Auditor-General’s introduction
The Audit Office holds a privileged position as one of a small number of independent agencies that provide the checks and balances integral to our system of government.
While our core business is the conduct of audits, our aim is to provide NSW Parliament and the entities we audit with broader insights that inform and challenge government to improve outcomes for citizens.
Like any agency, we have finite resources and must target our efforts to make the most of what we have at our disposal. This work program explains how we decide the focus of audits in this financial year, and likely topics over the next three years. Over the life of the program, circumstances are likely to change, or I may receive requests to undertake special audits. When this occurs, I will consider amending the scope of existing audits or including new audits, and may change the timing of my planned audits.
In shaping the program for the next three years we endeavour to get broad coverage of the sectors we audit. We consider risk and the scale of investments. In this program we will have particular regard to what I consider to be fundamental to good government – transparency, documentation and record keeping, performance measurement and reporting; and on good process and advice to government.
We would welcome any comments you may have to improve the annual work program, the processes we adopt, or our decisions. We promote continuous improvement among the entities we audit, and therefore also want to continuously improve the things we do and the way we do them.
Margaret Crawford
Auditor-General
2 August 2019
Our role
What we do
The Auditor-General reports to the NSW Parliament and is responsible for audits and related services. These audits help parliament hold government accountable for its use of public resources.
The Audit Office conducts financial and performance audits, principally under the Public Finance and Audit Act 1983 (PFA Act) and the Local Government Act 1993 (LG Act), and examines allegations of serious and substantial waste of public money under the Public Interest Disclosures Act 1994. The Auditor-General can also be requested by the Treasurer, a minister or both Houses of Parliament to perform audit or audit-related services. These include audits of agencies’ compliance with specific legislation, directions and regulations.
Financial audits
Our financial audits provide an objective and independent opinion on the financial statements of NSW Government agencies, NSW universities and their controlled entities and NSW Local Government councils.
We play an important role in effective public-sector governance as we assess the adequacy of the financial reporting control frameworks of the entities we audit. The PFA Act also provides us with the mandate to report any waste, lack of probity or financial prudence in the management of public resources identified during our audits.
Each year our financial audits will also examine a small number of specific focus areas across the entities we audit. We are in a unique position to look across the sectors we audit to identify common themes, issues or areas for improvement.
As well as our statutory financial audits, we also perform other assurance audits and reviews, including providing assurance over Commonwealth grants and payments to the NSW Government and NSW Local Councils under Commonwealth legislation.
For NSW Government agencies, the results of each financial audit are reported to the head of the agency concerned, the responsible minister, the Treasurer, and parliament.
For local councils, the results of each financial audit are reported to the local council concerned, the responsible minister, the Secretary of the Department of Planning, Industry and Environment, and parliament.
Cluster and sector-wide reports are provided to parliament through the Auditor-General’s Reports to Parliament. In the case of local councils, a sector-wide report is also provided to parliament.
Performance audits
Our performance audits assess whether the activities of government entities are being carried out effectively, economically, efficiently and in compliance with relevant laws. Our mandate to conduct these audits is provided under the PFA Act and the LG Act.
The activities examined by a performance audit may include a government program, project, or service, all or part of an audited entity, or more than one entity. Performance audits can also consider issues which affect the whole state sector or local government sector.
Under the Government Advertising Act 2011, we are also required to conduct a performance audit of at least one government advertising campaign each year.
For NSW Government agencies, the results of each performance audit are reported to the head of the agency concerned, the responsible minister, the Treasurer, and parliament.
For local councils, the results of each performance audit are reported to the local council concerned, the responsible minister, the Secretary of the Department of Planning, Industry and Environment, and parliament.
Agencies and local councils have the opportunity to provide a formal response to each performance audit. This is included in the Auditor-General’s Report to Parliament.
Other assurance reviews
The Auditor-General can be requested by the Treasurer, a minister or both Houses of Parliament to perform audit or audit-related services. These can also include audits of agencies’ compliance with specific legislation, directions and regulations.
Each year we review whether Members of NSW Parliament complied with certain requirements outlined in the Parliamentary Remuneration Tribunal’s Determination.
Focusing our efforts
There are a multitude of government activities and programs which we could audit. Our resources are limited, so we undertake a robust risk-based approach to identify and prioritise areas of focus, to deliver on our mandate. The diagram below details our internal processes for identifying and selecting performance audit topics and financial audit focus areas for the coming year.
* Our special interest groups comprise members of our leadership team and senior members of our financial and performance audit branches who possess specialist knowledge and expertise in particular sectors such as Health, Transport and Education.
Focusing our financial audit program
In designing our financial audit program we consider the risks and challenges to reporting the true financial position and performance of the state and local councils and how these may be addressed during our audits.
Current risks and challenges that may impact financial reporting that are considered when responding to audit risks include:
Machinery of Government changes
Following the recent New South Wales state election on 23 March 2019, the NSW Government has made significant changes to the allocation and structure of functions between government agencies and ministers. In summary, the NSW Government has:
- abolished several departments and agencies with their functions either transferred to newly created departments or existing departments and agencies
- abolished the associated clusters of these departments, with new clusters created
- moved agencies across clusters
- moved programs or parts of programs to other agencies.
Risks and challenges include:
- non-compliance with legislation, delegations and other instruments which are not yet effective
- control environments being significantly impacted by staffing and system changes
- ensuring adequate records management and impacts to contractual arrangements
- loss of corporate knowledge and disruption to relationships and networks with key staff
- establishing opening and closing accounting balances
- tight timeframes for agencies to implement the changes effectively whilst also responding to our audit processes.
Government Sector Finance reforms
In November 2018, NSW Parliament passed legislative reforms to the financial management of the public sector which will have a significant impact on the agencies we audit. Under the reforms, legislation governing financial management, reporting and audit is now separated into two Acts. The newly enacted Government Sector Finance Act 2018 (GSF Act), containing the new framework for government sector financial and resource management, commences in stages from 1 December 2018. Legislative arrangements for the Auditor-General and the Public Accounts Committee will be contained in the Government Sector Audit Act 1983 (GSA Act) (currently known as the PFA Act). The PFA Act is expected to be renamed to the GSA Act on 30 June 2020.
The GSF Act is intended to have a greater focus on performance, transparency, accountability, and efficiency with respect to financial management in the government sector.
On 1 December 2018, certain provisions of the GSF Act commenced, including key concepts, roles and responsibilities, authorisation of expenditure, financial services and arrangements, performance information, information sharing and delegations.
From 1 July 2019, further provisions commenced including those related to budget, appropriations and special deposit accounts and certain types of expenditure. The reporting arrangements commence progressively over three years to 2020–21.
The audit provisions remain largely unchanged by the reform, except for the principal objects which specifically recognise that the Auditor-General is an independent and accountable statutory officer.
Risks and challenges include:
- building agencies’ awareness of the impacts of the new reforms
- assessing internal control environments for alignment with the GSF Act principles
- reviewing expenditure processes (including financial delegations)
- ensuring financial arrangements (such as entering into borrowings) are appropriately approved
- assessing the potential impact of the new banking arrangements, effective from 1 April 2019
- preparing for the new legislative financial and performance reporting framework.
Information Technology System Controls
Agencies increasingly rely on information technology to deliver services and manage information. Associated risks need to be managed by ensuring information technology computer controls remain effective.
Risks and challenges to financial reporting include:
- control weaknesses in information systems that may compromise the integrity and security of financial data used for decision-making and financial reporting
- entities being exposed to increased risk of fraud and cyber-attacks.
Impact of new accounting standards
Over the next two years, the following new accounting standards will come into effect and are likely to have a significant impact on all sectors:
- AASB 15 ‘Revenue from Contracts with Customers’ and AASB 1058 ‘Income of Not-for-Profit Entities’ (applicable for the year ending 30 June 2019 for for-profit entities and the year ending 30 June 2020 for not-for-profit entities)
- AASB 16 ‘Leases’ (applicable for the year ending 30 June 2020)
- AASB 1059 ‘Service Concession Arrangements: Grantor’ (applicable for the year ending 30 June 2020).
Risks and challenges to financial reporting include:
- interpreting the new requirements and adequately planning for their application as many new rules apply and management judgement is needed
- implementing new systems to capture more detailed information to meet increased reporting obligations.
Focusing our performance audit program
In designing our performance audit program, we consider the risks and challenges facing government, and opportunities for improved public-sector accountability, governance and performance. We look at the potential social, financial and environmental risks associated with poor administration of an activity or area.
We identify these risks and opportunities through research and consultation, and continuously scan the environment for emerging issues. The current areas of focus are:
Planning for the future
Governments play an important stewardship role. Their decisions need to consider intergenerational equity by ensuring that investment strategies are sustainable. Governments also need to consider the impact of their decisions and priorities on different parts of the community. They also need to plan well to ensure services and infrastructure are fit for purpose, and will meet demand now and into the future.
Meeting community expectations for key services
State and local governments exist to provide services to citizens, and citizens are playing a greater role in defining what services they want or need. Expectations about consultation, ease of access, timeliness, and customisation of services are rising. Governments face challenges to continually improve the way they plan and deliver services to meet these expectations and are increasingly moving to commissioning and partnership models with external providers. Governments also need to provide quality services for a growing and ageing population whilst working within a constrained financial environment.
The scale of investment in infrastructure
The NSW Government will invest $93.0 billion in infrastructure over the next four years. Infrastructure investment of this size creates significant opportunities and risks. Competition for resources is high and maintaining the capability to manage and deliver projects effectively is challenging. Governments also need to plan effectively to ensure infrastructure built today will meet future needs.
Cybersecurity and digital disruption
Governments rely on digital technology to deliver services, organise and store information, manage business processes, and control critical infrastructure. Increasing IT capability has created opportunities for governments to improve services and customer engagement. At the same time, increasing use of digital technology has exposed new cyber threats and challenges.
Managing the environment and natural resources
Governments face challenges in balancing the use of natural resources to meet diverse interests, while ensuring resources are used sustainably into the future. Governments need to supply communities with water, produce energy, and manage threats to the environment and human health. They also need to support farming, industry and economic development.
Our plan for 2018–19
Financial audit
We will carry out around 590 statutory financial audits of NSW Government agencies, NSW universities and NSW Local Government councils’ financial statements, issuing over 1,100 assurance opinions. We will comment on the results of these audits and our examination of cluster-specific and across-the-board focus areas in the Auditor-General’s Reports to Parliament, detailed in the table below. In response to the Machinery of Government changes, we plan to align our financial audit Auditor-General’s Reports to Parliament with the new clusters effective 1 July 2019.
Financial Audit Auditor-General’s Reports to Parliament
Report on State Finances (October to December 2019 quarter)
This report will focus on the State’s 2018–19 consolidated financial statements. It will comment on the key matters that have been the focus of our audit and highlight significant factors that have contributed to the State’s financial results.
Internal Controls and Governance (October to December 2019 quarter)
This report will bring together the findings and recommendations from our 2018–19 financial audits that relate to the internal controls and governance of the 40 largest NSW State Government agencies.
Six state sector cluster reports (October to December 2019 quarter)
Our cluster-based reports will analyse the results of the 2018–19 financial statement audits of NSW Government agencies and will comment on internal controls and areas of interest that are in focus during the conduct of our audits. In 2019, our cluster reports will cover:
- Central Agencies (incorporating the Treasury, Premier and Cabinet and newly created Customer Service clusters)
- Education
- Health
- Planning, Industry and Environment (incorporating the former Planning and Environment and Industry clusters)
- Stronger Communities (incorporating the former Family and Community Services and Justice clusters)
- Transport.
Local Government (January to March 2020 quarter)
This report will bring together findings and recommendations from our 2018–19 financial audits of local councils and will comment on financial reporting and sustainability, internal controls and governance, and areas of interest that are in focus during the conduct of our audits.
Universities (April to June 2020 quarter)
This report will analyse the results of the financial statement audits of the ten NSW universities and their controlled entities for the year ended 31 December 2019. It will comment on financial reporting and performance, internal controls and governance, and areas of interest that are in focus during the conduct of our audits.
Our plan 2019–20
Performance audit
We plan to conduct the following performance audits in 2019–20. Our aim is to complete 20 performance audits per year, however the audit program will allow room to add, remove or change the timing of audits to respond to emerging issues or requests. The Auditor-General has the discretion to decide on performance audit topics and the program may change at any time in response to changing priorities and circumstances. Any updates to topics and tabling dates will be published on our website. Information on audits already underway, and not reflected below, can also be found on our website.
Premier and Cabinet
- Advice on major decisions
Treasury
- Supporting major events in NSW
Education
- Local Schools, Local Decisions
- TAFE modernisation program (One TAFE)
Health
- Elective surgery wait-times
- Health capital works
- Support for health staff in high pressure, high demand environments
Stronger Communities
- Funding enhancements for police technology
- Their futures matter
- Access to Legal Aid and community legal services
Transport
- CBD South East Light Rail – follow-up audit
- Transport capacity and reliability
- Westconnex
Planning, Industry and Environment
- Waste services levy and planning for waste infrastructure
- Agency coordination in precinct planning
Customer Service
- Cybersecurity
- Government advertising
Local Government
- Credit card management
- Developer contributions and voluntary planning agreements
- Management of procurement
All clusters
- Water management, security and supply
- Place-based auditing
Other assurance reviews
The following other assurance reviews are planned for completion in 2019–20.
Members’ Additional Entitlements (January to March 2020 quarter)
We conduct and report to parliament on an annual external review of whether Members of NSW Parliament complied with certain requirements outlined in the Parliamentary Remuneration Tribunal’s Determination.
A compliance review (April to June 2020 quarter)
We will conduct at least one compliance review to confirm that specific legislation, directions and regulations have been adhered to.
All clusters - Financial audit
In addition to our specific cluster focus areas (determined in response to key risks identified in each cluster and reported in our cluster-based Auditor-General’s Reports to Parliament), we will examine and report on the following across-the-board audit focus areas in the Auditor-General’s Report to Parliament on Internal Controls and Governance. These focus areas are being assessed as part of our audit scope for the 2018–19 financial audits.
| Audit focus area | Why focus on this topic? |
| Sensitive data management | Over the last few years, agencies are seeing their sensitive data compromised. Potential risks include:
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| Gifts and benefits | Effective management of gifts and benefits safeguards against the loss of public trust, financial losses and in some cases legal action. Potential risks include:
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| Contingent workforce management | According to NSW Procurement, agencies spent $1.5 billion on contingent labour during 2017–18. Potential risks include:
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| Internal audit | Well-resourced and effective internal audit functions deliver value to agencies. Potential risks include:
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Performance audit program by cluster
Premier and Cabinet
The Premier and Cabinet cluster supports the Premier and the Cabinet to deliver the NSW Government’s objectives. The cluster coordinates policy implementation and reform across government, manages the passage of significant legislation, supports the delivery of major projects and events, and leads intergovernmental relations. The cluster includes Aboriginal Affairs and heritage functions.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Advice on major decisions | The NSW Government makes decisions that involve the spending of significant sums, and that have substantial impacts on citizens. This topic will examine a number of policy or investment decisions and examine whether these:
|
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Infrastructure NSW | Infrastructure NSW provides independent advice to assist the NSW Government in identifying and prioritising the delivery of critical public infrastructure for economic and social wellbeing. It also oversees aspects of delivery of some major infrastructure projects. This audit will consider how effectively Infrastructure NSW meets its objectives to provide independent advice to government while also delivering infrastructure projects. |
| Machinery of Government changes | In April 2019, after the NSW state election, the Premier introduced changes to the structure of NSW Government agencies (known as Machinery of Government changes). These changes included the consolidation of government agencies into a structure of eight clusters. This audit will consider issues such as whether the 2019 Machinery of Government changes achieved their effectiveness and efficiency goals and improved public sector administration. |
| Managing heritage assets | The NSW Government owns and manages a range of significant heritage assets across a number of government agencies. These assets include historic buildings, gardens, artefacts and Aboriginal places with heritage significance. This audit will consider whether these significant cultural buildings and sites are being managed effectively and to the benefit of the community. |
Treasury
The Treasury cluster is the government’s principal financial and economic adviser. Its role is to drive economic strategy and oversee governance of the State’s finances. The cluster comprises several entities, including the Crown Finance Entity, that reports large expenditures in relation to whole-of-state assets and liabilities.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Supporting major events in NSW | This audit will examine whether the process used to assess, fund and support major events, including events infrastructure, delivers value for money to taxpayers. It may also consider the role of Destination NSW – which is responsible for devising and implementing strategies to grow the State’s visitor economy. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| City Deals (including Planning, Industry and Environment) | City Deals are partnerships between three levels of government to pursue common infrastructure or social policy goals. The Western Sydney City Deal is a partnership between the Australian Government, NSW Government, and Blue Mountains, Camden, Campbelltown, Fairfield, Hawkesbury, Liverpool, Penrith and Wollondilly local councils. This audit will consider the NSW Government's role in contributing to the planning and implementation process. |
| Implementation of Treasury’s budget, performance monitoring and reporting system (PRIME) | PRIME is the IT platform used by NSW Government agencies to submit data for budget, performance monitoring and reporting. This audit will consider whether the implementation of PRIME has been managed effectively and economically, and whether the system is likely to effectively support the government’s financial management transformation goals. |
| Financial management transformation | In 2013, NSW Treasury committed to a reform program known as Financial Management Transformation (FMT), which aims to improve financial governance across the NSW public sector. This audit will consider whether the government’s financial management transformation agenda has achieved its objectives. |
| Jobs for NSW fund | The Jobs for NSW fund is a $190 million, four-year program designed to create and foster job growth. Jobs for NSW provides financial support to start-ups and emerging and fast-growth small to medium enterprises to build momentum and grow jobs. The financial support can be grants, loans or loan guarantees. This audit may consider whether the fund is effective and economical in achieving its objectives, including whether:
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| Preparing the State Budget | The annual budget is one of the most important and visible statements about a government’s financial intentions. This audit will consider how well relevant agencies support an effective state budget process and may look at a range of aspects of the budget process including:
|
Education
The Education cluster delivers and regulates education and training services for NSW students, workers and industry. This includes the early childhood education and care sector, government and non-government schools, and the vocational education and training sector.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Local Schools, Local Decisions | The Local Schools, Local Decisions reform aims to give principals and their school communities a greater say over how they allocate and use their available resources to best meet the needs of their students. The key mechanism for distributing funds is the needs-based Resource Allocation Model. This audit may assess whether:
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| One TAFE | TAFE NSW launched a series of modernisation initiatives in 2016 that aimed to transform the organisation into a contemporary and commercial government-owned business. These included transitioning to a single Registered Training Organisation. Other priority initiatives included introducing enterprise-wide business systems, implementing a co-ordinated approach for marketing and communications, and establishing Connected Learning Centres to enable greater reach to regional and rural communities. This audit will consider whether the One TAFE modernisation program is on track to achieve its intended benefits. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Reducing out-of-area placements in secondary schools | Students enrol in public schools based on their home address, however schools may accept enrolments from outside their area if places are available. In 2018, around 24 per cent of public high school students were enrolled out-of-area, placing pressure on the school system to effectively balance resources and ensure equity. This audit will consider the effectiveness of efforts to spread capacity from over-enrolled to under-enrolled schools. |
| NSW Literacy and Numeracy Program | This $340 million, four-year program aims to improve literacy and numeracy in NSW schools. Targeted strategies include early years intervention, guidance on explicit teaching and diagnostic assessments, more support in secondary schools, additional training for teacher education students, and evaluation to focus effort on what works. This audit will consider whether the key elements in the strategy have been implemented well, and whether the strategy has been successful in improving education outcomes in the targeted areas. |
| Access to out of school hours care services | Out of School Hours Care (OSHC) services are designed to offer a stimulating and challenging environment for primary school children outside of normal school hours. These services support families to balance the competing priorities of employment, family and education. In April 2019, the NSW Government announced $120 million to expand access to, and reduce the costs of OSHC. This funding includes $50.0 million for new equipment and facility expansions and $40.0 million for rental subsidies to service providers. This audit will consider how the Department of Education supports accessible, affordable and quality OSHC services. |
| Education for remote students | In terms of aggregated results, students in rural and remote areas of NSW underperform on major educational indicators when compared to students in metropolitan locations. Students in rural and remote areas also have lower attendance rates and engagement and are less likely to transition to further study. In 2014, the NSW Government allocated $80.0 million over four years to fund the Rural and Remote Education Blueprint for Action. This audit will consider the effectiveness of the Department of Education’s initiatives to reduce the gap in educational outcomes between rural and remote students and metropolitan students. |
| Security of student information held by schools | NSW public schools collect and store student-level information through a number of central and locally run applications and information systems. This may include things such as family court orders, medical information, discipline and behaviour records, and external support services accessed by students. It is important that the Department of Education and individual schools apply an appropriate level of security to protect the integrity and confidentiality of student information. This audit will consider whether there are clear policies and effective processes to secure sensitive information held by schools. |
Health
The Health cluster works to protect, maintain and improve the health and wellbeing of residents in New South Wales. It is also currently overseeing a significant investment in new capital works and renewal. The Health cluster takes in the Ministry of Health, as well as Local Health Districts and Speciality Networks, the ‘Pillar’ agencies, statewide health services – such as Ambulance – and shared services.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Elective surgery wait-times | Elective surgery is non-emergency, but essential surgery that can be provided in public hospitals under the principle of universal health care. Some hospitals manage elective surgery wait-times within expected benchmarks, while others do not with some wait-times being over one year. This audit may:
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| Health capital works | According to the 2018 Auditor-General’s Report to Parliament on Health, the value of assets held by NSW Health increased from $18.6 billion at 30 June 2017 to $20.1 billion at 30 June 2018. Most of this increase is attributed to capital expenditure on new facilities, upgrades and redevelopments. The same report also notes that two capital projects were completed on time and under budget in the same financial year. Completion dates were revised for ten other projects and budgets revised for six projects. This audit will consider:
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| Support for health staff in high-pressure, high-demand environments | Under the Workplace Health and Safety Act 2011, health is defined as including both physical and mental health. Public servants may be exposed to situational stressors (i.e. the tasks they perform) and conditional stressors (i.e. shift work and work culture) that affect their mental health. This audit may consider whether health staff are effectively supported to manage their mental health after trauma and may also consider particular staff groups such as junior medical officers or emergency nursing staff. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Access to public dental services | Dental services, unlike other health services, are not covered by the principle of universal access. Public dental health services in NSW are provided to children and a proportion of the community who meet eligibility criteria (around 47 per cent of the NSW population are eligible). This audit will consider the extent to which people eligible for public dental services have access to government-provided services that are timely, effective and meet their needs. |
| Drug and alcohol treatment services | NSW Health offers a range of services to assist people experiencing substance misuse issues. This audit may consider whether NSW Health is effectively oversighting delivery of programs through non-government organisations (NGOs), including whether:
This audit may also consider programs aiming to divert people charged with drug and alcohol offences from the criminal justice system. |
| Provision of health services in custodial settings | The Justice Health and Forensic Mental Health Network delivers health care to adults and young people in contact with the forensic mental health and criminal justice systems. The Network supports a highly vulnerable patient population across community, inpatient and custodial settings. Its patients can include people with many and complex health needs and significant increases in the adult custodial population may have placed additional demands on the delivery of health services. This audit may look at planning to adequately service increased prisoner numbers, cross-agency collaboration and preventive care approaches. |
| Management of adverse incidents | A preventable adverse event that occurs in the NSW health system can include harm to a patient caused in the course of their medical care, rather than from their underlying medical issue (i.e. disease, illness, injury). The Australian Institute of Health and Welfare reports that rates of adverse events nationally are increasing over time but notes this may be attributable to a number of factors, including improved reporting. This audit may consider:
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Stronger Communities
The Stronger Communities cluster delivers community services to support a safe and just New South Wales. It aims to support safer, stronger communities through the protection of children and families, building resilience to natural disasters and emergencies, promoting public safety, breaking the cycle of reoffending, and promoting physical activity and participation in organised sport, active recreation and sporting events. The police, courts, correctives, child protection and emergency services help keep citizens safe. Rule of law, affordable housing, assistance for people with disability and initiatives to reduce domestic and family violence, all help to build strong and supportive communities across New South Wales.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Funding enhancements for police technology | In 2015, the NSW Government announced funding of $100 million over four years to equip the NSW Police Force with new technology to respond to crime and enhance officer mobility. This included body-worn video cameras, tablet computers, mobile fingerprint scanners and mobile drug detection devices. This audit may consider whether these investments were economical and have achieved their intended benefits. |
| Their Futures Matter | Their Futures Matter is a multi-agency response to the 2015 Tune Report (Independent Review of Out-of-home Care in NSW), which involves an increased focus on early intervention rather than crisis response. This audit will consider:
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| Access to legal aid and community legal services | Legal Aid NSW and non-government community legal services (CLCs) provide legal assistance services across New South Wales to socially and economically disadvantaged people to improve access to justice and help people break the cycle of disadvantage. Legal Aid NSW operates through a network of 24 offices and 235 regular outreach locations. In August 2018, the NSW Government announced an increase in funding available for CLCs, with annual contributions expected to increase to $12.0 million per annum from 2019–20. This audit will consider how accessible these services are and how effectively they are prioritising their services. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Homelessness initiatives | Homelessness programs are some of the longest-commissioned programs by the NSW Government. Homelessness services in NSW are transitioning to outcomes-based contracts. This will involve changes to the data that is reported by service providers with a greater emphasis on long-term outcomes for clients. This audit will consider:
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| Managing child safety information (ChildStory) | ChildStory was implemented in November 2017 to be a single platform that drew together information for all the people involved in caring for a child into one place. This audit will consider whether:
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| Future directions for social housing | The 2016 Future Directions for Social Housing strategy sets out the government’s ten-year vision for social housing. This audit will consider:
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| Improving outcomes for Aboriginal people (Aboriginal Outcomes Strategy 2017–2021) | The Aboriginal Outcomes Strategy 2017–2021 sets out the Family and Community Services strategy to deliver outcomes for Aboriginal people and is identified as a key action in the FACS Strategic Plan 2017–2021. Priorities include increased access to early intervention for Aboriginal families, reduced overrepresentation of Aboriginal children and young people in out-of-home care, improved economic and social outcomes for Aboriginal social housing clients, increased number of Aboriginal staff and increased engagement with disability services. This audit will consider whether the Department is effectively targeting programs to help Aboriginal people and if outcomes are improving. |
| Police resource allocation amalgamations of police stations | The 2018–19 State Budget allocated $288.2 million over four years to support the re-engineering of the NSW Police Force and provide the Police Commissioner with the flexibility to deploy resources according to need. Re-engineering has consolidated 42 local area commands in metropolitan Sydney into 32 police area commands. The 32 existing commands in regional NSW have been replaced by 26 ‘police districts’. This audit may review how data has been used to inform the reallocation of police resources through amalgamating stations, including examining whether benefits are being realised. |
| Social and Affordable Housing Fund (SAHF) | The SAHF is a key initiative under the Future Directions for Social Housing in NSW strategy. Under this model, the NSW Government does not directly fund or provide housing, but instead purchases housing and related support as a service via outcomes-based contracts with nominated service providers. This audit will consider whether the SAHF model is leading to effective and efficient delivery of social and affordable housing and consider if tenant welfare is being effectively and efficiently protected in SAHF properties. |
| Domestic and family violence | The NSW Government marked reducing domestic and family violence reoffending as a Premier’s Priority in 2015. The 2016–17 Budget announced $300 million over four years for early intervention programs, crisis responses, and new approaches intended to change perpetrator behaviour. This audit may consider whether agency responses are effectively responding to domestic and family violence and may be undertaken as a series of audits looking at how different interventions are delivered and coordinated. |
| Emergency management | Emergency management involves a range of programs and arrangements designed to prevent, prepare for, respond to and recover from significant adverse events. In NSW, the Office of Emergency Management is the lead agency for coordinating emergency management policy and overseeing emergency management planning and activities. This audit may consider agency co-ordination and preparedness to respond to a significant emergency. |
| Management of the risk of bushfires | The NSW Government has committed to the protection of 600,000 homes through hazard reduction works and conducting hazard reduction activities across 750,000 hectares of land. The NSW Rural Fire Service has received funding to coordinate and undertake these activities. This audit will consider how effectively bushfires are being managed and prevented through preparedness and prevention activities such as public education and hazard reduction. |
| Managing offenders in the community | The number of offenders on community-based orders increased from around 16,500 in 2012–13 to over 19,100 in 2017–18. NSW Government reforms in September 2018 changed the way that community orders are organised, reducing the previous six orders to three. This audit may look at planning to cater for expected increases in the number of offenders under supervision in the community and may follow on from our work examining responses to growth in the prisoner population. |
| NSW Trustee and Guardian | NSW Trustee and Guardian provides financial management services to over 33,000 clients who are unable to manage their own affairs. Our previous reports to parliament have identified a need to set performance indicators and targets for the cost and quality of the services NSW Trustee and Guardian provides to the community. This audit may consider whether NSW Trustee and Guardian effectively provides trustee and guardianship services to the satisfaction of its clients. |
Transport
The Transport cluster plans and delivers infrastructure and integrated services across all modes of transport, including road, rail, bus, ferry, light rail, cycling and walking. The cluster aims to contribute to economic growth in New South Wales by delivering integrated services, managing assets, and improving the transport system to enable the safe, efficient and reliable movement of people and goods.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| CBD South East Light Rail – follow up audit | The CBD South East Light Rail (CSELR) is a light rail project that will connect the CBD to Kingsford and Randwick. It is currently scheduled to commence operation in 2019–20. We concluded a performance audit of the CSELR in 2016 and this audit will consider whether Transport for NSW has implemented the recommendations of this work. This audit will also consider the current status and budget of the project. |
| Transport capacity and reliability | Across NSW, many people rely on public transport to access employment, education and to live their lives. This audit may look at a specific issue impacting capacity and reliability and consider whether the system is coping with demand, is prepared for future demand, and is reliable for its customers. |
| Westconnex | The Westconnex project is a motorway project that will link the M4 and M5 motorways with 33 km of new motorway tunnels in Sydney. We conducted a performance audit of the Westconnex business case review process in 2014. This audit will consider aspects of planning and delivery of Westconnex and may take the form of a series of reports conducted over time, focusing on different aspects of the delivery of Westconnex. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Sweating of transport assets | This audit may consider whether Transport is getting the best possible utilisation from significant transport asset investments – for example in trains, buses and ferries. This may include examining whether the expected useful lives of these assets are being realised. |
| Sydney Metro | Sydney Metro is Australia’s biggest public transport project. From the north west, metro rail is being extended under Sydney Harbour, through new underground city stations and beyond to the south west. This audit may consider whether:
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| Roads asset management and maintenance - State/local | NSW has over 144,000 km of roads across its network. This audit will consider how effectively and efficiently Transport for NSW and local councils plan for, and manage, their road assets including maintenance activities, rehabilitation and rebuilding roads at the end of their useful life. |
| Road safety | In 2017, NSW had 4.99 road deaths per 100,000 population. This is well down from the peak of 28.9 in 1970, but above the low of 4.1 in 2014. This audit will consider whether selected road safety initiatives are effectively reducing death and injury on NSW roads. It may also consider planning and preparedness for significant future changes, such as driverless cars. |
Planning, Industry and Environment
The Planning, Industry and Environment cluster is responsible for improving the liveability, prosperity and sustainability of the State. The cluster’s key areas of focus include the security and affordability of water and energy, building sustainable communities with adequate public spaces, job creation and industry development, and environmental conservation. It also aims to strengthen regional areas and primary producers to unlock the economic potential of rural New South Wales.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Coordination of agencies in precinct planning | The Department of Planning, Industry and Environment coordinates with other entities to develop and deliver precinct plans. These plans aim to deliver “a planned approach to growth in Sydney, with new homes and jobs located close to public transport, shops and services, while retaining and enhancing a community’s character”. New priority precincts were announced in July 2017. This audit will consider how effectively the Department coordinates with relevant entities to deliver on this objective. |
| Waste services levy and planning for waste infrastructure | The NSW Government charges councils a waste levy to encourage recycling. This audit will consider:
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Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Threatened species protection | The NSW Government is investing $100 million over five years in saving more threatened animals and plants from extinction. The funds are allocated from 2016 to 2021 to the ‘Saving our Species’ program. This audit will consider progress towards the program’s key objectives of:
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| Voluntary planning agreements | A voluntary planning agreement (VPA) is an agreement entered into by a planning authority (such as the Department of Planning, Industry and Environment) and a developer. Under the agreement, a developer agrees to provide or fund public amenities and public services, affordable housing transport or other infrastructure. This audit may consider whether VPAs are achieving their goal of ensuring sufficient infrastructure to support development, while streamlining the development and planning process. |
| Government response to building regulation and flammable cladding risk | The NSW Government faces the complex task of regulating new building development to ensure quality and safety, in the context of significant and rapid development in some areas of the State. The emergence of risks relating to flammable cladding is one example of the complex issues requiring regulation. Certain types of cladding can burn rapidly if caught alight. Problems with metal composite panels and insulated cladding systems relate mainly to multi-storey buildings because of the potential for rapid fire spread via the external areas of the building. These products can ignite easily and melt at relatively low temperatures. This audit will consider how well the government is regulating building standards in NSW and responding to flammable cladding risks. |
| Implementation of government climate policy | The NSW Government has committed to a climate change policy which aims to reduce net emissions to zero by 2050. One aspect of this policy is a reported $1.4 billion investment in delivering energy savings, reducing emissions, delivering reliable energy and increasing resilience to climate change. This audit may consider whether effective planning is in place to ensure this investment will achieve its objectives. |
| Investment in regional development | In 2017, the NSW Government announced a Regional Development Framework which provides a scaffold for better coordination, decision-making and effort on the ground. The NSW Government recognised the need to be more strategic and better coordinated if it is to make a difference, particularly in addressing some of the serious issues facing regional NSW such as pockets of youth unemployment, social disadvantage, changing economic opportunities and increased competition. This audit will consider whether regional development and grant programs are well coordinated and delivering improvements and may be performed as a standalone topic or as part of a place audit. |
| PFAS management | Perfluoroalkyl and polyfluoroalkyl substances (PFAS) are a group of manufactured chemicals that have been widely used globally, since the 1950s, in the manufacture of household and industrial products that resist heat, stains, grease and water. Because they are heat resistant and film forming in water, some have also been used in fire-fighting foams. The release of PFAS into the environment has become a concern because these chemicals do not break down easily by any natural process, and governments across Australia are recommending that people reduce their exposure to PFAS wherever possible, as a precaution. This audit will consider government responses to contamination from firefighting foam. |
| Property transactions | The proceeds from the sale of property assets provide an important source of revenue through which governments can fund important programs and services. It is important that they be conducted in accordance with relevant processes and guidelines and that the sale or lease of publicly owned property achieves optimum value. This audit may consider how effectively a selection of transactions has been conducted. |
Customer service
The Customer Service cluster aims to build upon work already undertaken to deliver and exceed customer expectations of NSW Government services. The cluster works to ensure customer insights are embedded in policy design and service.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Cybersecurity | Following our audit of central policy design and implementation in 2018, this audit would examine how effectively a selection of agencies are implementing IT security controls. This may include an examination of whether entities are compliant with the relevant cyber risk management frameworks. |
| Government advertising | Under the NSW Government Advertising Act 2011, the Auditor-General is required to undertake a performance audit on government advertising activities annually. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Service NSW | Service NSW is a NSW Government initiative to make it easier for NSW residents and businesses to access government services. This audit would follow up on our 2016 ‘Service NSW: benefits realisation’ audit and assess how effectively and efficiently Service NSW delivers services to its customers. |
| Government advertising | Under the NSW Government Advertising Act 2011, the Auditor-General is required to undertake a performance audit on government advertising activities annually. |
| ICT investment | NSW Government agencies rely on information technology to assist in delivering services. This audit will consider how well selected agencies plan for and manage large IT system implementation. |
Local Government
New South Wales has 128 local councils servicing a specific geographic area, and ten county councils formed for specific purposes, such as water supply, flood plain management or the eradication of noxious weeds. Each council provides a unique range of services to meet its communities’ needs. The mix is influenced by a range of factors including population density, demographics, the local economy, and geographic and climatic characteristics.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Credit card management | Credit cards offer a transparent, flexible and efficient way for local council officials to obtain goods or services to meet business needs. However, credit card misuse can expose a local council to risks such as waste, fraud and reputational damage. This audit may look at the effectiveness of credit card management policies and practices across a selection of councils. |
| Developer contributions and voluntary planning agreements | Development contributions help cover the cost of delivering infrastructure needed to support new communities and homes. They aim to make sure that developers and businesses are paying their fair share towards the infrastructure needed to support new homes. This audit will consider the management and use of developer contributions, including voluntary planning agreements, in selected NSW local councils. |
| Management of procurement | Local councils in New South Wales are tasked with managing a large volume of complex, multi-year service delivery and supply contracts. This audit may consider whether select councils have the requisite systems, procedures and capability to establish and manage these contracts to deliver their expected outcomes at a reasonable cost. |
Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Audit, Risk and Improvement Committees | The NSW Government agreed to streamline and modernise the Local Government Act 1993 in response to recommendations from the Independent Local Government Review Panel and the Local Government Acts Taskforce. Phase 1 of the reforms are contained in the Local Government Amendment (Governance and Planning) Act 2016, which passed parliament in August 2016. This included a requirement for councils to appoint Audit, Risk and Improvement Committees once supporting regulations, codes and guidelines are finalised. This audit may consider how effectively councils support their Audit, Risk and Improvement Committees to identify and respond to risk and implement audit findings. |
| Cybersecurity | The increasing global interconnectivity between computer networks has dramatically increased the risk of cybersecurity incidents. Such incidents can harm local government service delivery and may include the theft of information, denial of access to critical technology, or even the hijacking of systems for profit or malicious intent. This audit will consider how well selected councils ensure they have effective cybersecurity measures in place. |
| Rural water supply and sewage – fees and charges | Good quality drinking water is critical to good health. Affording appropriate infrastructure and accessing engineering expertise can be particularly challenging in rural areas. This audit may consider how effectively and efficiently rural councils and utilities are determining and applying water supply and sewage fees to cover the cost of providing potable water to their communities. It may be considered as a standalone audit or be included as part of a whole-of-government audit on water security and supply. |
All clusters - performance audit
In addition to our planned cluster-specific performance audits, detailed in an earlier section of this program, we plan to conduct the following cross-government and multi-agency performance audits. The specific agencies selected for inclusion in these audits will be identified during our preliminary scoping phase.
Planned audits to 30 June 2020
| Topic focus area | Brief overview |
| Water management, security and supply | Several topics in this program will examine how well, from a state and local government perspective, entities are ensuring, managing and regulating the state’s water supply. We will conduct these pieces of work as part of a multi-volume series on the theme of water, including looking at this issue in a particular place (refer ‘place-based auditing’ topic focus area above). |
| Place-based auditing | This audit will involve selecting a place and auditing various aspects of government interaction with that place. The issues covered could include:
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Planned audits post 30 June 2020
| Topic focus area | Brief overview |
| Outcomes-based budgeting | Outcome budgeting is a new way of budgeting to encourage agencies to commission outcomes – rather than cost inputs and processes. It was first announced in the 2017–18 Budget with the stated aim of putting the needs of people at the centre of investment decision-making. This audit will consider how well outcomes-based budgeting has been implemented and taken up by agencies, and whether agencies are positioned to maximise its benefits. |
| Project management capability | Governments are increasingly using more complex procurement strategies, partnership models and other complex contracting and project delivery approaches. This audit will consider whether agencies have sufficient project management capability to ensure good processes and realisation of expected benefits. |