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Actions for Performance audit insights: key findings from 2014-2018

Performance audit insights: key findings from 2014-2018

Whole of Government
Information technology
Internal controls and governance
Project management

A report released today by the Auditor-General for New South Wales, Margaret Crawford, presents key findings from four years of performance audits. The report findings are presented around six areas of government activity including planning for the future, meeting community expectations for key services, investment in infrastructure, managing natural resources, ensuring good governance and digital disruption.

In this report, we present common findings and lessons from the past four years of performance audits, and offer insights to the public sector on elements of effective performance. We have analysed the key findings and recommendations from 61 performance audits tabled in the NSW Parliament between July 2014 and June 2018, spanning varied areas of government activity. We will also use this report to help determine areas of unaddressed risk across all parts of government, and to shape our future audit priorities.

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 on different parts of the community. We recognise that governments face challenges in delivering programs and services, targeting complex social issues with finite resources.

Governments are changing how they deliver services to respond to citizen needs and deliver greater value for money. In this section, we reflect on audits that looked at how government entities are planning their activities to meet the needs of the community into the future.

State and local government 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. Governments also need to provide quality services for a growing and ageing population whilst working within a constrained financial environment.

Over the past four years, our performance audits have assessed aspects of State and local government services, including education, health services, disability support, corrective services, and many others. In this section, we draw together common findings that government entities should reflect on when providing services to the community.

The NSW Government’s 2018–19 Budget forecasts an $87.2 billion infrastructure investment program over the next four years. Infrastructure investment of this size carries 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.

Over the past four years, we have looked at some of the ways NSW Government agencies justify and prioritise projects for funding, work with contractors to deliver projects, and track and report on progress. In this section, we draw together common findings from our audits that government entities should consider when planning future infrastructure projects.

Governments face challenges in balancing the use of natural resources to meet diverse interests, while supporting a sustainable natural environment for the future. They need to supply communities with water, produce energy, protect natural habitats, and support farming, industry, and economic development.

Some of our recent audits have considered how government agencies are managing natural resources and protecting the environment for future generations. In this section, we have drawn together common findings across our audits that government entities should consider in managing the environment and natural resources.

A range of checks and balances is needed to support public confidence in government decision making. To maintain trust, government agencies should act transparently, and in accordance with relevant legislation and policy. This is particularly important as the public sector increasingly engages with external partners to deliver services and provide a more contestable environment.

Good governance arrangements should result in improved service delivery and more effective and efficient use of resources. Our audits have looked at many different elements of governance, including making sure the necessary processes and workplace cultures are in place to help government entities achieve their aims. In this section, we have drawn together various aspects of governance that government entities should consider.

The global increase in digital technology provides governments with opportunities to interact with citizens in more immediate and responsive ways than was previously possible. Data can be used in powerful ways such as predicting future demand for services, targeting interventions, responding to crises, and evaluating outcomes. Governments face challenges in doing this while maintaining secure digital environments that protect citizen interests, privacy, and autonomy.

Our audits have assessed some of the ways that government entities are incorporating digital change into their work. In this section, we draw together common themes that governments could consider in protecting their digital assets, or expanding their digital capabilities.


Actions for Assessment of the use of a training program

Assessment of the use of a training program

Internal controls and governance
Management and administration

The Department of Finance, Services and Innovation (DFSI) and Service NSW's use of Franklin Covey's '7 Habits' program (the Program) met identified business needs according to a report released today by the Auditor-General for New South Wales Margaret Crawford. 

This audit assesses the effectiveness and economy of the Department of Finance, Services and Innovation's, including Service NSW's, use of the Franklin Covey ‘7 Habits’ program (the Program). On 15 March 2018, the Hon. Victor Dominello MP, Minister for Finance, Services and Property, requested the Auditor General conduct this audit under section 27(B)(3)(c) of the Public Finance and Audit Act 1983 (the Act).

About the agencies

The Department of Finance, Services and Innovation (the Department) is the lead agency of the Finance, Services and Innovation cluster. The Department has a number of divisions and business units, including: ICT and Digital Government, Property and Advisory Group, Better Regulation, NSW Fair Trading, Government and Corporate Services, and Revenue NSW. At 30 June 2017, the Department (excluding Service NSW) had 5,239 full-time equivalent staff.

Service NSW is a central point of contact for customers accessing NSW Government Services. It is a Division of the Finance, Services and Innovation cluster and operates as an executive agency. As an executive agency, Service NSW is led by a Chief Executive Officer, who is responsible to the Minister for Finance, Services and Property but appointed by the Secretary of the Department of Finance, Services and Innovation. Service NSW was established in 2013 and has operated under the Finance, Services and Innovation cluster since July 2015. At 30 June 2017, Service NSW had 1,989 full-time equivalent staff.

About the Program

The Program that the Department and Service NSW are implementing, and which is the subject of this audit, is a professional development training course which focusses on organisational culture emphasising personal effectiveness, leadership development and change management. All staff in the Department and Service NSW will receive the training, which involves:

  • a 360-degree assessment where every staff member receives feedback from their manager, direct reports, and peers
  • a two-day training workshop, which will be delivered face to face by accredited facilitators
  • 2 years of online access to all training materials created by the provider of the Program.

As part of the licensing arrangement purchased by the agencies, the Program also provides access (at no extra cost) to the full range of the provider's training and development courses that might be useful for other learning and development activities. This includes courses to improve staff capability in communication skills, leadership, productivity and customer engagement. The Department is considering using one of these courses to develop leadership capabilities. Service NSW has integrated three of these courses into its people development curriculum.

Service NSW commenced the first sessions of the Program in May 2017. At 24 April 2018, around 1,000 staff had undertaken the training. Service NSW expects all staff to complete the Program by June 2019.

The Department of Finance, Services and Innovation commenced the first sessions of the Program in August 2017. At 18 April 2018, around 175 staff had undertaken the training. The Department expects all staff to complete the Program by December 2019.

Audit objective and criteria

The audit sought to assess the effectiveness and economy of the Finance, Services and Innovation cluster’s use of the Program. In making this assessment, we considered whether:

  1.  the Program is being used effectively, including whether
    1. there is an identified need for the Program
    2. the use of the Program meets the identified need
    3. Finance, Services and Innovation cluster agencies evaluate the effectiveness of the Program
  2. the Program is economical, including whether:
    1. the procurement complies with all relevant policies and processes
    2. funding and resources allocated to the Program are reasonable.
The Department of Finance, Services and Innovation, and Service NSW developed workforce strategies which identified a business need to improve organisational culture and staff engagement. The Program met the identified business needs and both agencies negotiated value for money contracts for the delivery of the Program when compared to other available options for training all staff.
However, the agencies did not document evidence to show that training all staff members was necessary to meet their business needs, as compared with training fewer staff members at a lower overall cost. As a result, we are unable to form a view on whether the approach to train all staff members was economical. The agency heads have subsequently provided information supporting their decisions to train all staff members. This information indicates their decisions were based on evidence that this would meet the goals of their workforce strategies, including improving employee engagement scores and organisational culture change.
The Department is paying $1,320,700, over three years, for up to 5,600 staff to participate in the Program ($235.84 per person). Service NSW is paying $595,000, over two years, for up to 2,400 staff to participate in the Program ($247.92 per person).
The agencies are collecting the data they need to evaluate the Program and there is some evidence that the Program is achieving its objectives in Service NSW. Due to the timing of this audit, there is not yet enough information available to comment on whether the Program is achieving its objectives in the Department.

Sector-wide learnings

Implementing robust learning and development frameworks

  1. Agencies should evidence decisions about how proposed learning and development opportunities will meet staff and business needs - both in the program design, and through evaluation. In many cases, organisations may have unique needs or circumstances, or may want to trial innovative approaches to improving organisational capability. Innovation should be encouraged, to avoid the risk that agencies are locked into outdated training and development models. However such approaches should be balanced by ensuring that business needs are well scoped and defined.
  2. Agencies implementing innovative or new approaches to learning and development should build-in iterative evaluations (such as pulse surveys, or collecting post-participation qualitative feedback) to ensure that the training is delivered on intended benefits, and to inform improvements to ongoing rollout.
  3. Agencies implementing innovative or new training programs should ensure they build enough flexibility into contracts so that they can assess how well programs are meeting staff and business needs, and use evidence to inform whether further rollout should occur.