Then education minister Christopher Pyne with the then prime minister Tony Abbott. Credit:Alex Ellinghausen The report finds the campaign promoting the Abbott government's proposed deregulation of university fees fell short of the requirement to "present campaign materials in an objective and fair manner". The ANAO also criticises the Department of Education for keeping its own secretary in the dark about adverse legal advice on the campaign. The advertising campaign began just after the higher education reforms were rejected for the first time by the Senate in December 2014 and ran while the government was preparing to introduce the package a second time in early 2015. The government later abandoned the policy of full fee deregulation. Despite being designed to tackle "myths and misconceptions" about the reforms, the ANAO report finds the advertisements used dubious claims to promote the higher education changes.

The government was warned this ad risked breaching the law but it ran anyway. Advertisements that ran prominently on television, radio, bus shelters and online stated: "The Australian Government will continue to pay around half your undergraduate degree. And HECS covers the rest." While preparing the campaign, the Department received internal legal advice that this claim created a "risk that the Australian government could be found to have engaged in misleading or deceptive conduct under section 18 of the Competition and Consumer Act 2010". To ensure the campaign didn't breach the law, the legal advice stated: "[Y]ou will need to ensure that the level of Australian government support for each undergraduate degree is not less than 47% as any amount less than 47% may not be considered 'around' 50% by the Australian Competition and Consumer Commission." In fact, the department's projections showed the average government contribution to the cost of a degree in 2018 would only be 39.5 per cent for students under the new system - down from 58.2 per cent in 2014.

The figure rose to 42.7 per cent when students continuing their studies under existing arrangements were taken into account. These figures are also at odds with statements made by then education minister Christopher Pyne and other government ministers promoting the reforms. For example, Mr Pyne said there would be a "50-50 split" of student fees and government support under the new system at a press conference in August 2014. While valid for 2016 if existing students were included, the ANAO found the statement in the advertisements was not "as strongly supported" for later years and for students under the new system. The Education Department told the ANAO it had "made the judgement that, on balance, the two statements were not misleading to the target audience".

"This decision was then reflected in the recommendation to the secretary to certify the campaign," it said. The ANAO report also finds the Intergenerational Report advertising campaign fronted by Dr Karl was "hampered by a lack of specific performance targets". An evaluation found the ads achieved good "cut through" and raised awareness of the report, but not the key challenges it outlined. The evaluation recommended that future campaigns "disassociate" from the Intergenerational Report and focus on specific reforms rather than "building the general case for change". The auditor also criticised the "By Boat, No Visa" campaign run by Labor in the lead up to the 2013 election campaign.

"The usual order of expenditure approval, contracting and service delivery was not observed in the procurement of media placement and research services," the review found. The key recommendation of the ANAO report is that the Independent Communications Committee overseeing government advertising be allowed to review campaigns at any stage of development.