Reports
Grants to non-government schools
The NSW Department of Education could strengthen its management of the $1.2 billion provided to non-government schools annually. This would provide greater accountability for the use of public funds, according to a report released today by the Auditor-General for New South Wales, Margaret Crawford.
Non‑government schools educate 418,000 school children each year, representing 35 per cent of all students in NSW. The NSW Department of Education administers several grant schemes to support these schools, with the aim of improving student learning outcomes and supporting parent choice. To be eligible for NSW Government funding, non‑government schools must be registered with the NSW Education Standards Authority (NESA) and not operate 'for profit' as per section 83C of the NSW Education Act 1990 (the Act). Non‑government schools can either be registered as independent or part of a System Authority.
In 2017–18, non‑government schools in NSW will receive over $1.2 billion from the NSW Government, as well as $3.4 billion from the Australian Government. Recently, the Australian Government has changed the way it funds schools. The NSW Government is assessing how these changes will impact State funding for non‑government schools.
This audit assessed how effectively and efficiently NSW Government grants to non‑government schools are allocated and managed. This audit did not assess the use of NSW Government grants by individual non‑government schools or System Authorities because the Auditor‑General of New South Wales does not have the mandate to assess how government funds are spent by non‑government entities.
Conclusion
The Department of Education effectively and efficiently allocates grants to non‑government schools. Clarifying the objectives of grants, monitoring progress towards these objectives, and improving oversight, would strengthen accountability for the use of public funds by non‑government schools.
We tested a sample of grants provided to non‑government schools under all major schemes, and found that the Department of Education consistently allocates and distributes grants in line with its methodology. The Department has clear processes and procedures to efficiently collect data from schools, calculate the level of funding each school or System should receive, obtain appropriate approvals, and make payments.
We identified three areas where the Department could strengthen its management of grants to provide greater accountability for the use of public funds. First, the Department’s objectives for providing grants to non‑government schools are covered by legislation, intergovernmental agreements and grant guidelines. The Department could consolidate these objectives to allow for more consistent monitoring. Second, the Department relies on schools or System Authorities to engage a registered auditor to certify the accuracy of information on their enrolments and usage of grants. Greater scrutiny of the registration and independence of the auditors would increase confidence in the accuracy of this information. Third, the Department does not monitor how System Authorities reallocate grant funding to their member schools. Further oversight in this area would increase accountability for the use of public funds.
The Department effectively and efficiently allocates grants to non‑government schools. Strengthening its processes would provide greater assurance that the information it collects is accurate.
The Department provides clear guidelines to assist schools to provide the necessary census information to calculate per capita grants. Schools must get an independent external auditor, registered with ASIC, to certify their enrolment figures. The Department checks a sample of the auditors to ensure that they are registered with ASIC. Some other jurisdictions perform additional procedures to increase confidence in the accuracy of the census (for example, independently checking a sample of schools’ census data).
The Department accurately calculates and distributes per capita grants in accordance with its methodology. The previous methodology, used prior to 2018, was not updated frequently enough to reflect changes in schools' circumstances. Over 2014 to 2017, the Department provided additional grants to non‑government schools under the National Education Reform Agreement (NERA), to bring funding more closely in line with the Australian Department of Education and Training's Schooling Resource Standard (SRS). From 2018, the Department has changed the way it calculates per capita grants to more closely align with the Australian Department of Education and Training's approach.
The Department determines eligibility for grants by checking a school's registration status with NESA. However, NESA's approach to monitoring compliance with the registration requirements prioritises student learning and wellbeing requirements over the requirement for policies and procedures for proper governance. Given their importance to the appropriate use of government funding, NESA could increase its monitoring of policies and procedures for proper governance through its program of random inspections. Further, the Department and NESA should enter into a formal agreement to share information to more accurately determine the level of risk of non‑compliance at each school. This may help both agencies more effectively target their monitoring to higher‑risk schools.
By December 2018, the NSW Department of Education should:
- Strengthen its processes to provide greater assurance that the enrolment and expenditure information it collects from non‑government schools is accurate. This should build on the work the Australian Government already does in this area.
- Establish formal information‑sharing arrangements with the NSW Education Standards Authority to more effectively monitor schools' eligibility to receive funding.
By December 2018, the NSW Education Standards Authority should:
- Extend its inspection practices to increase coverage of the registration requirement for policies and procedures for the proper governance of schools.
- Establish formal information‑sharing arrangements with the NSW Department of Education to more effectively monitor schools' continued compliance with the registration requirements.
The Department’s current approach to managing grants to non‑government schools could be improved to provide greater confidence that funds are being spent in line with the objectives of the grant schemes.
The NSW Government provides funding to non‑government schools to improve student learning outcomes, and to support schooling choices by parents, but does not monitor whether these grants are achieving this. In addition, each grant program has specific objectives. The main objectives for the per capita grant program is to increase the rate of students completing Year 12 (or equivalent), and to improve education outcomes for students. While non‑government schools publicly report on some educational measures via the MySchool website, these measures do not address all the objectives. Strengthened monitoring and reporting of progress towards objectives, at a school level, would increase accountability for public funding. This may require the Department to formalise its access to student level information.
The Department has listed five broad categories of acceptable use for per capita grants, however, provides no further guidance on what expenditure would fit into these categories. Clarifying the appropriate use of grants would increase confidence that funding is being used as intended. Schools must engage an independent auditor, registered with ASIC, to certify that the funding has been spent. The Department could strengthen this approach by improving its processes to check the registration of the auditor, and to verify their independence.
The Department has limited oversight of funding provided to System Authorities (Systems). The Department provides grants to Systems for all their member schools. The Systems can distribute the grants to their schools according to their own methodology. Systems are not required to report to the Department how much of their grant was retained for administrative or centralised expenses. Increased oversight over how the Systems distribute this grant could provide increased transparency for the use of public funds by systems.
By December 2018, the NSW Department of Education should:
- Establish and communicate funding conditions that require funded schools to:
- adhere to conditions of funding, such as the acceptable use of grants, and accounting requirements to demonstrate compliance
- report their progress towards the objectives of the scheme or wider Government initiatives
- allow the Department to conduct investigations to verify enrolment and expenditure of funds
- provide the Department with access to existing student level data to inform policy development and analysis.
- Increase its oversight of System Authorities by requiring them to:
- re‑allocate funds across their system on a needs basis, and report to the Department on this
- provide a yearly submission with enough detail to demonstrate that each System school has spent their State funding in line with the Department's requirements.
Appendix one - Response from agencies
Appendix two - NESA's risk-based compliance monitoring
Appendix three - About the audit
Appendix four - Performance auditing
Parliamentary reference - Report number #299 - released 3 May 2018
Managing risks in the NSW public sector: risk culture and capability
The Ministry of Health, NSW Fair Trading, NSW Police Force, and NSW Treasury Corporation are taking steps to strengthen their risk culture, according to a report released today by the Auditor-General, Margaret Crawford. 'Senior management communicates the importance of managing risk to their staff, and there are many examples of risk management being integrated into daily activities', the Auditor-General said.
We did find that three of the agencies we examined could strengthen their culture so that all employees feel comfortable speaking openly about risks. To support innovation, senior management could also do better at communicating to their staff the levels of risk they are willing to accept.
Effective risk management is essential to good governance, and supports staff at all levels to make informed judgements and decisions. At a time when government is encouraging innovation and exploring new service delivery models, effective risk management is about seizing opportunities as well as managing threats.
Over the past decade, governments and regulators around the world have increasingly turned their attention to risk culture. It is now widely accepted that organisational culture is a key element of risk management because it influences how people recognise and engage with risk. Neglecting this ‘soft’ side of risk management can prevent institutions from managing risks that threaten their success and lead to missed opportunities for change, improvement or innovation.
This audit assessed how effectively NSW Government agencies are building risk management capabilities and embedding a sound risk culture throughout their organisations. To do this we examined whether:
- agencies can demonstrate that senior management is committed to risk management
- information about risk is communicated effectively throughout agencies
- agencies are building risk management capabilities.
The audit examined four agencies: the Ministry of Health, the NSW Fair Trading function within the Department of Finance, Services and Innovation, NSW Police Force and NSW Treasury Corporation (TCorp). NSW Treasury was also included as the agency responsible for the NSW Government's risk management framework.
In assessing an agency’s risk culture, we focused on four key areas:
Executive sponsorship (tone at the top)
In the four agencies we reviewed, senior management is communicating the importance of managing risk. They have endorsed risk management frameworks and funded central functions tasked with overseeing risk management within their agencies.
That said, we found that three case study agencies do not measure their existing risk culture. Without clear measures of how employees identify and engage with risk, it is difficult for agencies to tell whether employee's behaviours are aligned with the 'tone' set by the executive and management.
For example, in some agencies we examined we found a disconnect between risk tolerances espoused by senior management and how these concepts were understood by staff.
Employee perceptions of risk management
Our survey of staff indicated that while senior leaders have communicated the importance of managing risk, more could be done to strengthen a culture of open communication so that all employees feel comfortable speaking openly about risks. We found that senior management could better communicate to their staff the levels of risk they should be willing to accept.
Integration of risk management into daily activities and links to decision-making
We found examples of risk management being integrated into daily activities. On the other hand, we also identified areas where risk management deviated from good practice. For example, we found that corporate risk registers are not consistently used as a tool to support decision-making.
Support and guidance to help staff manage risks
Most case study agencies are monitoring risk-related skills and knowledge of their workforce, but only one agency has addressed the gaps it identified. While agencies are providing risk management training, surveyed staff in three case study agencies reported that risk management training is not adequate.
NSW Treasury provides agencies with direction and guidance on risk management through policy and guidelines. In line with better practice, NSW Treasury's principles-based policy acknowledges that individual agencies are in a better position to understand their own risks and design risk management frameworks that address those risks. Nevertheless, there is scope for NSW Treasury to refine its guidance material to support a better risk culture in the NSW public sector.
Recommendation
By May 2019, NSW Treasury should:
- Review the scope of its risk management guidance, and identify additional guidance, training or activities to improve risk culture across the NSW public sector. This should focus on encouraging agency heads to form a view on the current risk culture in their agencies, identify desirable changes to that risk culture, and take steps to address those changes.
Appendix one - Response from agencies
Appendix three - About the audit
Appendix four - Performance auditing
Parliamentary reference - Report number #298 - released 23 April 2018
Detecting and responding to cyber security incidents
A report released today by the Auditor-General for New South Wales, Margaret Crawford, found there is no whole-of-government capability to detect and respond effectively to cyber security incidents. There is very limited sharing of information on incidents amongst agencies, and some agencies have poor detection and response practices and procedures.
The NSW Government relies on digital technology to deliver services, organise and store information, manage business processes, and control critical infrastructure. The increasing global interconnectivity between computer networks has dramatically increased the risk of cyber security incidents. Such incidents can harm government service delivery and may include the theft of information, denial of access to critical technology, or even the hijacking of systems for profit or malicious intent.
This audit examined cyber security incident detection and response in the NSW public sector. It focused on the role of the Department of Finance, Services and Innovation (DFSI), which oversees the Information Security Community of Practice, the Information Security Event Reporting Protocol, and the Digital Information Security Policy (the Policy).
The audit also examined ten case study agencies to develop a perspective on how they detect and respond to incidents. We chose agencies that are collectively responsible for personal data, critical infrastructure, financial information and intellectual property.
Some of our case study agencies had strong processes for detection and response to cyber security incidents but others had a low capability to detect and respond in a timely way.
Most agencies have access to an automated tool for analysing logs generated by their IT systems. However, coverage of these tools varies. Some agencies do not have an automated tool and only review logs periodically or on an ad hoc basis, meaning they are less likely to detect incidents.
Few agencies have contractual arrangements in place for IT service providers to report incidents to them. If a service provider elects to not report an incident, it will delay the agency’s response and may result in increased damage.
Most case study agencies had procedures for responding to incidents, although some lack guidance on who to notify and when. Some agencies do not have response procedures, limiting their ability to minimise the business damage that may flow from a cyber security incident. Few agencies could demonstrate that they have trained their staff on either incident detection or response procedures and could provide little information on the role requirements and responsibilities of their staff in doing so.
Most agencies’ incident procedures contain limited information on how to report an incident, who to report it to, when this should occur and what information should be provided. None of our case study agencies’ procedures mentioned reporting to DFSI, highlighting that even though reporting is mandatory for most agencies their procedures do not require it.
Case study agencies provided little evidence to indicate they are learning from incidents, meaning that opportunities to better manage future incidents may be lost.
Recommendations
The Department of Finance, Services and Innovation should:
- assist agencies by providing:
- better practice guidelines for incident detection, response and reporting to help agencies develop their own practices and procedures
- training and awareness programs, including tailored programs for a range of audiences such as cyber professionals, finance staff, and audit and risk committees
- role requirements and responsibilities for cyber security across government, relevant to size and complexity of each agency
- a support model for agencies that have limited detection and response capabilities
- revise the Digital Information Security Policy and Information Security Event Reporting Protocol by
- clarifying what security incidents must be reported to DFSI and when
- extending mandatory reporting requirements to those NSW Government agencies not currently covered by the policy and protocol, including State owned corporations.
DFSI lacks a clear mandate or capability to provide effective detection and response support to agencies, and there is limited sharing of information on cyber security incidents.
DFSI does not currently have a clear mandate and the necessary resources and systems to detect, receive, share and respond to cyber security incidents across the NSW public sector. It does not have a clear mandate to assess whether agencies have an acceptable detection and response capability. It is aware of deficiencies in agencies and across whole‑of‑government, and has begun to conduct research into this capability.
Intelligence gathering across the public sector is also limited, meaning agencies may not respond to threats in a timely manner. DFSI has not allocated resources for gathering of threat intelligence and communicating it across government, although it has begun to build this capacity.
Incident reporting to DFSI is mandatory for most agencies, however, most of our case study agencies do not report incidents to DFSI, reducing the likelihood of containing an incident if it spreads to other agencies. When incidents have been reported, DFSI has not provided dedicated resources to assess them and coordinate the public sector’s response. There are currently no formal requirements for DFSI to respond to incidents and no guidance on what it is meant to do if an incident is reported. The lack of central coordination in incident response risks delays and increased damage to multiple agencies.
DFSI's reporting protocol is weak and does not clearly specify what agencies should report and when. This makes agencies less likely to report incidents. The lack of a standard format for incident reporting and a consistent method for assessing an incident, including the level of risk associated with it, also make it difficult for DFSI to determine an appropriate response.
There are limited avenues for sharing information amongst agencies after incidents have been resolved, meaning the public sector may be losing valuable opportunities to improve its protection and response.
Recommendations
The Department of Finance, Services and Innovation should:
- develop whole‑of‑government procedure, protocol and supporting systems to effectively share reported threats and respond to cyber security incidents impacting multiple agencies, including follow-up and communicating lessons learnt
- develop a means by which agencies can report incidents in a more effective manner, such as a secure online template, that allows for early warnings and standardised details of incidents and remedial advice
- enhance NSW public sector threat intelligence gathering and sharing including formal links with Australian Government security agencies, other states and the private sector
- direct agencies to include standard clauses in contracts requiring IT service providers report all cyber security incidents within a reasonable timeframe
- provide assurance that agencies have appropriate reporting procedures and report to DFSI as required by the policy and protocol by:
- extending the attestation requirement within the DISP to cover procedures and reporting
- reviewing a sample of agencies' incident reporting procedures each year.
Appendix one - Response from agency
Appendix two - ISMS maturity model
Appendix three - About the audit
Appendix four - Performance auditing
Parliamentary reference - Report number #297 - released 2 March 2018
Government Advertising: Campaigns for 2015–16 and 2016–17
The 'Stronger Councils, Stronger Communities' and the 'Dogs deserve better' government advertising campaigns complied with the Government Advertising Act and most elements of the Government Advertising Guidelines.
However, some advertisements were designed to build support for government policy and used subjective or emotive messages. This is inconsistent with the requirement in the Government Advertising Guidelines for 'objective presentation in a fair and accessible manner'.
Advertisements in the 'Stronger Councils, Stronger Communities' campaign used subjective statements such as 'the system is broken' and 'brighter future'. While advertisements in the 'Dogs deserve better' campaign used confronting imagery such as gun targets, blood smears and gravestones.
The Government Advertising Act 2011 (the Act) requires the Auditor-General to conduct a performance audit in relation to at least one government advertising campaign in each financial year. The performance audit assesses whether advertising campaigns were carried out effectively, economically and efficiently and in compliance with the Act, the regulations, other laws and the Government Advertising Guidelines (the Guidelines). In this audit, we examined two campaigns:
- the ‘Stronger Councils, Stronger Communities’ campaign run by the Office of Local Government and the Department of Premier and Cabinet
- the ‘Dogs deserve better’ campaign run by the Department of Justice.
Section 6 of the Act details the specific prohibitions on political advertising. Under this section, material that is part of a government advertising campaign must not contain the name, voice or image of a minister, member of parliament or a candidate nominated for election to parliament or the name, logo or any slogan of a political party. Further, a campaign must not be designed so as to influence (directly or indirectly) support for a political party.
The ‘Stronger Councils, Stronger Communities’ government advertising campaign was run by the Office of Local Government and the Department of Premier and Cabinet in four phases from August 2015 to May 2016. The total cost of the campaign was over $4.5 million. See Appendix 2 for more details on this campaign.
Two factors potentially compromised value for money for the campaign. The request for quotes for the design of the Phase 1 advertisement did not reflect the full scale of work to be undertaken, which was substantially greater than initially quoted. Further, the department did not meet all recommended timeframes to minimise media booking costs for all phases of the campaign.
The campaign did not comply with all administrative requirements in all phases. Advertising for Phase 1 commenced before the compliance certificate was signed. There was no evidence that a compliance certificate was signed for Phase 2 extension. The cost benefit analyses for Phase 2 and Phase 2 extension did not sufficiently consider alternatives to advertising, as is required by the Government Advertising Guidelines.
Advertisements adopted subjective messages designed to build public support for council mergers and directed audiences to websites for more detailed information. Campaign research identified statements that were most likely to reduce resistance to mergers. Some advertising content used subjective language, which we consider inconsistent with the requirement for ‘objective presentation’. Evaluations of advertising effectiveness also measured the success of the advertisements in increasing public support for council mergers.
No breach of specific prohibitions in the Act
Section 6 of the Act prohibits the use of government advertising for political advertising. A government advertising campaign must not:
- be designed to influence (directly or indirectly) support for a political party
- contain the name, voice or image of a minister, any other member of parliament or a candidate nominated for election to parliament
- contain the name, logo or any slogan of, or any other reference relating to, a political party.
We did not identify any breach of the specific prohibitions listed above in the advertising content of this campaign.
Request for quotes to design advertisement did not reflect the full scope required
The request for quotes for the design of the Phase 1 advertisement did not reflect the full scale of work that was to be undertaken, and this created a risk to achieving value for money. The Office of Local Government sought quotes for design of a television advertisement only. It did not request an estimate for radio, online advertisements, or translation for linguistically diverse audiences, which were ultimately required for the campaign.
A full and fair assessment of which supplier could provide the best value for money could not be made given that the quotes obtained did not reflect the full scope of work. The final amount paid for the design of Phase 1 was 2.7 times the original quote. It is possible that another supplier that provided a quote could have provided overall better value for money.
The Office of Local Government continued to use the Phase 1 supplier for Phase 2 and Phase 2 extension (Exhibit 4). Where there are other suppliers that could feasibly compete for a contract, direct negotiation increases the risk the agency has not obtained the best value for money. The department advised that it continued with the same agency to avoid costs involved in briefing a new agency on the campaign.
The ‘Dogs deserve better’ government advertising campaign was run by the Department of Justice from August 2016, after the government announced its decision to prohibit greyhound racing, and was terminated in October 2016 after a change of government policy. The campaign had a budget of $1.6 million, with an actual spend of $1.3 million. See Appendix 2 for more details on this campaign.
The Secretary of the department determined that urgent circumstances existed that required advertising to commence prior to completing a cost benefit analysis and peer review. There was a concern that industry participants may make impulse decisions to destroy greyhounds without further information on support services; there was also an identified need to promote public greyhound adoptions.
Phase 1 advertisements focused on explaining the reasons for the prohibition on greyhound racing with a reference to a website for further information. While industry participants were identified as the primary audience, media expenditure was not specifically targeted to this group. Phase 2 advertisements more effectively addressed the originally identified ‘urgent needs’ of providing information on support services for greyhound owners and information on how the public could adopt a greyhound.
The urgency to advertise potentially compromised value for money. The department did not use price competition when selecting a creative supplier due to a concern this would add to timeframes. Further, the department did not meet recommended timeframes to minimise media booking costs.
We identified three other areas in Phase 1 advertisements that were inconsistent with government advertising requirements. Advertisements used provocative language and confronting imagery, which we consider to be inconsistent with the requirement for ‘objective presentation’. Two statements presented as fact based on the Special Commission’s Inquiry report were inaccurate; one of these was due to a calculation error. Radio advertisements did not clearly identify that they were authorised by the New South Wales Government for the first few days of the campaign.
No breach of specific prohibitions in the Act
Section 6 of the Act prohibits the use of government advertising for political advertising. A government advertising campaign must not:
- be designed to influence (directly or indirectly) support for a political party
- contain the name, voice or image of a minister, any other member of parliament or a candidate nominated for election to parliament
- contain the name, logo or any slogan of, or any other reference relating to, a political party.
We did not identify any breach of the specific prohibitions listed above in the advertising content of this campaign.
Animal welfare concerns were identified as the reason for urgent advertising
A brief prepared by the department in July 2016 raised concerns about the welfare of greyhounds following the NSW Premier’s announcement that the government would prohibit greyhound racing. The brief raised the risk that industry members may make impulse decisions to destroy their greyhounds without information on support that was being offered.
The department used the provisions in Sections 7(4) and 8(3) of the Act to expedite the release of advertising due to ‘other urgent circumstances’. This provision allows advertising to commence prior to completing the peer review process and cost benefit analysis.
In introducing the Government Advertising Bill to parliament in 2011, the then Premier noted that exceptional circumstances would cover situations ‘such as a civil emergency or sudden health epidemic’. There is no other guidance on when it is appropriate to use this section. It is at the discretion of a government agency head to determine whether a campaign is urgent.
Phase 1 advertisements did not focus on the urgent needs
This advertising campaign had three overarching objectives:
- to increase public awareness of the animal welfare reasons for the closure of the greyhound racing industry
- to change the behaviour of dog owners from potentially harming their greyhounds to treating them humanely, by accessing the support options and packages available
- to promote greyhound adoptions by the public.
Alongside advertising, the department took other steps to engage with the greyhound racing industry. This included direct mail, face to face meetings around the State, setting up a call centre and community consultation through an online survey. Other government agencies and animal welfare agencies were also engaged to reach out to affected stakeholders.
Phase 1 advertising content focused on providing information about the reasons for the closure of the industry. The department’s radio and television advertisements did not refer to support packages or encourage the public to adopt a greyhound. While print advertisements did mention these things, this was only presented in fine print. In all advertisements, audiences were referred to a website for further information.
The focus of advertisements on the reasons for industry closure was not consistent with the identified needs to urgently commence advertising to influence the behaviour of dog owners and encourage the public to adopt a greyhound.
The content in Phase 2 advertisements, which began around four weeks after the first phase, was more explicit in highlighting the services and support for industry members such as offering business and retraining advice. These advertisements also referred audiences to a call centre number as well as the website.
Peer review process limited to influencing second phase of advertisements
In urgent circumstances, the Act allows for peer review to be completed after advertising has commenced. For this campaign, the peer review process was completed on 19 August 2016, two weeks after advertising had commenced. Where advertising commences before the peer review process is completed, the usefulness of peer reviewers’ recommendations is limited to informing subsequent phases of advertising and the post-campaign evaluation.
The peer review report found the messages in Phase 1 advertisements were not clearly defined, and the role of advertising was not clearly defined amongst other campaign activities. These recommendations informed the second phase of advertising, which ran from 27 August 2016 until the campaign was terminated in October 2016.
The department could not demonstrate value for money was achieved for creative work
The department provided a fixed budget for creative work when requesting quotes from creative agencies to develop advertising material. This is not consistent with the quotation requirements in the government’s Guidelines for Advertising and Digital Communication Services. This approach creates risks to achieving value for money as creative agencies are not required to compete on price for their services. The department advised that it had pre-set the creative costs based on a comparative government campaign of a similar size. This was done due to a concern that requiring agencies to compete on price would affect the short timeframe given to develop creative material.
Three creative agencies accepted the opportunity to present design ideas for the campaign. The department was unable to provide evidence of how it chose the preferred supplier out of these three agencies. Records are important for accountability and allow a procurement decision to be audited after an urgent decision.
Short notice did not allow for cost-efficient media booking for all phases
Placement of advertisements in various media channels was done through the State’s Media Agency Services contract. This contract achieves savings as the government can use its aggregated media spend to gain discounts from the media supplier.
The Department of Premier and Cabinet provides guidance to ensure cost efficient media booking. For example, media time for a television advertisement should be booked at least 6 to 12 weeks in advance. Radio advertisements should be booked at least 2 to 8 weeks in advance.
The peer review report noted that the department did not have adequate time to look for the most cost-efficient way to advertise. In its response to the peer reviewers, the department acknowledged this to be due to the urgency to start advertising. The media booking authority was signed by the department one day before the campaign commenced.
The department used a wide public campaign for a narrow target audience
The campaign identified greyhound industry participants as the primary target audience. In 201516 there were 1,342 greyhound trainers, 1,695 owner/trainers, 983 attendants and 1,247 breeders in New South Wales. The department’s advertising submission identified ‘concerns that industry members could make impulsive decisions, potentially jeopardising the welfare of a large number of dogs, prior to the shutdown of the industry’.
The submission’s evidence of advertising effectiveness focused on increasing the level of wider community support for the ban rather than stopping industry members from making impulse decisions. It used an early opinion poll to show that total support for the ban on greyhound racing rises by 17 points and opposition drops by four points following explanation of the findings of the Special Commission of Inquiry report.
The peer review report noted that the role of advertising was not clearly defined amongst the department’s range of other direct and targeted communications and consultations held with industry members.
No demonstrated basis for use of confronting imagery and provocative language
The Guidelines require ‘objective presentation in a fair and accessible manner’. Neither the Guidelines or Handbook further explain what objective presentation means. We have used an ordinary definition of this term as ‘not influenced by personal feelings or opinions in considering and representing facts’. This is synonymous with terms like ‘impartial’, ‘neutral’, and ‘dispassionate’ and opposite to ‘subjective’. We consider that to meet the current requirements in the Guidelines for objectivity, advertising content should contain accurate statements or facts, and avoid subjective language.
Phase 1 focussed on the ongoing consequences if no action was taken to close the industry. The advertisements used provocative language, for example ‘Up to 70 per cent of dogs are deemed wastage by their own industry. Wastage! Slaughtered just for being slow’. Advertisements used confronting imagery like gravestones, blood smears and gun targets.
Our literature review into this area highlighted mixed findings on the effectiveness of confrontational advertising materials. In some cases, shock campaigns may cause an audience to reject or ignore the message, and may even encourage people to do the opposite of the intended behaviour. In other cases, such as in road safety campaigns, this style of advertising can be successful. This shows the importance of conducting pre-campaign research before adopting a confrontational or emotive approach in advertising.
The Government Advertising Handbook recommends that an agency explain the rationale and the evidence for their chosen advertising approach. There was no evidence that the department researched the effectiveness of its advertising approach with its target audience. The department had planned to undertake creative concept testing as part of a strategy to ensure the creative material was understood by its audience. The department advised that due to the urgency of the campaign, it did not have time to conduct this testing.
Not all Phase 1 radio advertisements clearly identified that they were authorised by the New South Wales Government
For the first few days on air, Phase 1 radio advertisements ended by referring the audience to a government website, instead of clearly identifying that it had been authorised by the New South Wales Government. Government authorisations and logos ensure the work and the programs of the NSW Government are easily identifiable by the community.
The department’s cost benefit analysis did not consider alternatives to advertising
For government advertising campaigns that cost over $1.0 million, the Act requires the advertising agency to carry out a cost benefit analysis and obtain approval from the Cabinet Standing Committee on Communications, prior to commencing the campaign.
The department engaged with audiences through direct mail, face to face forums, and a telephone helpline in addition to advertising. However, the department’s cost benefit analysis did not meet the requirements in the Guidelines to specify the extent to which expected benefits could be achieved without advertising, and to compare costs of options other than advertising that could be used to successfully implement the program (see Exhibit 6).
The cost benefit analysis made optimistic assumptions about the impact of the campaign on greyhound adoptions. It estimated that 2,360 greyhounds would be adopted if the campaign was run. This is significantly higher than the ‘most optimistic outcome’ of re-homing in the Special Commission Inquiry report (we calculated this to be 1,467 greyhounds). There was insufficient evidence to support the higher number of adoptions in the cost benefit analysis.
The sensitivity analysis shows that using the Special Commission’s ‘most optimistic outcome’ figure of re-homing would reduce the net present value of advertising to be negative. Further, the cost benefit analysis also assumed that increased government funding would be made available to animal welfare and rehoming organisations to support more adoptions, but did not estimate or include this cost when calculating the net present value of advertising.
There were two factual inaccuracies in key messages used for Phase 1 advertisements
Section 8(2) of the Act requires the head of a government agency to certify that the proposed campaign ‘contains accurate information’. The Secretary of the Department of Justice signed the compliance certificate on 29 July 2016, before advertisements commenced.
We examined the accuracy of factual claims in this advertising campaign, by comparing the key statements to the report of Special Commission of Inquiry into the Greyhound Racing Industry (the Commissioner report). The Commissioner report was quoted by the NSW Government as the basis for its policy to transition the greyhound racing industry to closure.
We identified that two of the key statements used in Phase 1 advertisements to support the animal welfare reasons for industry closure were inaccurate (Exhibit 7).
Appendix one - Responses from agencies
Appendix two - About the campaigns
Appendix three - About the Audit
Appendix four - Performance Auditing
Parliamentary reference - Report number #294 - released 2 November 2017
Sharing school and community facilities
Schools and the community would benefit if school facilities were shared more often.
The Department of Education’s ‘Community Use of School Facilities Policy’ encourages but does not require schools to share facilities. Sharing depends heavily on the willingness of school principals and there are few incentives. There are many challenges in developing agreements with community users and there is only limited support available from the Department.
There are strategies and plans to support the sharing of facilities between schools and the wider community, but none are backed up with budgets, specific plans or timeframes.
Governments should strive for the best use of assets. This is particularly important in the context of a growing New South Wales population, fiscal constraints and increasing demand for services.
Lack of available land, rising land costs and population growth highlighted in our April 2017 'Planning for school infrastructure' performance audit report mean that new and existing schools will need to share their facilities with communities more than is currently the case.
This audit assessed how effectively schools share facilities with each other, local councils and community groups. In making this assessment, the audit examined whether the Department of Education (Department):
- has a clear policy to encourage and support facilities sharing
- is implementing evidence-based strategies and procedures for facilities sharing
- can show it is realising an increasing proportion of sharing opportunities.
Facilities sharing is the use of a physical asset, such as a building, rooms, or open spaces, by more than one group for a range of activities at the same time or at different times. For the purposes of this audit, we have divided sharing arrangements into two types: shared use and joint use.
Shared use refers to arrangements where existing school assets are hired out for non-school purposes, usually for a limited time. The assets remain under the control of the school. Generally, there is little alteration or enhancement to the asset required to enable shared use. Shared use can also refer to schools using external facilities, such as council pools, but these arrangements are not included within the scope of this audit.
Joint use refers to arrangements where new or upgraded school and non-school facilities or community hubs are planned, funded, built and jointly shared between a school and other parties, usually involving significant investment.
Both shared use and joint use agreements are governed by contractual obligations.
The sharing of school facilities with the community is not fully effective. The Department of Education is implementing strategies to increase shared and joint use but several barriers, some outside the Department’s direct control, must be addressed to fully realise benefits to students and the community of sharing school facilities. In addition, the Department needs to do more to encourage individual schools to share facilities with the community.
A collaborative, multi-agency approach is needed to overcome barriers to the joint use of facilities, otherwise, the Department may need significantly more funds than planned to deliver sufficient fit-for-purpose school facilities where and when needed.
Since the early 2000’s, several reviews in NSW and other jurisdictions have commented on the benefits of and need to increase the sharing of school facilities.
Several NSW Government strategies and plans support shared and joint use of facilities between schools and the wider community, but none are backed up with financial incentives, or specific plans with implementation timeframes. In Victoria and Queensland whole-of-government processes are in place to support a more coordinated approach to planning, building and sharing community facilities. For example, Victoria has a comprehensive policy framework encompassing both existing and future use of community facilities and a $50 million program to seed the development of community facilities on school sites over the next four years.
There are examples of successful shared use, but more can be done. Information about the available facilities is not readily available to potential community users. Schools should work more closely with councils and other stakeholders to leverage shared use.
Currently, the administrative burden, costs and risks associated with shared use can exceed the perceived benefits to schools, leading to reluctance amongst some Principals to share. In addition, a substantial backlog of school-initiated infrastructure proposals awaiting Departmental approval means that schools that raise money from sharing their facilities find it difficult to use the funds they raise on improved infrastructure. Some of these proposals have been waiting for approval for more than 12 months.
The Department could do more to support Principals by ensuring the fees charged for facilities cover the costs incurred by schools, that Principals can access help with negotiating and managing contracts, and that infrastructure proposals initiated and funded by schools are approved in a timely manner.
The Department is not monitoring shared use across the State, and does not evaluate different approaches as evidence to influence policies and procedures.
Recommendations
By December, 2018, the Department should:
- increase incentives and reduce impediments for school Principals to share school facilities, including:
- review the methodology for calculating fees charged for facilities to ensure that shared use of school facilities does not result in a financial burden to schools or the Department
- improve support provided to Principals by School Infrastructure NSW, including reducing the backlog of school-initiated infrastructure proposals awaiting approval
- develop service standards, including timeframes, for assessing and approving school-initiated infrastructure proposals.
- provide readily-accessible information about available school facilities to community groups and local councils
- implement processes to monitor and regularly evaluate the implementation of the shared use policy and promote better practice to drive improvements.
As discussed in our 2017 audit report on ‘Planning for school infrastructure’, joint use agreements are a key direction of the School Assets Strategic Plan. Joint use of school facilities will be necessary to ensure that there will be enough fit-for-purpose learning spaces for students when and where needed. Under the ‘Community Use of School Facilities Policy’ Principals play the leading role in identifying opportunities, and developing and managing agreements for sharing school facilities. This is impractical for joint use projects which involve substantial investment in new or refurbished assets, in particular for joint use projects in schools that are yet to be built. In addition, the policy does not address joint-use facilities built on land not owned by the Department. For these reasons, the Department is developing a new policy.
The Department is planning to develop joint use agreements in a more systematic way as part of school community planning, previously known as cluster planning, with a special focus on local councils. Several agreements are currently being piloted, and will be evaluated to provide an evidence-based foundation for this new approach.
To develop or refurbish school facilities for joint use, the Department, councils and other key stakeholders must work together and prioritise joint use from the earliest stages of any project. A collaborative, multi-agency approach is needed to ensure sufficient fit-for-purpose facilities are available for school students within the funding framework proposed in the School Assets Strategic Plan.
To increase shared and joint use, the Department is recruiting specialist staff in its Asset Division to assist with the brokerage, community engagement and development of agreements, but these staff are not dedicated to joint use projects and their available time may not be sufficient to provide the necessary support in the timeframes required.
Recommendations
By December, 2018, the Department of Education should:
- ensure that the implementation of the new ‘Joint Use of School Facilities and Land Policy’ is adequately resourced, and has the support of Principals
- implement processes to monitor and regularly evaluate the implementation of joint use policy and promote better practice to drive improvements.
Appendix one - Response from agency
Appendix two - About the audit
Appendix three - Victoria's 30-Year Infrastructure Strategy
Appendix four - Not-for-profit hire changes
Appendix five - Performance Auditing
Parliamentary reference - Report number #293 - released 1 November 2017
Energy rebates for low income households
The Department of Planning and Environment provides more than $245 million in energy rebates to around 27 percent of NSW households. This report highlights that the department is not monitoring the rebate schemes to understand whether they are delivering the best outcomes.
Most rebates are ongoing payments applied directly to energy bills reducing the amount payable by the householder. The structure of these rebates is complex and can be inequitable. Some households are eligible for four different rebates, each with its own eligibility criteria. Also, some households in very similar circumstances receive different levels of support depending on what type of energy is used in their home or which adult in the house is the energy account holder. For example, a household using both electricity and gas receives more assistance than a household with electricity alone even if total energy bills are the same.
By September 2018, the Department of Planning and Environment should:
- Ensure effective strategies are in place to make information about rebates available to all eligible, low-income households
- Evaluate alternative models and develop advice for government to reduce complexity and improve equity of ongoing rebates
- Establish measurable objectives for schemes that provide ongoing support, and monitor and measure performance of all schemes against objectives and outcome measures
- Assess the impacts of the forecast increase in embedded networks and develop strategies to manage any increased administrative risk
- Strengthen assurance that EAPA is being provided in accordance with its objectives and guidelines by implementing accreditation and compliance programs
- Ensure those eligible for EAPA financial support are not disadvantaged by inflexible payments, inconsistent provider practices, or inability to access an EAPA provider in a timely manner. Options include:
- moving from a fixed-value voucher to a flexible payment based on need irrespective of energy type
- establishing a ‘Provider of Last Resort’ facility for households that cannot access an EAPA Provider.
Parliamentary reference - Report number #292 - released 19 September 2017
Office of Strategic Lands
The Office of Strategic Lands effectively fulfils most aspects of its defined role, however, it could do more to support strategic land planning by identifying and acquiring land for future public use proactively rather than waiting for agencies or landholders to approach it. It may also have greater impact if it expanded its activities beyond greater Sydney.
The Office of Strategic Lands (OSL) was established under the Environmental Planning and Assessment Act 1979 (EP&A Act) to identify, acquire, manage and divest land required for long-term planning by the NSW Government, particularly for open space and public purposes.
OSL is a Corporation Sole acting on behalf of the Minister for Planning and is run within the Department of Planning and Environment (DPE). OSL is a self-funding entity, and is responsible for administering the Sydney Region Development Fund (SRDF), a statutory fund used for ongoing land acquisition and management. OSL currently only operates within greater Sydney and holds over a billion dollars in land assets in this region.
This audit assessed whether OSL effectively fulfils its role to identify, acquire, manage and dispose of land, and whether OSL ensures it is sustainable over the long-term to meet its objectives.
Conclusion:
OSL effectively fulfils most aspects of its defined role, but is not supporting strategic land planning through proactive identification and acquisition of land for future public use. OSL is diligent in its financial management over the short and medium terms. However, it has identified that relying on the sale of surplus land to continue funding its ongoing operations is not sustainable, and it is yet to finalise a strategy to address this.
OSL does not currently have a strategic or proactive focus to improve land planning outcomes. This is primarily due to the lack of a clear strategy and business plan to direct its work which defines OSL’s purpose, objectives, goals and performance targets.
OSL expects to finalise and implement a Strategic Business Plan to guide its future direction and long-term sustainability, in late 2017.
OSL has three primary sources of funding. The largest source is Treasury loans which it needs to repay. The next most significant source of funding is from sales of land no longer required for government’s long-term needs. OSL has identified that it is likely to run out of surplus land within ten years. This is a significant financial risk for OSL, which should be addressed through a long-term financial strategy.
Contributions by Sydney councils into the SRDF are OSL’s only regular and consistent income stream. The formula to calculate these contributions has not been reviewed for over 25 years, and recent council mergers and border changes have increased the need to review the formula.
OSL is not used as extensively as it could be by other NSW Government agencies. It has the potential to play a much bigger role in assisting NSW Government agencies with longer term planning by partnering with them to identify, acquire, hold and manage land for future needs. For example, it could acquire land in future residential growth areas for needed public services such as schools, hospitals and transport corridors. There is also potential for OSL to expand its operations beyond the greater Sydney region into other parts of NSW to provide a statewide benefit from its unique role in government.
OSL has a unique role amongst government agencies, and could be used across NSW
NSW Government agencies we spoke with consider OSL fulfils an important role for the state that no other government agency performs. As a self-funding long-term land holder and manager, OSL can acquire and manage land beyond the four-year budget cycle that other government agencies face. Consideration should be given to expanding to other growth areas in NSW, where its unique role could assist in longer term land planning.
OSL has established good processes and procedures for most aspects of its role. This includes governance processes that we found to have been applied effectively. There was also adequate oversight and approvals for land transactions.
OSL has yet to finalise a business strategy to ensure long-term sustainability
OSL has shown that it is financially and operationally viable in the short to medium term. However, it does not have an overarching business strategy to guide its operations and ensure it is financially sustainable for the long-term. With a unique role in government, it is important for OSL to clarify its direction and implement a strategic business plan to drive its progress.
While there is no overarching long-term strategy, OSL has documented operating plans which guide its land acquisition and land divestment activities over the short to medium term. It has not developed a plan for its ongoing land management activities.
OSL advised that its Strategic Business Plan will be finalised and implemented in late 2017. This Plan should clarify OSL’s long-term direction, and guide its business to ensure it is financially sustainable.
OSL does not have adequate performance targets and measures
OSL has four key deliverables as part of DPE’s business plan. These deliverables cover land management, working with other agencies, and ensuring the SRDF is sustainable. There was no evidence that OSL or DPE monitor whether OSL achieves all key deliverables.
Currently, OSL’s performance targets are limited to meeting dollar values. OSL does not have any measures to demonstrate the achievement of outcomes that align with its core business, such as its success in land management or in working with other agencies. OSL staff also said that dollar targets were not always adequate or appropriate to measure its business performance.
With the development of its Strategic Business Plan, OSL has the opportunity to clarify its future business direction. This includes ensuring it has a range of relevant goals and performance measures that will support it becoming a strategic land planning partner with NSW Government agencies and local councils, and a land holder for the long-term.
OSL’s current financial management approach may impact long-term sustainability
OSL has valued the land that it needs to purchase on behalf of government to meet long-term strategic land needs in the Greater Sydney region, at $1.2 billion. However, OSLs annual budget for purchasing land is only between $40 million and $50 million until 2021. Also, in each of the last four years, OSL has not spent more than $30 million on land purchases because it relies on landowners to initiate contact when they are ready to sell their land.
Without a more proactive approach, it is not possible for OSL to make needed purchases in a timely manner. OSL acknowledges the substantial gap between these values, but has not established a budget or plan for how it will purchase all the identified land.
OSL has developed a Divestment Strategy which provides a five-year schedule of planned divestments. This is land OSL owns which has been identified as no longer required for government purposes. OSL has established an approach to generate the best and highest price for these sales. While funds are generated through the sale of surplus land, it also means that OSL holds fewer land assets to sell. OSL has identified it will run out of surplus land within ten years.
OSL needs to finalise and implement a business model to ensure it is financially and operationally capable to sustain and grow its business for the long-term.
OSL is working to improve transparency and engagement with key stakeholders
To deliver on its role, OSL needs to be able to effectively engage and work with its stakeholders, including NSW Government agencies, local councils, and people selling or buying land.
NSW Government agencies we spoke with are generally satisfied with OSL’s level of engagement and consultation. However, it would be beneficial for all parties to clarify and document their expectations of each other through a formal arrangement. OSL could also be more proactive in promoting its services, and working with additional NSW Government agencies to identify strategic lands.
The local councils in the Sydney region we spoke with are not as satisfied with OSL’s engagement and communication. The councils advised that they do not consider they are well-informed of OSL’s plans for their area, or how their contributions to the SRDF are spent.
More broadly, the activities of OSL are not reported transparently to stakeholders or the general public. OSL is developing a communication package for local councils and the community. This is an opportunity for OSL to improve the transparency of its role, operations, projects, and the SRDF, as well as promote its services and achievements.
The Office of Strategic Lands (OSL) was established in 1951 to identify, acquire, manage and divest land required for the NSW Government's long term planning purposes. OSL acts on behalf of the Minister for Planning, as a Corporation Sole, under the Environmental Planning and Assessment Act 1979 (EP&A Act).
OSL acquires and manages land identified for long-term strategic needs, and then transfers or sells it to other government agencies for ultimate use. It also sells land identified as surplus to government’s long term strategic requirements. Surplus land can also be transferred to local councils. OSL operates only in the greater Sydney region (from Wyong in the north, to the base of the Blue Mountains in the west, and south to Wollondilly). OSL has 20 staff who manage over 6,000 parcels of land.
Parliamentary reference - Report number #290 - released 10 August 2017
Information and Communication Technologies in schools for teaching and learning
Several factors are reducing effective use of information and communication technology (ICT) in the classroom.
These are primarily:
Parliamentary reference - Report number #289 - released 6 July 2017
Sydney Road Maintenance Contracts
In November 2013, Roads and Maritime Services (RMS) outsourced the maintenance of State roads in the Sydney region south and west zones using an innovative contracting approach called the Stewardship Maintenance Contract (SMC). The SMC links risk to reward, and uses a performance framework where outcomes should drive improved performance over time.
| WA | VIC | QLD | NSW | |
|---|---|---|---|---|
| Roads managed (lane kms) | 52,659 | 50,510 | 71,353 | 80,348 |
| Estimated spend ($/lane km) | 5,000 | 4,500 | 6,000 | 7,000 |
| Road quality measure (%) | 99 | 99 | 94 | 91 |
Parliamentary reference - Report number #288 - released 15 June 2017
NorthConnex
The processes used to assess NorthConnex adequately considered value for money for taxpayers.This report also found that the impact of tolling concessions on road users and the motorway network was consistent with policy objectives described in the 2012 NSW Long Term Transport Master Plan.
Parliamentary reference - Report number #287 - released 8 June 2017
