About this report 

The land titles registry is a collection of registers established under the Real Property Act 1900 and related legislation. It is the source of truth for land and property ownership in NSW and underpins significant economic activity.

The registry is owned by the NSW Government. From 1 July 2017, a private operator has operated and maintained the registry under a 35-year concession granted by the NSW Government.

The Office of the Registrar General is the regulator of the private operator’s activity under the concession. It is a business unit in the Department of Customer Service.

This audit examined the effectiveness of the regulator in overseeing and monitoring the operation and maintenance of the registry to ensure its integrity and security.

Conclusion

The Office of the Registrar General has implemented an effective system and supporting processes to oversee and monitor the integrity and security of the land titles registry.

However, the audit found opportunities for the Office of the Registrar General to improve how it conducts its regulatory functions.

Recommendations

The audit recommended that the Office of the Registrar General should:

1. develop and publish its approach to exercising its regulatory functions and powers
2. publish a regulatory charter to ensure greater regulatory transparency
3. review the skills and capabilities required to regulate the land titles registry
4. ensure greater clarity on the rights to use data, and the application of privacy legislation
5. ensure compliance with the NSW Cyber Security Policy, including the requirements relating to third parties
6. perform an audit of the subscriber compliance process.
    

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Parliamentary reference - Report number #403 - released 12 February 2025

About this report

Bus services in metropolitan Sydney are provided by private operators under contract to the NSW government. Transport for NSW (TfNSW) determines bus timetables, routes, stops, and frequency, while the operators deliver the specified bus services.

This audit assessed the effectiveness of TfNSW’s design and management of metropolitan Sydney bus service contracts. The audit focused on the nine regions where services are provided under the Greater Sydney Bus Contract (GSBC).

Conclusion

TfNSW is not effectively managing bus contracts to ensure that operators are meeting contracted obligations and customer needs. It has not responded strategically to major changes in commuter, work and travel patterns on metropolitan bus services.

TfNSW identified significant gaps in its strategic contract management capacity since 2022 but has not sufficiently addressed these. As a result, it has not undertaken essential medium to long term strategic activities required to effectively manage the GSBCs. It has not conducted a holistic, systematic review of service levels across all regions to fully address the impacts of the post-COVID-19 period, and other changes such as new infrastructure and travel options like the Sydney Metro M1 line.

First stop on time running has stabilised since January 2023. However, operators are not consistently meeting their performance obligations for on time running, cancelled trips and customer complaints.

There are gaps in TfNSW’s contract management specific procedures and delegations. These gaps mean that the risks of inappropriate exercise of delegations, non compliance with contractual requirements and/or inappropriate use of public funds are not fully addressed.

Recommendations

The audit recommends that TfNSW improve the capacity of its bus contracts management team. It should also close the gaps in its contract management specific procedures and delegations, and start regularly auditing operator responses to customer complaints.

TfNSW should implement strategic planning, including enhanced data analytics, aimed at improving bus operator performance.

On time running (OTR), customer complaints, tracking rates, and cancelled and incomplete trips are important key performance indicators (KPIs) as they represent significant facets of the customer experience.⁷ This chapter considers OTR KPIs in detail, since the start of the Greater Sydney Bus Contract (GSBCs).

OTR is defined in Schedule 4 of the GSBC with three KPIs – first, mid and last stop OTR. All three are measured as the percentage of timetabled bus trips that are on time at the specified location. GSBC operators are required to report to Transport for NSW (TfNSW) on these three KPIs every month.

For the first and mid stops ‘on time’ is defined as between 59 seconds early and five minutes and 59 seconds late compared to the timetable.

TfNSW has advised that mid transit stop OTR has been incorrectly calculated for multiple GSBC regions and that it was in the process of re-calculating this KPI for the operators that were affected. As a result, we do not report mid transit stop OTR numbers here or draw any conclusions about them.

OTR for the last transit stop on a route is measured as a percentage of bus trips arriving on time, where ‘on time’ is defined as no later than five minutes and 59 seconds after the timetable arrival time.

First stop OTR has decreased over the duration of the GSBCs, but it has stabilised in the period from January 2023 to May 2024

Figure 8 shows the aggregated first stop OTR performance data across metropolitan Sydney as a whole (excluding region 6) for the duration of the GSBCs. It also reflects advice received from TfNSW that there is a change in bus operator performance in January 2023 and splits the time period accordingly (April 2022 to December 2023 and January 2023 to May 2024).

During the audit, TfNSW emphasised the impact of the bus driver shortage on bus service performance against KPIs, as well as seasonal effects in OTR performance. Therefore, Figure 8 also shows the reported driver shortages for each month from June 2022, as well as the January and February seasonal effects.

Figure 8 shows that, while there is an overall downward trend in performance, first stop OTR becomes stable after January 2023. Prior to that point in time, performance was declining.⁸

This chapter considers operator performance against key performance indicators (KPIs) for bus tracking rates and cancelled and incomplete trips. From the perspective of bus passengers, tracking is important to ensure timetables and real-time data are accurate and reflects the reality of the services they are receiving. Tracking is also essential for the measurement of on time running (OTR) and cancelled and incomplete trips.

This chapter considers operator performance based on customer complaints received. Customer complaints are defined in Schedule 4 of the Greater Sydney Bus Contract (GSBC) as any report of a negative experience in relation to a bus service in the categories of ‘complaint’ and ‘feedback’. This excludes vexatious complaints, and any complaints about issues that are within Transport for NSW’s (TfNSW) control and not the operators.

Customer complaints have increased since the start of the GSBC

The number of customer complaints about bus services over the entire GSBC area has increased over time. The number of complaints per 100,000 boardings in May 2024 is approximately double that in April 2022 (28.9 complaints per 100,000 boarding compared to 14.4), reflecting increasing customer dissatisfaction with the services delivered.

Complaints are measured using several key performance indicators (KPIs) that represent factors such as the number of complaints per 100,000 boardings and the time it takes operators to respond to complaints. Figure 12 represents the number of customer complaints per 100,000 boardings across the GSBC operators over the GSBC period.

Appendix 1 – Response from Transport for NSW

Appendix 2 – The evolution of bus contracting in NSW from 2003

Appendix 3 – About the audit

Appendix 4 – Performance auditing

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

Parliamentary reference - Report number #402 - released 29 January 2025.

What this report is about

This report focuses on the 2023–24 Consolidated State Financial Statements of the New South Wales General Government Sector (GGS) and Total State Sector (TSS), which comprise the Total State Sector Accounts.

It comments on the key matters and highlights significant factors that have contributed to the State’s financial outcomes for the year ended 30 June 2024.

Observations

The audit opinion on the Total State Sector Accounts for the year ended 30 June 2024 was unqualified.

The GGS’s net operating balance for the 2023–24 financial year was a deficit of $10.7 billion. This was $2.9 billion more than the original budgeted deficit of $7.8 billion, and $1.1 billion more than the revised budget deficit of $9.6 billion estimated during the 2023–24 half yearly review.

Revenue growth exceeded expense growth in 2022–23 and 2023–24, after several years when expenses increased in excess of revenue as the government responded to COVID-19 and natural disasters.

The State recorded $769 million in write offs of infrastructure and other assets in 2023–24, largely from transport projects including the Great Western Highway upgrade, the Beaches Link project and the Fast Rail program.

The State also wrote off $334 million of inventories including expired rapid antigen test kits and personal protective equipment.

The GGS’s net debt to gross state product increased from -0.3% in 2019 to 11.4% in 2024. It is predicted to reach 14.2% of gross state product by 2028.

The State maintained its triple-A and AA+ credit ratings.

Recommendations

Seven of nine 2023 report recommendations have been addressed.

NSW Treasury is working to address the two open recommendations relating to reviewing the financial reporting exemption framework.

The Audit Office’s annual work program

The Annual Work Program 2024–27 was published in August 2024

Each year, the Audit Office’s Annual Work Program reflects an ongoing strategic assessment of the risks and challenges facing government. It outlines subsequent focus areas for financial audits, as well as planned performance audit topics published as a three-year rolling program. We aim to inform NSW Parliament, the public sector and the community about key risks we identify, as well as our priorities and expected timeframes for delivering our work. This helps to give our stakeholders the best opportunity to prepare for, and engage with, our audits.

Our financial audit program this year included a consolidated report on the audit results of NSW Government agencies’ financial statements. The State agencies 2024 report highlighted the issues that had the most significant impact across the whole sector.

There are five key focus areas in our performance audit program:

• effective advice and decision making
• First Nations people in NSW
• environment and sustainability
• efficient and responsible use of public resources
• cyber security.

A sharper focus on information technology risks and data

The NSW public sector is increasingly reliant on information technology to improve service delivery. The Systems Assurance, Cyber and Data Branch within the Audit Office seeks to respond to the pervasive risks and opportunities associated with information technology, and the growing availability of large amounts of data. The creation of this branch reflects the prominence of data and cyber issues within our Corporate Strategy and Annual Work Program, and the importance of our information systems assurance work. The work of the branch supports our financial and performance audits, with insights reflected in our financial and performance audit reports.

The outcome we seek is a sharper focus on information technology risks within the public sector, particularly cyber security risks, to be highlighted in our performance and financial audits. Our increasing use of data for more effective audits aims to further enhance our audit reports.

The Systems Assurance, Cyber and Data Branch also plays a role in thought leadership about artificial intelligence and its impacts on the way we work and the work of the agencies we audit. This plan includes commencing our first audit focused on artificial intelligence.

Digital audit transformation

The Audit Office is embarking on a digital audit transformation which is looking at how we can better use data and technology to enhance our audits.

This transformation looks to re-imagine how we plan for, complete and report on our financial and performance audits incorporating data analytic solutions, automation and predictive analytics, leading to more efficient, effective and timely audits.

An initial key focus is on standardising and automating data requests from agencies, which will streamline processes, save time, automate some audit procedures and improve audit risk assessment and benchmarking.

We understand that there are some key enablers required to achieve this outcome and acknowledge that there are some key risks that we need to manage. Ensuring that we have a workforce that is digitally capable, and technological solutions that are fit-for-purpose, while continuing to maintain high levels of security and privacy over information is essential.

While this transformation will be staged, the support of the sector will be crucial to ensure speedy and consistent implementation across the entire sector.

Audits will target the efficient and responsible use of public resources

The Government Sector Employment Act 2013 establishes the core values of the public sector in NSW. One of these core values is that public servants should be fiscally responsible and focus on the efficient, effective and prudent use of resources.

The Government Sector Audit Act 1983 provides that the Auditor-General may have regard to the wastage of public resources and may deal with reports about the serious and substantial waste of public money. Serious and substantial waste involves the uneconomical, inefficient or ineffective use of resources, whether authorised or unauthorised, and which could result in a loss of public funds or resources.

Waste can result in an opportunity cost for government where money could have been used for a better purpose, or better spent on achieving the same purpose. Waste can also lead to higher costs being incurred to address earlier failings in program design, budgeting and management.

The Audit Office’s work program for 2024–27 includes audits that focus on identifying whether the planning and management of key programs and services has been efficient and financially responsible, and whether opportunities to avoid and reduce waste have been identified early.

Climate-related financial reporting in NSW

The NSW Government has announced the introduction of mandatory climate-related financial disclosures as part of agencies’ annual reporting.

The release of climate-related financial disclosures by government entities is intended to provide transparency on the NSW Government’s exposure to the impacts of climate change and enhance accountability over strategies to respond to risks and capitalise on opportunities.

NSW Treasury recently issued its framework for first year climate-related financial disclosures

In October 2024, NSW Treasury issued TPG24-33 ‘Reporting Framework for First Year Climate-related Financial Disclosures’ (the Framework). The Framework sets out mandatory reporting requirements, including key guiding principles and disclosure content.

The Framework is closely informed by the Australian Accounting Standards Board’s (AASBs) Australian sustainability reporting standard, AASB S2 ‘Climate-related Disclosures’. It has been tailored by NSW Treasury to reflect NSW Government circumstances and reporting entity capability and capacity.

Entity level climate-related financial disclosures will commence in stages from 1 July 2024

The disclosure obligations will commence in 2024–25 for the largest entities or those entities likely to be most exposed to material climate-related risks. Based on NSW Treasury’s assessment, 29 ‘phase 1 entities’ will apply the Framework for their 2024–25 climate disclosures.

Other entities will apply the Framework when they make their first climate-related financial disclosures in subsequent phases.

The assurance regime over climate-related financial disclosures is being developed

The Audit Office has been engaging with NSW Treasury to determine the nature and scope of independent public sector assurance over future climate-related disclosures at both a whole-of-government and agency level. Assurance requirements are expected to be staged, with NSW Treasury recently seeking expressions of interest for some phase 1 entities to have their 2024–25 climate disclosures assured by the Audit Office. Mandatory assurance for all phase 1 entities will commence in 2025–26.

Appendix 1 – Key audit matters

Appendix 2 – Prescribed entities

Appendix 3 – Controlled entities of the State

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

About this report

Results and key themes from our audits of the state agencies’ financial statements for the year ended 30 June 2024.

It also includes observations on the following areas of focus:

• risk management
• capital projects
• shared service arrangements.

Findings

The Treasurer did not table the audited Total State Sector Accounts (TSSA) in Parliament as required by the Government Sector Finance Act 2018, and Responsible Ministers did not table 16 annual reports in Parliament by the required date.

Audit results

Unqualified opinions were issued for all but one agency.  The quality of financial statements submitted for audit improved, with reported misstatements down to a gross value of $3.9 billion in 2023–24, compared to $10.8 billion in 2022–23.

Key themes

Errors in accounting for assets led to financial statements adjustments of $1.4 billion. 

Our audits identified deficiencies in key controls across financial management, payroll, contract management and procurement.

Risk management

Risk management maturity is low across most agencies. Some of the largest 40 agencies self-assess their risk maturity as requiring improvement.

Capital projects

There is a lack of transparency in the NSW budget papers relating to significant capital projects. The estimated total costs for some major projects are not published as the amounts are considered commercially sensitive. The budget papers do not provide a complete and accurate reflection of the actual costs of large infrastructure projects.

Shared service arrangements

Three of the five agencies that provide shared services to 108 customer agencies did not obtain independent assurance over the effectiveness of their control environment. 

Recommendations

The report makes recommendations to agencies to improve controls and processes in relation to:

• financial reporting
• financial management
• risk management
• shared service arrangements
• capital projects.

Financial reporting is an important element of good governance. Confidence in, and transparency of, public sector decision making is enhanced when financial reporting is accurate and timely.

This chapter outlines our audit observations relating to the financial reporting of State Government agencies.

Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are also essential for quality and timely decision making.

This chapter outlines observations and insights from our audits of financial statements of the 40 largest agencies in the State sector. These agencies are listed in Appendix 3.

This chapter outlines audit observations, conclusions and recommendations from our review of agencies’ risk maturity, assessment processes, governance, systems and culture across the 40 largest agencies in the state sector. These agencies are listed in Appendix 3.

This chapter outlines observations, conclusions and recommendations from our review of the 15 most significant capital projects in the State.

Shared service arrangements can centralise corporate services functions such as finance, human resources, procurement and information technology (IT). Across NSW Government agencies, many business processes and IT functions are provided on a shared services model, that is, one agency operates a business function or IT platform that is used by other agencies rather than each agency maintaining their own. These services are shared by several agencies (‘customers’), but generally are operated and managed by one agency or department (‘provider’).

This chapter outlines audit observations, conclusions and recommendations from our review of shared service arrangements provided and received by the 40 largest agencies in the state sector. These agencies are listed in Appendix 3.

This report outlines the findings on shared service arrangements.

Appendix 1 – Status of audits of consolidated entities

Appendix 2 – Status of audits of non-consolidated entities

Appendix 3 – Forty largest State agencies contents

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

About this report 

This report reviews compliance by members of the Parliament of New South Wales with certain requirements outlined in the Parliamentary Remuneration Tribunal’s (the Tribunal) 2024 Annual Determination (the Determination). 

Claims made by members for additional entitlements totalling $12.7 million were within the scope of our review. The remaining payments of $12.1 million were not reviewed as there are certain salaries and allowances that the Determination excludes from our compliance review requirements. 

Claims relating to annual basic and additional salaries, additional expense allowances, and electoral and committee allowances are excluded by the Determination from the scope of our compliance review.

Findings 

From a sample of 56 claims, our compliance review procedures identified 27 departures from requirements of the Determination and/or the administrative guidelines of the Department of Parliamentary Services (the Department). 

There were fewer departures this year than in previous years, however late submission of claims and declarations by members continued. The Department needs to provide clarity to members on expenditure claim requirements and processes.

Recommendations 

The Department should: 

• enhance its assessment as to whether members’ expenditure claims comply with requirements and advise members promptly about whether their claims are ineligible 
• improve its quality review processes when reporting the total number and dollar value of members’ additional entitlements claims for each year 
• ensure internal audits of members’ additional entitlements are adequately scoped and endorsed prior to their commencement and reflect the requirements of the Determination. These internal audits should be completed prior to the compliance review performed by the Audit Office 
• continue to work with members to provide them additional training or education and better help them comply.

This report reviews compliance by members of the Parliament of New South Wales with certain requirements outlined in the Parliamentary Remuneration Tribunal’s (the Tribunal) 2024 Annual Determination (the Determination).

The Determination establishes the annual salaries and additional entitlements allowed to members of the Parliament of New South Wales under the Parliamentary Remuneration Act 1989 and requires members’ claims for additional entitlements to also comply with requirements of the Department of Parliamentary Services’ (the Department) administrative guidelines. The Parliament of New South Wales, through the Department, administers payments of additional entitlements.

There were 32,244 payments made to members for entitlements under the Determination during the 2023–24 financial year totalling $24.8 million. Of these, 30,566 claims for payment of additional entitlements totalling $12.7 million were within the scope of our compliance review under the Determination. The remaining payments of $12.1 million made during the 2023-24 financial year were not reviewed as there are certain salaries and allowances within the Determination that are excluded from compliance review requirements. These payments include:

• annual basic salaries, additional salaries and additional expense allowances
• additional entitlements comprising electoral allowances and committee allowances.

The infographic below outlines which payments made to members for entitlements under the Determination are within the scope of our compliance review, and those which the Determination excludes from our compliance review.

There were fewer departures from requirements of the Determination and/or the administrative guidelines of the Department identified in our 2023–24 compliance review than in previous years. However late submission of claims and declarations by members continue, indicating a need for improved processes and greater clarity, training and education for members.

From a sample of 56 claims, our compliance review procedures identified 27 departures from requirements of the Determination and/or the administrative guidelines of the Department. These included:

• 21 claims for payment were not submitted within 60 days of receipt of invoice or incurring the expense (2022–23: 22 claims)
• 1 claim under the Communications Allowance related to a publication that did not include the required authorisation and attribution (2022–23: two claims)
• 5 members submitted their annual loyalty/incentive scheme declarations after the date specified in the Department’s administrative requirements (2022–23: seven members).

The table below shows the number of departures from requirements of the Determination and/or the administrative guidelines of the Department identified in the past three financial years’ compliance reviews.

* Blackout periods are applicable only to election years.

Members require further clarity to address the continued departures from the Determination

Our past compliance reviews identified departures from the Determination and the administrative requirements of the Department that indicate a need for greater clarity in the current processes and guidance, including increased training or education to help support members comply with the Determination.

Last year we recommended:

• the Tribunal provides greater clarity on current processes and implications of departures from the guidelines to members
• the Department works with members to provide them additional training or education and better help them comply with the Determination and/or the administrative guidelines of the Department.

While an improvement was observed in the number of departures from the Determination and the administrative requirements of the Department over the years, similar departures have been consistently identified in our compliance reviews. This suggests there is still a need for the Department to improve processes and provide greater clarity, training and education to members. It reconfirms the importance of our recommendation in section 3.3, which calls for the Department to be responsible in assessing the eligibility of claims for additional entitlements prior to payment.

Enhanced public reporting

Since 2016, our reports to Parliament have recommended the Tribunal consider requiring the Department regularly publish full details of members’ expenditure claims on its website in an accessible and searchable format.

In response, the Tribunal had developed a plan requiring greater public reporting of members’ expenditure from 1 July 2019. However, Crown Solicitor’s advice sought by the Tribunal confirmed it did not have the power to require the Department publish full details of members’ expenditure claims.

The Department responded to this recommendation by identifying that a significant investment in the required systems was necessary to allow for the detailed publishing of all members’ expenditure claims.

This recommendation has been considered by the Department and to date, there are no imminent plans for any change in the way it publishes the details of members’ expenditure claims during the year. Given our recommendation was to enhance public reporting of members’ expenditure claims, and there is no non-compliance with existing reporting, we will not be repeating this recommendation.

Appendix one - Response from the Department of Parliamentary Services

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

About this report

Local councils in NSW manage a large proportion of roads across the state. Roads often represent a significant proportion of total council
expenditure.

How councils manage roads is impacted by their revenue, local conditions, and the needs of residents, businesses and other road users.

This audit was undertaken within the wider context of natural disasters and weather events that have significantly impacted the road network in NSW in recent years.

It assessed whether three councils had effectively managed their road assets to meet the needs of their communities, makes detailed findings and recommendations to each audited council, and identifies key lessons for the wider local government sector.

Key findings

All councils can improve how they link community consultation with planned service levels. Formalising these processes could help better demonstrate how current service levels meet community needs.

Clarence Valley Council

• has established a strategic priority for road asset management but not formal governance arrangements or a long-term capital works program
• is delivering and reporting on its work to respond to natural disasters but does not report against targets for road asset quality and service
• has set benchmarks for road asset maintenance, replacement and renewal but needs clear service levels.

Gwydir Shire Council

• did not have aligned, up-to-date asset plans during the audit period
• did not have a long-term capital works program but adopted a prioritisation program for capital works in August 2024
• did not effectively implement formal governance, or coordinate management oversight, to manage its road assets.

Wollondilly Shire Council

• has a strategic framework for road asset management and has used long-term plans to guide its asset capital and maintenance works
• has reported asset management outcomes against a planned capital works program but could improve how it uses KPIs to demonstrate performance.

This is the first performance audit of the local government sector that I am tabling in Parliament as Auditor-General for New South Wales.

Our performance audits are designed to provide valuable information to parliamentarians, sector stakeholders and the public. Ultimately, our aim is to ensure transparency, a principle that underpins effective and efficient use of public resources.

The management of roads and associated assets is a critical issue for local councils across the state. In recent years, many councils have had to contend with the immediate and ongoing effects of natural disasters.

These natural disasters, along with increased community expectations, population changes and complex regulatory obligations all contribute to financial sustainability risks for councils. Some councils have used short-term funding allocations (including emergency relief grants) to cover the costs of managing long-term assets. These councils do not have the capacity to generate sufficient income from their own sources, and therefore depend on assistance from other levels of government. Councils’ ability to plan and budget for the long term has also been disrupted by the need for new or restored infrastructure outside asset life cycles.

Several reports and inquiries in recent years have highlighted these significant financial sustainability risks. The parliamentary inquiry into the ‘Ability of local governments to fund infrastructure and services’,¹ due to be tabled soon, will be a critical input to a long-term solution.

The three councils audited in this report – Clarence Valley, Gwydir Shire and Wollondilly Shire –each experienced significant natural disasters, including fires, storms and floods during the audit period. Despite this, each audited council was able to deliver a large volume of road asset management works.

This report provides valuable lessons from these audited councils that can help all councils manage their roads more effectively in the face of evolving risks and competing resource demands.

I acknowledge this has been a difficult time for some councils across NSW. This report supports councils with practical steps to manage their roads as effectively as possible, improve their resilience to climate challenges and meet legislative requirements.

¹ The inquiry into the ‘Ability of local governments to fund infrastructure and services’ by the NSW Legislative Council Standing Committee on State Development commenced on 14 March 2024 to inquire into, and report on, the ability of local governments to fund infrastructure and services.

Background

Local councils in New South Wales (NSW) manage over 180,000 km of local and regional roads combined. These roads are crucial to travel within local government areas and across the state, improving community accessibility. Reliable roads ensure commercial and public transport can run on time, increase safety and keep the environment clean.

As roads age and deteriorate, they become more expensive to repair. Road surfaces and formations are vulnerable to both extreme heat and water exposure. These kinds of exposure have varying effects on the ways roads degrade, depending on the amount of traffic and the kinds of vehicles that use them.

Local conditions, business and road-user needs, and the impacts of natural disasters vary between councils and influence the way each council manages its roads. Regularly maintaining roads can keep roads functional and safe and prevent costly, unbudgeted repairs and replacements.

In the 2022–23 financial year (FY2022–23), the estimated total replacement cost of council road assets across NSW was around $102 billion. In the same year, local councils reported collective road asset maintenance expenditure of around $1 billion.

Since 2017, financial audits of local councils have identified asset management-related issues, including gaps in asset management processes, governance and systems. The Audit Office’s ‘Local Government 2023’ report outlined 266 asset management-related findings across the local government sector, including gaps in revaluation processes, maintenance of information in asset management systems and accounting practices.

Councils also provide a wide range of other services and infrastructure, including water and sewer infrastructure and services, waste management, environmental protection, housing, and community transport. Through integrated planning and reporting, councils determine how they will allocate resources to their services and infrastructure. Understanding community expectations for assets and services, alongside technical requirements, supports effective planning for function, cost and quality.

Audit objective

This audit assessed how effectively three councils – Clarence Valley Council, Gwydir Shire Council and Wollondilly Shire Council – are managing their road assets to meet the needs of their communities.

The audit assessed whether the selected councils:

• have a strategic framework in place for managing their road assets
• have effective governance, data and systems for road asset management
• are managing their road assets in line with planned service levels and quality outcomes.

Overview of findings

This audit assessed how effectively Clarence Valley Council, Gwydir Shire Council and Wollondilly Shire Council managed their road assets to meet the needs of their communities.

In assessing each Council’s performance, this audit concluded:

Clarence Valley Council has effectively established a strategic priority for road asset management, but delivery of this priority was not supported by formal governance arrangements or a long-term capital works program. While the Council is delivering and reporting on a large volume of road asset works in response to natural disasters, it does not report on consolidated targets for road asset quality and service. The Council has set benchmarks for maintenance, replacement and renewal of roads. It now needs to enhance this with clear service levels to ensure community needs and expectations are met.

Detailed conclusions and recommendations for the Council are outlined in sections 2.2 and 2.3. Recommendations include that Clarence Valley Council:

• updates and implements its asset management plan and associated improvement actions
• reviews and implements key performance indicators (KPIs)
• captures lessons learned from its natural disaster responses
• implements a long-term capital works program.

Gwydir Shire Council did not have aligned, up-to-date long-term asset management plans to support a strategic framework for road asset management across the audit period. The Council did not effectively implement formal governance and coordinated management oversight for its road assets. The Council implemented updates to its asset management plans in June 2024 and governance arrangements in July 2024.

The Council has reported on the large volume of works it is delivering, including in response to natural disasters, but is not reporting in the context of information about targets and quality benchmarks. The Council does not have a long-term capital works program, but adopted a prioritised rolling program of works in August 2024 to guide its priorities and efforts over time.

Detailed conclusions and recommendations for the Council are outlined in sections 3.2 and 3.3. Recommendations include that Gwydir Shire Council:

• implements its asset management plans and associated improvement actions
• formalises and documents community priorities and service level expectations for roads
• captures lessons learned from its natural disaster responses.

Wollondilly Shire Council has effectively applied a coordinated and strategic framework to deliver road asset management. The Council has long-term plans to guide its efforts and uses data to inform its approach. The Council has delivered a large volume of works in response to natural disasters during the audit period. The Council is reporting its road asset management outcomes and can demonstrate progress against a clearly defined capital works program, but its use of performance indicators could be improved.

Detailed conclusions and recommendations for the Council are outlined in sections 4.2 and 4.3. Recommendations include that Wollondilly Shire Council:

• finalises and implements its transport asset management plan
• reviews performance indicators for road assets
• formalises and documents community priorities within its integrated planning and reporting (IP&R) and asset management frameworks.

Key observations of good practice

While each council was separately audited, this report also identifies practices that contribute to effective road asset management across all local councils.

These include:

1. a good understanding and articulation of the community’s vision, priorities and purpose for local roads
2. asset management documents that are current and aligned with broader strategies and financial plans
3. long-term capital works planning that considers associated ongoing costs, and is supported by systematic prioritisation of works
4. clear and documented decision making processes
5. transparent performance reporting on progress and outcomes
6. reliable, accurate and assured data and systems
7. continuous improvement through both formal reviews and capturing lessons learned
8. resilience and responsiveness to natural disasters with a planned approach to disaster recovery.

Further lessons for local government can be found in Appendix 3.

Appendix 1 – Response from entity

Appendix 2 – Council expenditure profile

Appendix 3 – Lessons for local government road asset management

Appendix 4 – About the audit

Appendix 5 – Performance auditing

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

Parliamentary reference - Report number #401 - released 21 November 2024.

About this report

Internal controls are key to the accuracy and reliability of agencies’ financial reporting processes. This report analyses the internal controls and governance of 26 of the NSW public sector’s largest agencies for the 2023–24 financial year.

Findings

There are gaps in key business processes, which expose agencies to risks. These gaps are identified in 121 findings across the 26 agencies—including 4 high risk, 73 moderate risk and 44 low risk findings. All four high-risk issues related to IT controls and 19% of control deficiencies were repeat issues. Thirty-five per cent of agencies had deficiencies in control over privileged access.

Shared IT services

Six agencies provide IT shared services to 120 other customer agencies. All six had control deficiencies—three of these were high risk. Four agencies provide no independent assurance to their customers about the effectiveness of their own IT controls.

Cyber security

Eighteen agencies assessed cyber risk as being above their risk appetite. Fourteen of these agencies had not set a timeframe to resolve these risks and two agencies have not funded plans to improve cyber security.

Fraud and corruption control

Agencies need to improve fraud and corruption control. Instances of non-compliance with TC18-02 NSW Fraud and Corruption Policy were identified, including gaps such as a lack of comprehensive employment screening policies and not reporting matters to the audit and risk committee.

Gifts and benefits

Management of gifts and benefits requires better governance and transparency. All agencies had policy and guidance but all had gaps in management and implementation—such as not publishing registers nor providing ongoing training.

Information Technology

Nine agencies did not effectively restrict or monitor user access to privileged accounts.

Recommendations

The report makes recommendations to agencies to implement proper controls and improve processes in relation to:

• organisational processes
• information technology
• cyber security
• fraud and corruption, and
• gifts and benefits.

Read the PDF report

Internal controls are processes, policies and procedures that help agencies to:

• operate effectively and efficiently
• produce reliable financial reports
• comply with laws and regulations
• support ethical government.

This chapter outlines the overall trends for agency controls and governance issues, including the number of audit findings, the degree of risk those deficiencies pose to the agency, and a summary of the most common deficiencies found across agencies.

This chapter outlines our audit observations, conclusions and recommendations arising from our review of agency controls to manage key financial systems.

This chapter outlines our audit observations, conclusions and recommendations arising from our review of agencies' cyber security.

This chapter outlines our audit observations, conclusions and recommendations from our review of agencies' fraud and corruption control framework, policies and practices. Our Internal Controls and Governance 2018 found a number of fraud and corruption control gaps in NSW Government.

The NSW Treasury Circular TC18-02 NSW Fraud and Corruption Control Policy (the Circular) requires NSW government agencies to develop, implement and maintain a fraud and corruption control framework. The Circular sets out minimum standards for a NSW Government agency’s fraud and corruption control framework.

Previous Audit Office report on agency fraud and corruption control

This chapter outlines our audit observations, conclusions and recommendations arising from our review of agencies' managing of gifts and benefits.

Click here for the Easy English version of the report snapshot

The Easy English version is intended to meet the needs of some people with lower literacy skills, some people with an intellectual disability, and some people from different cultural backgrounds.

The Easy English document is not the final audit report that has been prepared and tabled in NSW Parliament under s.38EB and s.38EC of the Government Sector Audit Act 1983. It should not be relied on or quoted from as the final audit report.

About this report

Australian and state legislation protects the right of students with disability to a quality education, free from discrimination. These require that students with disability be supported to access and participate in education on the same basis as their peers without disability.

This audit assessed whether the NSW Department of Education is effectively supporting students with disability in NSW public schools.

Findings

The Department has effectively designed approaches and developed reforms under its 2019 Disability Strategy and related measures.

But it still hasn’t resolved longstanding issues with funding, access to targeted supports, monitoring school practice and tracking outcomes for students with disability.

This is despite the Department being made aware of these performance gaps for almost two decades across multiple audits, parliamentary inquiries and the recent national Disability Royal Commission.

Recommendations

The report makes five recommendations to address these gaps, including that the Department should:

• annually monitor the experiences and outcomes of students with disability to be able to identify and address emerging issues, and promote good practice
• reform funding to be better aligned to student needs
• enhance guidance and support to schools and families on making reasonable adjustments for students with disability.

Background

Australian legislation protects the right of students with disability to a quality education, free from discrimination, and describes the obligations of education providers to these students.

Under the federal Disability Discrimination Act 1992 (Cth) and related legislated Disability Standards for Education 2005 (the Disability Standards), education providers have legal responsibilities to make education and training accessible to students with disability, including in enrolment, participation, curriculum and support services. This is to be done through providing ‘reasonable adjustments’ or measures and actions that assist students with disability to access education on the same basis as students without disability.

The NSW Department of Education (the Department) is responsible for supporting students with disability in NSW public schools. The Department and schools provide a range of adjustments and targeted supports, in consultation with the student and/or their parents/guardians. In 2023, approximately 206,000 children or young people in NSW public schools (around one-quarter of all public school students) had disability and received adjustments in NSW.

The state Education Act 1990, Disability Inclusion Act 2014 and Anti-Discrimination Act 1977 also protect the right of students with disability in NSW to a quality, accessible education free from discrimination. For public schools in NSW, legislative obligations are articulated in key policy and practice documents including the Inclusive Education Statement and Policy, NSW Wellbeing Framework for Schools, and Achieving School Excellence in Wellbeing and Inclusion tool and associated resources.

A number of key reviews conducted over the last two decades have considered the experiences of students with disability and the effectiveness of school and departmental practices in meeting their needs. In 2017, a NSW Parliamentary inquiry found that while there were many instances of excellence, the inclusive approach to education provision promoted in legislation and policy was not the reality experienced by many students with disability in NSW schools at that time. In response, the Department released its Disability Strategy in 2019 with a commitment to building a more inclusive education system in which all children thrive academically, physically, emotionally, and mentally. The strategy focused on four key reform areas:

• investing in teachers and other support staff
• developing new resource models and support to meet individual student needs
• streamlining processes and improving communication and access to information
• building an evidence base to measure progress.

Audit Objective

This audit assessed whether the Department of Education is effectively supporting students with disability in NSW public schools. It reviews relevant evidence relating to the six calendar years 2018–2023, guided by the following questions:

1. Has the Department designed and delivered approaches that effectively support students with disability?
2. Is the Department addressing the needs of students with disability?

Conclusion

The Department of Education has effectively designed approaches and developed reforms aimed at improving the support provided to students with disability. However, key initiatives that target longstanding and well-known issues have not been implemented in a timely way, limiting the effectiveness of the Department’s support for students with disability in NSW public schools.

The Department, in its 2019 Disability Strategy, committed to building a more inclusive education system, ‘one where all students feel welcomed and are learning to their fullest capacity’. Under the strategy the Department commenced new initiatives and strengthened existing ones to modify school funding, improve teacher skills and resources, enhance accessible school infrastructure, and increase engagement with students and families.

However, key initiatives have been in place for less than eighteen months, and some remain outstanding. The Department’s efforts have not resolved longstanding issues including unmet demand for targeted supports, gaps in professional learning and practice guidance for school staff, and inconsistent central monitoring of school practice and outcomes data. This is despite the Department being made aware of these issues for almost two decades across multiple audits, parliamentary inquiries and the recent national Disability Royal Commission.

Since 2018 the proportion of NSW public school students with disability has grown from one-fifth to one-quarter. While the Department is making efforts across a range of disability reform areas, many students, families and schools continue to feel they have not been adequately supported.

The Department does not know how effectively it is meeting the needs of students with disability because it has not consistently monitored outcomes for students with disability or schools’ inclusive education practices. Our own analysis of the Department’s data shows that there has been improvement in some student learning outcomes, but deterioration in some measures of student wellbeing.

Key findings

The Department effectively designed its Disability Strategy based on evidence and broad stakeholder input, and provides a range of supports to schools for students with disability

The Department defines an inclusive education system as one where all students feel welcomed and are learning to their fullest capacity. Under the 2019 Disability Strategy it committed to building this, and put in place a variety of measures to support schools in meeting the needs of students with disability.

In designing the strategy, the Department responded to the recommendations from the 2017 Parliamentary inquiry, and undertook a literature review analysis of evidence-based practices and personalised learning approaches. The Department also consulted widely, including with schools, experts and people with disability.

The Department introduced 15 new initiatives, and strengthened a similar number of existing ones, to better support students with disability in NSW public schools. These included initiatives aimed at:

• reforming the basis for relevant funding to better reflect student need
• increasing the provision of inclusive education courses in tertiary education and professional learning, and teaching resources for educators and school staff
• increasing access to allied health and school counsellor/psychologist services
• creating more inclusive learning spaces in school infrastructure
• improving communication to, and exploring ways to obtain better feedback from, students and parents/guardians.

The Department has established governance arrangements focused on inclusive education, and provides professional development and teaching resources for schools. Some specialist central staff roles are funded in regional teams and in schools across the state to advise schools in making reasonable adjustments for individual students with disability. The Department provides disability-specific funding on top of base school allocations, and funds infrastructure integration works in response to individual student needs for accessible school grounds. A full list of initiatives and supports for students with disability in NSW public schools is at Appendix two.

The Department’s efforts to reform support for students with disability have not been timely

Performance gaps in Department and school supports for students with disability have been repeatedly identified through public reviews over the last two decades. This includes unmet demand for targeted supports, gaps in professional learning and practice guidance for school staff, and inconsistent central monitoring of school practice and outcomes data. The 2017 Parliamentary inquiry, which the 2019 Disability Strategy responded to, found many of the same issues that were identified in our 2006 audit Educating Primary School Students with Disabilities conducted eleven years earlier. These concerns were also highlighted in a 2010 NSW Parliamentary inquiry and in five-yearly reviews of the federal Disability Standards. The Disability Strategy initiatives came thirteen years after many of the same risks were identified in our 2006 audit. Had these been implemented sooner, an entire cohort of students with disability who completed primary and secondary education in that time may have had a different schooling experience.

While the Department has delivered almost all the Disability Strategy initiatives since it commenced in 2019, the few that are outstanding are fundamental to determining the success of the Disability Strategy:

• reforming all streams of disability funding to be based on student needs, so that schools have more resources, and those resources will be more flexible
• consistently tracking outcomes for students with disability, families and teachers to understand what is changing in their lived experiences of education.

The Department did not examine whether actions in the Strategy were addressing the intent of previous recommendations

The reform areas and initiatives in the Disability Strategy reflected evidence from previous reviews, as well as contemporary research literature and broad stakeholder consultation. Stakeholders we heard from - including academics, advocates and peak bodies - broadly agreed that the strategy addressed the right areas for action.

The strategy reform initiatives targeted areas that had been repeatedly identified as issues in previous public inquiries held over the past twenty years including: insufficient funding, workforce constraints, gaps in professional learning, inadequate outcomes tracking, and limited engagement with students and families.

While the Department advised that it has implemented the accepted recommendations from previous reviews into disability support and inclusive education, the Department’s approach to tracking recommendations does not include assessing whether the action taken has met the intent of the relevant recommendation. Without this, there is a risk that previously identified gaps and performance issues are not addressed and persist or recur in the future.

While the Department’s governance arrangements were suitable for the design and implementation of the Disability Strategy, the Department did not consider why areas that had been repeatedly identified were still not resolved. This audit found that students, families and schools continue to feel the impact of issues that the recommendations from past reviews aimed to improve, raising questions about the accountability for, and effectiveness of, the Department’s responses.

The Department does not know how effectively it is meeting the needs of students with disability

Schools are legally required to provide individualised supports to students with disability where these are needed for students with disability to be able to access and participate in education on the same basis as their peers without disability. The Department captures schools’ data on the reasonable adjustments they are making for students with disability through the annual Nationally Consistent Collection of Data on students with disability (NCCD).

Where students with disability receive targeted supports such as placement in a support class or specific school funding to learn effectively in a mainstream class, schools are also required to annually review student needs in consultation with the student, their families and teachers, and respond to any changes.

The Department provides schools with guidance and specialist staff to support making reasonable adjustments for students with disability to access and participate in education on the same basis as their peers. However, the Department does not independently verify school evidence on adjustments made and does not have visibility of where reasonable adjustments provided are not meeting students’ needs (for example, where targeted supports are not available) unless a complaint is made or escalated to the Department.

Stakeholders we heard from – both from schools and families – said that there can still be conflicting views about what reasonable adjustments are required in particular situations, and that information provided is vague. The Department has accepted the recommendations of previous reviews and the Disability Royal Commission to improve its guidance and resources for schools and families about reasonable adjustments.

The Department also has a legislative and policy obligation to understand and address the particular needs and potential barriers to accessing supports that may be experienced by students with disability who also have other identities or characteristics such as being Aboriginal, living in rural or remote areas, socioeconomic disadvantage, or speaking English as an additional language or dialect (also known as intersectionality).

While the Department has taken some steps to consider intersectionality for students with disability in its policies and resources, it has not reduced the impacts where these create compounding factors of disadvantage. The Department was unable to demonstrate that it was meeting the needs of these students.

The Department’s criteria for accessing targeted supports for disability has not been updated in over 20 years

If a student with disability has moderate to high needs and requires specialist support that cannot be met with existing school funding and staffing resources, their school may apply to the Department for targeted supports through the ‘access request’ process. Applications are decided by a panel of regional departmental staff including learning and wellbeing staff; primary, high school and Schools for Specific Purposes principal representatives; and a senior education psychologist.

Access to almost all targeted supports is limited to eligible students with disability who have a confirmed medical diagnosis that falls within the Department’s 2003 disability criteria. These criteria exclude those students with undiagnosed disability or with diagnosed disabilities that fall outside the Department’s criteria, such as attention-deficit/hyperactivity disorder (ADHD) and dyslexia.

Despite limitations with the current criteria being highlighted in multiple parliamentary inquiries over the past 13 years, the Department has not updated these criteria since 2003. It advises that updated criteria will be released from term four, 2024.

The Department does not have a clear and accurate picture of demand compared to supply, or the time taken for targeted supports to be provided to students

The Department tracks if applications for targeted supports have been supported, deferred, declined or withdrawn through the access request panel process. However, the rationale for why an application has been deferred or declined is not consistently recorded in the system.

The Department does not maintain waiting lists for students deemed eligible for targeted supports where the support is not available. In particular, for support classes, while the Department has centralised statewide oversight of class numbers and locations to inform decisions about establishing new classes each year, it does not have a clear picture of demand at local geographic levels at any point in time.

Although recommended in our 2006 audit, the Department still does not monitor the time taken for targeted supports to be provided to eligible students after an application has been approved for provision, so cannot tell how long students with identified needs are waiting for supports to reach them.

The Department has not consistently monitored outcomes for students with disability

The Department started to develop a framework to measure the outcomes of students with disability, at a system level, in 2019. These include wellbeing, independence and learning growth outcomes, informed by measures including students’ perceptions, supports provided, educators’ understanding and skills, and satisfaction of parents/guardians. The framework is comprehensive and evidence-based, and includes existing datasets to minimise the administrative burden on schools. The Department tested proposed measures to validate their reliability.

While there are many complexities in comparing progress and experiences across all students with disability due to the diversity across this cohort, and a range of data limitations that needed to be addressed, the implementation of this framework was not timely. Although the domains, outcomes and metrics for the disability outcomes framework were endorsed by the Department executive in 2022, the framework was still not fully operational in September 2024. Since executive endorsement, the Department has updated the framework to reflect the final accepted recommendations of the Disability Royal Commission and to ensure alignment with the NSW Government’s 2023-2027 Plan for Public Education. It advises that it has started to implement the framework in a staged approach.

The Department has the ability to link data which identifies students with disability with a variety of its other datasets, such as student attendance, suspensions and expulsions, participation and results in the National Assessment Program – Literacy and Numeracy (NAPLAN) and the Higher School Certificate (HSC). The Department uses these linked datasets to inform the development of statewide policy and guidance on practice in schools periodically. However, it is not using the datasets to regularly monitor school practice, identify and address emerging issues, or identify and promote ‘what works’ to support students with disability.

The Department’s School Excellence Framework involves schools self-assessing and peer-reviewing their performance in learning, teaching and leading at least once every five years, but this has not had a specific focus on inclusive education to date. A policy monitoring process involves schools reporting on their compliance with specific policies annually, but this did not include the Disability Standards until 2024. Schools provide some information in their public annual reports about their disability funding expenditure, but this reporting is not outcomes-focused.

The Department runs annual surveys of students, parents/guardians and teachers called ‘Tell Them From Me’. This survey gives students with disability and their families a direct voice to schools and the Department, although the survey is voluntary and not accessible for some students with complex learning and communication needs (the Department is developing a suite of accessible tools to be able to seek feedback from these students in the future). However, the Department does not regularly analyse the Tell Them From Me survey response data to understand whether the experiences of students with disability or their families are changing since the Disability Strategy and related efforts.

Complaints are another way by which the Department can obtain insight into school practice and student outcomes. However, the Department does not have oversight of the number, type or trends in complaints that arise and are resolved at the school level, including those concerning students with disability.

The Department was aware from the 2017 Parliamentary inquiry and the Disability Royal Commission that students with disability and their families can be reluctant to make complaints to their principal about their school, perceiving a conflict of interest and risk of negative consequences. However, the Department was not seeking feedback from complainants about the resolution of their complaint when these were made at the school level, or from students with disability and their families more broadly (in the absence of complaints). The Department advises that it is taking steps in 2024 to seek and address feedback from parents/guardians on their experience in raising concerns at the school level.

The Department has not tracked the impact of the Disability Strategy on the experiences of students, families and schools

Although the Disability Strategy outlined a vision for inclusive education and success measures that sought changed experiences of students, families and teachers, the Department did not establish a time horizon by which the strategy vision and success measures were expected to be realised, nor baseline information against which change could be assessed.

While it evaluated some individual initiatives under the strategy, it did not have an evaluation framework in place for the strategy as a whole and has not assessed how the experiences of students, families and schools have or haven’t changed as a result of the implementation of the Disability Strategy overall.

The Department has taken steps to reform the distribution of disability funding, but this was not timely, and evidence on whether resourcing is adequate to meet the needs of students with disability remains unclear

The Department has publicly acknowledged that ‘effectively resourcing schools is crucial to building an inclusive education system and improving outcomes for, and experiences of, students with disability.’

Stakeholders to this audit – including parents/guardians, school staff and advocacy organisations – consistently said that existing funding to support students with disability is not sufficient to meet their learning needs. Most of the previous public reviews also identified inadequate funding as a key challenge to providing inclusive education.

The Department allocated annual disability-specific funding to NSW public schools totalling approximately $1.1 billion in 2018 rising to $1.9 billion in 2023. This represents an annual average cost above the base allocations of $7,300 per student with disability in 2018 and $9,300 in 2023.

The Department commenced a program of work in 2020 to review and reform the disability-specific funding provided to schools. This sought to change the distribution of funding so that resourcing is linked to a student’s functional needs at school and reflects a school’s efforts to support a student with disability relative to these needs, rather than relying on students’ medical diagnoses or academic performance.

During the audit review period the Department:

• forecasted future funding needs
• revised the funding model for the disability equity loading allocated to mainstream schools to use towards all their students with disability who need supports, regardless of diagnoses – the Department estimated this would more than double the number of students who could be supported by this funding
• provided supplementary funding to Schools for Specific Purposes for 2020–2024, and
• sought government approval and resourcing to change the thresholds for targeted funding support for individual students with disability who have moderate to high learning needs in mainstream classrooms (not yet implemented).

While the Department made important advances in funding reforms, these efforts were not timely, coming around a decade after being recommended by the 2010 Parliamentary inquiry.

Nationally, evidence on the costs to schools to make adjustments to support students with disability is not clear. A 2019 federal review into the Australian Government disability loading for states and territories concluded that there was significant variation in these cost estimates and recommended that joint work be undertaken by the Australian, state and territory governments to produce more nuanced estimates.

In late 2023, the Disability Royal Commission made several recommendations to review disability funding and transparency in the education sector, which the Australian Government and state and territory governments jointly accepted in principle in July 2024.

The Department’s data shows mixed results for students with disability

Our analysis of the Department’s data showed that there had been some improvements for students with disability in the time of the Disability Strategy. This includes an overall reduction in the number of suspensions and expulsions for students with disability, and an increase in the number of students with disability receiving HSC results.

However, there was limited individual student growth in NAPLAN exams over this time, and deterioration in some measures of student wellbeing relating to self-reports of a sense of belonging and experiences of bullying at school. Aboriginal students with disability were worse off than their non-Aboriginal peers with disability in relation to suspension, expulsion, individual student growth and reported experiences of bullying.

Recommendations

By January 2026, the Department of Education should:

1. At least annually, monitor the experiences and outcomes of students with disability to:
   1. identify and address emerging issues
   2. identify and promote good practice
   3. take effective steps where there is a need to improve longer-term student outcomes, and
   4. consider the impacts of intersectionality.
2. Continue to expand the use of NCCD data to support funding allocation in accordance with the needs of students with disability.
3. Work with the Australian Government on reviews of the disability loading settings to ensure NSW public schools are adequately funded to support students with disability.
4. Work with stakeholders to enhance guidance and practical support to public schools and families on reasonable adjustments for students with disability, including ways to resolve conflicting views in a timely manner.
5. Improve the planning and delivery of targeted supports by:
   1. obtaining a clear and timely picture of the supply of, and demand for, targeted supports at a local and statewide level to identify and address constraints
   2. monitoring the time taken for targeted supports to be provided to eligible students, and addressing delays so that adequate support is put in place once need is identified
   3. reducing the administrative burden for schools in applying for targeted supports, and
   4. making the basis for decisions transparent to schools and families.

Under the Disability Strategy, the Department released the Inclusive Education Statement to provide direction and guidance on supporting the inclusion of students with disability in NSW public schools (section 3.2 above). The statement expressed a commitment of the Department to ‘building a more inclusive education system… where every student is known, valued and cared for and all students are learning to their fullest capability.’ 

However, as the Department does not consistently monitor outcomes for students with disability or schools’ inclusive education practices (section 3.6 above), it does not have oversight of whether the Inclusive Education Statement is being given effect and achieving desired outcomes for students with disability, parents/guardians and schools. 

Our 2006 audit Educating primary school students with disabilities found that it was not possible to determine whether the performance of ‘special education’ services had improved over time as there had been no mechanism in place to measure results. It recommended that the Department develop a suite of performance indicators to monitor and manage supports for students with disability at a school, region and state level. This is still not being done systematically, and the Department cannot tell whether things are improving for students with disability in NSW. 

Our analysis of the Department’s data shows that over the audit review period 2018-2023 there has been improvement in some measures of school practice such as the use of suspensions and expulsions, and improvement in some student learning outcomes, but deterioration in some measures of student wellbeing. 

Self-reported survey data shows improvements in the experiences of students with disability in primary school but these have worsened for students in secondary school 

Statewide data from the annual Tell Them From Me student survey shows that secondary students with disability are less likely to agree with statements related to receiving support from teachers in 2023 compared to 2018 (47% agreeing in 2018 declining to 44% in 2023). Results for students with disability in primary school to similar survey questions have remained steady with around 70% agreeing that their teacher supports them in both 2018 and 2023. 

A higher proportion of primary school students overall reported that they had never been bullied in 2023 compared to 2018. For students with disability in primary schools, the proportion reporting that they had never been bullied lifted from 66% in 2018 to 69% in 2023, however there was variability across individual years. For primary school students without disability, 75% reported that they had never been bullied in 2018, compared to 76% in 2023. 

The proportion of students with disability in secondary school reporting that they had never been bullied increased from 65% in 2018 to 69% in 2020, but then dropped to 66% in 2023. By comparison, the rate of students without disability reporting that they had never been bulled improved between 2018 and 2020 (from 75% to 78%) but then worsened in 2023 (74%). 

Students with disability in both primary and secondary schools were less likely to agree with questions about having a sense of belonging at school in 2023 compared to 2018. For secondary school students with disability, 49% agreed with questions relevant to belonging in 2018, which dropped to 43% in 2023. In primary schools, where survey results indicate there was a greater sense of belonging amongst all students than in secondary schools, there was also a drop for students with disability from 62% in 2018 to 57% in 2023.

There has been an overall increase in parents/guardians completing the Tell Them From Me parent/guardian survey since 2018. Survey results show that parents/guardians of children with disability are less likely to have their child enrolled at their first choice of public school than parents/guardians of children without disability. The proportion of parents/guardians of children with disability reporting that their child was enrolled at their first choice has slightly worsened between 2019 (when the question was first included in the survey) and 2023, from 87% in 2019 to 85% in 2023. The proportion of parents/guardians of students without disability who said their child was enrolled at their first choice of public school remained steady between 2019 to 2023 at close to 90%. 

There was limited individual student growth in NAPLAN results for the majority of students with disability 

Individual student growth is a measure of the progress of individual students in their NAPLAN results across their educational journey from Year 3 to Year 9. NAPLAN is an annual national assessment for all students in Years 3, 5, 7 and 9. It tests skills in reading, numeracy, writing, spelling and grammar. 

For most of the audit review period, all students participating in NAPLAN were assessed against national minimum standards in each exam as being below, at, or above standards. NAPLAN assessments and reporting changed in 2023, with four proficiency standards replacing the previous 10-band structure and the national minimum standards. For this reason, NAPLAN results from 2023 cannot be compared with those from earlier years. 

Our analysis of the Department’s data found that, for students with disability who participated in a NAPLAN exam more than once between 2018 and 2022: 

• 60% had no change in whether they placed below, at or above the national minimum standards (compared to 83% of students without disability). 
• 11% had an improvement, either moving from below the national minimum standards to be at the standards, or moving from being at to above the standards (compared to 4% of students without disability). 
• 22% had a decline, either moving from being above the national minimum standards to be at the standards, or from being at the standards to being below them (compared to 9% of students without disability). 

Exhibit 23 provides a breakdown of our analysis of student growth for each test type for students with disability between 2018 and 2022.

Appendix one – Response from agency

Appendix two – Relevant initiatives and supports 

Appendix three – NCCD definitions 

Appendix four – The Department’s principles of inclusive education 

Appendix five – Student behaviour management and restrictive practices 

Appendix six – Relevant funding for NSW public schools 

Appendix seven – The Department’s Disability Criteria (2003) 

Appendix eight – About the audit 

Appendix nine – Performance auditing

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

 Parliamentary reference - Report number #400- released 26 September 2024.

If you have questions or feedback about individual matters, you can:

• contact the NSW Department of Education through the website
• make a complaint to the NSW Ombudsman online or by calling 1800 451 524.

About this report

Over 1,100 native animals, plants and ecological communities are listed as threatened in New South Wales. The Department of Climate Change, Energy, the Environment and Water (DCCEEW) delivers programs and activities aiming to reduce the risk of extinction for threatened species and ecological communities. 

This audit assessed whether DCCEEW has effectively delivered outcomes to support threatened species and ecological communities across New South Wales including delivery of the statutory Biodiversity Conservation Program (Saving our Species). 

Findings

DCCEEW uses a risk‑based approach to guide and deliver a range of programs aiming to improve the outcomes for threatened species and ecological communities.

However, DCCEEW has not effectively determined departmental priorities, coordinated programs to align efforts, or reported on the overall outcomes it is delivering for threatened species and ecological communities. 

Further, DCCEEW does not capture sufficient data to monitor species that it is not actively managing, creating a risk that it cannot readily identify or respond to further decline.

Under the Saving our Species program, DCCEEW is delivering conservation actions for less than one‑third of all threatened species and ecological communities. This number has reduced over time, in line with reduced program funding. 

Gaps in core program planning and risk management frameworks create program delivery risks. 

Recommendations

The report made several recommendations to DCCEEW, focusing on:

• Strengthening Saving our Species program compliance, governance, planning and risk management frameworks.
• Developing a long‑term framework to coordinate and align efforts across DCCEEW for the delivery of threatened species outcomes.
• Expanding activities to improve coordination with other parts of government delivering activities that impact on outcomes for threatened species.

This chapter assesses the effectiveness of DCCEEW’s ability to report on threatened species outcomes across its various programs and activities, and its strategic planning for the delivery of these outcomes at a departmental level.

Under Part 4, Division 6 of the BC Act, DCCEEW is required to deliver a Biodiversity Conservation Program. The program’s statutory objectives are to:

• maximise the long-term security of threatened species and ecological communities in nature
• minimise the impacts of key threatening processes on biodiversity and ecological integrity.

Under Section 4.36 of the BC Act, the program must have:

• strategies to achieve the objectives of the program in relation to each threatened species and threatened ecological community
• a framework to guide the setting of priorities for implementing the strategies
• a process for monitoring and reporting on the overall outcomes and effectiveness of the program.

Appendix one – Response from agency

Appendix two – Legislative and regulatory provisions relevant to threatened species

Appendix three – Programs and activities relevant to threatened species

Appendix four – Comparison of statutory provisions for the conservation of threatened species

Appendix five – About the audit

Appendix six – Performance auditing

© Copyright reserved by the Audit Office of New South Wales. All rights reserved. No part of this publication may be reproduced without prior consent of the Audit Office of New South Wales. The Audit Office does not accept responsibility for loss or damage suffered by any person acting on or refraining from action as a result of any of this material.

 Parliamentary reference - Report number #399 released 15 August 2024.

About this report

NSW Ambulance delivers emergency and non emergency medical services and transport to patients in New South Wales, and connects patients who do not need an emergency medical response with the most appropriate health provider.

NSW Ambulance operates as part of a network of public health services. 

This audit assessed the efficiency and effectiveness of ambulance services in regional New South Wales.

Findings

NSW Health is maintaining effective ambulance services in regional New South Wales, despite increasing demand. 

NSW Ambulance and the Ministry of Health use effective governance arrangements to monitor regional ambulance performance. NSW Ambulance and Local Health Districts (LHDs) communicate effectively to manage day-to-day operational challenges. However, the audit identified opportunities to improve the Ministry’s oversight of regional performance, and to enhance information sharing between NSW Ambulance and LHDs.

NSW Health is working to identify opportunities to reduce demand on the NSW Ambulance fleet and hospital emergency departments in regional New South Wales.

NSW Ambulance undertakes holistic service planning to efficiently deliver ambulance services in regional New South Wales.

Recommendations

The audit recommends that:

• The Ministry of Health, eHealth and NSW Ambulance implement a new NSW Ambulance Electronic Medical Record system
• The Ministry of Health and NSW Ambulance improve system oversight, monitoring and reporting of ambulance performance at the regional and metropolitan level
• The Ministry of Health finalise its Transport for Health strategy and undertake a review of all non-emergency patient transport operators across the state
• NSW Ambulance and LHDs improve strategic engagement with other NSW Health entities.

NSW Ambulance is a front line health service provider, delivering emergency and non-emergency medical services and transport to patients in New South Wales. It provides medical help to patients experiencing life-threatening injuries (referred to as high acuity patients), illness, and trauma, and connects patients who do not need an emergency medical response (referred to as low acuity patients) with the most appropriate health provider.

NSW Ambulance operates as part of a network of public health services. For NSW Ambulance to efficiently transfer patients to hospitals, hospitals need to have sufficient capacity to accept new patients. In regional contexts, distance is an important factor in the effective delivery of ambulance services.

The objective of this audit is to assess the efficiency and effectiveness of ambulance services in regional New South Wales, by answering the following questions:

1. Does NSW Health work effectively and efficiently to deliver ambulance services in regional and rural New South Wales?
2. Is NSW Health effectively and efficiently planning and allocating ambulance services in regional New South Wales?
3. Is the effectiveness of ambulance services in regional and rural New South Wales increasing over time?

The NSW Health agencies included in this audit are NSW Ambulance, the Ministry of Health, Murrumbidgee and Southern NSW Local Health Districts, eHealth NSW and HealthShare NSW.

The Ministry of Health expects Local Health Districts and state wide health services (such as NSW Ambulance) to engage and collaborate with stakeholders throughout service planning, but it is unclear whether the Ministry ensures that this occurs

The Ministry of Health is responsible for setting policy and strategy direction for the overall NSW Health system and provides guidance to all NSW Health entities (including Local Health Districts and NSW Ambulance) to inform service planning. Local Health Districts are responsible for ensuring that relevant policy objectives are achieved through the planning and funding of the range of health services that best meet the needs of their communities.

Service plans describe how services will achieve measurable health improvements and outcomes. NSW Health entities create service plans within a broader framework of system-wide goals, objectives and priorities. The Guide to Service Plans notes the importance of active and inclusive stakeholder engagement and requires that stakeholders should be engaged throughout the planning process. It also notes that state-wide health and shared services impacted by planning should be engaged to assist with the assessment of service requirements and resource implications.

The audit identified several examples of service plans and key initiatives developed within Southern NSW Local Health District which directly related to ambulance services, but where NSW Ambulance was not identified as a stakeholder. These include:

• A business case for a new MRI service at Goulburn hospital: prior to the establishment of MRI services in Goulburn, there were no MRI services available within Southern NSW Local Health District, with the closest available provider located in Bowral (a private provider) or at the Canberra Hospital. This business case included decreased reliance on patient transport for imaging as a benefit.
• The clinical service plan for Batemans Bay Community Health Centre (which will provide urgent care services in Southern NSW Local Health District).

Southern NSW Local Health District included NSW Ambulance as a stakeholder in cross-border service planning, including NSW Ambulance as a signatory in a cross-border memorandum of understanding for stroke patient transfers between Southern NSW Local Health District, Murrumbidgee Local Health District, Canberra Health Services and NSW Ambulance.

In Murrumbidgee Local Health District, the audit identified one example of the Local Health District including NSW Ambulance as a stakeholder in planning activities. In an updated terms of reference document for the Cootamundra Partnership Reference Committee, which was established to develop a new Health Service Plan for the Cootamundra Health Service, NSW Ambulance has been included as an invitee to this forum.

No health entities undertake whole-of-system service planning for non-emergency patient transport services in rural and regional New South Wales

Non-emergency patient transport services in regional and rural Local Health Districts are provided by HealthShare NSW (in Hunter New England Local Health District and Illawarra Shoalhaven Local Health District), Local Health Districts and NSW Ambulance. Both Southern NSW Local Health District and Murrumbidgee Local Health District engage private providers and community transport providers to supplement their patient transport capacity. When non-emergency patient transport services are at capacity, Local Health Districts rely on NSW Ambulance to assist with facilitating patient transfers.

Despite these challenges, there is no whole-of-system approach to service planning for patient transport. Whole-of-system planning would enable NSW Health to better manage risk and reduce reliance on the use of the NSW Ambulance fleet for patient transport in rural and regional New South Wales.

NSW Ambulance undertakes holistic service planning, but it did not engage Local Health Districts as stakeholders in the development of its recent Clinical Services Plan

As a state-wide health service, NSW Ambulance’s service planning broadly reflects the key deliverables articulated in its Service Agreement with the Secretary of Health. The Ministry of Health, in its responsibility for planning key services and as the ‘purchaser’ of ambulance services, ensures that NSW Ambulance service planning gives regard to the broader strategic policy environment.

In 2023, NSW Ambulance developed a new Clinical Services Plan 2024–2029 which includes a focus on supporting innovative approaches to clinical redesign and the delivery of new clinical programs. This includes strengthening collaboration between NSW Ambulance and Local Health Districts (particularly in care models for smaller rural communities and the involvement of paramedics in care and management of patients with chronic diseases).

NSW Ambulance consulted with the Ministry in the development of the Clinical Services Plan. It advised the audit that as the Clinical Services Plan largely reflects the objectives contained in its Strategic Plan, specific consultation with Local Health Districts was not required.

While NSW Ambulance is currently developing a five-year roadmap for the implementation of its Clinical Services Plan, it is unclear how NSW Ambulance intends to implement and resource these objectives in a timeframe that complements similar work across NSW Health.

The Southern NSW Local Health District Clinical Services Plan does not include specific consideration of the provision of patient transport and it is not clear whether it consulted NSW Ambulance during development

Southern NSW Local Health District’s 2023–28 Clinical Services Plan notes development of the plan was informed by local, state and national strategic directions for the health system, as well as outcomes and recommendations of relevant NSW Health and local reviews and inquiries.

Southern NSW Local Health District identified five focus areas in its 2023–28 Clinical Services Plan:

• Supporting health and wellbeing through primary, secondary, and tertiary prevention
• Providing care closer to home
• Ensuring the sustainability of our existing services
• Planning for growth and ageing in our population
• Ensuring equity of access to care.

The Southern NSW Local Health District conducted community stakeholder consultation during development of its Clinical Services Plan, which resulted in feedback relating to challenges accessing health services. Community consultation feedback provided to Southern NSW Local Health District included the below key points relating to transportation to access health services:

• a lack of public and/or private transport to and from health facilities
• the additional burden on rural residents to access health care, noting that rural communities are often long distances from tertiary facilities
• difficulties with transportation, noting community transport options are limited and it can be difficult to coordinate timing.

Southern NSW Local Health District’s Clinical Services Plan acknowledges the District consulted with internal stakeholders and other service providers to develop the plan, however, it is not clear whether Southern NSW Local Health District included NSW Ambulance in consultation for feedback. Additionally, while actions to address the areas of focus for the Clinical Services Plan relate to more localised access to care and delivery of care, as well as increased capacity and access, the plan does not include any actions specific to the provision of health related transportation.

Southern NSW Local Health District has committed to improve access to clinical services in rural and remote settings through the delivery of virtual care models

In its 2023-28 Clinical Services Plan, Southern NSW Local Health District commits to establishing a single point of entry so that patients can access appropriate care in ‘the right place, at the right time’ through (among other actions), an enhancement and expansion of its Virtually enhanced Community Care program and establishment of the Virtual Rural Generalist Service.

This audit identified some examples of Local Health Districts partnering to improve access to clinical service in rural and remote settings. In Southern NSW Local Health District, the Local Health District has partnered with Western NSW Local Health District to implement the Rural Virtual Generalist Service in smaller facilities across the District.

NSW Ambulance’s workforce planning effectively considers demand, workload, coverage, and capability requirements and it uses this evidence to allocate personnel and other resources to efficiently deliver ambulance services in regional New South Wales

NSW Ambulance has a well evolved and evidenced service planning methodology. NSW Ambulance established a service planning capability in 2010, and the current methodology (developed in 2022–23) includes analysis at the station and local network level of demand projections, staffing levels required, the drivers of effective and efficient supply provision, models of care, specialty resources and capital and infrastructure requirements. It includes a substantial focus on station location and the type of resource required.

Service planning informs (and is informed by) benefits realisation for new programs and initiatives (such as SWEP, SWIFT). NSW Ambulance has also developed a model to assess ‘unmet demand’ which it uses when determining sites for potential resource allocation and supplementation. NSW Ambulance continuously monitors its need and priority for additional or enhanced ambulance services and considers the following criteria:

• volume of demand in town and surrounding area
• distance from any ambulance service
• current response times to emergency incidents
• modelled improvement in response times if an ambulance station was commissioned
• assessment of capacity and condition of closest ambulance station
• capacity of NSW Ambulance volunteer service to provide a response.

NSW Ambulance continuously reviews key inputs into the service planning methodology, in particular its demand project methodology.

The main output of NSW Ambulance’s service planning methodology is the creation of a whole-of-state service model which describes the clinical service levels for each ambulance station. A station’s clinical service level determines both the number of clinical staff required and its specific roster pattern, as well as the staff type (graduate paramedic, specialist paramedic, etc.). NSW Ambulance then creates station rosters in alignment with this model.

In addition to the demand- and activity-based evidence sources NSW Ambulance uses to inform its service planning, NSW Ambulance includes evidence-based analysis in its business cases to support NSW Government funding requests, which also contain thorough descriptions of how the proposed funding would be allocated.

Recent investments in the regional paramedic workforce have allowed NSW Ambulance to reduce the use of on-call rostering and improve the working conditions of regional paramedics

NSW Ambulance rostering practices allow for some stations to utilise on-call resources, which can cause fatigue among paramedics rostered on shift following an on-call period.

Announced in the 2018–19 NSW Budget, the NSW Government announced funding for the recruitment of an additional 750 FTE paramedic and call-centre staff over four years commencing in 2018–19. The Statewide Workforce Enhancement Program (SWEP) was designed by NSW Ambulance to enable improvements in efficiency, coverage, quality, safety and performance across New South Wales and achieve response performance targets.

The SWEP business case detailed the extent to which NSW Ambulance relied upon various forms of premium labour in order to maintain service delivery and to meet community expectations in terms of response performance. The SWEP business case identified that $20 million in premium labour savings after the four-year implementation program would be achieved by reducing over-reliance on overtime.

SWEP resulted in an additional 376 FTE positions across ambulance stations in regional NSW, and allowed NSW Ambulance to reduce on-call rostering:

• 22 regional/rural locations were converted to a 24/7 operating model removing overnight on-call
• Removal of on-call at four locations that were previously operating on a 24/7 roster with overnight on-call
• Reduction in on-call at eight locations.

NSW Ambulance measured premium labour savings achieved by monitoring callouts, crib-penalty payments, and dropped-shift overtime. In August 2022, as part of an internal review of the SWEP program, NSW Ambulance noted that the SWEP program achieved the reduction in premium labour expenditure and improved the working conditions of regional paramedics.

NSW Ambulance anticipates that recent changes to funding arrangements will result in a key program not achieving its intended benefits

In June 2022, the NSW Government announced a $1.76b investment in NSW Ambulance over a four-year period to fund 210 ambulance support staff (including the ongoing establishment of NSW Ambulance’s Virtual Clinical Care Centre (VCCC)), 1,878 new paramedics, 52 nurses, eight doctors, and build 30 stations.

Known as the Strategic Workforce InFrastructure Team program (SWIFT), NSW Ambulance designed the program to meet two objectives:

• firstly, to improve patient outcomes, and the probability of survival from immediately life threatening conditions.
• to achieve compliance with WHS obligations through the reduction of overrun shifts, overtime, and increase staff meal breaks.

When it was announced as part of the 2022–23 NSW Government budget, SWIFT was designed as a four-year program. However, recent changes to funding arrangements have changed the SWIFT timeframe and the program will now be delivered over seven years (at the same cost).

One of the key objectives of the SWIFT business case was to improve patient outcomes and the probability of patient survival by achieving response times within 15 minutes for 85% of P1 incidents by 30 June 2026. NSW Ambulance regularly reports and tracks performance on SWIFT indicators, and advises that as at 21 December 2023, the program was on track to meet the target.

NSW Ambulance modelled that the impact of extending the funding window from four years to seven years would add three years of additional demand growth and result in the program failing to achieve the 85% target by June 2026.

Appendix one – Response from agency

Appendix two – NSW Ambulance performance data

Appendix three – NSW Ambulance regional station map

Appendix four – NSW Ambulance key performance indicators

Appendix five – Types of patient transport operational across New South Wales

Appendix six – Scheduled psychiatric interhospital patient transfers

Appendix seven – NSW Ambulance governance bodies

Appendix eight – About the audit

Appendix nine – Performance auditing

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 Parliamentary reference - Report number #398 released 27 June 2024.