Commonwealth Fraud and Corruption Control Framework
The Minister for Finance and the Attorney-General have announced the new Commonwealth Fraud and Corruption Framework which will come into effect on 1 July 2024.
This follows the recent amendments to section 10 of the Public Governance, Performance and Accountability (PGPA) Rule 2014 (the Fraud Rule) to include corruption, and strengthen the requirements for Commonwealth entities to prevent, detect and deal with fraud and corruption. These amendments will become the Fraud and Corruption Rule.
To reflect these amendments, the Attorney-General’s Department (AGD) has updated the Fraud Policy and is revising Resource Management Guidance 201 – Preventing, detecting and dealing with fraud.
The Commonwealth Fraud Control Framework 2017 will continue to apply until 30 June 2024.
Commonwealth Fraud and Corruption Control Framework 2024
The Framework is designed to support Australian Government entities to effectively manage the risks of fraud and corruption.
The Framework consists of 3 parts:
- Fraud and Corruption Rule (Section 10 of the PGPA Rule 2014)
- Fraud and Corruption Policy
- Fraud and Corruption Guidance (Resource Management Guidance 201 – Preventing, detecting and dealing with fraud and corruption).
Fraud and Corruption Rule
This is a legislative instrument binding for all PGPA Act entities from 1 July 2024. It sets out the minimum standards for accountable authorities of PGPA Act entities in relation to managing the risk and incidents of fraud and corruption relating to their entity.
Fraud and Corruption Policy
This Policy is binding for all Non-Corporate Commonwealth Entities (NCEs) from 1 July 2024. Corporate Commonwealth Entities (CCEs) and Commonwealth Companies are encouraged to adopt the Fraud and Corruption Policy as better practice. The Fraud and Corruption Policy sets out the procedural requirements entities must implement to establish and maintain an appropriate system of fraud and corruption control for their entity.
Fraud and Corruption Guidance
This provides further guidance on the Australian Government’s expectations for fraud and corruption control arrangements for all Commonwealth entities. An Exposure Draft of Resource Management Guide (RMG) 201 - Preventing, detecting and dealing with fraud and corruption was distributed to Senior Officials in December 2023 for consultation. The Attorney-General’s Department is currently reviewing feedback and will release the RMG in early 2024.
Why has the Framework been updated?
The changes are part of a suite of reforms to improve the standards of integrity across the public sector.
The Fraud and Corruption Rule amendments bring it into alignment with Australian Government policies including the Commonwealth Risk Management Policy 2023 and the Australian Government Investigation Standards 2022, along with industry standards, and will strengthen the Commonwealth’s counter fraud and corruption efforts.
What has changed in the 2024 Framework?
The most significant change for the Fraud and Corruption Rule is to expand its application to corruption as well as fraud – requiring Commonwealth entities to take steps to prevent, detect and deal with corrupt conduct. This complements the National Anti-Corruption Commission’s (NACC) prevention and investigation functions.
In addition, there are also new clauses requiring entities to:
- have governance structures and processes to effectively oversee and manage risks of fraud and corruption relating to the entity
- have officials who are responsible for managing risks of fraud and corruption relating to the entity
- periodically review the effectiveness of the entity’s fraud and corruption controls.
What support is available?
To support entities meet their obligations under the amended Fraud and Corruption Rule and Fraud and Corruption Policy, the Commonwealth Fraud Prevention Centre will release the following additional resources in early 2024:
- Fraud and Corruption Guidance
- Information Sheets and resources about the changes to the Framework
- A series of webinars, training and briefings to help Australian Government officials understand and implement the new requirements.
Please refer to this page for further updates, join our mailing list below or reach out to firstname.lastname@example.org for more information.
What consultation has taken place?
In February 2023, the Commonwealth Fraud Prevention Centre consulted broadly via a consultation paper discussing proposed changes to section 10 of the PGPA Rule 2014. In June 2023, the Centre sought feedback on the draft Fraud and Corruption Control Policy 2024 and the final draft of the Policy was distributed in November 2023 for red line comments. We would like to thank the many entities that contributed feedback throughout this engagement. Your feedback was considered in the drafting of the amendments to the Rule and Policy. In December 2023, an Exposure Draft of Resource Management Guide 201: Preventing, detecting and dealing with fraud and corruption was provided to all PGPA entities for consultation.
Recent newsletter articles are also linked below:
- The Fraud Rule is changing
- Consultation on the Fraud and Corruption Policy
- Fraud Control Framework review update
The new Framework – Frequently asked questions
What is corruption?
For the purposes of this Framework, corruption in relation to an entity is defined broadly consistently with the NACC Act and is any conduct that does or could compromise the integrity, accountability or probity of public administration. This includes:
- any conduct of any person (whether or not a staff member of a Commonwealth agency) that adversely affects, or that could adversely affect, either directly or indirectly:
- the honest or impartial exercise of any staff member’s powers as a staff member of a Commonwealth agency; or
- the honest or impartial performance of any public official’s functions or duties as a public official;
- any conduct of a staff member of a Commonwealth agency that constitutes or involves a breach of public trust;
- any conduct of a staff member of a Commonwealth agency that constitutes, involves or is engaged in for the purpose of abuse of the person’s office;
- any conduct of a staff member of a Commonwealth agency, or former staff member of a Commonwealth agency, that constitutes or involves the misuse of information or documents acquired in the person’s capacity as a staff member of a Commonwealth agency.
Corruption may be criminal or non-criminal in nature and may affect any aspect of public administration. For example, an official being offered or accepting a bribe, or engaging in fraud against the entity.
What is fraud?
For the purposes of this Framework, fraud is defined as ‘dishonestly obtaining (including attempting to obtain) a gain or benefit, or causing a loss or risk of loss, by deception or other means.’ This definition is still based on the dishonesty offences under Chapter 7 of the Criminal Code but extends to attempts to dishonestly obtain a benefit, causing a risk of loss to the Commonwealth.