RMGs are guidance documents. The purpose of an RMG is to support PGPA Act entities and companies in meeting the requirements of the PGPA framework. As guides, RMGs explain the legislation and policy requirements in plain English. RMGs support accountable authorities and officials to apply the intent of the framework. It is an official’s responsibility to ensure that Finance guidance is monitored regularly for updates, including changes in policy/requirements.
Audience
This guidance will assist officials of Commonwealth entities who are responsible for preparing and completing the Risk Potential Assessment Tool (RPAT) as part of a New Policy Proposal within the Budget process.
Key points
- The RPAT is an Excel template that provides a standardised assessment and presentation of risks in your New Policy Proposal.
- The Budget Process Operational Rules state that entities must comply with the Government’s Risk Assessment and Assurance Reviews process for New Policy Proposals, including completion of a RPAT for eligible policy proposals.
- Entities must complete a RPAT for all New Policy Proposals with financial implications of $30 million or above.
- Entities may opt to complete a RPAT for proposals with a financial implication of less than $30 million if you choose to do so.
- Where the level of risk before mitigation is ‘MEDIUM’ or higher, you must provide a copy of your RPAT to the relevant Finance Agency Advice Unit in Budget Group and the Assurance Reviews Unit. The level of risk will be used to determine whether additional assurance such as an Implementation Readiness Assessment or Gateway Review may be required.
- The purpose of the RPAT is to assist entities to determine and communicate the potential risk of a proposal to ministers before seeking Cabinet’s agreement. The risk rating of a proposal can also inform whether additional assurance processes may apply.
The RPAT is the first step in the assessment of risk when developing a New Policy Proposal. It provides a standard set of high-level criteria for assessing the degree of strategic importance and implementation complexity.
The RPAT assists to identify the risks that need to be managed. Identifying a source of risk is an important step and helps to establish the extent to which that source plays a contributing role, either in terms of the likelihood of the risk occurring and/or its impact.
The RPAT is not an exhaustive risk analysis model, although it can inform and complement a fuller program/project risk analysis. The RPAT is a template to standardise the assessment and presentation of risks in New Policy Proposals and to better support Government consideration. The RPAT uses your responses to develop a risk rating for each New Policy Proposal, which is also used as a basis to determine whether or not a proposal may be subject to a Cabinet-mandated assurance review (i.e. the Gateway review process or an Implementation Readiness Assessment).
The RPAT must be completed for each New Policy Proposal with an estimated financial implication of $30 million or more (refer to relevant Estimates Memorandum available from the Central Budget Management System (CBMS) – please consult your CFO area if you do not have access to the Estimates Memorandum).
Where the Level of Risk (before mitigation) is MEDIUM or higher, a copy of the RPAT must be provided by the entity to the relevant Finance Agency Advice Unit (AAU) in Budget Group and the Assurance Reviews Unit.
Where multiple New Policy Proposals contributing to a single policy objective are presented to Cabinet as a package within a single submission, an additional whole of submission RPAT must be provided to Finance.
Where a New Policy Proposal is seeking in-principle agreement from Government to develop a more detailed case for options (for example, First Pass consideration), the RPAT must reflect the total proposal being put forward, as best as it is known (that is, it must not be limited to the activities to be undertaken between First Pass/First Stage and Second Pass/Second Stage consideration).
After Government approval of a New Policy Proposal, if there is a significant change to one or more risk factors affecting the New Policy Proposal’s implementation, the implementing entity is required to complete a revised RPAT. The updated RPAT must be provided to Finance if the estimated financial implication is $30 million or above and the Level of Risk (before mitigation) is MEDIUM or above.
The RPAT must be submitted to Finance as soon as practicable, and well in advance of the planned Cabinet consideration date.
Please email your completed RPATs to Assurance Reviews Unit and to your Agency Advice Unit.
