Senator RICE: I will continue on with that line of questioning seeing as that's where all our heads are at. You note that the agency has never met its statutory requirements. Both overall and for pesticides, what have been the peak rates, potentially even looking back beyond the years that you've been sharing with us?
Dr Parker: I'd have to take that on notice. I have back to March 2016. There's an overall figure for 2015-16, but I couldn't give you, depending on what time frame you want, the accurate peaks and the troughs associated with that.
Senator RICE: I'm interested in knowing how that 68 per cent in 2015-16 compared with previous years? Overall, was that fairly middling, or was it lower than usual or higher than usual?
Dr Parker: It's very hard to compare, because there was a different way of measuring before those figures. So you're not comparing apples with apples. I can certainly make an effort to give you that on notice without any trouble at all. But at this stage it wouldn't be fair, because they were worked out differently to, say, what it was in 2014. And I don't actually even have the information with me.
Senator RICE: And you're saying that you've never met the 100 per cent requirement of approvals on time. Is that correlated with the economic problems that you were talking about? The fact that because the approvals were taking longer than necessary there's more staff time—that it is one of the reasons as to why your expenses are more than your revenue?
Dr Parker: As I said in my opening remarks, I'm not in a position to be able to give accurate information to this committee on that particular issue. I simply do not know all the factors that are affecting that performance. I'm hopeful that at the end of the year we'll have a much better picture of what those factors are and what we may be able to do to tweak those so that we're able to deliver in a better time frame performance.
Senator RICE: Your 70 per cent target for the next financial year, is that across the board for both—
Dr Parker: The 70 per cent would be an overall result. I would hope that we might do better than that in some of the other ones.
Senator RICE: Do you have a target for, say, pesticides, which are considerably lower than the other categories?
Dr Parker: I would like to see them all at 70 per cent, at least.
Senator RICE: Do you think that's a realistic target?
Dr Parker: I would like to think that they're on an upward trajectory.
Senator RICE: Obviously, this coming year is going to be a time of change. You've got staff moving and ongoing staff volatility, as I hear it. Do you think that's realistic? What are the strategies that are going to enable you to get it to 70 per cent? That would be doubling the timeliness of the pesticides.
Dr Parker: There are a number of things that I've already put in place as far as improving performance goes. There is resolving the CCR issue. There is also putting in place some—
Senator RICE: Resolving the what?
Dr Parker: improved procedures.
Senator RICE: What's the CCR?
Dr Parker: Sorry. Let me get the commercial-in-confidence information. That's the information centre that is provided to us to support applications. Where we have generic products that want to use information, we're able to use that information; it's then just how we provide that in public. That caused some considerable issues off the back of a court case for the organisation. So we've put out a new practice statement that addresses that since I've started. We've also worked very closely with the industry about how we might use international assessments and international approvals of products in Australia. There are some differences, and we're talking with industry about how we manage that.
The other thing, which Mr Thompson mentioned, is that I'm also starting to look at how we might manage a provisional registration scheme, all of which is in place to try to improve the performance of the organisation.
Senator RICE: Right. Moving on to the issue of staff and the staff movements. You mentioned that you've had 11 staff in your small group that have responded to your expression of interest by saying that they would like to move at some time in 2018 or early 2018—
Dr Parker: No, they'd like to move early.
Senator RICE: Early, okay.
Dr Parker: That was what the EOI was about: it was early. Just to be clear: I haven't asked all the staff about their intentions about relocation. I intend to do that early next year.
Senator RICE: Right. What are the categories of those 11 staff?
Dr Parker: I'd have to take that on notice, Senator, but a number of them are senior managers in the organisation.
Senator RICE: Right. How about in terms of the regulatory scientists? Have you got any sense of how many of those?
Dr Parker: Again, I'd have to take it on notice to give you an accurate assessment.
Senator RICE: Again, and noting that you've said that you haven't put out an EOI at the moment, and noting also that you've said that you do want to have a staged movement of staff now rather than all in one go, what's your expectation of the number of staff that would be in Armidale by the end of next year?
Dr Parker: By the end of next year?
Senator RICE: Yes.
Dr Parker: I don't have an expectation at this stage.
Senator RICE: But, surely, given that you're going to need accommodation for them, you would have to be doing some forward planning for what—
Dr Parker: So, on the accommodation, the temporary—
CHAIR: I'm not sure that this—this borders on hypothetical. Dr Parker is capable—
Senator RICE: I think it's quite a reasonable question. The end of next year is a year ahead. Any organisation, if it's efficiently planning, will be looking a year ahead.
CHAIR: Where are you going to be at the end of next year, Senator? It's a crazy question.
Senator STERLE: You might still be sitting here frustrated because we can't get some answers.
CHAIR: It takes us 20 minutes every time we open this. Dr Parker, you manage it how you see, but it's bordering on a hypothetical question.
Senator RICE: There are no rules against hypothetical questions, I understand, in estimates.
CHAIR: The witness has responded by telling you he has no sense of it, so let's not pursue that, when the witness has made it clear.
Senator RICE: Dr Parker, you have a cohort of three there at the moment. You have another 11 who want to move early, so you would expect to have 14 there by, what, February or March?
Dr Parker: It might be simplest to answer this question with how I'm preparing. Currently the interim office has facilities for 15 people. I have asked my staff to investigate with the Department of Human Services, with whom we share the accommodation, the option of reconfiguring that office to allow us to have up to 35 or 40 seats there. It would be my assessment that that will be fine for probably the next six to eight months, but asking me how many will be there in 12 or even 15 months time? I don't have a sense of that exact answer. I think that gives you a sense of how we're planning going forward.
Senator RICE: Perhaps I will put it another way. You said that 216 is close to the full complement. That's what you have at the moment. Do you now have an expectation of how many of those will eventually be based in Armidale and how many will be working remotely?
Dr Parker: The short answer to that is no. Again, if I could take a step back, the business model that I would like to implement is that all the staff move to Armidale and we do the job from Armidale. That is not realistic for the current staff. We then need to think about what functions are going to be where, and what functions might be done by a third party. We might commission that. In the corporate space—
Senator RICE: Are you looking at outsourcing some functions? I'll come back to that.
Dr Parker: In a corporate sense we're investigating actively with the department about their doing this in a shared service for us as well. There are a range of options depending on what the function is. Where a staff member indicates they want to move to Armidale, the function they are doing will move to Armidale with them. Where staff members do not—and I stress I have not asked all staff members whether or not they're moving—want to move, we need to think about how we're going to manage that function into the future. There will be a range of options to manage that function. I am not going to settle on one option just now, because that needs to remain flexible, so we're able then to continue to provide the service that industry expects.
CHAIR: Senator Rice, at a suitable time, we need to move on. We're doing this in 20-minute blocks.
Senator RICE: I started at five past six. That's another seven minutes.
Senator STERLE: Pull your head in, Chair.
CHAIR: No, that's not when she started, but I'm not going to make an issue of it.
Senator RICE: There are a range of different ways to be fulfilling those functions. What options are you looking at?
Dr Parker: It depends on the function. If we look at the traditional reg scientist who'll be assessing an application, it's our assessment—and the high-level business model talks about this—that those functions will probably be suitable for e-working. That does not mean that all the people in those functions will be suitable for e-working. E-working, as I'm sure you can appreciate, is a product of both whether the function is suitable and whether the individual is suitable. Some individuals will go extremely well working by themselves; others do not go so well. They may like the social environment of a workplace or they may not be as self-motivated as others, so we need to make an assessment of that. Once we've finished and finalised the consultation on the e-working policy, which I mentioned in my opening statement, we will then be in a position to trial, take expressions of interest of who wants to e-work and make some selections from that. It would be my intention to trial that in Canberra, probably in a flexible working arrangement. They might do three days e-work, two days back in the office in Canberra. Let's see how that arrangement works. If it looks like it's working well then those officers would go on to e-work on a more permanent basis. If it looks like it's working well, then those officers would go on to be e-working on a more permanent basis. I call it tasting and trying something: we get in, we settle on the policy, we see who wants to be involved in the policy, we then make a selection process of people we believe may be suitable—and that will be in close consultation with their managers. We then go, 'Great, let's trial that, see how that runs.' If it's a good option for that function into the future, then that function's settled; we can go, 'Righto, we don't need to worry about filling those roles in Armidale, because we can manage the function in that manner.' I don't have a permanent view about every single function, because I think we need to remain flexible.
Senator RICE: How about a staff member that either, because of the function or because of the person, isn't appropriate for e-working—they've currently got a job in Canberra; they don't want to move to Armidale?
Dr Parker: Then there are a range of options that we're working through with those people. A number are already outlined in our enterprise agreement. We've had, I think, 92 staff members go to a whole lot of career sessions that we're running. I'm sure, as you can appreciate, if you've been in a job for a number of years, you probably haven't written a CV or an application for a little while, so we're providing that training for people as well to assist them in the transition into a new job, and I think that's all reasonable. There are provisions within the EA if we get to a period of time where people may choose to retire or they may get to the stage where they may need a voluntary redundancy. All of those options are open and they're all explained to staff in our EA. In fact, what we're just working on now is some guidance material for our staff with some of those pathways that you're describing and how they might manage those pathways themselves.
Senator RICE: Will there be forced redundancies, if things don't turn out—?
Dr Parker: They're not forced redundancies.
Senator RICE: No, but in the situation where you've got someone for whom e-working isn't going to work, either for them or for the organisation, and the organisation is moving to Armidale and will not have an office in Canberra, it's not going to work for them.
Dr Parker: They may choose the pathway to investigate a voluntary redundancy.
Senator RICE: What if they don't choose a voluntary redundancy and say 'No, I'm here. I'm working for the APVMA.'
Dr Parker: Again, I can only tell you the pathways that are available in the EA. I am hopeful that those we can assist by providing assistance and guidance find new employment elsewhere if they don't want to move to Armidale. Again, I don't have a sense of the numbers at the end; I really don't.
Senator RICE: No, it may be quite small.
Dr Parker: I'm not sure. It may be zero; I don't know.
Senator RICE: That's right, but are you ruling out, then, forced redundancies?
Dr Parker: I don't see them as forced redundancies.
Senator RICE: No, but are you ruling them out?
Dr Parker: They are voluntary redundancies, and they're voluntary—
Senator RICE: You can't have a voluntary redundancy if it's not voluntary—if they don't want to leave, if they're in Canberra and e-working doesn't suit them or the organisation for whatever reason.
Dr Parker: I don't want to rule anything in or out at this stage; I really don't.
Senator WILLIAMS: Or alarm people.
Senator RICE: How is the development of the virtual network going to enable the e-working?
CHAIR: This is your last question, Senator.
Dr Parker: The priority, in the digital sense, for me is stabilising the network and digitising the data that we have. We have over 200,000 files that need to be digitised. It's that preparation work that will provide the framework for e-working. We're able to manage the Armidale office at the moment, but suffice to say there has been a chronic lack of investment in IT in the organisation, and we struggle a bit in that space at the moment.
Senator RICE: Are you confident it's all going to be on track by the start of 2018 when you move?
Dr Parker: I am as confident as I can be.
Senator RICE: Thank you.
Senator RICE: Thank you. I might have a bit more than five, perhaps. With the timely approval rates for pesticides, which we have just heard went from 82 in September 2016 to 36, can you give me the same statistics for the others? Is it basically just two categories that you track for pesticides and veterinary medicines, or is it divided up into further categories?
Dr Parker: We divide it up into pesticides and vet meds, but then there are actives and permits as well, which all come into it. In that September quarter of 2016, pesticides were 82 and vet meds were eight.
Senator RICE: Eight?
Dr Parker: Eight. And in September 2017, it was 36 for pesticides and 76 for vet meds.
Senator RICE: What were the intervening ones? I've got myself a little table here. I may as well as fill it in.
Dr Parker: The intervening for December 2016? Is that where you are?
Senator RICE: Yes.
Dr Parker: It is 50 per cent for pesticides and 87 per cent for vet meds. In March 2017, it is 30 per cent for pesticides and 58 per cent for vet meds. Pesticides in June 2017 were 24 and vet meds were 75. In the September quarter, it's 36 for pesticides and 76 for vet meds.
Senator RICE: I see you what you mean about volatility. Is there any underlying reason or any structural reason why you have different performance, or is it basically random statistics? Are some applications more tricky and difficult than others?
Dr Parker: As I said earlier, one of the influences would be the type of application that came in. If you had a large number of simple changes then they could probably be done quite quickly. There would be a range of other factors that might come in. In a small organisation, things like staff illnesses in key people—all of those things—contribute to that volatility. I believe it is more useful to focus on a year, and whatever year we pick—Senator Gallagher chose a particular year—that's fine. I think that would be a more useful way of looking at it. Ms Fox may have something to add.
Ms Fox: I do. Thank you. I just want to correct a number that Dr Parker just read out for you, Senator, in relation to the September 2016 quarter for vet meds. Dr Parker read out eight per cent.
Senator RICE: Which I thought was extraordinarily low.
Ms Fox: It was actually an incorrect number in Dr Parker's paper. It should be 84 per cent. So if I could correct that, please, to 84 per cent.
Senator RICE: Right. That makes more sense. Good correction. Essentially, you have generally a higher performance, more timely approval rates, for the vet meds than pesticides over the year?
Dr Parker: It would seem we have been more consistent in that part of the business.
Senator RICE: Is there anything structural at all? No?
Dr Parker: Again, I'm hoping—
Senator RICE: You can say it.
Dr Parker: I'm not going to say no, because I think there must be. What I am saying is that I can't articulate that to you at this stage, and that is some of the stuff that I have asked the independent review to look at in that process. As you know, we're a regulator. A regulator has a beginning and an end in a process, and the regulator touches that process at particular parts. I'm unclear exactly why and where we touched that and whether we even should be at those particular points or whether we're missing another point where we should be, and that's all part of the work that the independent inquiry will be looking into.
Senator RICE: I'm interested in some more details about your building procurement process in Armidale. You said you're on track with that, but just give us a bit more detail about where things are at with that.
Dr Parker: If we are talking about the permanent—
Senator RICE: Yes.
Dr Parker: Right. We had an approach to market with an expression of interest which closed on 28 July. We advised those who put in an expression of interest on 12 October, which is when it closed. We've now, this week, put in place a request of AusTender for a request for proposal—the next stage for those people who were whittled down from the initial ones. I believe we had 10 respondents to the expression of interest. That was assessed by a group of people who included staff from my organisation, staff from the project manager who we've employed to help us with it, staff from the Department of Agriculture and Water Resources and staff from Department of Human Services. They whittled that 10 down to four, and those four have now been asked for a request for permit. That closes on 16 November.
Senator RICE: What is your expected time line? After that closes on 16 November, when will you be selecting a successful tenderer?
Dr Parker: I would hope as soon as possible after that, but certainly within a month.
Senator RICE: By the end of the year?
Dr Parker: Before the end of the year, yes.
Senator RICE: And then you would want construction to start ASAP?
Dr Parker: That would be my desire.
Senator RICE: Is the plan to have construction completed by the end of 2018?
Dr Parker: No, by the time we move up there, which will be the end of June 2019. That is what we're saying. We should all be there in July 2019, and it would be contingent on having a building for us to all to go into.
Senator RICE: Is the process still as was outlined—essentially the tenderer will be building the building, owning the building and then leasing it?
Dr Parker: I can tell you, with those 10 respondents, we didn't have any existing buildings up there that form part of that EOI process. That would mean that someone would be, in some arrangement, building a new building which then, of course, we would lease in the normal arrangements.
Senator RICE: What's the timing? How long is the expected lease that you'd be entering into?
Dr Parker: I'm not sure I've got the time frame for a lease, but I think it would at least be five years and then you would have an option that would sit on top of that. But I'm happy to take that on notice. If it has been decided, I'll give you an answer on notice.
Senator RICE: I that know you're probably going to be reluctant to give exact details, but the indication that we were given at previous estimates was that the cost of that building to the person building it was in the order of $20 million, if I recall.
Dr Parker: The costs wouldn't be my costs. That'd be whatever they want to do.
Senator RICE: No, the cost of construction of that building that you would then be leasing.
Dr Parker: That's their costs. In the $25 million that the government provided, there's a contingency in there of $4.5 million which assists with the development of the proposals and paying for the people who sit on top of that and then also looking at the fitout in the early stage.
Senator RICE: Then you've got your ongoing lease costs here?
Dr Parker: Just as we have ongoing lease costs now—correct.
Senator RICE: Are you expecting the lease costs of that building to be less, about the same or more than your lease costs in Canberra?
Dr Parker: I don't have that information.
Senator RICE: What's the expected capacity of that building? How many are you planning to—
Dr Parker: What we've requested in the request for proposal is an accommodation solution that provides 2,000 square metres for APVMA and 750 square metres of leased office accommodation for DHS.
Senator RICE: So it's a combination?
Dr Parker: Correct.
Senator RICE: So you're currently in with DHS?
Dr Parker: Currently, in our interim office, we are in there together. You'll have to ask these questions of DHS, but my understanding is their lease of that premises comes up at some stage. They would also, maybe, be looking at other options. They're looking at coming in with us, and so we would co-locate Commonwealth employees in that particular space.
Senator RICE: That was 2,500 square metres, was it?
Dr Parker: It is 2,000 square metres.
Senator RICE: In that 2,000 square metres, how many workstations would there be?
Dr Parker: Again, it depends on how you configure it, but I'm expecting that we will have between 100 to 140 staff in Armidale. That's about the numbers that I'm thinking about. I know that's a fairly broad number—100 to 140—but it's about the flexibility that I need in that business model, whether people will be moving and whether the function moves or doesn't move.
Senator RICE: If you maintain your existing staff rates of 210 to 216, you're looking at having a minimum of 70 to 80 employees—possibly 100 employees—not on site?
Dr Parker: With the functions that they're currently doing done in a different manner, yes.
Senator RICE: But not on site at Armidale?
Dr Parker: That's correct.
Senator RICE: That brings me to the last point that I want to cover, and I said I'd come back to it. You talked about the potential of further outsourcing. You've talked about bringing back in house the health assessments, so you've got 10 people you've brought back in house. What are the options for outsourcing that you're possibly looking at?
Dr Parker: Again, it depends on the function. One of the options we're looking at for the corporate function—and, in fact, we are about to move one section of our corporate function—is to do a share arrangement with the department who'd be providing those services for us. For other parts of the business, such as the scientific assessment, we already use a number of external providers to provide assessments, particularly in the environment space, but there are other spaces that we use them in. It's my intention to go out in the next few weeks with an EOI to market to test the market to see what other services may be out there for doing scientific assessments.
Senator RICE: Is that some of the work that your in-house regulatory scientists are currently doing?
Dr Parker: That's correct. Then we will have a range of functions, such as the case management function, which really should be in Armidale. They're the client-facing ones. They need that to be in that sort of space. Again, it's a little bit of horses for courses, and it's about which staff are currently moving with that function and where we might go.
Senator RICE: Can you envisage a scenario where some of your regulatory scientists who are currently in Canberra who don't want to move to Armidale could set themselves up as a business and then tender for their own functions that they're currently undertaking?
Dr Parker: That's entirely a matter for individuals.
Senator RICE: But you can envisage, given that you're looking at outsourcing, that that could be a possibility?
Dr Parker: If we looked at providing a contract where we were requesting particular bits of assessment to go and individuals had decided to do exactly what you said, then they would be assessed in the normal manner you would for procurement of services and, if they did that, so be it.
Senator RICE: So they could set up their own business, stay in Canberra, lease their own office space—because the APVMA isn't allowed to have offices there—and essentially be outsourced to do the work that they are currently doing for the APVMA?
Dr Parker: In some ways, it's quite an exciting time. There will be a range of service providers out there, and some of the existing service providers may employ some other people to come on. Until we go out and test that market, we won't know.
Senator RICE: On that, what discussions are you having with the union or unions about the potential outsourcing?
Dr Parker: I don't believe I personally have had any discussions with the unions about outsourcing.