complex and sometimes contentious issues. We hope that, while

stakeholders may not always agree with our recommendations, our rigorous and transparent analysis and

processes will promote discussion and informs evidence-based debate on key policy issues.

The creation of the Commission is the result of a significant effort from Commission staff, other government

agencies and stakeholders. I would like to thank everyone that has assisted and supported our establishment.

Looking ahead, I am committed to ensuring the Commission's work continues to contribute effectively to the

long term interests of the Queensland community.

Kim Wood

Principal Commissioner

Queensland Productivity Commission 2015-16 Annual Report 1

THE QUEENSLAND PRODUCTIVITY COMMISSION

The Queensland Productivity Commission (the Commission) is an independent statutory body, established in

2015 under the Queensland Productivity Commission Act 2015 (QPC Act) to provide independent economic

and policy advice to the government.

The Commission provides advice on complex economic and regulatory issues, and proposes policy reforms

with the aim of driving economic growth, lifting productivity and improving living standards.

In essence, the Commission aims to help the Queensland Government develop evidence-based policies and

regulation in the long-term interests of the Queensland community.

The Commission operates and reports independently from the Queensland Government—with our views,

findings and recommendations based on our own analysis and judgments. Wide-ranging, open and

transparent public consultation underpins our approach.

The Commission has an advisory role. This means that our advice and information contribute to policy

development—but policy action is ultimately a matter for the Queensland Government.

RESPONSIBILITIES

Public Inquiries

The Commission undertakes inquiries on complex

policy and regulatory issues to provide objective

advice on matters vital to the productivity of the

Queensland economy.

Research

The Commission undertakes research on policy and

regulatory matters beyond its formal inquiry

function.

Regulatory review

The Commission assists agencies to undertake

quality assessments of regulatory proposals to

support good policy development, consistent with

best practice principles.

Competitive neutrality

The Commission receives, investigates and provides

recommendations on competitive neutrality

complaints on state and local government business

activities.

The QPC will support

the Queensland Government's

objectives for the community to:

by providing

independent policy advice to:

• Create jobs and a diverse economy

• Deliver quality frontline services

• Build safe, caring and connected communities

• Protect the environment

• Drive economic growth, lift productivity and improve living standards

• Improve the efficiency and effectiveness of government services and operations

• Assess potential costs and benefits of policies, including impacts on the disadvantaged and vulnerable, and on the environment.

Queensland Productivity Commission 2015-16 Annual Report 2

OPERATING ENVIRONMENT

The Commission was established to provide independent economic advice on complex, and sometimes

controversial , matters as referred to it by the Queensland Government.

The Commission’s functions and operating principles (Figure 1) are drawn from the QPC Act .

Figure 1 Functions and operating principles

The Commission aims to provide high quality advice, helping the Queensland Government make evidence-

based policies and regulation in the long-term interests of the Queensland community.

It will do this by delivering high-quality advice, based on robust analysis, that is timely and useful to

government.

Assessing how effective the Commission is in achieving this objective is difficult because:

the Commission has an advisory role and is one source, among many, of policy advice, so:

the time taken to respond, and the nature of the response, are matters for government; and

even when advice is not supported, it still plays an important role in supporting informed decision

making;

the Commission provides advice on contentious or complex policy issues, so:

the impact of advice is often best considered over the medium to long term; and

community feedback is often informal and can be hard to document and collate systematically — and

feedback can reflect the interests of those affected by the Commission’s findings or recommendations.

Queensland Productivity Commission 2015-16 Annual Report 3

The Commission is developing a number of indicators across its activities to measure its overall performance

and its progress in achieving its objectives (Figure 2).

Figure 2 Measures of success

Some indicators of performance include:

the quantity of activities undertaken — including the number of inquiries, the number, nature and

scope of regulatory assessments made and the opportunities to deliver further support (including

through training);

the cost of activities undertaken — both for the Commission and for the agencies and stakeholders

participating in its processes;

the quality of the Commission's processes — including our transparency and accountability, the

effectiveness of consultation and the usefulness and timeliness of advice on regulatory proposals; and

the quality of analysis.

As this year’s report relates to the Commission’s performance across its first year of operation, detailed

information is not available for all measures, across all activities. Where information is available, it has been

included as a baseline for future reports, with a view to improving its comprehensiveness over time.

Usefulness of advice Nature and effectiveness of consultation.

Transparency and accountability of processes. Cost and timeliness of activities.

Measures of success

Queensland Productivity Commission 2015-16 Annual Report 4

ORGANISATION

The Board

The Board manages the Commission and ensures it performs its functions with independence, rigour,

responsiveness, transparency, equity, efficiency and effectiveness.

The QPC Act provides for the Board to be made up of the Principal Commissioner and other Commissioners

(if any) appointed by the Governor in Council. A maximum of three Commissioners (including the Principal

Commissioner) may be appointed. Board members are appointed under the QPC Act for a term of not more

than three years, and may be reappointed.

Kim Wood

Principal Commissioner

Appointed: 1 October 2015 — 30 September 2018

Mr Wood joined the Commission as the Principal Commissioner in October

2015. He has extensive knowledge of regulated industries and commercial

operations, with hands-on leadership roles at Victoria’s City West Water,

GPU PowerNet and Queensland’s Stanwell Corporation, as well as other

electricity, water and telecommunication businesses.

He has tackled both business transformation roles, and new utility start-ups,

and enjoys a challenge.

He commenced his CEO roles as the Sydney-based Managing Director of GEC

Plessey Telecommunications — and has also held senior roles with BellSouth

Australia and Hewlett-Packard. He began his career as an engineer with the

Victorian State Electricity Commission.

Organisational Chart as at 30 June 2016

* Ms Tania Homan was appointed to set up the Commission as its inaugural Executive Director (on secondment to Queensland Rail from April 2016).

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 5

OVERVIEW OF KEY ACTIVITIES

HIGHLIGHTS 2015-16

PUBLIC INQUIRIES

The Commission conducts public inquiries based on Terms of Reference provided by the Treasurer.

A public inquiry is a robust,

evidence-based process.

Public consultation plays a

key role in the Commission’s

inquiries. In addition, the

Commission's advice, and the

information on which it is

based, is open to public

scrutiny.

In 2015-16, the government directed the Commission to examine

two policy areas:

Electricity Pricing — to investigate ways to improve

Queensland’s electricity pricing and productivity outcomes, now

and into the future; and

Solar Feed-in Pricing — to investigate a fair price for solar

exports produced by small customers based on the public and

consumer benefits of solar exported energy.

Both inquiries were progressed in parallel, having regard to each

other as relevant.

The Commission’s inquiry process (Figure 3) provides for all stakeholders to submit their evidence and views,

and for Commission analysis and recommendations to be publicly considered and tested.

Figure 3 Public inquiry process

The Queensland Productivity Commission Act 2015 establishes the Commission as an independent policy advisory body.

Completed the inquiry into electricity pricing in Queensland, identifying changes to improve outcomes for customers.

Completed the inquiry into a fair price for solar exports produced by small customers.

Met with more than 120 individuals or groups and received over 200 written submissions across the work program.

Provided advice and review on best practice regulation across 400 proposals.

Undertook a regulatory impact assessment of the Sugar Industry (Real Choice in Marketing) Bill 2015.

ISSUES PAPER

Identifies key issues to focus consultation &

research efforts

CONSULTATION

Submissions and consultation with interested

parties

DRAFT REPORT

Set out preliminary, findings &

recommendations

CONSULTATION

Feedback on draft report

through submissions & public hearings

FINAL REPORT

Provided to government

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 6

Electricity Pricing

The government asked the Commission to examine

electricity pricing in Queensland and provide

options for improving outcomes for consumers.

The inquiry examined all segments of the electricity

supply sector in Queensland, including the major

cost drivers, and identified changes needed in the

short, medium and longer term to:

drive productivity growth and optimise pricing

and other consumer outcomes by better

managing future opportunities and challenges;

encourage greater competition in retail

markets, having regard to potential risks and

challenges for particular consumers, particularly

in regional and remote areas; and

better manage impacts for vulnerable

consumers through a targeted concessions

framework and by identifying how government

could assist consumers to better manage

demand and become more energy efficient.

Solar Feed-in Pricing

The government asked the Commission to report

on a fair price for solar power produced at the

home or business premises of a ‘small customer’

and exported into the electricity grid.

The inquiry examined:

whether there are energy, environmental,

wholesale market, network, industry

development and social benefits that are not

accounted for in feed-in tariffs;

the equity impacts of various feed-in tariff

arrangements on the least-well off in the

Queensland community;

the barriers/constraints to solar export pricing

and a well-functioning solar export market;

and

the most appropriate form and design of

regulation for regional Queensland to achieve

objectives at minimum cost.

The Commission has provided final reports for both inquiries to the Treasurer, in accordance with the

timeframes required by government (Table 1). The Treasurer must provide the Commission with a written

response within six months of receiving it. After that, the Commission must publish the Final Report.

Table 1 Inquiries undertaken 2015-16

Inquiry Date commenced Draft report Date completed Government response

Electricity pricing June 2015 3 February 20161 31 May 2016 by 30 November 2016

Solar feed-in pricing August 2015 10 March 2016 20 June 2016 By 20 December 2016

In the course of its first two inquiries, the Commissioner and staff met with more than 120 individuals,

organisations or groups and held public hearings, forums and roundtables across Queensland (Table 2).

Stakeholders provided over 190 written submissions that are available on our website,2 together with

summaries of our roundtable discussions and transcripts from our public hearings. The Electricity pricing

inquiry also convened a Stakeholder Reference Group, as required by its terms of reference, to provide

additional advice and feedback on the analysis undertaken, the proposed findings and recommendations,

and the likely effects of proposals on particular stakeholder groups.

1 In August 2015 the Treasurer extended the deadline for the Commission to deliver its draft report for the Electricity pricing inquiry

from November 2015 to January 2016, to provide further opportunity for consultation. 2 Submissions provided to us on a confidential basis have not been published. Other material has been supplied to the Queensland

Government Energy Taskforce to assist in its deliberations and will be published at a later date.

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 7

The Commission seeks to encourage participation in, and raise awareness of, its inquiries by preparing an

issues paper (when a new inquiry commences) and draft report (to test the Commission's preliminary views,

findings and recommendations). The Commission's website provided on going updates on progress and

inquiry participants were also kept informed through inquiry circulars: the Commission produced 10 circulars

during the year for its two public inquiries provided to over 700 interested parties.3

Table 2 Consultation 2015-16

Electricity pricing inquiry Solar feed-in pricing inquiry

Issues paper 14 October 2015 16 October 2015

Draft Report 3 February 2016 10 March 2016

Submissions 125 68

Public consultation

Public Hearings and forums

Brisbane: 5 November 2015, 4 April 2016 Bundaberg: 7 April 2016 Cairns: 26 November 2015, 14 April 2016 Mt Isa: 18 November 2015, 13 April 2016 Rockhampton: 17 November 2015, 11 April 2016 Toowoomba: 12 November 2015, 5 April 2016 Townsville: 2 November 2015, 12 April 2016

Roundtables

Regional issues (Bundaberg): 15 October 2015 Consumer (Brisbane): 27 October 2015 Renewable (Brisbane): 29 October 2015 Emerging technologies (Brisbane): 31 March 2016

Other consultation

45

REGULATORY REVIEW

Regulation is essential for the proper functioning of society and the economy. The challenge for government

is to deliver regulation that effectively addresses an identified problem, and ensures regulation maximises

the net benefit (benefits less costs) to the community.

Regulatory Impact Analysis (RIA) is a systematic method used to provide an informed, objective and

transparent basis for regulatory decision making. The Queensland Government has the Regulatory Impact

Statement (RIS) System to assist agencies in improving the quality of regulation.

3 The Commission also produced 5 circulars as part of its Regulatory Impact Assessment of the Sugar Industry (Real Choice in

Marketing) Amendment Bill 2015 and 1 general circular.

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 8

Best practice principles

help to ensure any

impacts of a proposed

regulatory change are

carefully and fully

assessed — so that those

designing, implementing

and/or approving the

regulation fully

understand its potential

impacts.

The Commission ensures agencies undertake quality assessments of

regulatory proposals to support good policy development through the use

of RIA set out in the RIS System guidelines.4 This includes:

advising agencies whether:

a regulatory proposal requires further analysis – a Preliminary

Impact Assessment (PIA) or a Consultation RIS;

the impacts of a regulatory proposal are unlikely to be significant

and accordingly, further analysis is not required;

the regulatory proposal belongs to an excluded category under

the RIS System guidelines.

providing training and guidance relating to the RIS System guidelines,

including best practice consultation.

Assessment of regulatory proposals

Figure 4 Total Assessments 2015–16

The Commission records all of the regulatory proposals

submitted by government agencies for assessment. Between 1

July 2015 and 30 June 2016, there were 295 requests for

exclusions, 104 PIAs and 7 RISs (Figure 4and Table 3).

In 2015-16, the Commission has focused on its regulatory

assessment tasks — building and developing its review team

and developing its assessment processes and practices. Over

the coming year, the Commission intends to launch its updated

training program as a means of promoting best practice

regulation and improving regulatory analysis.

Table 3 Nature and type of review activities 2015–16

Exclusion requests PIA and RIS submissions

Outcome Assessments Outcome Assessments

Excluded from further analysis under RIS guidelines

254 Not significant/No further analysis required

96

Not excluded, but not significant (no further analysis required)

33 Significant (RIS required) 3

Not excluded, further analysis required by department

1 Post Implementation Review required

5

Partially excluded 7 Consultation or Decision RIS assessed

7

Total 295 Total 111

4 The RIS System Guidelines describe the required procedure for developing regulation for Queensland government agencies under

the RIS system.

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 9

SUGAR INDUSTRY (REAL CHOICE IN MARKETING) AMENDMENT BILL 2015

On 19 May 2015 the Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 (the Bill) was introduced

into the Queensland Parliament. The Bill sought to 'prevent anti-competitive behaviour and promote pro-

competitive outcomes … to ensure economic viability for both growers and mill owners, among others, in

the Queensland sugar industry'.5

A regulatory impact

assessment uses a

transparent, robust

process to provide decision

makers with the

information they need to

make an assessment of the

benefits and costs of

regulatory intervention.

As the Bill was a Private Member’s Bill, it was not subject to the

regulatory impact assessment process that would normally be

undertaken for government-initiated legislation. However, Queensland

Parliament’s Agriculture and Environment Committee (AEC)

recommended that a regulatory impact assessment be completed prior

to the Bill being brought for the second reading debate.

On 30 September 2015, the Treasurer asked the Commission to

undertake an independent regulatory impact assessment of the Bill.

The assessment was undertaken in accordance with the RIS system

guidelines and with the assistance of the Department of Agriculture and

Fisheries. The assessment was based around the preparation of a:

Consultation RIS – a draft RIS publicly released to provide interested stakeholders with information to

allow informed debate; and

Decision RIS – which considers the submissions received during consultation and is designed to inform

and recommend a final policy decision.

An expedited timeframe was required to meet the Queensland Parliament’s consideration of the Bill (Figure

5), rather than the consultation practice set out in the RIS System Guidelines.

Figure 5 Decision RIS assessment process

Taking into account work done by the AEC and the Senate Committee on Rural and Regional Affairs and

Transport (Inquiry into Current and Future Arrangements for the Marketing of Australian Sugar), and 12

submissions received on the Consultation RIS, the Decision RIS concluded that:

there was no evidence to support a case for market failure in the Queensland sugar industry that would

indicate the need for additional government intervention; and

the benefits of additional regulation set out in the Bill, do not outweigh the costs.

The RIS recommended the existing regulatory framework be retained ― with no additional regulation,

providing the greatest net benefit to Queensland.

The Bill was passed on 2 December 2015. The Bill was not supported by the Queensland Government due to

the likely negative impacts. The Queensland Government notified the Australian Competition and Consumer

Commission and the Australian Government of the legislation and its concerns, including in relation to the

authorisation of anticompetitive behaviour, and requested that the matter be referred to the National

Competition Council for assessment.

5 Revised Explanatory Notes to the Sugar Industry (Real Choice in Marketing) Bill, page 2

3 SeptemberReferral from

Treasurer 30 October

Consulation RIS13 NovemberSubmissions

recieved

25 NovemberDecision RIS to Treasurer

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 10

COMPETITIVE NEUTRALITY

In Queensland, the competitive neutrality principle is applied to all Government Owned Corporations (GOCs),

government agencies and local governments carrying out significant business activities or activities

prescribed under a regulation.

Competitive neutrality requires that a

public sector business, or agency,

should not have a competitive advantage

(or disadvantage) over the private

sector solely due to their government

ownership.

The Commission has responsibility for the Queensland

Government’s competitive neutrality complaints

mechanism.

It receives, investigates and provides recommendations

on complaints about the alleged failures of government

agencies complying with the principle of competitive

neutrality.

The Commission’s approach (Figure 6) to implementing competitive neutrality, receiving complaints,

undertaking investigations and providing recommendations is set out in the Competitive Neutrality and

Queensland Government Business Activities guidelines,6 and other relevant legislation.7

Figure 6 Competitive neutrality process

Upon commencement of the QPC Act and Regulations

in late 2015, four active competitive neutrality

investigations transferred to the Commission from the

Queensland Competition Authority.8

These are expected to be finalised in the first half of

2016-17. Subsequent to the Government’s response,

the Commission’s reports and the government’s

responses will be published on the Commission's

website.

6 Published by the Queensland Government and dated July 1996. 7 Includes the QPC Act, the QPC Regulation 2015, the Local Government Act 2009 and the Local Government Regulation 2012. 8 The Commission received three further complaints, however the requirements for initiating an investigation were not met.

Determine whether the complaint is

substantiated

Undertake an initial

assessment

Complaint recieived

No further action

Launch investigation

Written report to government

Overview of Key Activities

Queensland Productivity Commission 2015-16 Annual Report 11

PUBLICLY AVAILABLE PUBLICATIONS

Release Date Title

2015

14 October Electricity pricing in Queensland issues paper

16 October Solar feed-in pricing issues paper

30 October Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 Consultation RIS

30 October Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 Consultation RIS summary

25 November Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 Decision RIS

25 November Sugar Industry (Real Choice in Marketing) Amendment Bill 2015 Decision RIS summary

2016

3 February Electricity pricing in Queensland draft report

10 March Solar feed-in pricing draft report

10 March Solar feed-in pricing fact sheet

10 March Solar feed-in pricing FAQs

June Electricity pricing inquiry and Solar feed-in pricing inquiry public hearing transcripts and discussion summaries

PUBLICATIONS SUBMITTED TO GOVERNMENT9

Date submitted Title

2016

31 May Electricity pricing in Queensland final report

31 May Electricity pricing in Queensland fact sheets

31 May Electricity pricing in Queensland FAQs

20 June Solar feed-in pricing final report

20 June Solar feed-in pricing fact sheet

20 June Solar feed-in pricing FAQs

9 The Treasurer must provide the Commission with a written response within six months of receiving a Final Report. After that, the

Commission must publish the Final Report.

CORPORATE MATTERS

Queensland Productivity Commission 2015-16 Annual Report 12

CORPORATE MATTERS

GOVERNANCE

Section 14 of the QPC Act establishes the Board as the governing body of the Commission.

The Board is made up of the Principal Commissioner, and the other Commissioners, as appointed by the

Governor in Council. A maximum of three commissioners may be appointed.

Mr Kim Wood was appointed as the first Principal Commissioner in October 2015.

The Board is accountable for the management and performance of the Commission in accordance with the

QPC Act, as well as any other applicable legislation including the Financial Accountability Act 2009 the

Statutory Bodies Financial Arrangements Act 1982. Section 15 of the QPC Act states the Board’s functions

are to (a) manage the Commission and (b) to ensure the Commission performs its functions with

independence, rigour, responsiveness, transparency, equity, efficiency and effectiveness.

The Principal Commissioner provides strategic direction and leadership across all of the Commission’s key

functions and activities. This includes an:

approval role — ensuring the Commission’s work is evidence-based and makes a positive contribution

to the long-term interests of the Queensland community;

a consultative role — leading the Commission’s public inquiries and actively engaging with stakeholders

regarding productivity and regulatory matters; and

a performance management role — reviewing Board and organisational performance to drive

continuous improvement.

Section 44 of the QPC Act says that, subject to the approval of the Principal Commissioner, the Commission

may conduct meetings of the Board in the way it considers appropriate. However, minutes of all Board

meetings must be kept. Following the appointment of the Principal Commissioner in October 2015, 10 Board

meetings were held to 30 June 2016 (Table 4).

Table 4 Board meetings 2015-16

Scheduled Special Out-of-session Total

Board meetings 7 2 1 10

The responsibility for the day-to-day conduct and management of the Commission lies with the Executive

Director. The Executive Director administers the Commission in line with the delegation, policies and

procedures approved by the Board. The Executive Director is the primary link between the Board and

Commission employees and is responsible for communicating Board policies and priorities to employees.

As a new agency, the Commission has developed policies and procedures to ensure Commissioners and

employees carry out their duties using best practices and in accordance with statutory requirements and

core public sector values. These include:

a Strategic Plan — that formalises the Commission’s vision, purpose and objectives; identifies broad

strategies to achieve them; and identifies ways to measure progress;

Codes of Conduct for Commissioners and Employees — that set out the principles and standards of

conduct expected to be put into practice, to guide decision-making, and workplace behaviour;

CORPORATE MATTERS

Queensland Productivity Commission 2015-16 Annual Report 13

a Finance Manual — that provides policies, procedures, delegations and arrangements to enable the

Commission to carry out day-to-day accounting and financial functions, in a manner consistent with the

statutory requirements;

a Guide to Inquiry Procedures — that sets out good practice for undertaking public inquires, including

consultation and stakeholder engagement and record keeping and publication of submissions; and

a Purchasing and Procurement Manual — that sets out the governance for a range of functions

including the appointment of consultants and engagement of contractors.

Risk management and accountability

The Commission’s risk management procedures are outlined in its interim Risk Management Policy. As the

Commission is a small organisation, it does not have a formal risk management committee or an internal

audit function to manage its strategic and operational risks. Instead, the senior management group considers

areas of potential risk exposure, assesses them in terms of severity and probability and ensures

arrangements in place to ensure key risks are being mitigated and opportunities taken. The Executive

Director reports annually to the Board regarding the status of risk management policies and issues.

The Commission will review its risk management policy in 2016–17.

FINANCIAL PERFORMANCE

In 2015-16 the Commission’s income was $3.1 million (largely from government funding). Over the year it

spent $2.8 million. Wages and salaries are the largest component of the Commission’s costs — however, it

also incurs costs associated with contractors and consultants, accommodation, corporate services charges

and costs associated with its consultation processes (travel and advertising).

Expenditure, including performance against budget, is reported monthly to the Board.

OUR EMPLOYEES

Workforce profile

As at 30 June 2016, the Commission employed 12 permanent employees (11.8 full time equivalents) with

specialist expertise in economic analysis, regulatory analysis and competitive neutrality policy, plus the

Principal Commissioner.

The Commission adjusts resources depending on the tasks referred by the government. It offers secondment

opportunities for Queensland Government employees with specialist experience for particular inquiries.

During 2015-16, the Commission seconded 10 employees from the Queensland Treasury, the Department

of Energy and Water Supply and Energex to work in its public inquiries, as well as two additional employees

to provide administrative support in peak work periods.

Workforce planning and performance

As a new agency, a key focus is to attract and retain capable and committed employees to provide the

capacity to maintain high quality work.

All permanent and seconded employees are appointed through a merit-based process. Permanent vacancies

(including promotions) and temporary vacancies over 12 months (other than entry level) are advertised and

filled through merit-based selection. Secondment opportunities for Queensland Government employees are

filled through a competitive expression of interest process.

CORPORATE MATTERS

Queensland Productivity Commission 2015-16 Annual Report 14

The Commission’s Human Resources Manual sets out the terms and conditions of employment under the

QPC Act. In 2015–16, the Commission also developed policies relating to workplace bullying prevention,

health and safety, antidiscrimination and sexual harassment, and domestic violence.

Flexible work arrangements

The Commission provides for flexible work practices to maximise employee’s productivity and help our

employees balance work with other commitments. These include flexible work hours, ongoing part‐time

work and purchased leave (up to an additional four weeks of leave per year). Employees may also work from

home (subject to organisational requirements).

Investing in the development of people

The Employee Capability System describes the core capabilities and expectations for Commission employees.

It is designed to support and develop employees for their own professional development and to deliver high

quality outcomes. It is used as the basis for performance planning and development, as well as career

conversations.

The Commission also seconds specialist employees for particular inquires, as it is committed to providing a

workplace that provides a positive career experience, regardless of whether they are permanent employees

or on secondment from other parts of the Queensland Government.

Early retirement, redundancy and retrenchment

During the period, no early retirement, redundancy and retrenchment packages were paid.

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FINANCIAL STATEMENTS

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Glossary

Queensland Productivity Commission 2015-16 Annual Report 39

GLOSSARY

AEC Agriculture and Environment Committee (Queensland Parliament)

ARRs Annual report requirements for Queensland Government agencies

Bill Sugar Industry (Real Choice in Marketing) Amendment Bill 2015

Commission Queensland Productivity Commission

FAA Financial Accountability Act 2009

FPMS Financial and Performance Management Standard 2009

GOCs Government Owned Corporations

ISSN International Standard Serial Number

PIA Preliminary Impact Assessment

QPC Act Queensland Productivity Commission Act 2015

RIA Regulatory Impact Assessment

RIS Regulatory Impact Statement

Appendix A: Letter of compliance

Queensland Productivity Commission 2015-16 Annual Report 40

APPENDIX A: LETTER OF COMPLIANCE

Appendix B: Compliance checklist

Queensland Productivity Commission 2015-16 Annual Report 41

APPENDIX B: COMPLIANCE CHECKLIST

Summary of requirement Basis for requirement Annual report reference

Letter of compliance

A letter of compliance from the accountable officer or statutory body to the relevant Minister/s

ARRs – section 8 40

Accessibility Table of contents

Glossary

ARRs – section 10.1 i

39

Public availability ARRs – section 10.2 Inside cover 43

Interpreter service statement Queensland Government Language Services Policy

ARRs – section 10.3

43

Copyright notice Copyright Act 1968

ARRs – section 10.4

Inside cover

Information Licensing QGEA – Information Licensing

ARRs – section 10.5

N/A

General information

Introductory Information ARRs – section 11.1 ii

Agency role and main functions ARRs – section 11.2 1-3, 5-11

Operating environment ARRs – section 11.3 2

Non-financial performance

Government’s objectives for the community ARRs – section 12.1 1-3, 5-11

Other whole-of-government plans / specific initiatives

ARRs – section 12.2 1-3, 5-11

Agency objectives and performance indicators ARRs – section 12.3 1-3, 5-11

Agency service areas and service standards ARRs – section 12.4 5-11,

Financial performance

Summary of financial performance ARRs – section 13.1 13-14

Governance – management and structure

Organisational structure ARRs – section 14.1 4

Executive management ARRs – section 14.2 4

Government bodies (statutory bodies and other entities)

ARRs – section 14.3 43

Public Sector Ethics Act 1994 Public Sector Ethics Act 1994

ARRs – section 14.4

12–13

Queensland public service values ARRs – section 14.5 12–13

Governance – risk management and accountability

Risk management ARRs – section 15.1 13

Audit committee ARRs – section 15.2 13

Internal audit ARRs – section 15.3 13

External scrutiny ARRs – section 15.4 N/A

Appendix B: Compliance checklist

Queensland Productivity Commission 2015-16 Annual Report 42

Summary of requirement Basis for requirement Annual report reference

Information systems and recordkeeping ARRs – section 15.5 13

Governance – human resources

Workforce planning and performance ARRs – section 16.1 13–14

Early retirement, redundancy and retrenchment Directive No.11/12 Early Retirement, Redundancy and Retrenchment

Directive No.16/16 Early Retirement, Redundancy and Retrenchment (from 20 May 2016)

ARRs – section 16.2

14

Open Data Consultancies ARRs – section 17

ARRs – section 34.1

43

Overseas travel ARRs – section 17

ARRs – section 34.2

43

Queensland Language Services Policy ARRs – section 17

ARRs – section 34.3

N/A

Financial statements

Certification of financial statements FAA – section 62

FPMS – sections 42, 43 and 50

ARRs – section 18.1

36

Independent Auditor’s Report FAA – section 62

FPMS – section 50

ARRs – section 18.2

37

FAA Financial Accountability Act 2009

FPMS Financial and Performance Management Standard 2009

ARRs Annual report requirements for Queensland Government agencies

Annual report access

Queensland Productivity Commission 2015-16 Annual Report 43

ANNUAL REPORT ACCESS

ADDITIONAL COPIES

A copy of this report can be obtained by contacting us as follows:

Email [email protected]

Mail Executive Support

Queensland Productivity Commission

PO Box 12112

George Street

BRISBANE QLD 4003

Tel (07) 3015 5111

Fax (07) 3015 5199

This report is available online and in PDF format on our website: http://www.qpc.qld.gov.au/about-the-

commission.

OPEN DATA

Further information on the following is available through the Queensland Government’s Open Data website: qld.gov.au/data:

Consultancies 2015–16

Overseas travel 2015–16

GOVERNMENT BODIES

The Queensland Register of appointees to Government bodies provides access to information about

government bodies including descriptions, contact details, and lists of appointees.

TRANSLATING AND INTERPRETING ASSISTANCE

The Commission is committed to providing accessible services to Queenslanders from all

culturally and linguistically diverse backgrounds. If you have difficulty in understanding the

annual report, you can contact us on (07) 3015 5111 and we will arrange an interpreter to

effectively communicate the report to you.

FEEDBACK

Readers are encouraged to provide feedback on the contents or structure of this report by contacting us at

[email protected].

Level 27, 145 Ann Street Brisbane Q 4000 PO Box 12112, George Street Brisbane Q 4003 Tel (07) 3015 5111 Fax (07) 3015 5199

www.qpc.qld.gov.au