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Auditor General strongly criticises NHMRC Grants Management

by Staff Writers •
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In his recent report, the Federal Government Auditor General has strongly criticised all aspects of the National Health and Medical Research Council grants management process.

NHMRC has an important role in fostering a strong Australian medical research base and is "widely regarded as one of Australia’s peak bodies in the area of evidence-based health", the audit report noted.

In 2008, NHMRC administered 3843 new and continuing grants, accounting for $595m in expenditure. NHMRC grants are highly competitive with less than 30% of applications receiving funding each year.

The Auditor General concluded, "Notwithstanding the agency’s progress to date, there are several shortcomings in the NHMRC’s administration of this substantial grant program, which combined impact significantly on the effectiveness of NHMRC’s grant administration."

Overall, the Auditor General found:                 

  • There was a lack of consistency in applying guidelines and procedures, including possible conflicts of interest in NHMRC’s peer review process;
  • There was "poor compliance in managing grants post-award. [This] diminishes the agency’s ability to provide sufficient assurance that funds are used for their intended purpose";
  • "While NHMRC funds grants in over 90 Administering Institutions, it cannot demonstrate that the institutions are approved in accordance with NHMRC’s own policy"; and
  • The auditor also found the NHMRC’s procedures for initial checking of grant applications, "lacked consistency and rigor, with reasons for waiving eligibility requirements not always apparent".

The Auditor General was also highly critical of NHMRC’s grants management IT system, finding:

  • Poor data management. The system does not "allow sufficient collection of information to report against program outcomes" and "contains substantial data anomalies";
  • "The NHMRC’s information systems do not adequately support NHMRC’s core business – grant management"; and
  • "NHMRC has a poor compliance in its collection and monitoring of grant reports and acquittal".

NHMRC indicated that it is aware of the deficiencies and that a new grants management system is under development. The system has already commenced a phased rollout that is anticipated be complete by 2010. Accompanying the system release NHMRC will be addressing staff training and management procedures.

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