Chapter 2Annual reports of Commonwealth entities and companies
2.1The committee has selected the 2021–22 annual reports of the following entities for closer examination:
the Sport Integrity Australia (SIA); and
the National Disability Insurance Agency (NDIA).
Sport Integrity Australia
2.2Established on 1 July 2020 under the Sport Integrity Australia Act 2020, SIA is a non-corporate Commonwealth entity whose purpose is to keep Australian sport safe and fair. SIA’s creation arose from the Government Response to the Report of the Review of Australia’s Sports Integrity Arrangements (Wood Review), which called for the establishment of a single body to protect Australian sport from threats to integrity. Consequently, SIA fulfils its purpose by addressing threats to sport integrity, as well as acting as the National Anti-Doping Organisation as per the World Anti-Doping Code.
2.3SIA’s accountable authority is its Chief Executive Officer (CEO), David Sharpe APM OAM. Operating alongside the CEO is the SIA Advisory Council. The SIA Advisory Council can provide strategic advice to both the CEO and the Minister for Sport in relation to the CEO’s functions or SIA’s functions. Members are appointed by the Minister and hold a diverse range of experience in backgrounds such as sport, governance, law enforcement and child protection.
CEO message
2.4CEO, David Sharpe, opened his year in review by recounting the challenges the agency had faced arising from COVID-19, specifically the delayed Tokyo Olympics and Paralympics, World Championships across multiple sports, and the Commonwealth Games.
2.5Mr Sharpe also noted that the 2022 financial year was the agency’s second year in operation. Consequently, SIA has spent considerable time to ensure that they have listened to athletes to understand their needs and expectations, therefore building trust. This has informed changes to their operating model, including the establishment of the Athlete Advisory Group, which informs SIA on how to best support athletes through education and prevention programs.
2.6SIA used the 2022 financial year to implement its National Integrity Framework, which ensures that Australian sports have consistent integrity policies and an Independent Complaints Handling Model. This framework clearly delineates acceptable and unacceptable behaviour in sport, particularly around issues of child safeguarding, protection of members, competition manipulation and the use of drugs and medicines.
2.7Mr Sharpe noted that this expanded scope required SIA to collaborate with its partners to manage workloads, in which he noted the collaboration with the Commonwealth Games of Australia to prepare athletes on integrity-related matters ahead of the Birmingham 2022 Games.
2.8The CEO’s review closed by acknowledging the evolving sport landscape which creates new threats to integrity. Mr Sharpe concluded by reaffirming SIA’s commitment to ensuring that sport is fair and safe.
Performance reporting
2.9As per its corporate plan, SIA’s purpose is as follows:
Through the coordination of a national approach, protection of the integrity of sport and the health and welfare of those who participate in Australian sport.
2.10SIA has one outcome and one program against which it measures its success:
Outcome 1: Protection of the integrity of Australian sport and the health and welfare of those who participate in sport through the coordination of a national approach to all sports integrity matters.
Program 1.1: Promote community confidence in sport by preventing and addressing threats to sports integrity and the health and welfare of those who participate in sport, through the coordination of a national approach to all sports integrity matters in Australia.
2.11SIA used strategic objectives rather than performance targets to gauge performance success during the reporting period. SIA noted that it intentionally did not use targets to measure success, so that the agency could be flexible in reviewing its success against its purpose.
2.12The SIA’s strategic objectives each have a corresponding measure(s), which are as follows:
Strategic objective 1: Adapt to our environment:
Gathers, assesses, and shares information with stakeholders.
Strategic objective 2: Strengthen our environment:
Leverages productive partnerships and contributes to fora, committees and projects.
Promotes positive practices across the sporting community.
Strategic objective 3: Address threats to our environment:
Evidence of SIA’s activities and coordination efforts to address sport integrity threats.
2.13SIA reported that all performance measures were met in 2021–22 and the committee commends the agency on its success. The committee also appreciates that SIA provided a thorough explanation of the methodologies used to determine how strategic objectives were met.
2.14However, the committee also notes that SIA does have a performance measure target that is listed in both the Portfolio Budget Statement and SIA’s corporate plan, which is to:
Identify and manage risks and address threats to sport integrity through collaboration with partners and effective awareness, interventions and monitoring controls.
2.15Consequently, the committee would like to draw SIA’s attention to its performance reporting obligations under the PGPA Rule. Section 16F stipulates that Commonwealth entities must measure and assess performance in accordance with the method that was set out in the corporate plan and Portfolio Budget Statement, i.e., the above performance measure target. The committee does acknowledge SIA’s note that its performance framework is evolving and that it will include targets in its 2022–23 annual performance statement.
2.16The committee looks forward to SIA measuring its success against its performance target in future, as per the PGPA Rule requirements.
Financial performance
2.17SIA noted COVID-19 as a significant event that impacted its financial statements. The agency explained that staff were unable to travel domestically or internationally, which is a key part of its engagement. This caused lower than usual spending on travel, and a decline in revenue from user pays clients.
2.18In 2021–22, SIA’s expenses totalled $37,507,000, up from $31,876,000 in 2020–21. Of this total, significant expenses included $18,016,000 which related to suppliers, and $17,186,000 which related to employee benefits.
2.19SIA had a range of purchaser and provider arrangements during the reporting period. Notable expenditure associated with suppliers included testing services which totalled $4,016,000. This related to activities such as international sample collection and analysis services. Additionally, contracts accounted for $3,710,000 of the total suppliers’ expenditure.
2.20Total own source revenue amounted to $1,384,000 for the 2021–22 financial year, a majority of which was generated from contracts with customers, totalling $1,179,000. However, SIA recorded a net deficit of $220 000 compared to the surplus of $1,550,000 in 2020–21.
2.21The committee appreciates the accompanying notes that SIA provided to read in conjunction with its financial performance reporting.These notes increased the readability of the presented figures and consequently increased the transparency of the SIA’s financial position during the reporting period.
List of Requirements
2.22The List of Requirements (compliance index) is an important aid that enables the reader to easily access information within annual reports. The committee appreciates that the format of SIA’s index did not deviate from the format set out in the PGPA Rule. The committee also thanks SIA for including 'if applicable, mandatory' items in their index and clearly noting that these items do not apply to the agency. By including every item regardless of their applicability, SIA’s index reassures the reader that items have not been inadvertently missed.
2.23However, the committee also notes that SIA’s index referenced whole sections of its annual report to locate information. Going forward, the committee would appreciate SIA referencing specific pages to enable the reader to easily locate information, thus increasing the overall accessibility of the report.
2.24Further, the committee would also like to draw SIA’s attention to a handful of instances where the index refers to a section of the report that does not actually contain the required information. For instance, the item that requires the entity to provide a description of non-salary benefits provided to employees is said to be found under the 'performance pay' section. However, the performance pay section does not include this type of information.
2.25Overall, the committee commends SIA on its annual report, and looks forward to the agency acting upon the committee’s advice in future annual reports. The committee considers SIA’s annual report for 2021–22 to be apparently satisfactory.
National Disability Insurance Agency
2.26The NDIA is a corporate Commonwealth entity within the Social Services portfolio and its statutory functions are set out in section 118 of the National Disability Insurance Scheme Act 2013 (NDIS Act). Its key statutory functions are:
delivering the NDIS so as to, amongst other things, support the independence, and social and economic participation, of people with disability and enable people with disability to exercise choice and control in the pursuit of their goals and the planning and delivery of their supports;
managing, and advising and reporting on, the financial sustainability of the NDIS;
developing and enhancing the disability sector;
building community awareness of disabilities and the social contributors to disabilities;
collecting, analysing and exchanging data about disabilities and the supports for people with disability; and
undertaking research relating to disabilities, the supports for people with disability and the social contributors to disabilities.
Chair’s review
2.27Acting Chair, Mr Jim Minto, outlined the agency’s highlights for 2021–22:
total payments to participants were $28.6 billion, an increase of just over $5 billion on the previous financial year;
the average payment per participant was $55 000. Five years ago it was $32 300;
for participants who now have six or more plans the average payment was $92 900. The average payment relating to their first plan was $30 300. Their plan values have tripled over those six or more plans;
of the 534 655 participants with an approved plan at the end of the year, 82 863 were children younger than seven years old. The number of NDIS participants as a proportion of the Australian population peaks between the ages of five and seven, at 6.8 per cent; and
a total of 208 265 participant plan reviews were conducted between 1 July 2021 and 31 December 2021; of those plan reviews, 2069 resulted in an Administrative Appeals Tribunal case. At 30 June 2022, 93 per cent of complaints were being resolved within 21 days.
Acting Chief Executive Officer’s review
2.28Acting Chief Executive Officer, Dr Lisa Studdert, reported on the NDIA’s key areas of work in 2021–22, which included:
at 30 June 2022, 534 655 participants received support from the NDIS, with more than 300 000 of these receiving supports for the very first time;
at 30 June 2022, 38 846 participants in the Scheme identified as Aboriginal and Torres Strait Islander, now representing 7.3 per cent of all participants;
an increased number of participants who identified as culturally and linguistically diverse, which is now 49 201, or 9.2 per cent of all participants;
responses to significant events, including the ongoing COVID-19 pandemic and severe weather events;
an increased focus on engagement with the sector, particularly through intensive, genuine co-design;
improved home and living options to support participants to have more choice and control over where they live, who they live with and the supports they use;
the progression of NDIA’s Operational Guidance Refresh project, improving how the agency communicates Scheme policy and decision-making information; and
the roll-out of a contemporary, custom-built participant-facing system. to significantly improve the quality and efficiency of NDIA’s service delivery.
Performance reporting
2.29As outlined in its 2021–25 corporate plan, the NDIA’s purpose is to:
Support individuals with a significant and permanent disability (participants) to be more independent and engage more socially and economically, while delivering a financially sustainable NDIS that builds genuinely connected and engaged communities and stakeholders.
2.30To support achieving its purpose, the NDIA has five aspirations to measure its strategic objectives and focus areas:
(a)a quality experience and improved outcomes;
(b)a competitive market with innovative supports;
(c)a genuinely connected and engaged stakeholder sector;
(d)a high-performing NDIA; and
(e)a financially sustainable NDIS.
2.31Compared to its previous 2019–20 Annual Report, the NDIA have included six new performance metrics as outlined in section five of their 2021–25 Corporate Plan:
(a)participant and scheme outcomes;
(b)participant and stakeholder sentiment;
(c)Scheme financial sustainability and integrity;
(d)Scheme operating performance;
(e)market performance; and
(f)agency operating performance.
2.32The NDIA stated that these performance metrics were designed to provide a longitudinal understanding of the performance and impact of the Scheme, and that targets provide a ‘high-level scorecard’ of the agency’s progress towards enhancing participant outcomes, while maintaining long-term financial affordability.
2.33Each performance metric encompasses a number of priorities and specific activities. This annual report outlines this year’s results, next year’s target and long-term aspirations. A summary of this year’s results are as follows:
Table 2.1Performance metric (a) – Participant and Scheme outcomes
| | | |
Participant employment rate (%) | 23% | 24% | No |
Participant social and community engagement rate (%) | 43% | 48% | No |
Families and carers employment rate (%) | 50% | 49% | Yes |
Children benefiting from the Scheme and no longer needing supports (%) | 5.8% | 5.5% | Yes |
Socioeconomic equity (%) | 104% | 100% | Yes |
Source: NDIA, Annual Report 2021–22, pp. 141–142.
Table 2.2Performance metric (b) – Participant and stakeholder engagement
| | | |
Participant satisfaction (%) | 75% | 78% | No |
Participant perception of choice and control (%) | 76% | 75% | Yes |
General community sentiment and confidence (%) | 67% | 70% | No |
Provider sentiment and confidence (%) | 54% | 62% | No |
Source: NDIA, Annual Report 2021–22, pp. 143–144.
Table 2.3Performance metric (c) – NDIS financial sustainability and integrity
| | | |
Payment growth compared to healthcare and social assistance wages growth | 1.8 times | <3 times | On target |
NDIS annual spend (Program 1.1) compared to PBS (%) | 98% | 100% | On target |
Source: NDIA, Annual Report 2021–22, p. 145.
Table 2.4Performance metric (d) – NDIS operating performance
| | | |
Participant Service Guarantee timeframes met (%) | 51% | 100% | No |
Plan utilisation by region (%) | 7.5% | <8% | Yes |
Source: NDIA, Annual Report 2021–22, pp. 146–147
Table 2.5Performance metric (e) – Market performance
| | | |
Market concentration (%) | 8.4% | <10% | Yes |
Providers charging below the price limit (%) | 22% | 24% | No |
Source: NDIA, Annual Report 2021–22, p. 148.
Table 2.6Performance metric (f) – NDIA operating performance
| | | |
NDIA spend (Program 1.2) compared to PBS (%) | 95.3% | 100% | On target |
NDIA spend (Program 1.2) as proportion of Scheme spend (%) | 5.6% | 7% | No |
Payment errors/anomalies (% of program outlay) | 3.2% | <1% | No |
Staff engagement (%) | 76% | >78% | No |
Staff wellbeing (%) | 71% | 70% | Yes |
Staff with disability (%) | 18% | 17% | Yes |
Senior Executive Service staff with disability (%) | 9% | 11% | No |
Female representation in the Senior Executive Service (%) | 58% | 50% | Yes |
Source: NDIA, Annual Report 2021–22, pp. 149–151.
2.34The committee appreciates NDIA’s transparency, discussion and analysis on the targets that were not met and the agency’s commitment to improving results in the future.
Financial reporting
2.35In 2021–22, the NDIA received $1.263 billion in government funding and reported an operating deficit of $273 million. The NDIA noted that the rate of new entrants to the Scheme continues to be high.
2.36An annual financial sustainability report (AFSR) is required under section 180B of the NDIS Act and provides an assessment of the financial sustainability of the Scheme. The AFSR is produced using data at 30 June each year and a summary of each years’ AFSR has been included in the NDIA annual report.
2.37The NDIA stated that from 1 July 2021 to 30 June 2022, $27.6 billion in payments for supports were made on a cash basis across all participants. This was $1.2 billion or 4.2 per cent less than the previous 2020–21 AFSR estimate of $28.8 billion. Further, total payments on an accrual basis were $28.6 billion, or 2 per cent lower than the than the previous 2020–21 AFSR estimate of $29.2 billion. The NDIA attributed these variances to the systemic impacts from COVID-19 on the supply of and demand for disability support services.
2.38The committee appreciates the NDIA’s description of the variance in Scheme expenses for 2021–22, which included:
systematic disruptions to demand for and supply of services (estimated to be $440 million or 37 per cent of total variation);
a lower-than-expected expense for participants in residential aged care (estimated to be $175 million or 15 per cent of total variation);
the mix of new entrants which have a relatively low per participant expense, (partially offset by higher-than-expected participant numbers overall) – estimated to be $111 million or 9 per cent;
activities to address provider compliance; and
other items which are not explained as they are not able to be quantified.
2.39The committee also appreciates the detailed financial statements provided and thanks the NDIA for its comprehensive description contained in the AFSR, combining both qualitative and quantitative information.
List of Requirements
2.40The committee draws the NDIA’s attention to Schedule 2A, sections 17BE(taa) and 17BF of the PGPA Rule.
2.41In relation to section 17BE(taa) concerning information about the entity’s audit committee, the committee notes that although the NDIA provided the details of their audit committee in its annual report, the agency did not provide a reference for this requirement in its compliance check list.
2.42In relation to section 17BF which denotes the disclosure requirements for government business enterprises, the committee notes that this section was omitted from the NDIA’s compliance check list. This makes it difficult to ascertain whether this section was removed because they are not applicable, or if they have been inadvertently excluded from the list of requirements. Going forward, the committee urges the NDIA to denote these items as ‘N/A’ to aid transparency, rather than removing this section from the compliance index altogether.
2.43The committee also notes that the NDIA’s list of requirements does not provide page references, only indexed sections of the report. It is important that the agency lists the specific page reference to mandatory reporting items to maximise ease of access within the report for the reader.
2.44Overall, the committee looks forward to the NDIA implementing the above suggestions in its future annual reports. It deems that the agency’s 2021–22 annual report meets the relevant reporting requirements and finds that it is apparently satisfactory.
Office of the National Rural Health Commissioner
2.45The committee thanks the Office of the National Rural Health Commissioner (ONRHC) for its comprehensive annual report for 2021–22.
2.46The annual report is presented in accordance with the ONRHC’s annual reporting requirements under the Health Insurance Act 1973. Section 79AP(2) of the Health Insurance Act 1973 stipulates that details of activities during the reporting period should be included as well as any other matters the Rural Health Minister directs the Commissioner to include.
2.47In its annual report, the ONRHC reviewed its 2021–22 highlights, including the Ngayubah Gadan (Coming together summit). This summit brought together rural stakeholders to discuss the importance of investing in rural and remote multidisciplinary health teams. Other key activities included the Rural Healthcare Student Mentorship, the Office Statement on Racism, the Primary Care Rural Innovative Multidisciplinary Models grant opportunity, and the co‑design of care models and wellbeing tools.
2.48The report provided a thorough breakdown on the ONRHC’s key priority areas, which are:
Stakeholder Relationships;
Urgent and Emerging Priorities;
Innovative Models of Care;
Rural Workforce, Training and Primary Care Reform; and
Organisational Governance and Financial Management.
2.49The appendices included in the report were also comprehensive and provided the reader with further insight into the finer details of topics such as presentations and engagements that the ONRHC participated in, and articles and submissions the ONRHC prepared during the reporting period.
2.50The committee commends the ONRHC on its annual report for 2021–22 and considers it to be apparently satisfactory.
General comments on other annual reports
Reportable consultancy and non-consultancy contracts
2.51In accordance with Schedule 2A, sections 17AG(7)(a) and 17(AG)(7A)(a) of the PGPA Rule, all entities are required to state the total expenditure in the reporting of these contracts inclusive of GST.
2.52However, the NDIS Quality and Safeguards Commission (NDIS Commission) did not include information on whether their total expenditure for consultancy and non-consultancy contracts were inclusive of GST.
2.53The committee notes that the NDIS Commission have not implemented the committee’s suggestion in its previous report on annual reports, and reminds the Commission to provide the total expenditure, inclusive of GST, for reportable consultancy and non-consultancy contracts.
Compliance index
2.54The committee thanks the National Mental Health Commission (NMHC) and the NDIS Commission for presenting their compliance indexes in the form prescribed in the PGPA Rule, as this ensures that all mandatory reporting items are captured correctly.
2.55However, there were instances in both indexes where page numbers were either referenced incorrectly or omitted. For example, the NMHC states that information on non-salary benefits is on page 57 of its annual report, when this information is instead located on pages 55–56.The same issue occurred in relation to the reporting item on advertising campaigns. The NMHC’s compliance index references page 75, yet this information is located on page 74.
2.56Similar issues were also identified in the Aids to Access part of the NDIS Commission’s compliance index. For example, page number references were omitted in sections 17AJ(e), 17AJ(f) and 17AJ(g) which points to the details of their contact officer, the entity’s website address and the electronic address of their annual report respectively. The committee encourages the NDIS Commission to provide page number references for these sections in its future reporting to ensure the reader can locate this information in the body of the annual report.
2.57Overall, the committee commends the NMHC and NDIS Commission on their detailed annual reports for 2021–22 and looks forward to the correction of these minor errors going forward.
Apparently satisfactory
2.58As noted in Chapter 1, the committee has assessed all reports of the Health and Aged Care and the Social Services portfolios tabled after 31 October 2022 as apparently satisfactory. The committee would like to reiterate its request for the minor errors mentioned in this chapter to be rectified in future annual reports. This will ensure that all agencies comply with the requirements of the PGPA Act and PGPA Rule.
Senator Marielle Smith
Chair