Chapter 2 - Annual reports of departments
Department of Families, Housing, Community Services and Indigenous Affairs
2.1
The Department of Families, Housing, Community Services and Indigenous
Affairs (FaHCSIA) annual report provides a well-structured and comprehensive
review of the Department's functions and operations, including detailed
performance reporting against the performance indicators of the 2009-10
Portfolio Budget Statements (PBS) and the 2009-10 Portfolio Additional
Estimates Statements (PAES).
2.2
FaHCSIA is a key source of advice to the government on social policy and
manages a diverse range of payments and services to support and improve the
lives of Australians. Part 1 of the report provides an overview of the
portfolio and department as well as a review by the Secretary highlighting the
major activities for the financial year. These include: the Paid Parental Leave
(PPL) Scheme; the Secure and Sustainable Pensions reform package; the draft
National Disability Strategy; initial stages of the National Partnership
Agreement on Remote Service Delivery; and development of the National Compact
with the not-for-profit sector.[1]
Performance reporting
2.3
Part 2 of the report provides an overview of the performance of the
department as a whole, as well as an examination of performance against each
outcome. The performance report for each outcome provides an overview as well
as an outlook for coming years. FaHCSIA reported against its new outcome and
program structure developed in accordance with Operation Sunlight, the
government's reform agenda to improve transparency of public sector financial
management. FaHCSIA worked closely with the Department of Finance and
Deregulation (Finance) to review the performance framework, with a strong
emphasis placed on reporting against program objectives, rather than simply the
level of program activity.[2]
The department now reports against seven outcomes, rather than four:
A key goal of the framework is to assist programs to set
clear performance expectations, assess whether levels of performance have been
met, set benchmarks to monitor trends and offer feedback to services on their
performance.[3]
2.4
FaHCSIA has an Online Funding Management System for mainstream programs
and a Grants Management System for Indigenous specific programs. During 2009-10
FaHCSIA implemented new performance indicators primarily in programs funded as
special appropriations and will now report on 130 key performance indicators
(KPIs) and describe 49 deliverables across the seven outcomes. Reviews were
conducted for grant programs and changes to performance reporting for those
programs will occur in 2010-11. FaHCSIA reports that the new standardised
performance framework and KPIs reduces the amount of data collection and the
costs of collating and analysing performance information.[4]
2.5
The key influences on the achievement of outcomes were economic factors
including share markets, housing affordability and the effects of the global
financial crisis on retirement incomes. This contributed to an increase in
outlays for the Aged Pension. There has also been a trend increase in new
births since 2003 affecting Outcome 1, Families and Children.[5]
External scrutiny
2.6
As well as a comprehensive list of internal audit practices, the report
includes various means of external audit of the department. The Australian
National Audit Office (ANAO) found no category A or B findings and two category
C findings in its audit of the department's financial statements.[6]
In addition, the ANAO tabled five audit reports in parliament relevant to the
operations of the department, and the former Office of Evaluation and Audit
tabled six audit reports involving FaHCSIA's operations.[7]
2.7
The report notes that the Commonwealth Ombudsman received 186 approaches
about the department in 2009-10, a decrease of 200 from 2008-09. This year the
Commonwealth Ombudsman closed 185 of these matters; seven investigations had
findings of administrative deficiencies.[8]
2.8
FaHCSIA also gave written and oral evidence to 14 inquiries by a number
of parliamentary committees including the Senate Community Affairs Committee.[9]
Consultancies
2.9
During 2009-10 FaHCSIA entered into 271 new contracts with a total
expenditure of $12.1 million. In addition, 140 ongoing consultancy contracts
were active with a total expenditure of $11.2 million.[10]
Department of Health and Ageing
2.10
The Department of Health and Ageing (DoHA) annual report provides a well
structured and comprehensive review of the Department's functions and
operations, including detailed performance reporting against the performance
indicators of the 2009-10 Portfolio Budget Statements (PBS) and the 2009-10
Portfolio Additional Estimates Statements (PAES).
2.11
The report begins by highlighting the department's major achievements in
2009-10. This is followed by a section which highlights the projects and
activities for the coming year. This format is straight forward and useful for
the reader to obtain a broad picture of the department's performance and
activities at a glance. These points are further elaborated on in the
Secretary's review. Some of these include: the new National Health and
Hospitals Network considered the biggest reforms in health since the
introduction of Medicare close to 25 years ago; the large scale response to the
pandemic influenza 2009 (H1N1); and the development of 21 GP Super Clinics.[11]
2.12
The Secretary's report is followed by a report from the Chief Medical
Officer (CMO) and, for the first time, the Chief Financial Officer's (CFO) report.
The CMO's comprehensive report provides a medical perspective on the health of
the nation as a whole; the current status and future direction of health
protection and delivery. Supporting graphs and tables are included in the
overview. Mental disorders ranked as the fourth highest occurring major disease
group projected for 2010. The current survey suggests around 17 per cent of the
population experience some mental health problem in a year. Those with a mental
health condition are more likely to spend days out of work and be unable to
carry out regular activities. COAG has identified mental health as a major
priority for 2011.[12]
The CMO also details the enactment of the Australian Health Management Plan for
Pandemic Influenza in response to the pandemic influenza A (H1N1) in the winter
of 2009.[13]
2.13
Part 1 of the report follows the overview of the Secretary, CMO and CFO,
and provides further information about the department's structure, as well as
the executive and ministerial teams.
Performance reporting
2.14
Part 2 of the report discusses the department's performance against the
outcome framework including reports on budget estimates and actual expenses for
2009-10 against each outcome. The performance report begins with a table
summarising the available appropriation compared to the actual payments made
for each outcome.[14]
The department has 14 outcomes, and a further 18 outcomes specific to portfolio
agencies.[15]
2.15
The report provides a summary and breakdown of each program administered
within an outcome as well as a highlight of major achievements. This includes a
table outlining the deliverables and key performance indicators (KPIs) and the
result against each for the financial year. These tables are a useful gauge of
the department's performance and actual results achieved within the year. The
performance report for each outcome concludes with a financial resources
summary breaking down the appropriated amount for each outcome compared to the
actual expenditure, and also includes the budget estimate for the 2010-11
financial year.
External scrutiny
2.16
Part 3 details the department's governance, people and financial
management arrangements and ministerial responsibilities. It also includes
information on internal and external scrutiny activities.[16]
2.17
The ANAO tabled several reports in Parliament relating to the
department, one directly pertaining to the department on the protection of
residential aged care accommodation bonds and five other cross agency audits
where the department was involved. There were an additional three reports where
recommendations were targeted at all agencies, including DoHA.[17]
2.18
The Joint Committee of Public Accounts and Audit tabled one report which
reviewed reports of the Auditor-General including matters relating to the
department. The department also appeared before the Senate Community Affairs
Legislation Committee on three occasions in 2009-10 for estimates, and give
evidence to 22 parliamentary inquiries. The department received a combined
total of 166 questions on notice through both chambers of parliament, and a
total of 1,061 from the three estimates hearings.[18]
2.19
During 2009-10 the Commonwealth Ombudsman investigated 61 complaints
against the department's administrative practices, 36 of which were new
complaints, 11 remain open as at 30 June 2010. The Ombudsman has advised of two
findings of administrative deficiency relating to the department 2009-10.[19]
Consultancies
2.20
During 2009-10 the department entered into 429 new consultancy contracts
with an expenditure of $29.23 million (GST inclusive). In addition, 178 ongoing
consultancy contracts were active during the year with expenditure of $20.4
million (GST inclusive). The committee appreciates the departments clear
reporting on consultancies including the selection processes used and a table
of consultancy services entered into for sums of $10,000 or more.[20]
Department of Human Services
2.21
The Department of Human Services' (DHS) report reflects the move to
integration within the portfolio, in line with the implementation of service
delivery reform. Whilst legislation requires three separate reports, the DHS
report is intended to be read as a companion with those of Centrelink and
Medicare Australia.[21]
The reforms are intended to 'maximise convenience for Australians'.[22]
DHS undertook much activity this year to position the portfolio to implement
the reforms including setting up a number of co-located offices in existing
sites and engaging with customers and the community services sector on service
co-design.[23]
2.22
DHS includes the Child Support Program (CSP) and CRS Australia. This
year CSP customer satisfaction improved and the number of complaints reduced by
over 25 per cent. A pilot assessment process produced significantly shorter
timeframes for finalising child support applications. The Alignment of Care
2009-10 Budget Measure was successfully implemented allowing mutual customers
to contact either CSP or Centrelink to notify care arrangements and
determinations are made using consistent rules for each agency. The other
agency is then informed of the decision which is then applied to the customer's
assessment.[24]
2.23
CRS Australia provides disability employment, assessment and injury management
services. This year CRS Australia transitioned to the new Department of
Education, Employment and Workplace Relations Employment Services Memorandum of
Understanding; and saw significantly more job seekers being placed in employment
than in previous years.[25]
CRS Australia assisted more than 57 000 job seekers.[26]
2.24
The Secretary's review concludes with an outlook for 2010-11 including:
establishing pilots projects on compliance approaches for social, health and
welfare payments; implementing Paid Parental Leave; implementing the
initiatives under the Fifth Community Pharmacy Agreement; and further service
delivery reforms.[27]
Performance Reporting
2.25
Chapter 2 discusses the central department's achievements; chapter 3
CSP; and chapter 4 CRS Australia. Each contains performance highlights followed
by a more detailed report of results achieved in the year compared to last year
as well as summaries of the various activities. The table comparing the KPI
results between the years is a useful tool, however the format was better
suited to CSP and CRS Australia who had a more simplified table. The central
department's table was more complex and the headings were more difficult to
follow across pages. Each chapter includes a case study which brings a greater
understanding of the work of each area.
External Scrutiny
2.26
The ANAO issued several audit reports that involved the department:
- Report 17 of 2009-10, tabled 17 December 2009 audits of the
financial statements of government entities;
- Report 19, tabled 18 December 2009 Child Support Scheme Reforms
(CSSR);
- Report 39, tabled 24 May 2010 Medicare Australia's Administration
of the Pharmaceutical Benefits Scheme;
- Report 46, tabled 22 June 2010 Child Support Scheme Reforms:
Building a Better Child Support Agency (BBCSA);
- Report 50, tabled 24 June 2010 Interim phase of the audit of
financial statements of major general government sector agencies; and
-
the commencement of a performance audit on the CRS Australia
business operations, its governance and responsiveness to client feedback.
2.27
The audit of financial statements found no issues for the department,
and the other reports contained a number of recommendations which the
department agreed to. Recommendations for the two audits on the CSSR are being
addressed together along with findings of an independent review by David
Richmond AO into the appropriateness, design and implementation of current
decision-making processes and quality assurance for CSP.[28]
2.28
The Commonwealth Ombudsman published the following reports in relation
to agencies within DHS:
- Australian Federal Police and the Child Support Agency,
Department of Human Services, Caught between two agencies: the case of
Mrs X (Report no. 14/2009); and
- Putting things right: compensating for defective
administration, Administration of decision-making under the scheme for
compensation for detriment caused by defective administration (Report no.
11/2009).
2.29
Whilst the reports are listed, there is no indication of the
department's response to the reports.
2.30
The Social Security Appeals Tribunal (SSAT) is responsible for
independently reviewing CSP objection decisions and refusals of an extension of
time to lodge an objection. The SSAT received 2665 applications for review of
CSP decisions in 2009-10 and finalised 2777 decisions in relation to appeals.
49 per cent affirmed CSP's objection decision, and 59 per cent set aside or
varied the CSP decision. The number of appeals made to the SSAT constituted 15
per cent of the total objection decisions finalised in 2009-10.[29]
Consultancies
2.31
The report includes an appendix explaining the principles and selection
process used when DHS engages in a consultancy contract, as well as a list of
contracts entered into valued at $10,000 or more during the year.[30]
The table has a useful column outlining the justification for using the
consultancy based on:
- skills currently unavailable within agency;
- need for specialised or professional skills; and
- need for independent research or assessment.
2.32
The committee notes there is no summary of consultancy services
outlining the total amount or a means to differentiate between new and ongoing
consultancies.
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