A Defence public servant was issued a $14,800 debt after a timesheet fraud investigation in 2023, a deep-dive into the way the department handles alleged wrongdoing has revealed.
Tucked away in an audit office report, a case study reveals the department's human resources branch found the employee breached the APS Code of Conduct, leading to a salary reduction sanction.
The debt was fully recovered in August 2024 but the audit office found the employee could have owed more money.
"The calculation of the debt amount was based on the employee's hourly rate at the time and did not account for additional benefits that may have accrued through fraudulently claiming additional hours, such as superannuation and leave," it reads.
The audit looked at a web of investigation authorities that oversee the 20,000-strong civilian workforce, 92,000 Defence Force members and 33,000 reservists.
It found investigations had not always been conducted in accordance with Defence policy or in a timely manner.
Citing another example, the audit office revealed that a Defence contractor was found to have "submitted falsified quotes to Defence on ten occasions between May 2020 and October 2020", while the contractor's response "identified 71 further instances of possible fraud across 16 projects".
The contractor repaid close to $1.4 million to the department in October 2022, but the audit found the Investigations and Public Interest Disclosures Branch did not assess it for broader offending despite a request to do so.
"Documentation on Defence's system from March 2019, relating to a separate matter, documented concerns with the same contractor, including that claims for payment were 'very high in comparison to the works undertaken' and that the contractor's claims may be 'deliberately excessive,'" the report reads.
Among nine recommendations, Defence agreed to ensure that policies for the recovery and write-off of fraud-related debts were enforced.
The department also accepted a recommendation to establish clear and consistent arrangements for managing procurement-related complaints, ahead of the establishment of the Defence Delivery Agency in July 2027.
The delivery agency will split out procurement functions from the department and see more than 6000 personnel from three key capability branches merge into one.
A February 2025 briefing to the Defence secretary advised that the department's investigation caseload "increasingly involves complex procurement-related misconduct including fraud and conflicts of interest, indicating potential systemic weaknesses and attitudes across Defence".
