Do government advertising campaigns comply with the Public Administration Act 2004 and are they cost-effective?
Why this audit is important
The Victorian Government spends at least $80 million a year on advertising.
Given the potential political sensitivity, public sector agencies must comply with the advertising laws and show how the public will benefit from these campaigns.
In 2017, the Victorian Parliament passed laws to ensure government advertising is in the public interest and to stop public sector agencies publishing political advertising.
What we examined
We looked at whether two government advertising campaigns complied with the 2017 laws and were cost-effective. They were:
- the 2019 Our Fair Share (OFS) campaign, which advocated for more Commonwealth funding for Victoria
- Victoria's Big Build (VBB), a multi-year campaign about major transport projects.
We examined the six agencies involved in the campaigns.
What we concluded
In our opinion, the campaigns did not fully comply with the 2017 laws. Most OFS and a small number of VBB advertisements were political, in that they could easily be seen to:
- promote the current Victorian Government
- in the case of the OFS campaign, criticise the current Commonwealth Government.
The agencies interpret the 2017 laws differently. They maintain they complied with their obligations.
The conflicting interpretations show the laws are not sufficiently clear. This needs to be remedied.
In addition, the agencies could not show, nor is it clear, that the campaigns were cost-effective.
What we recommended
We made seven recommendations, including:
- a review of the 2017 laws
- stronger oversight of government advertising
- better evaluation and reporting of advertising cost-effectiveness.
Source: VAGO, based on information from the Department of Premier and Cabinet’s Victorian Government Advertising Report 2019–20 and agencies’ annual reports between 2017–18 and 2020–21 for Our Fair Share and Victoria’s Big Build campaign costs.
What we found and recommend
We consulted with the audited agencies and considered their views when reaching our conclusions. The agencies’ full responses are in Appendix A.
Compliance with the Public Administration Act 2004
In 2017, the Parliament introduced new laws into the Public Administration Act 2004 (PAA) to regulate government advertising and communication. The laws aim to ensure government advertising is in the public interest and not party political. They also limit government advertising on television to certain purposes, such as promoting public safety or promoting economic development.
Before the Parliament passed the laws, it added extra clauses. The extra clauses were meant to stop other types of political advertising, particularly advertising promoting the government of the day. They require public sector agencies to ensure advertising is not designed or intended to influence public sentiment for or against the current Victorian or Commonwealth governments.
We audited two government advertising campaigns against the laws:
- The 2019 OFS campaign, which advocated for more Commonwealth funding for Victorian schools, health care and transport projects.
- The VBB campaign, a multi-year campaign about the Victorian Government's major transport projects and related travel disruptions. We looked at two phases of the campaign—one from 2018 and part of a later VBB campaign from 2019–20.
The two campaigns met most of the requirements in the laws, including the public interest requirements. However, in our opinion, they did not always comply with the Parliament's extra clauses on political advertising:
- Most OFS advertisements included statements that could easily be seen as criticising the Commonwealth Government’s funding for schools, health and transport in the lead-up to the 2019 federal election.
- Most OFS advertisements, and a small number of VBB advertisements, included messages that could be easily seen as promoting Victorian Government spending on projects.
It is also our opinion that the OFS campaign did not comply with the limits on television advertising.
Conflicting interpretations of the law
We sought independent legal advice from the Victorian Government Solicitor’s Office (VGSO) about the 2017 laws. Its advice informed our interpretation of the laws, our assessment of the campaigns and our conclusions.
The audited agencies interpret the laws differently. They have their own legal advice, obtained prior to campaign launch and during this audit. The agencies state that they were motivated either solely or in part (Department of Education and Training (DET)) by the public interest and believe they complied with their legal obligations.
The conflicting legal opinions show the intent and operation of the laws are not sufficiently clear. We support an independent review of the laws to assess whether they provide clear standards.
Internal compliance systems
The Department of Premier and Cabinet (DPC) helps to promote compliance with the 2017 laws by publishing guidance for agencies. But its information for agencies, and for the public, does not mention the extra clauses added by Parliament.
The agencies involved in the campaigns told us they were aware of the 2017 laws. But their internal compliance systems were not always:
- clearly documented—except for DET and Major Transport Infrastructure Authority (MTIA)
- proportionate to the risks involved in the campaigns.
Whole-of-government oversight arrangements
Government advertising campaigns also go through a central approval process. An officer-level committee—the Advertising Approval Group (AAG)—assesses campaigns to ensure they comply with legal and policy requirements.
In the case of these two campaigns, DPC (which chairs the AAG and provides its secretariat) did not always ensure the process was robust. DPC:
- did not ensure that the AAG's terms of reference and responsibilities were clear
- did not ensure the AAG had adequate information about legal risks involved in the campaigns, or sufficient time and expertise to discharge its responsibilities
- allowed officers involved in developing the campaigns to sit on the AAG when it reviewed the campaigns. This meant those officers effectively reviewed their own work, undermining the oversight arrangements.
The AAG secretariat in DPC is small and lacks the resources needed to support the AAG’s functions effectively.
Accountability for compliance
In the case of the OFS campaign, one of the agencies involved—DPC—did not accept it was legally responsible for the campaign.
DPC prepared the campaign with DET, the Department of Health (DH) and the Department of Transport (DoT). DPC initiated the campaign, helped develop the advertisements and arranged the media bookings.
The three other agencies accept that they caused the campaign's publication and that they were legally responsible for compliance. DPC does not. We disagree.
Recommendations about legal compliance
|We recommend that:||Response|
Department of Premier and Cabinet
1. commissions and publishes an independent expert review of the government advertising laws in the Public Administration Act 2004 (including section 97C(a)(iv) and (v)) that:
Not accepted by: Department of Premier and Cabinet
2. updates its information for agencies, and the public, about the government advertising laws in the Public Administration Act 2004 to include section 97C(a)(iv) and (v) (see Section 2.3).
Accepted by: Department of Premier and Cabinet
3. strengthens the whole-of-government oversight arrangements for government advertising to:
Accepted by: Department of Premier and Cabinet
Department of Premier and Cabinet
4. document risk-based processes for checking advertising campaigns’ compliance with the Public Administration Act 2004. In particular, for high-risk and/or sensitive campaigns, agencies should:
Accepted by: Department of Education and Training, Department of Health, Department of Transport, Major Transport Infrastructure Authority
Partially accepted by: Department of Premier and Cabinet
Cost-effectiveness of the audited campaigns
The agencies involved in the two campaigns could not demonstrate that the campaigns were cost-effective. This was partly due to inadequate planning. The agencies did not always set clear and measurable campaign objectives and performance targets.
In addition, agencies did not evaluate their campaigns once they had finished, to check whether they met their campaign objectives and targets. A review was undertaken for VBB only; however, the conducted assessment was not systematic or objective enough to be considered an evaluation.
This meant agencies could not show that their spending on the campaigns was effective or provided value for money.
We found similar problems in our last audit of government advertising in 2012, but agencies are yet to adequately address the issues. DPC provides some guidance to agencies on evaluations, but it must be strengthened to promote better practice.
Under government financial reporting rules, agencies must report publicly on all campaigns over $100,000 in their annual reports. DPC also publishes two reports every year—one summarising all major government advertising campaigns and one reporting on whole-of-government advertising expenditure.
MAMS refers to the Master Agency Media Services media buying contract through which Victorian Government media strategy, planning, buying and reporting services can be procured.
These reports promote accountability and transparency, but they can be improved.
The agencies’ public reports were often incorrect and incomplete. Some reports contained errors, such as figures that did not add up or figures that did not match paid invoices. DPC's reporting on whole-of-government advertising expenditure excludes significant costs, such as creative development, and Master Agency Media Services (MAMS) fees. Therefore, it does not reflect the true cost of government advertising. Agencies also publish data mostly in Portable Document Format (PDF) reports, which makes comparison and analysis difficult. As a result, agencies are not reporting campaign costs in an accountable and transparent manner.
Recommendations about cost-effectiveness
|We recommend that:||Response|
Department of Premier and Cabinet
5. revises the Governance Guidelines and associated processes to ensure that:
Partially accepted by: Department of Premier and Cabinet
Department of Premier and Cabinet
6. include reporting guidance to agencies on:
Accepted by: Department of Premier and Cabinet, Department of Treasury and Finance
Department of Premier and Cabinet
6. in its whole-of-government reporting:
Accepted by: Department of Premier and Cabinet
1. Audit context
The Victorian Government uses advertising to communicate with the public about important issues, such as government services, changes to the law and health and safety. It spent at least $84.6 million on advertising in 2019–20.
In 2017, the Victorian Parliament introduced new laws to ensure government advertising is in the public interest, and to stop public sector agencies publishing political advertising.
Agencies are required to evaluate their campaigns to show whether they were cost-effective. DPC and agencies are required to report publicly on their advertising costs.
This chapter provides essential background information about:
1.1 Government advertising in Victoria
Governments use advertising to communicate with the public about issues such as government services, changes to laws and health and safety.
The Victorian Government classifies advertising into three categories:
- Campaign advertising is intended to inform, educate, motivate or change behaviour. Examples are road safety and regional tourism campaigns.
- Functional advertising includes simple, one-off advertisements such as legal notices and requests for tender.
- Recruitment advertising promotes job vacancies in government.
Government spending on these categories varies from year to year. Figure 1A shows publicly reported expenditure on advertising from 2012–13 to 2019–20 (the government is yet to publish its 2020–21 expenditure). Campaign advertising accounts for most of the expenditure.
FIGURE 1A: Victorian Government advertising expenditure
Note: The Victorian Government's publicly reported advertising expenditure does not reflect total costs (see Section 3.2).
Source: VAGO, based on Victorian Government Annual Advertising reports.
1.2 Legal requirements
Government advertising must comply with a range of Victorian and Commonwealth laws. In this audit, we looked at the PAA.
In 2017, the Victorian Parliament added new laws to the PAA to regulate government advertising and communication. The objects of the laws include ensuring advertising is in the public interest and not party political.
Before the Parliament passed the laws, it added some extra clauses. They were intended to stop other types of political advertising, particularly advertising that uses public money to promote the government of the day. The extra clauses require public sector agencies to ensure advertising is not ‘designed or intended to directly or indirectly influence public sentiment for or against’:
- the current government of the state
- the current government of the Commonwealth.
In the PAA and Regulations, public sector communication means information, material or messages published by or on behalf of a public sector body.
The government at the time opposed the extra clauses at first, noting that they might stop the state government advocating for Victorians against the Commonwealth. But it later agreed to the amendments and they passed into law.
In 2018, the Victorian Government added more detailed standards through the Public Administration (Public Sector Communication) Regulations 2018 (the Regulations).
The legal requirements in the PAA and Regulations apply to 'public sector communication'. For simplicity, in this report we use the term ‘advertising’ to refer to all paid public sector communication.
The agency that publishes the advertising, or causes it to be published, is responsible for complying with the legal requirements.
FIGURE 1B: Main legal requirements in the PAA and Regulations
|Legal requirements in the PAA and Regulations|
Public interest requirements
Section 97B requires public sector agencies to ensure publication of government advertising is in the public interest.
The Regulations list 12 examples of purposes that are in the public interest. They include:
Political advertising requirements
Section 97C requires public sector agencies to ensure that government advertising is not ‘designed or intended to directly or indirectly influence public sentiment for or against’:
The Regulations set out further restrictions. For example, they prohibit advertising that refers to a political party or includes a political party’s slogan, image or brand.
Television advertising requirements
Section 97D requires public sector agencies to ensure that the purpose of government advertising on television is one of the following:
The PAA and the Regulations also have other requirements for government advertising. For example, government advertising must not:
1.3 Whole-of-government oversight arrangements
The Victorian Government also has whole-of-government oversight arrangements for its campaign advertising.
Planning, approval, evaluation and reporting
The oversight arrangements include central processes for planning, approving, evaluating and reporting on government advertising.
DPC outlines the arrangements in the Victorian Government Advertising Planning and Approval Process. In this report, we call this document the Governance Guidelines.
The Governance Guidelines say the government maintains ‘robust review and governance processes’ to maximise the efficiency and effectiveness of government advertising, and ensure advertising is undertaken ‘for an appropriate purpose that delivers a genuine public benefit’.
There are four main bodies involved in the arrangements:
- Departments each have a senior communications executive (SCE) who coordinates the process for their department and its portfolio agencies.
- DPC provides secretariat support for the arrangements. It also issues other guidelines and standards on government advertising.
- AAG is an officer-level committee chaired by a DPC executive officer. Its members include two SCEs from departments (membership rotates every six months) and two members nominated by ministers. It undertakes ‘detailed peer review’ of campaigns.
- The Advertising and Communications Planning Committee (ACPC) is a Cabinet committee responsible for government advertising and communication.
Figure 1C gives an overview of the arrangements and the main responsibilities of these bodies.
FIGURE 1C: Overview of the Victorian Government advertising process
Source: VAGO, based on Victorian Government Advertising Planning and Approval Process, DPC, 2019.
Funding envelope, in this context, means the total amount that the government allocates for campaign advertising during the financial year.
To help control and track advertising expenditure, the government has a central state purchase contract for MAMS. Agencies must use the appointed MAMS contractor to plan and buy advertising space. The government sets an annual funding envelope for MAMS expenditure during its annual planning process.
Agencies can develop creative material in-house or engage an external creative agency through the state purchase contract for marketing services.
1.4 The two audited campaigns
This is our first audit of government advertising since the Parliament introduced the 2017 laws in the PAA.
We looked at two government advertising campaigns—the OFS campaign and the VBB campaign. We examined whether the campaigns complied with the 2017 laws and related regulations, and whether the campaigns were cost-effective.
Our Fair Share
The OFS campaign ran from April to June 2019. Its objectives included securing more Commonwealth funding for Victorian public schools, health care and transport projects.
The OFS campaigns grew from a February–March 2019 radio campaign called Fairer Funding. DET funded that campaign, which focused on funding for schools.
In March 2019, following discussion with the Premier’s Private Office, DPC asked three agencies—DET, DH (which was then part of the Department of Health and Human Services) and DoT—to prepare a broader integrated campaign that covered funding for schools, health and transport. The Premier’s Private Office advised us that it is common practice for it to have discussions with DPC on major advertising campaigns.
The Premier launched the school and health parts of the campaign on 14 April 2019. The transport part of the campaign began a week later, on 21 April 2019. The campaigns involved advertisements on television, radio, print media and digital platforms and on ‘live banners’ at football stadiums.
The publicly reported cost of the campaign in 2018–19 was $1.7 million.
The OFS campaign coincided with the 2019 federal election, which was announced on 11 April 2019 and held on 18 May 2019. This led to complaints that the campaigns involved political advertising.
FIGURE 1D: Timeline for the OFS campaign
Source: VAGO, based on department records.
Victoria’s Big Build
The VBB campaign is a multi-year campaign that launched in February 2018. Its objectives include informing Victorians about travel disruptions associated with major transport infrastructure projects.
DoT (which was then part of the Department of Economic Development, Jobs, Transport and Resources) started the campaign in 2017. It was concerned that individual transport projects were running separate campaigns on travel disruptions, creating clutter and confusion for people affected by the projects. It wanted an integrated campaign covering all major transport projects and disruptions.
In January 2019, the Victorian Government created MTIA to take responsibility for major transport infrastructure projects. The MTIA also took over responsibility for the VBB campaign.
The publicly reported cost of the VBB campaign between 2017–18 and 2020–21 was $11.5 million, out of a total $33.75 million spent on advertising related to disruptions from transport construction during the same period.
Out of the many VBB campaign phases since 2018, we selected two for examination:
- the initial Travel Plan B phase that ran from February to June 2018. This campaign involved television, radio, newspaper, digital and outdoor (billboard) advertising.
- the Summer Blitz phase that ran from December 2019 to February 2020. This campaign involved television, radio, newspaper and digital advertising.
FIGURE 1E: Timeline for the VBB Travel Plan B campaign and Summer Blitz phases
Source: VAGO, based on DoT and MTIA records.
2. Legal compliance
In our opinion, the two advertising campaigns did not fully comply with the PAA. Some of the campaign advertisements included political advertising. One campaign did not comply with limits on television advertising.
The agencies involved in the campaigns interpret the laws differently. They maintain that they complied with their legal obligations.
At the very least, this suggests that the laws are not sufficiently clear.
This chapter discusses:
2.1 Compliance with the Public Administration Act 2004
We assessed the OFS and VBB campaigns against the requirements in the PAA and the Regulations.
The campaigns complied with most of the requirements. For example, they met the public interest requirements in the PAA and Regulations.
The campaign objectives included:
- advocating for better funding for Victorian schools, health care and transport infrastructure, in the case of the OFS campaign
- informing people about travel disruptions caused by major transport projects, in the case of the VBB campaign.
Publication of this information was in the public interest.
However, in our opinion, there were instances of non-compliance with two requirements—political advertising and television advertising requirements.
Political advertising requirements
The OFS and VBB campaigns both discussed current Victorian Government spending and projects. The OFS campaign also discussed current Commonwealth Government spending.
Under the 2017 laws, agencies had to ensure that the advertisements were ‘not designed or intended to directly or indirectly influence public sentiment’ for or against those governments.
The agencies involved in the campaigns told us they had no intention to influence public sentiment about current governments. They said that they were motivated either solely or in part (DET) by the public interest.
We found no evidence of bad faith on the part of the agencies. However, they did not take sufficient steps to ensure all their advertisements complied with the 2017 laws.
Our Fair Share
Based on the objectives, content and timing of the OFS campaign, our opinion is that parts of the advertisements were designed in way that could easily influence public sentiment about the current Victorian and Commonwealth Governments.
The agency’s campaign strategies listed extra objectives, in addition to securing more funding for Victoria. For DET and DoT, those objectives were to:
- raise community awareness of state investment in schools and transport networks
- raise community awareness of a ‘disparity’ or ‘discrepancy’ in current Commonwealth funding for schools and transport.
Logically, raising community awareness of these issues would be expected to increase positive sentiment towards the current Victorian Government, and negative sentiment towards the current Commonwealth Government.
The OFS advertisements included content that could easily be seen as promoting current Victorian Government funding and criticising current Commonwealth Government funding. Figure 2A shows some print advertisement examples.
FIGURE 2A: Example of OFS print advertisements
The DET advertisement states, 'The Victorian Government believes every student should be fully supported to succeed. That's why we've invested $10.8 billion into education for our growing state’. It then states, 'But Canberra's proposed funding deal means Victorian public schools could miss out on $500 million of federal funding every year.'
These advertisements did more than state facts and data about government funding. The statements about the Victorian Government appeared to have a positive tone. They referred to billions of dollars or 'record levels' of investment. The statements about 'Canberra' were negative. They used language such as 'cuts' and 'miss out'. Members of the public were likely to find the language in some of the advertisements to be particularly emotive. One of the television advertisements included the line 'don't let Canberra short-change our kids'.
The advertisements ran during the 2019 Commonwealth election campaign. Figure 2B shows that agencies' media buy focused on the weeks leading up to the election on 18 May 2019.
FIGURE 2B: OFS campaign advertisement placement
Note: Figure shows combined dates for all DET, DH and DoT campaign advertising.
Source: VAGO, based on DET, DH and DoT invoices, records and annual reports.
Agencies told us they were targeting a political issue, not the current Commonwealth Government. They said that neither the Commonwealth Government nor the canOpposition had committed to the funding sought by Victoria. They said they used the term 'Canberra' in a broad sense. They noted that Commonwealth funding depends on laws passed by the Commonwealth Parliament and intergovernmental arrangements, as well as decisions by Commonwealth Government ministers.
In our assessment, the agencies did not design the advertisements to make this clear. We encouraged DPC, DET and DH to provide us with evidence that the public would have understood the statements about ‘Canberra’ to refer to the Commonwealth Parliament, other bodies or the Commonwealth broadly. They did not.
At the time the advertisements were published, Victorian Government ministers were involved in public disputes with Commonwealth Government ministers about school funding, national health reform funding and funding for major road projects. In this context, in our opinion, members of the public could likely understand the criticisms of 'Canberra' as including criticisms of the current Commonwealth Government.
Other integrity agencies also interpreted the advertisements in this way. In August 2019, the Independent Broad-based Anti-corruption Commission (IBAC) and the Victorian Ombudsman wrote to the Premier following complaints about the campaign (see Appendix D for a copy of this letter). They decided that investigation of complaints could not be justified. They said that it was highly unlikely that department secretaries’ statements that they were motivated solely by the public interest could be contradicted, and that they made no criticism of any departmental secretary. However, they stated, 'we consider that the timing and content of the campaign advertisements would have had the effect of influencing public sentiment against the Government of the Commonwealth. This would have been the likely perception of a reasonable member of the Victorian public, whatever their political allegiance.'
Victoria's Big Build
In our opinion, a small number of VBB advertisements were also designed in a way that could easily be seen to influence public sentiment about the current Victorian Government. This is based on the content of those advertisements and campaign records.
Most of the Travel Plan B and Summer Blitz VBB advertisements started with information about transport projects and their benefits. This was part of the campaign strategy. Research showed that people were more likely to accept travel disruptions if they understood the benefits of the transport projects.
However, a small number of advertisements focused more on the Victorian Government's projects than the disruptions. The VBB Travel Plan B print advertisement in Figure 2C is one example. The advertisement devoted more space to the projects and their benefits (highlighted in yellow) than to the travel disruptions.
FIGURE 2C: Travel Plan B campaign half-page print advertisement
Source: MTIA, published in 2018.
A small number of VBB Travel Plan B advertisements did not mention disruptions at all. The billboard advertisement at Figure 2D is an example.
FIGURE 2D: Example of Travel Plan B billboard advertisement
Source: MTIA, published in 2018.
After the Travel Plan B phase, MTIA told us it strengthened the disruption information in the VBB advertisements.
We could see this improvement in the VBB Summer Blitz phase, which ran in late 2019 and early 2020. Most of those advertisements struck a balance between information about the projects and the disruptions. There were some exceptions. For example, the 60-second television advertisement spent 42 seconds describing the Victorian Government's transport projects before mentioning disruptions.
Internal campaign records also show that DoT and MTIA tested their advertisements' impact on feelings towards the Victorian Government.
- DoT researched the effectiveness of the 2018 VBB Travel Plan B phase. One of the survey questions looked at the television advertisements’ impact on feelings towards the Victorian Government. It asked people if they agreed or disagreed with the statement, ‘The ad makes me feel positive towards the Victorian Government’.
- One area of MTIA’s research on the 2019–20 Summer Blitz phase asked people if they knew that transport projects were part of a coordinated master plan by the Victorian Government. It reported results on how that knowledge made them feel about the Victorian Government. MTIA told us these questions referred to the Victorian Government generally, not the current Victorian Government.
Television advertising requirements
In our assessment, the OFS campaign also did not comply with the television advertising requirements in the PAA.
The Parliament intended the 2017 laws to limit government advertising on television. When introducing the laws into the Parliament, the responsible minister said '[t]elevision is a high value, mass market medium'. The minister said that under the laws, 'television advertising will be restricted to specific purposes'.
The agencies involved in the OFS campaign told us that the purpose of the television advertisements was 'to promote commercial or economic development within the State'. That is a permitted purpose under the laws. Agencies have their own legal advice. They said that investing in education, public health and transport promotes economic development through better outcomes.
However, the campaign objectives and content show that the purposes of the advertisements included raising awareness of funding issues and securing more Commonwealth funding. Improved economic outcomes may have been a secondary purpose, or a long-term consequence of more funding. In our opinion, it was not the dominant purpose of the advertisements.
2.2 Conflicting interpretations of the law
To inform our interpretation of the 2017 laws, we sought independent expert advice from VGSO. Its advice informed our assessment of the campaigns.
VGSO expressed the view that the political advertising requirements in section 97C of the PAA set an objective standard for assessing whether government advertising is designed or intended to influence public sentiment. This means it is necessary to look at:
- the content and nature of the advertisements
- relevant contextual factors, such as timing of the advertisements.
VGSO said while it was not beyond doubt, it did not think it was necessary to establish a state of mind on the part of any person.
In other words, there is no need to prove motive on the part of a public sector body. It is the communication and its influence on public sentiment that matters.
The agencies interpret the laws differently. They have their own legal advice. The agencies argue that section 97C sets a subjective standard. This means it is necessary to focus on the motives or intentions of the person or body that published the advertisement. The agencies say they were motivated either solely or in part (DET) by the public interest and had no intention of influencing public sentiment for or against current governments. They also say that, even if section 97C involves an objective assessment, in their view the campaigns complied with the Act.
In our opinion, VGSO's interpretation is consistent with the wording of the PAA, which imposes an obligation on public sector bodies to ensure that the communication is not designed or intended to directly or indirectly influence public sentiment for or against the current governments of the state or Commonwealth.
The 2017 laws are relatively new and unique to Victoria, and the courts are yet to consider these conflicting interpretations. In the meantime, the different interpretations are causing debate about whether agencies complied with the law.
When the government introduced the 2017 laws into the Parliament, it said 'we are providing the Auditor-General with a clear, transparent set of standards by which to judge any public sector communication activity now and into the future.' The issues that arose in this audit suggest the standards are not clear or transparent enough.
IBAC and the Victorian Ombudsman wrote to the Premier in 2019, in response to complaints about the OFS campaign, proposing amendments to the laws (see Appendix D for a copy of this letter). Following this audit, we support an independent expert review of the laws to assess whether they are clear and to recommend amendments.
2.3 Internal compliance systems
Under the PAA, the public sector agency that publishes advertising, or causes it to be published, is responsible for complying with the 2017 laws.
DPC has helped to promote awareness of the laws amongst agencies by:
- circulating information and discussing the laws at meetings with agency SCEs
- publishing information on the Victorian Government's www.vic.gov.au website.
However, DPC's information omits the extra clauses added by the Parliament. For example, a DPC presentation to agencies following the introduction of the laws in 2017 referred to ‘requirements around not influencing opinion for or against [any] political party… [or] candidate’. It did not mention the extra clauses on influencing public sentiment for or against the current Victorian and Commonwealth governments. The information on the www.vic.gov.au website does not mention the extra clauses either.
The agencies involved in the campaigns told us they were aware of the 2017 laws and believed they complied with them. However, only two of the agencies—DET and MTIA—had clearly documented internal approval processes for advertising campaigns.
In addition, the agencies' steps to check compliance were not always proportionate to the risks involved in the campaigns.
The OFS campaign was high risk because it proposed to criticise Commonwealth funding for Victoria in the lead-up to a Commonwealth election. Agencies were aware that the campaign would attract criticism. The Victorian Ombudsman had already enquired into a complaint about DET's earlier Fairer Funding campaign. Agencies sought advice from department lawyers and briefed their secretaries. However, the written legal advice was brief and in one case—DoT—mostly verbal. It would have been prudent for agencies to get detailed or external legal advice.
There was a level of risk associated with the VBB campaign as well, as there had been criticism of transport advertising in Parliament before it passed the 2017 laws. However, DoT and MTIA did not seek any legal advice about the implications of the laws before publishing their advertisements.
2.4 Whole-of-government oversight arrangements
Under the arrangements, the AAG is also meant to ensure that advertising campaigns comply with government standards.
In the case of the OFS and VBB campaigns, the AAG approved the campaigns without recording any discussion about legal compliance. We raised this issue with DPC in 2019 following our 2018–19 financial audit of its accounts. DPC agreed to ensure AAG meeting minutes reflect the AAG's discussions and decisions.
In this audit, we identified other issues that potentially limited the 'robust' processes described in the Governance Guidelines.
For these campaigns …
Which created a risk that …
DPC did not ensure the AAG's responsibilities were clear
it did not update the AAG's terms of reference to specifically mention legal compliance until mid-2020, and it is yet to update the Governance Guidelines
some AAG members did not know they were meant to review the campaigns' legal compliance.
DPC did not require agencies to provide detailed advice to the AAG about the 2017 laws
DPC issues a template form for agencies to submit material to the AAG. The form's only mention of the 2017 laws is a compliance checklist, where agencies tick a box to confirm compliance. Other information about legal risks is optional
agencies would not fully inform the AAG about legal risks.
Agencies did not provide adequate advice to the AAG about legal risks
for the OFS campaign, agencies completed the checklist but only one (DH) disclosed that there was a legal risk and it had sought legal advice. It included two sentences on the issue
AAG members could not make an informed assessment about legal compliance.
DPC gave the AAG limited time to review material before meetings and deadlines
DPC routinely sent material to AAG members the day before meetings or approval deadlines. On one occasion, DPC emailed OFS material (three television advertisements) to AAG members at 12.24 pm for 'urgent review', because the material had to go to the ACPC later that afternoon. AAG members approved the material in 27 minutes
AAG consideration was rushed and members lacked time to properly read and review material.
DPC did not ensure an independent 'peer review' process
on at least four occasions, DPC allowed officers who had worked on the campaigns to sit as AAG members when the AAG reviewed and approved campaign material
the process became one of 'self-review' for those officers, undermining the robustness of the arrangements.
In addition, DPC did not always clearly document its own approval of final creative material for the campaigns. We could infer DPC's approval from other evidence, but this created a risk of confusion and publication of unapproved advertising.
DPC advised that its secretariat for the AAG currently consists of two full-time equivalent officers. These resources need to be reviewed to ensure the secretariat can support the AAG’s functions more effectively in the future.
2.5 Accountability for compliance
The AAG's and DPC's role in campaigns can also blur lines of accountability for legal compliance.
The PAA makes the public sector agency that publishes the advertising, or causes it to be published, responsible for complying with the 2017 laws. But the AAG's terms of reference say it is responsible for ensuring legal compliance. DPC's Governance Guidelines do not clarify the respective responsibilities of each body.
In the case of the OFS campaign, DPC also played a significant role in developing the campaign. DPC commonly coordinates cross-agency activities. In this case, it:
- initiated the campaigns with DET, DH and DoT following discussion with the Premier's Private Office. In internal briefings, two agencies wrote that DPC had 'briefed' or 'directed' them to prepare the campaign
- asked agencies to prepare the campaigns for a mid-April 2019 launch date
- advised some agencies about their budgets for the campaign
- provided feedback and input into the content of the advertisements on behalf of itself and the Premier's Private Office
- attended meetings with the creative agency working on the campaign and proposed to attend recording sessions for the advertisements
- arranged the media bookings for the campaign advertisements with the government's media contractor, and co-signed media booking forms.
Based on the above, we consider that DPC caused the advertisements to be published along with DET, DH and DoT. In our opinion, it shared legal responsibility and accountability for the campaigns.
During this audit, DET, DH and DoT accepted legal responsibility for the campaign. However, DPC argued it did not cause the advertisements to be published. It has a different interpretation of the term ‘causes’ in the PAA. It argued that its role in the OFS campaign was not significant.
If DPC takes a similar role in government advertising campaigns in future, it also needs to accept accountability for the campaigns' legal compliance.
The agencies involved in the two advertising campaigns could not show that the campaigns were cost-effective. Systems for assessing cost-effectiveness were inadequate. Agencies did not always set clear campaign objectives and targets for assessing the campaigns’ performance. They did not evaluate systematically and objectively whether the campaigns met their objectives.
Inadequate reporting on campaign costs limits accountability and transparency around these issues. Public reporting is often incorrect, incomplete, inconsistent and hard to access.
This chapter discusses:
3.1 Cost-effectiveness of the audited campaigns
Campaign objectives are the outcomes or impacts that the agency is trying to achieve.
A target is a measure for expected or desired level of activity.
A benchmark is the industry or sector-level standard that agencies use to assess their own performance.
Cost-effective means that agencies achieve their campaign objectives for the least cost.
Value for money means achieving the desired outcome at the best possible price. It requires consideration of non-financial factors, such as quality, as well as financial factors.
Evaluation involves an objective and systematic assessment against campaign objectives.
The Governance Guidelines say that the Victorian Government is committed to maximising the efficiency and effectiveness of advertising expenditure. The Guidelines require agencies to set objectives and measures for campaigns, and to evaluate campaigns against those metrics. This ensures agencies are accountable for their spending, and that they document lessons learned to improve future campaigns.
In the case of the OFS and VBB campaigns, agencies could not show that the campaigns were cost-effective. They could not show that the campaigns met their campaign objectives or that they provided value for money. This situation arose because of:
- inadequate planning of objectives and measures by agencies
- missing or inadequate evaluations
- inadequate whole-of-government guidance and oversight by DPC.
Inadequate planning of campaign objectives and measures by agencies
Before campaigns begin, agencies are meant to plan how they will evaluate campaign effectiveness. DPC’s Campaign Strategy Approval Form, which agencies submit to the AAG when seeking approval for campaigns, requires them to list campaign objectives, along with benchmarks and target measures for judging their success.
In the case of the OFS and VBB campaigns, these plans were incomplete or inadequate.
One agency involved in the OFS campaign—DH—did not develop any plan for how it would evaluate its campaign. It left this section of its form blank.
In other cases, agencies used measures that did not fairly represent performance. Their objectives and measures were not always clearly defined or measurable. Figure 3A provides an example for each of these.
FIGURE 3A:Example of a campaign objective, target and benchmark that were not clearly defined or measurable
Raise awareness of the health funding challenges within Victoria and advocate for better funding for Victorian health care provision, particularly hospitals (OFS)
DH did not identify:
Positive anecdotal evidence from staff on the ground at disruption (VBB)
DoT and MTIA did not include details on how they would measure or assess this.
Low awareness of school funding sources (OFS)
DET did not describe how it rated or measured ‘low’ awareness. The benchmark also did not provide a clear baseline against which DET could measure any change in awareness.
The inadequate planning increased the risk that agencies could not effectively evaluate the cost-effectiveness of their campaigns.
Missing or inadequate evaluation
Agencies are meant to evaluate their campaigns against their campaign objectives within three months of the campaign’s conclusion. DPC’s form asks agencies to:
- report whether they met their campaign objectives, benchmarks and targets
- acquit their final expenditure against their planned expenditure for each objective.
The agencies involved in the OFS campaigns did not comply with these requirements. DPC did not consistently follow up with agencies to ensure compliance.
Where agencies reviewed the campaigns, these reviews were not systematic and objective assessments against campaign objectives. For example:
- In the case of the VBB campaign, DoT sought to evaluate against its objectives. It concluded that Travel Plan B met its objectives. However, one of DoT’s targets was to achieve 90 per cent awareness among public transport and road users. In the review, DoT did not show it had achieved that target. Another target measure said DoT would consider anecdotal evidence from staff on the ground at project sites. The evaluation did not include such evidence.
- For Summer Blitz, MTIA commissioned other research on the VBB campaign, including survey and focus group feedback on their advertisements. However, this research was also not an objective and systemic evaluation of the campaign.
- For all the campaigns audited, the agencies received a post-campaign report from the MAMS provider after the completion of the campaign. The report included cost, reach and engagement analytics. However, it did not constitute an objective and systematic assessment against campaign objectives.
We reported similar problems in our last audit of government advertising in 2012. That audit identified that agencies were either not evaluating campaigns or that their evaluations were inadequate. It also found that DPC was not requiring agencies to acquit their expenditure against approved budgets.
Agencies are yet to properly address these issues.
Inadequate guidance provided by DPC
DPC needs to improve its guidance to agencies to ensure that evaluations are appropriately planned and completed. The Governance Guidelines did not provide sufficient guidance on how to:
- ensure public benefit
- evaluate campaigns
- monitor campaigns’ value for money and effectiveness.
SMART objectives are specific, measurable, achievable, relevant and time-bound.
Program logic is the framework for the relationships between resources, activities and results. In the case of advertising, it may be one of many activities that contributes to the achievement of results.
DPC changed the Governance Guidelines from 2019. It now advises agencies to ensure their campaign objectives are SMART and to set targets covering both the implementation and impact of their campaigns. The Guidelines also provide examples of possible objectives, benchmarks and target measures.
However, they do not require agencies to ensure evaluation plans:
- are based on a robust program logic
- include data sampling, collection and analysis details
- include adequate evidence to show that the campaign was likely to be successful
- include whether the campaign represented the least cost for the required quality
- show each campaign’s contribution to whole-of-investment advertising objectives and compare to industry benchmarks.
DPC’s guidance on how to evaluate campaigns is also not consistent with better practice. For example, other jurisdictions require agencies to undertake:
- cost–benefit analysis of high-cost campaigns before approval
- evaluations using a preferred provider.
Inadequate whole-of-government oversight by DPC
DPC and the AAG are meant to oversee planning and evaluation of campaigns. In the case of these two campaigns, they did not effectively address agencies’ non compliance with requirements.
At the planning stage, the AAG’s terms of reference require it to ensure that campaigns provide value for money, set individual campaign quality benchmarks and ensure campaigns are appropriately evaluated. In the case of the OFS and VBB campaigns, the AAG approved the campaigns without recording any discussion about these issues. The AAG approved DH’s OFS campaign strategy, even though it was missing benchmarks or target measures.
At the evaluation stage, the Governance Guidelines require agencies to submit evaluations to DPC for all campaigns over $100,000. The AAG’s terms of reference also require it to ensure appropriate evaluation of campaigns. DPC and AAG should have been aware that evaluations for the OFS campaign and the Summer Blitz phase of the VBB campaign were missing. DPC did not follow up with agencies to ensure compliance.
DPC has not ensured that the AAG has the required expertise and guidance to fulfil this part of its terms of reference by:
- assessing whether campaigns are strategic, coordinated and at an appropriate level of expenditure
- ensuring that campaigns provide value for money
- ensuring campaigns are appropriately evaluated.
DPC submitted that AAG members are properly qualified to perform their role and fulfil their terms of reference. We note that the AAG’s terms of reference involve several areas of specialist expertise, such as legal compliance, assessing value for money and evaluation. DPC did not provide evidence that AAG members all have such specialist expertise.
3.2 Public reporting
Public reporting promotes accountability and transparency around how much agencies spend on advertising and whether that spending is cost-effective.
The current arrangements involve two levels of reporting, shown in Figure 3B.
Financial reporting directions are issued by the Minister for Finance under the Financial Management Act 1994. They set rules for agencies about financial policy and disclosure, as well as some non-financial matters such as annual reports.
FIGURE 3B: Public reporting on government advertising expenditure
|Agency reporting||Whole-of-government reporting|
Published by individual agencies
Published by DPC
Requirements in Financial Reporting Directions 22I (FRDs) and Governance Guidelines
Requirements in Governance Guidelines
Agency annual reports include details for all campaigns over $100,000:
Annual Victorian Government Campaign Activity Summary report collates details of all campaigns over $100,000 from agency annual reports.
Annual Victorian Government Advertising Report publishes an overview of all government advertising expenditure.
|Deadline for reporting||No deadline for reporting|
Incorrect, incomplete, inconsistent and inaccessible reporting
The agencies involved in this audit complied with reporting requirements overall. However, there were several problems with their public reporting that limited their transparency and accountability.
In this audit, public reporting was sometimes …
For example …
agencies did not have reliable processes for recording and verifying campaign costs.
guidance does not require agencies to ensure reported costs are correct, or cover what steps they should take to ensure accurate reporting.
DPC replicated agencies’ information in its whole-of-government reports without checking its accuracy.
agencies' reported costs did not match invoices.
FRDs require agencies to report campaign advertising costs that relate to the MAMS contract. DPC only reports on partial spending on media buy (or MAMS) costs in its Annual Advertising Report’s overview of total government advertising expenditure.
some agencies are not covered by the FRDs.
MTIA has not reported VBB letterbox drop costs.
DPC’s reporting on total government expenditure excludes some significant costs, such as campaign and creative development and fees and levies for MAMS costs.
Visit Victoria, which spends a significant amount on advertising, does not have to report on its campaign expenditure. It advised us that this is to maintain competitive advantage and to protect its commercial and intellectual property.
guidance does not define cost categories and/or provide guidance on how to classify costs.
guidance is not sufficiently clear on when similar or repeat campaigns should be reported in aggregate or individually.
for the OFS campaign, DH recorded its translation costs under the 'print and collateral' category. DET recorded its translation costs under ‘other’.
DET included the costs of its earlier Fairer Funding campaign in its OFS reporting, even though it was a separate campaign.
hard to access
agencies mostly publish information in PDF format.
it is difficult to analyse and compare spending by different agencies, by different campaigns or by expenditure over time.
Our 2012 audit also identified problems with the way agencies record and report advertising expenditure. We recommended:
- agencies introduce rigorous business operations processes to enable consistent and accurate reporting of their advertising expenditure
- DPC make total advertising and communications expenditure publicly available.
The Victorian Parliament’s Public Accounts and Estimates Committee also recommended enhancing reporting requirements so that agencies have to identify and report on performance against advertising budgets.
Agencies are yet to adequately action these recommendations.
Improving accuracy and accessibility
There are already resources within government that agencies could use to strengthen their reporting. The Department of Treasury and Finance (DTF), which manages the government’s MAMS contract, has several data dashboards that DPC and other agencies could use to cross-check their records and improve their reporting and accountability.
Agencies could also look to good practice in other states. South Australia’s public reporting on government advertising includes:
- information about the campaign’s proposed budget as well as actual spending
- a summary of campaign evaluations, which reports on whether campaigns met their objectives.
An example of where advertising costs are more accessible is the Government Advertising Spend dashboard on our website (audit.vic.gov.au), which collates publicly available Victorian Government advertising spend data in an interactive format. Agencies could explore similar formats to make their public reporting more accessible and effective.
Appendix A. Submissions and comments
Click the link below to download a PDF copy of Appendix A. Submissions and comments.
Click here to download Appendix A. Submissions and comments
Appendix B. Acronyms, abbreviations and glossary
Click the link below to download a PDF copy of Appendix B. Acronyms, abbreviations and glossary.
Click here to download Appendix B. Acronyms, abbreviations and glossary
Appendix C. Scope of this audit
Click the link below to download a PDF copy of Appendix C. Scope of this audit.
Click here to download Appendix C. Scope of this audit
Appendix D. IBAC and Victorian Ombudsman joint letter to the Premier
Click the link below to download a PDF copy of Appendix D. IBAC and Victorian Ombudsman joint letter to the Premier.
Click here to download Appendix D. IBAC and Victorian Ombudsman joint letter to the Premier