About this report

This report examined whether the NSW Police Force has been efficient and effective in managing and supporting the psychological wellbeing of the police workforce.

Findings

In 2023, the NSW Police Force funded a range of additional wellbeing initiatives to support police. In 2024, a standalone command was established to deliver these initiatives and manage the health and wellbeing of the workforce.

Over the five years from July 2019 to June 2024, the NSW Police Force had increasing numbers of psychological injury claims, escalating compensation costs, and increasing psychological injury medical exits. Since October 2024, there has been a reduction in the number of psychological injury notifications.

The NSW Police Force monitors and reports on psychological injuries to the workforce, but does not monitor, analyse or report on the root causes of these injuries. As a result, the NSW Police Force is not efficiently or effectively preventing future psychological injuries to the police workforce. Work is currently in progress to improve psychological risk reporting.

NSW Police Force wellbeing initiatives provide counselling and support for police after traumatic incidents. The initiatives do not address other psychological risk factors such as fatigue, role overload, or burnout.

Some police commands have higher workload volumes than others, and the NSW Police Force does not have a staffing allocation model to distribute police to locations under the greatest workload pressure.

In the five years from 2020 to 2025, the NSW Police Force invested $34 million on proactive wellbeing services for police, and an additional $60 million on the administrative costs of running the Health Safety and Wellbeing Command.

The cost of compensation for police psychological injuries amounted to approximately $1.75 billion from July 2019 to June 2024.

Recommendations

The NSW Police Force should, by July 2026:

1. develop and implement a workforce allocation model that matches police numbers to command-level workload demands and changing workload levels
2. fully implement the health and safety incident notification system and regularly report on the causal factors that lead to psychological incidents and injury claims
3. investigate and report on the factors that contribute to police role overload and burnout, and adjust policy settings, practices and controls accordingly
4. implement a strategy, process, and evaluation framework, that links police wellbeing initiatives and resources to evidence-based psychological risk factors.

A significant proportion of police report poor wellbeing in the People Matter Employee Survey, but managers do not have detailed information about workforce-wide stressors and risks

In 2024, 44% of police respondents to the People Matter Employee Survey reported unfavourable levels of wellbeing. The self-reported poor wellbeing of police included a reduced ability to function well in the role, and a lack of resources to manage wellbeing in the course of work duties. Other results from the People Matter Employee Survey show that the majority of police respondents do not believe they have support from managers to assist with wellbeing. While 44% of police reported low wellbeing in 2024, this is an improvement on 2023 levels, when 58% of police reported unfavourable wellbeing via the People Matter Employee Survey.

The People Matter Employee Survey is the only workforce-wide, self-reported source of information about police wellbeing risks. While the People Matter Employee Survey provides some insight into police wellbeing, it does not describe the nature, prevalence, or causes of psychological risk to employees. The NSW Police Force does not have an alternative means by which employees can report their psychological stressors, such as a workforce-wide survey.

The People Matter Employee Survey asks generalised questions about whether stress is manageable for the individual, whether employees are experiencing burnout, and whether employees are satisfied with the workplace practices that aim to manage wellbeing. In 2023 and 2024, more than 50% of police respondents recorded unfavourable responses to these three questions.

In the five years from 2019–2020 to 2023–2024, the NSW Police Force recorded an average of 1,100 psychological injury claims each year. Over this timeframe, the cost of psychological workers compensation claims accounted for 74% of total workers compensation claims costs, with physical injuries accounting for 26% of all costs. The psychological injury numbers recorded each year grew from 790 in 2019-2020 to just over 1,200 in 2023-2024.

In 2020, the NSW Police Force conducted a one-off, point-in-time survey, the ‘Mental Wellbeing Climate Survey’. It asked police about their experience and knowledge of existing wellbeing services. However, this survey did not ask police employees about their workplace stressors, or about their views on the nature or cause of psychological risks and injuries.

The NSW Police Force is in the early stages of meeting its obligation to understand workforce psychosocial risks, but needs to do more to understand risks associated with job demands

The NSW Police Force management reporting on psychological health and safety risks has not been sufficiently detailed to assist decision-makers to identify, address, and potentially mitigate risks to the workforce. Police management reports do not contain meaningful data on the causes of psychological injuries in the workforce.

While psychological injury rates were rising across the NSW police workforce, police management reports have lacked information about psychological injury types, or the causes of these injuries. For example, the most common psychological injury type was listed as ‘other mental stress factors’. The second most common psychological risk factor was described as ‘exposure to workplace or occupational violence’, and the third was ‘work pressure’. While these categories are set by Safe Work Australia, they are not sufficiently detailed for the NSW Police Force to understand its workforce risks.

The ten psychological injury categories are listed in order of their prevalence amongst the NSW police workforce are as follows:

• other mental stress factors
• exposure to workplace or occupational violence
• work pressure
• work related harassment and/or workplace bullying
• exposure to a traumatic event
• suicide or attempted suicide
• other and multiple mechanisms of incident
• mental stress related to Novel Coronavirus (COVID-19)
• being assaulted by a person or persons
• other harassment.

From 2019 to 2024, the NSW Police Force had limited identifiers about the nature or causes of these ten risk categories, and no indication of the causes of psychological injury claims. This meant that the NSW Police Force lacked evidence on which to base its control measures, or to manage hazards.

Some of the data in health and safety reports is combined, so it is not possible to distinguish between physical or psychological injury types. For example, reports on the 1,307 injured workers who were unfit for work in June 2024, do not show differentiated data between psychological or physical injuries. Managers cannot see the proportion of 403 police who were deployed to other ‘suitable’ duties in June 2024, by those recovering from psychological injuries, compared to those with physical injuries. This means that managers lack evidence to plan rehabilitation services based on the level of requirement for different service types.

Reports show the impacts of injury on police over time, and the workforce attrition rates that are due to injury. While this data indicates overall impacts of police injury on workforce functioning, data does not show psychological and physical medical exits. In addition, reports do not show psychological medical exits by location or command. Specific data on injury type by location, may point to problem areas in different segments or locations of the workforce.

As an employer, the NSW Police Force has obligations to its employees under the Work, Health and Safety Act 2011 (NSW)

The Work, Health and Safety Act 2011 (NSW) (the Act) requires that employers identify health and safety risks and take reasonable steps to minimise both physical and psychosocial risks. Under Section 27(5) of the Act, ‘reasonable steps’ means that employers must ‘ensure … appropriate processes for receiving and considering information regarding incidents, hazards and risks and responding in a timely way to that information’.

NSW Police Force management reports on health and safety incidents show the number of incidents with psychological risk factors present. While these reports allow managers to track psychological injuries over time, information is not sufficiently detailed to indicate the causes of these injuries. Risks are not fully understood at the workforce-wide level, and so resources cannot be targeted to identified problems.

The NSW Police Force is also able to source information about workforce psychological hazards from individual risk reports made by police employees. The majority of these reports describe potential hazards to the physical safety of police, and in rare instances, psychological risks are reported to peer representatives. Reports are escalated to senior managers and provide some corporate insight into psychological health and safety risks.

Safe Work Australia has identified some of the contributing factors to workforce psychological risks. These include high job demands, excessive workloads, exposure to traumatic incidents or content, and long working hours without enough breaks. Excessive job demands become a psychosocial hazard when workload levels are unmanageable for prolonged periods. Other psychological risk factors include jobs with ‘high emotional demands’. The features of ‘high emotional demands’ have strong correlations with police work. They are:

• exposure to aggression, violence, harassment or bullying
• supporting people in distress (for example, giving bad news), or
• displaying false emotions (for example, being friendly to difficult customers).

The NSW Police Force is implementing a new incident notification system that aims to improve incident investigation reporting on psychosocial risks and hazards

At the time of this audit’s publication in June 2025, the NSW Police Force is implementing a new incident notification reporting system. This system will provide a greater level of detail about the types and causes of psychological incidents, hazards and near misses. In addition, the new system has built-in welfare response notifications that are matched to the workplace incident.

In October 2022, amendments were made to NSW Work Health and Safety Regulations. These obligations imposed a higher standard for monitoring workforce psychosocial risks. They now require that employers introduce a range of control measures to mitigate psychosocial risks and hazards and to ‘eliminate psychosocial risks so far as is reasonably practicable’. The control measures are described in Section 55D (2) of the Regulations and include consideration of:

The NSW Police Force’s new incident notification reporting system has potential to improve the level of information about psychosocial risks and hazards, including information that shows the investigation stages and outcomes, and indicates the root causes of incidents and near misses.

At the time of this audit, NSW police employees are able to report their wellbeing concerns to line managers, but a number of frontline police advised that this course of action can be ‘career limiting’. Police employees are also able to speak with peer-appointed, work, health and safety officers. Work health and safety representatives have meetings with local police in their command on a monthly or quarterly basis, depending on the size of the command. During these meetings, work, health and safety officers record staff issues relating to trauma, psychological risks, and other wellbeing matters. The minutes from these meetings are escalated to senior human resource managers.

Frontline police are able to report individual health, safety and wellbeing concerns through an online ‘safe reporting’ portal. This online option is used to report local risks along with colleague misconduct concerns. However, this feedback portal was not well known by police interviewed for this audit. Those police that knew about the portal option, were concerned that feedback would not be anonymous, and could be traced back to individuals.

The NSW Police Force does not utilise information collected from critical incident reports to identify common psychological hazards that may contribute to these events

Police management reports do not include aggregated data about the factors that were evident in the lead up to critical incidents. Individual incident reports may include information about whether fatigue, stress, or excessive haste were evident when the incident occurred. Reporting on these factors in the aggregate, may reveal to managers, some potential risks, and the root causes of critical incidents.

The NSW Police Force correlates some command-level data about police accidents, work, health and safety incidents, but does not report on the factors that contributed to the psychological injury incident. This information should be visible to central managers and decision-makers who have the authority to direct resources to the areas where risks are identified. For example, managers need information to understand whether segments of the workforce are operating under workload pressures. These pressures can be indicated through workplace accidents and incidents.

In the five years from 2019–2020 to 2023–2024, NSW police officers were involved in 171 critical incidents. Critical incidents are incidents that result in deaths or serious injuries to the public and, or police. Critical incidents are those which occur as a result of police vehicle pursuits and collisions, or the discharge of police firearms. Police managers do not receive reports that might indicate common factors in these incidents – factors that may provide insight into workforce wellbeing and optimal functioning.

Police critical incident notification forms include fields for police to record the time in the shift when an incident occurred. However, police managers have not used this information to observe trends and patterns of incident times and risks. It means, for example, that police managers did not know if factors such as fatigue played a part in police critical incidents.

There is potential for the NSW Police Force to do more to understand the stressors on the workforce. Other employers have developed mechanisms to monitor risks. For example, health providers and hospital managers review and analyse clinical incident trend data. They use this information to identify system-level harms that indicate emerging risks to the workforce and the public, and take action at an organisational level.

Safe Work Australia identifies strategies to understand psychosocial pressures on the workforce. These include monitoring and observing workforce mistakes, as potential indicators of areas where job demands are too high. In addition, Safe Work Australia recommends workforce-wide consultation processes, including the use of surveys and tools to seek the views of workers on a wide range of psychosocial risks.

Ultimately, the NSW Police Force lacks systems to understand and report on structural risks to the workforce. This level of information would allow managers to review policies if necessary, and target resources to mitigate these risks.

The NSW Police Force does not use a workforce allocation model to distribute its workforce according to workload burden

Workload stress is a significant factor in police wellbeing. The frontline police who were interviewed for this audit, were consistent in the view that unmanageable workload pressures have the greatest impact on their wellbeing. 'Work pressure' is the third most common source of psychological injury cited in police injury notification data. While police managers have information about the police workload pressures across commands, they do not use a workforce allocation model to allocate workforce resources in a way that effectively mitigates this risk. In general, police managers measure workload pressures by assessing the number of calls that local police are unable to attend within the hour across the 57 NSW local area commands.

The NSW Police Force lacks a formula to allocate and distribute its police workforce across commands. The location of police across the State has been largely determined by historical factors, such as the location of an existing workforce. Staffing levels are also determined by political decisions. Some staffing allocations are made via election commitments to place additional police in certain regions, without an analysis of workforce requirements.

The NSW Police Force has been operating with significant workforce shortages since 2023. Workforce vacancy rates differ across commands. Some police area commands and districts are operating with workforce vacancies of more than 30%. Others have lower workforce vacancy rates at 11%. While workforce vacancies are not always a true indicator of workload burden, the data can show commands under changing workforce pressures. The ability of a command to meet its call-out volumes provides a clearer assessment of workload demand. That said, the NSW Police Force has not done any analysis of its authorised workforce strength by command over the past eight years.

Each year, police managers can make minimal changes to the distribution of police across the State. This is almost exclusively through the placement of newly graduated police. The process for placing new probationary constables is determined via annual meetings with Deputy Police Commissioners and region-level commanders. During this process, police workload levels and vacancy rates are assessed, and region-level bids are made for new graduates based on regional needs.

The NSW Police Force does not use a staffing allocation model to distribute its personnel based on an assessment of the workloads of each command. While police managers have access to data that shows the areas experiencing the highest workload across the 57 NSW local area commands, they are limited in their ability to change the workforce levels across the State.

In instances where there are significant increases in crime or call-out rates, the NSW Police Force is able to temporarily deploy additional police as part of a surge capability. These deployments seek to surge police in crime hotspots. However, they are a temporary measure and do not solve entrenched under-resourcing of some commands.

Senior police managers advise that they are limited in their ability to transfer police positions, or to increase the overall workforce headcount to respond to workload demands. While Deputy Commissioners and region-level commanders can monitor police workloads, they lack a staffing allocation model that would allow them to transfer police to commands under the highest levels of workload pressure.

The NSW Police Force does not assess or compare the effects of police taking up a second job to determine whether secondary employment impacts on police fatigue, stress or performance

Over the past five years, around 1,650 NSW Police Force employees were engaged in secondary employment annually. Central managers and policy makers do not receive data or reports that would allow them to monitor and compare levels of secondary employment across commands, and its impacts on police performance.

Police managers do not receive data that correlates secondary employment levels with sick leave data or adverse incident data, for example. While police managers advise that secondary employment is monitored at the local command level, there is no capability to assess impacts centrally, and make policy adjustments if data shows impacts on workforce wellbeing or functioning.

Given that the NSW Police Force has not collected or analysed system-level, psychological risk factor information, managers are unable to inform the design of police wellbeing programs based on evidence of workforce needs.

NSW frontline police work some of the longest shifts in the country and the NSW Police Force has not sufficiently assessed the risks or impacts of this shift cycle on performance and fatigue

Frontline police complete four 12-hour shifts that are condensed into a four-day timeframe, followed by six days off. In general, frontline police complete two day-shifts followed by two night-shifts, that are completed consecutively. Police are required to have a ten-hour break in between shifts, but unplanned overtime and travel to and from the workplace and home, can reduce the time available for rest and recovery.

The NSW Police Force has a 'flexible work arrangements manual' with principles that allow for flexible rostering of shift lengths between six and 12 hours throughout the day and overnight. In practice, however, rostering patterns show that 96% of general duties police undertake shift lengths of 12 hours. Most other police jurisdictions in Australia, with the exception of the Northern Territory, implement shift lengths that vary between eight and ten hours.

The NSW Police Force does not analyse its incident notification reports to assess whether there are any trends in the times when adverse incidents occur. The NSW Police Force is not able to identify correlations between the length of shifts and incidents, or the patterns of shifts and adverse incidents. As a result, police managers do not know whether the current shift arrangements for frontline police are a contributing factor to fatigue and stress. They do not have trend data to show if fatigue is leading to increases in accidents, incidents and performance matters.

The NSW Police Force’s work readiness framework advises that a 'review of workplace incident data' is a method that can be used to identify factors contributing to fatigue. Aggregated data about the ‘time in shift’ when incidents occur, would assist managers to understand whether shift patterns have inherent safety risks.

The NSW Police Force does not have sufficient controls and tools to regulate the number of hours worked by police, and potentially mitigate police fatigue levels

The NSW Police Force currently manages fatigue through a work readiness framework that includes policies, guidelines and tools, that are designed to assist managers and employees to develop and implement work readiness management plans and strategies. Police commanders are not mandated to implement these guidelines and tools, and there is no register of police working hours or work readiness.

The framework does not address the ways in which the fatigue assessment tools will be used and monitored across local commands. The NSW Police Force does not have a process to ensure the implementation of tools and control measures. In addition, the fatigue assessment tools lack clarity or guidance on rest and stop-work directives. Some employers of emergency service workers and first responders are able to proactively monitor fatigue. For example, NSW Ambulance has an automated fatigue management calculator that allows managers to view the hours worked by employees in real time, in order to manage risks.

The NSW Police Force work readiness framework contains guidelines that can be used to mitigate some of the contributing factors to fatigue. Guidelines advise police managers to conduct 'consultation with workers'. However, there is limited evidence that the NSW Police Force has consulted with, or sought feedback from the workforce on fatigue risks. There is no evidence that police employees have been surveyed about the effects of shift hours on the available time for sleep, or on work readiness.

In October 2023, the NSW Police Force developed a risk control ‘ready reckoner’ which includes ‘fatigue’ as a risk factor in police work. This risk control system is still in draft form and has yet to be implemented. The register identifies potential controls that can be used to manage fatigue, but it does not assign owners or business areas as responsible for the controls and risks. The impact of the ready reckoner is not yet known, nor has there been any monitoring of its uptake to date.

SafeWork NSW has identified fatigue as a potential workforce health and safety hazard for employees across all industries. Fatigue has both physical and psychological impacts. According to the regulator, each employer has responsibility to identify and manage fatigue risks to employees. In recent decades, numerous supreme court decisions have found employers liable for breaching their duty of care in failing to take reasonable steps to minimise the risks of fatigue to their workers.

SafeWork NSW recommends that employers develop a fatigue policy in consultation with their employees. The policy should define clear roles and responsibilities for employers that include the management of excessive working hours, workplace assessments of fatigued workers to gauge fitness for work, and procedures for reporting hazards and managing risks.

Complaints and legal claims relating to alleged police misconduct are costly to the State

Frontline police are more likely to be recipients of public complaints than other police as they have more interaction with the public during events such as domestic violence incidents, assaults, neighbourhood disputes, mental health incidents, and other crime responses. Specialist police such as detectives and forensic experts have less interaction with the public and therefore receive fewer public complaints.

Frontline police told audit staff that complaints against them have significant impacts on their wellbeing. These negative impacts are compounded by the fact that police are not told about the nature of the complaint against them or the name of the complainant. For many police, this process seems unjust as in some instances, they have no information about what they have done to receive the complaint, and no recourse to defend their case.

Public complaints about police are handled differently across the six police regions. In one region, the region commander has determined that police will not be informed about complaints that are shown to be vexatious and declined. This is to ensure that morale is not affected. In another region, all complaints are reported to police, even if they are declined. Some police argue that declined complaints should not be recorded on their files, as is the current practice. They advise that complaints can have an adverse impact on their promotion eligibility, even when the complaints are vexatious.

Police told us that there was an inadequate level of wellbeing support available for officers who were subject to complaints or investigations. Complaint and investigation policies and procedures make mention of the availability of Employee Assistance Program services, but this is the only external support. According to the policy, local commanders are responsible for monitoring the welfare of complaint recipients and all other people involved. Procedure documents do not include any requirement for commanders to refer police to wellbeing support services.

During the five years from 2019–2020 to 2024–2025, a total of 2,124 legal claims were made against NSW police employees for misconduct matters. The NSW Police Force paid $155.44 million to settle these claims over the five-year period. Despite the significant cost of these claims, the NSW Police Force does not report basic information about these legal matters. The NSW Police Force does not report on the number of claims that were settled via payments to claimants, the number of claims that proceeded to Court, or the claims that were successfully defended in Court.

Since 2019–2020, there have been increases in psychological injury claim numbers and costs across the NSW public sector, for police these costs have risen by almost 50% year on year

Despite increases in mental health services and psychological support for police, the costs of psychological injuries have been increasing year on year. While compensation claims for physical injuries occur at more than twice the rate of psychological injury claims, the costs associated with psychological injury claims are higher than for physical injuries. Compensation costs to psychologically injured police totalled approximately $1.75 billion from 2019–2020 to 2023–2024. The NSW Police Force is not alone in experiencing increases in psychological injuries and costs, higher claim numbers and costs are also evident in other NSW government agencies.

Police compensation costs were covered by two different insurance schemes during the five years from 2019–2020 to 2023–2024. The icare workers compensation insurance scheme covered costs of $927.84 million, and the Police Blue Ribbon Insurance Scheme covered $817.29 million in costs. The Police Blue Ribbon Insurance Scheme was managed by a private insurer.

From 2019–2020 to 2023–2024, NSW police employees made approximately 3,080 compensation claims for physical injuries each year, compared to a yearly average of 1,100 claims for psychological injuries. Over this timeframe, psychological claims accounted for 74% of the total compensation claims costs, with physical injuries accounting for 26% of costs.

Exhibit 6 shows the number of physical and psychological compensation claims numbers each year, and the claim costs for the different injury types by year.

Appendix 1 – Response from entity

Appendix 2 – About the audit

Appendix 3 – 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 #408 - released 11 June 2025

About this report 

The Northern Beaches Hospital is a private hospital that also provides public hospital services. The hospital was built in 2018 and is operated by a private operator, Healthscope, in a public-private partnership with the NSW Government.

Healthscope is contracted to operate the public portion of the hospital until 2038. 

This audit assessed how effectively and efficiently the Northern Beaches Hospital public-private partnership delivers public hospital services.

Conclusion 

The Northern Beaches Hospital public-private partnership is not effectively delivering the best quality integrated health services and clinical outcomes to the Northern Beaches community and the State – the standard required under the arrangement and the key objective of the project deed. 

The partnership is at risk of failure, with Healthscope requesting in November 2023, and again in December 2023, that the return of the public portion of the Northern Beaches Hospital be brought forward by 14 years. In its requests, Healthscope noted the risk to the viability of the Northern Beaches Hospital, citing insufficient funding, a lack of integration into the wider health network, and strained stakeholder relationships. 

NSW Health effectively manages the contract with Healthscope day-to-day on behalf of the State, ensuring that public hospital activity at the Northern Beaches Hospital is provided at a lower cost than if the State operated the hospital. However, the public-private partnership structure creates tension between commercial imperatives and clinical outcomes. 

The Northern Beaches Hospital has recorded concerning results for some hospital-acquired complications and has not taken sufficient actions to address some identified clinical safety risks. 

The project deed, which governs the partnership, does not support the hospital’s integration into the local health district and broader health network. This has an impact on patient journeys and access to services for patients in the Northern Beaches. Additionally, Healthscope has no obligation or commitment to implement NSW Health initiatives – such as the Safe Staffing Levels initiative. 

The Northern Beaches Hospital has achieved accreditation to ensure it meets national quality standards for hospital care but some quality and safety concerns remain. 

Recommendations 

The report made three recommendations:  

1. The NSW Government and NSW Health note the findings of the report and consider whether the Northern Beaches Hospital public-private partnership is the appropriate model to deliver the best quality integrated health care in the Northern Beaches region
    
2. Healthscope should resolve:
   1. safety and quality issues
   2. system issues
   3. reporting issues
       
3. NSW Health should consider issues raised for this public-private partnership for any future arrangement.

This chapter reports on the performance of the Northern Beaches Hospital. The first section reviews the performance of the Northern Beaches Hospital in terms of safety and quality. The second and third sections review the operational performance of the emergency department and elective surgery (including general surgery). One of the features of the Northern Beaches Hospital public-private partnership is the requirements of demand and volume management placed on Healthscope, the operator of the hospital. How that interacts with the performance of the emergency department and admitted patient areas is examined here. The fourth section reports on patient experience and complaints.

A key objective of the project deed is for the Northern Beaches Hospital to provide the best quality care for people in the Northern Beaches catchment and the people of NSW. The best quality care is operationalised in the project deed by requiring the Northern Beaches Hospital to perform in the top quartile of comparator hospitals for many measures. Only one of these measures relates to the scope of this audit – patients who left the emergency department after triage without being seen. Comparator hospitals are drawn from national hospitals for these measures.

When comparing results with NSW hospitals, the Northern Beaches Hospital is within the B1 hospital grouping, which includes Blacktown, Sutherland, Hornsby Ku-ring-gai and Campbelltown in metropolitan Sydney, and Orange, Tamworth, Wagga Wagga, Tweed Valley, Coffs Harbour, Port Macquarie and Lismore hospitals in regional NSW.

This chapter focuses on the role of the Northern Sydney Local Health District and Ministry of Health in managing the Northern Beaches Hospital public-private partnership for the State. The first section reviews identification and management of risks arising from this arrangement, including clinical risks and how NSW Health intervenes to address issues. (Chapter 3 also considered this question in relation to results for hospital-acquired complications and for sepsis and deteriorating patients). The second section looks at integration, which is one of the key objectives of the public-private partnership. Integration is the way the hospital fits into the surrounding NSW Health network. The third section then considers the efficiency of this arrangement for NSW Health.

Appendix 1 – Response from entities

Appendix 2 – Northern Beaches Hospital services and role delineation

Appendix 3 – Hospital-acquired complication data

Appendix 4 – 2023–24 abatable key performance indicators

Appendix 5 – About the audit

Appendix 6 – 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 #404 released 17 April 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.

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.

NSW Police Force IT systems and processes are built around the Computerised Operational Policing System (COPS), which has been in place since 1994. The Police Technology Program aims to replace legacy COPS infrastructure, introduce new capabilities and approaches to enhance the operational efficacy of the NSW Police Force.

In 2013 the NSW Police Force was allocated $45m to replace COPS. It developed a proof of concept in 2017 for a replacement system (NewCOPS), but did not deliver on this system.

NSW Police Force began the system development process again, under the title of the Integrated Policing Operations System (IPOS) program. An initial business case for the IPOS program was developed in 2018 and finalised in 2019. In 2020, the NSW Police Force selected a single vendor to provide an integrated solution for core policing functions. In 2022, the NSW Police Force terminated the contract with the selected vendor and is currently pursuing a multi-vendor approach. 

This audit may assess the efficiency and effectiveness of the NSW Police Force in planning and sourcing key components to upgrade core policing technology.

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

© 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 #398 released 27 June 2024.

About this report

This audit assessed the effectiveness of the Department of Communities and Justice (DCJ) in planning, designing, and overseeing the NSW child protection system.

The audit used 'follow the dollar' powers to assess the performance of five non-government organisations (NGOs), that were contracted to provide child protection services. More information about how we did this is included in the full report.

Findings

The NSW child protection system is inefficient, ineffective, and unsustainable.

Despite recommendations from numerous reviews, DCJ has not redirected its resources from a ‘crisis driven’ model, to an early intervention model that supports families at the earliest point in the child protection process.

DCJ's organisational structure and governance arrangements do not enable system reform.

DCJ has over 30 child protection governance committees with no clarity over how decisions are made or communicated, and no clarity about which part of DCJ is responsible for leading system improvement.

DCJ's assessments of child protection reports are labour intensive and repetitive, reducing the time that caseworkers have to support families with services.

DCJ has limited evidence to inform investments in family support services due to a lack of data about the therapeutic service needs of children and families. This means that DCJ is not able to provide relevant services for families engaged in the child protection system. DCJ is not meeting its legislated responsibility to ensure that families have access to services, and to prevent children from being removed to out of home care.

DCJ does not monitor the wellbeing of children in out of home care. This means that DCJ does not have the information needed to meet its legislative responsibility to ensure that children 'receive such care and protection as is necessary for their safety, welfare and well-being’.

In August 2023, there were 471 children living in costly and inappropriate environments, such as hotels, motels, and serviced apartments. The cost of this emergency accommodation in 2022–2023 was $300 million. DCJ has failed to establish ‘safe, nurturing, stable and secure’ accommodation for children in these environments.

Since 2018–19, the number of children being returned to their parents from out of home care has declined. During the five years to 2022–23, families have had limited access to restoration services to support this process.

Recommendations

The audit made 11 recommendations to DCJ. They require the agency to identify accountability for system reform, and to take steps to ensure that children and families have access to necessary services and support.

The child protection system aims to protect children and young people under 18 years old from risk of abuse, neglect, and harm. In NSW, child protection services can include investigations of alleged cases of child abuse or neglect, referrals to therapeutic services for family members, the issuing of care and protection orders, or the placement of children and young people in out of home care if it is deemed that they are unable to live safely in their family home.

A key activity in the child protection process is to determine whether a child is at ‘risk of significant harm’ as defined by Section 23 of the Children and Young Persons (Care and Protection) Act 1998. The Act describes significant harm as when ‘the child's or young person's basic physical or psychological needs are not being met or are at risk of not being met'. The Department of Communities and Justice (DCJ) has developed a process for determining risk of significant harm. It requires multiple assessments of child concern reports and at least two separate assessments of the child in the home. This process can take a number of months, and until all of these activities are complete, DCJ describes the child as suspected or presumed to be at risk of significant harm.

DCJ has primary responsibility for the child protection system in NSW. DCJ is both a provider of child protection services and a purchaser of child protection services from non-government organisations (NGOs). As system steward, DCJ has a role to establish the policy environment for child protection services and operations. In addition, DCJ is responsible for all governance and reporting arrangements for the commissioned NGOs that deliver services on its behalf, as well as for the governance and reporting arrangements of its own DCJ staff. DCJ must ensure that the child protection system is achieving its intended outcomes – to protect and support children in ways that meet their best interests - as described in legislation.

This audit assessed the effectiveness of DCJ’s planning, design, and oversight of the statutory child protection system in NSW. We assessed whether DCJ was effective in ensuring:

• there is quality information to understand and effectively plan for child protection services and responses
• there are effective processes to manage, support, resource, and coordinate child protection service models and staffing levels
• there is effective oversight of the quality and outputs of child protection services and drivers of continuous improvement.

To do this, the audit assessed the statutory child protection system with a particular focus on:

• initial desktop assessments and triaging of child protection reports
• family visits and investigations of child protection reports
• case management services and referrals to services
• the management of all types of care and protection orders
• the assessments and placements of children in out of home care.

The audit also assessed the performance of five NGOs that provide commissioned child protection services. Collectively, in 2021–2022, the five audited NGOs managed approximately 25% of all out of home care services in NSW. The policies, practices, and management reporting of the five NGOs was assessed for effectiveness in relation to the following:

• quality of data used to understand service requirements
• arrangements for operational service delivery to meet identified needs
• governance arrangements to deliver safe and quality out of home care services under contract arrangements with DCJ.

This audit was conducted concurrently with another audit: Safeguarding the rights of Aboriginal children in the child protection system.

The child protection system aims to protect children and young people (aged less than 18 years) from the risks of abuse, neglect, and harm. Child protection services can include investigations, (which may or may not lead to substantiated cases of child abuse or neglect), care and protection orders, and out of home care placements.

The Department of Communities and Justice (DCJ) has statutory responsibility for assessing whether a child or young person is in need of care and protection. DCJ’s Child Protection Helpline receives and assesses reports of possible child abuse or neglect. If the information in the report is assessed as meeting a threshold for risk of significant harm, DCJ caseworkers at Community Service Centres investigate the report and decide on a course of action. Follow-up actions can include referring the family to services, visiting the family to conduct ongoing risk and safety assessments of the child, or closing the case. If a child is determined to be unsafe, the child may be removed from the family home and placed in out of home care.

Non-government organisations (NGOs) are funded by the NSW Government to provide services to children and young people who require out of home care and other support services. NGOs provide approximately half of all out of home services in NSW, and DCJ provides the other half.

Government agencies such as Health, Education and Police also play a role in child protection processes, particularly in providing support for children and families where there are concerns about possible abuse or neglect. NSW Health provides some support services for families, along with the Department of Communities and Justice. Exhibit 1 shows some headline child protection statistics for NSW in 2022–2023.

Source: Audit Office summary of DCJ data on child protection statistics.

DCJ has not made progress in shifting the focus and resources of the child protection system to an early intervention model of care, as recommended by major system reviews

DCJ has not readjusted its resource profile so that its operating model can take a more preventative approach to child protection. A preventative approach requires significant early intervention and support for families and children soon after a child has been reported as being at risk of significant harm. This approach has been recommended by a number of reviews into the child protection system.

In 2015, the Independent Review of Out of Home Care in New South Wales recommended an investment approach that uses client data and cost-effective, evidence-based interventions to reduce entries to out of home care and improve outcomes for families and children.

The NSW Government response to the Independent Review of Out of Home Care in New South Wales was a program entitled: Their Futures Matter. This program commenced in November 2016 and was intended to place vulnerable children and families at the heart of services through targeted investment of resources and services. A 2020 report from our Audit Office found that ‘while important foundations were laid and new programs trialled, the key objective of establishing an evidence-based whole of government early intervention program … was not achieved. The majority of $380 million in investment funding remained tied to existing agency programs, with limited evidence of their comparative effectiveness.’

DCJ’s expenditure since 2018–2019 shows that most additional funding has been used to address budget shortfalls for out of home care, and to expand the numbers of frontline case workers. Budget increases show that during the period from 2018–2019 to 2022–2023, DCJ’s expenditure on out of home care increased by 36%, and expenditure on caseworkers increased by 26%. DCJ’s expenditure on family support services, including early intervention and intensive support services, increased by 31% during the audit period.

These resourcing priorities indicate that DCJ has not shifted its focus or expenditure in ways which reorient the child protection system. DCJ has not dedicated sufficient resources to early intervention, and therapeutic support for families and children, in order to implement the recommended changes made by systemwide child protection reviews.

In 2019, the Family is Culture Review recommended increased investment in early intervention support services to prevent more Aboriginal children entering out of home care, with a preference for these services to be delivered by Aboriginal Community Controlled Organisations. Progress towards enhancing a culturally appropriate service profile has been limited. DCJ last published progress against the Family is Culture recommendations in August 2021, when it reported that projects to increase financial investment in early intervention services were under review.

Data from March 2023 shows that 89% of the DCJ-funded, family support service volume across NSW is delivered by mainstream providers compared with ten per cent provided by Aboriginal Community Controlled Organisations, and one per cent by culturally specific providers. Given that Aboriginal children make up approximately half of all children in out of home care, there is still significant work required to shift the service profile.

DCJ’s governance arrangements are not structured in a way that ensures transparency and accountability for system reform activity and service improvements

DCJ’s organisational structure reflects multiple operational and policy functions across its three branches - the Commissioning Branch, the Operational Branch, and the branch responsible for Transforming Aboriginal Outcomes. Some branches have responsibility for similar functions, and it is not clear where overall executive-level accountability resides for system reform. For example, all three branches have a policy function, and there is no single line of organisational responsibility for this function, and no indication about which branch is responsible for driving system reform.

DCJ has over 30 governance committees and working groups with responsibilities for leadership and oversight of the statutory child protection and out of home care system. DCJ’s governance committees include forums to provide corporate and operational direction, to make financial and resourcing decisions, and to provide leadership and program oversight over the different functions of child protection and out of home care. Some committees and working groups oversee DCJ’s activity to meet government strategic priorities and respond to the findings and recommendations of child protection and out of home care reviews and commissions of inquiry.

Much of DCJ’s work in child protection and out of home care is interdependent, but its governance arrangements have not been structured in a way that show the lines of communication across the Department. There is no roadmap to show the ways in which decisions are communicated across the various operational and corporate segments of DCJ’s child protection and out of home care business operations.

In 2022, DCJ commenced activity to reorganise its operational committees into a four-tier structure, with each tier representing a level in the hierarchy of authority, decision-making and oversight. Draft documents indicate the ways in which the new organisational structure will facilitate communication through the different business areas of DCJ to the Operations Committee where most of the high-level decisions are made or authorised before being referred to the Executive Board for sign off. The new governance arrangements indicate a more transparent process for identifying Department and divisional priorities across policy and programs, though the process for reforming governance processes was not complete at the time of this audit.

DCJ’s strategic planning documents do not contain plans to address the pressure points in the child protection system or address the increasing costs of out of home care. After the merger of the Department of Family and Community Services (FACS) and the Department of Justice, DCJ’s Strategic Directions 2020–2024 document sets out the direction for the expanded Department in generalised terms. While it describes DCJ’s values, and describes an intention to improve outcomes for Aboriginal people and reduce domestic and family violence, it does not contain enough detail to describe a blueprint for Departmental action.

In April 2023, DCJ published a Child Safe Action Plan for 2023 to 2027. This plan includes a commitment to hear children’s voices and to ‘improve organisational cultures, operations and environment to prevent child abuse’. In September 2023, the NSW Government committed to develop ‘long-term plans to reform the child protection system and repair the budget, as part of its plan to rebuild essential services and take pressure off families and businesses'. Any activity to implement these commitments was not able to be audited, as it was too soon to assess progress at the time of this report publication.

DCJ’s expenditure priorities predominantly reinforce its longstanding operating model – to focus on risk assessments and out of home care services rather than early intervention

More than 60% of DCJ’s budget for child protection is spent on out of home care. In the five years from 2018–2019, DCJ’s expenditure on out of home care increased by 36% from $1.39 billion in 2018−19 to $1.9 billion in 2022–23.

During the same timeframe, DCJ’s expenditure on risk report assessments and interventions at the Helpline and Community Service Centres increased by 25%. It grew from $640 million in 2018–2019 to $800 million in 2022–2023. This not only reinforced the existing model of child protection, it expanded upon it, at the expense of other activity.

While DCJ’s expenditure on family support services increased by 31% from $309 million in 2018–2019 to $405 million in 2022–2023, it remains a small component of DCJ’s overall expenditure at 13% of the total budget spend in 2022−2023, as shown at Exhibit 6.

Note: Expenditure is actual spending in each year, not adjusted for inflation. Totals may be more than the sum of components due to rounding. percentages may not sum to 100 due to rounding.

Source: Audit Office analysis of Productivity Commission data published in Reports on Government Services 2024, Table 16A.8.

DCJ has not done enough to support the transition of Aboriginal children to the Aboriginal community controlled sector as planned

In 2012, the NSW Government made a policy commitment to ensure the transfer of all Aboriginal children in out of home care to Aboriginal Community Controlled Organisations. DCJ acknowledges that over the past 12 years, the NSW Government has made limited progress in facilitating this transition.

In June 2023, a total of 1,361 children were managed by Aboriginal Community Controlled Organisations across NSW. At the same time, 1,746 Aboriginal children were being case managed by non-Aboriginal NGO providers, and 3,456 Aboriginal children were case managed by DCJ. In total there were 5,202 Aboriginal children waiting to be transferred to Aboriginal Community Controlled Organisations in June 2023.

The transition process was planned and intended to occur over a ten year timeframe from 2012 to 2022. This has not been successful. DCJ has revised its timeframes for the transition process, and now aims to see the transfer of the ‘majority’ of Aboriginal children to Aboriginal Community Controlled Organisations by June 2026. At the current rate of transition, it would take over 50 years to transfer all 5,202 children to Aboriginal Community Controlled Organisations, so this timeframe is ambitious and will require close monitoring by DCJ.

The cost of transitioning all 5,202 Aboriginal children from DCJ and the non-Aboriginal NGOs to the Aboriginal Community Controlled sector will add close to $135 million to the NSW Government out of home care budget. The increased costs are due to the higher costs of administration, accreditation, and oversight of services provided by the Aboriginal Community Controlled sector.

DCJ has prioritised the transfer of Aboriginal children from non-Aboriginal NGOs to Aboriginal Community Controlled Organisations before the transfer of Aboriginal children from DCJ’s management. This prioritisation is due, in part, to the fact that most of the non-Aboriginal carers of Aboriginal children are with NGOs. NGO contract requirements should have been one of the drivers of the transition of Aboriginal children to Aboriginal Community Controlled Organisations.

The most recent NGO contracts, issued in October 2022, required that NGOs develop an Aboriginal Community Controlled transition plan by 31 December 2022. This timeframe was extended to 30 June 2023. All of the NGOs we audited have now prepared detailed transition plans for the transition of Aboriginal children, including service plans that identify risks and document collaborative efforts with Aboriginal Community Controlled Organisations.

One important requirement in the success of the transitions, is the willingness of carers to switch from their existing NGO provider to an Aboriginal Community Controlled Organisation. During the period of this audit DCJ failed to provide sufficient information to carers, to assure them of the NSW Government’s commitment to the transition process. Since July 2023 DCJ has written to carers of Aboriginal children case managed by non-Aboriginal Community Controlled Organisations and provided them with more information about the transition process.

NGOs have had limited success in transitioning Aboriginal children to Aboriginal services, and can do more to report on activity, so that system improvements can be made

Non-Aboriginal NGOs have had limited success in transferring Aboriginal children to the Aboriginal-controlled out of home care sector. For example, of the approximately 1,700 Aboriginal children that were managed by non-Aboriginal providers in 2022–2023, 25 Aboriginal children were transferred from non-Aboriginal NGOs to Aboriginal Community Controlled Organisations in that year. While DCJ controls the key drivers in this transition, there is limited evidence that NGOs have initiated consultations with Aboriginal Community Controlled Organisations during the audit period.

NGOs advised that some of their carers do not want to transition to Aboriginal Community Controlled Organisations, and this is slowing the transfer process. NGO contracts in force until September 2022 required that: ‘The express agreement of carers must be sought prior to the transfer of an Aboriginal Child to an Aboriginal Service Provider.’ This audit was not able to verify the extent to which carers have resisted the move to Aboriginal Community Controlled Organisations.

DCJ did not provide NGOs with sufficient direction, coordination, or governance through its contract arrangements to effect transitions from non-Aboriginal NGOs to Aboriginal NGOs. DCJ has established a project control group with representatives from NGO peak bodies and has set up an internal program management office to manage the transition.

There are limited drivers for the transition of Aboriginal children to Aboriginal-controlled services, and financial risks for both Aboriginal Community Controlled Organisations and non-Aboriginal NGOs in the process

Aboriginal Community Controlled Organisations and non-Aboriginal NGOs are carrying significant financial risk due to a lack of certainty in the transition process of Aboriginal children to the Aboriginal Community Controlled sector. These agencies are responsible for planning and making changes to their business models in order to facilitate the transition process. DCJ does not provide funds for this activity.

Some non-Aboriginal NGOs have high numbers of Aboriginal children in their care. These agencies risk financial viability if children and their carers are transitioned in a short space of time. There is a degree of uncertainty about the timelines for transitions to Aboriginal Community Controlled Organisations, and the numbers of children that will be transitioned at any given time.

Non-Aboriginal NGOs are not in a position to require Aboriginal Community Controlled Organisations to take Aboriginal children. Similarly, Aboriginal Community Controlled Organisations cannot compel the transition of children to their care. There are no real system drivers for this activity, and some financial disincentives for NGOs supporting large Aboriginal caseloads.

Throughout 2023, some Aboriginal Community Controlled Organisations have been upscaling their businesses to prepare for the transition of Aboriginal children to their care. They have employed additional caseworkers and enhanced administrative and infrastructure arrangements to take on new children, without receiving new intakes. They report that they have been financially disadvantaged by the failure of the transition process. Aboriginal Community Controlled Organisations advise that they don’t expect confirmation of the child transition process and timelines until 2024 and must carry the financial consequences of upscaling.

DCJ does not collect sufficient data to assess the effectiveness of its child protection service interventions and does not know whether they lead to improved outcomes

DCJ does not collect sufficient information to understand whether its child protection risk and safety interventions are effective in protecting children from abuse, neglect, exploitation, and violence.

DCJ is the sole entity with responsibility to make assessments of children after there has been a child protection report. After a child has been reported, DCJ caseworkers conduct a range of assessments of the child and family context, to determine whether the child is at risk of significant harm. If DCJ caseworkers determine that a child is ‘in need of care and protection,’ Section 34 of the Care Act requires DCJ to ‘take whatever action is necessary to safeguard and promote the safety, welfare and well-being of the child or young person’, including ‘providing, or arranging for the provision of, support services for the child or young person and his or her family’.

DCJ has limited measures to assess the effectiveness of its service interventions. DCJ monitors and reports on the number of children who are re-reported within 12 months after receiving a DCJ caseworker intervention. However, DCJ does not monitor or report any comparative data that would potentially demonstrate the effectiveness of its service interventions. For example, DCJ does not collate and publish data on re-report rates of children who do not receive a DCJ service intervention. This comparative data would give DCJ greater understanding about the effectiveness of its service interventions.

In addition, DCJ’s re-report data does not differentiate between re-reports of children that are substantiated, from those that are not. Children can be re-reported for a variety of reasons. Some re-reports are of children who are not at increased risk of significant harm. Therefore, the current re-report data is a limited measure of the effectiveness of DCJ’s service interventions.

DCJ does not collect data or compare outcomes based on the kinds of services that are accessed by children and families. For example, DCJ does not report on instances where families were denied service interventions because support services were full, or did not exist in their region. DCJ does not collect data or report on children who were taken into out of home care in areas where there were no available services to support the family.

DCJ caseworkers can support families by making referrals to drug and alcohol rehabilitation services, family violence services, parenting support courses, or mental health services. It is not known whether families receive services that are relevant to their needs. Some services are offered as additional DCJ caseworker support, some are NGO funded support packages, some offer therapeutic interventions, and some are provided via external government agency services, such as NSW Health. Support services are highly rationed in NSW, and many families engaged in the child protection system do not have access to them.

Limited outcomes data and reporting means that DCJ cannot demonstrate how its actions and service interventions are reducing risks and harms to children, and promoting their safety, welfare, and wellbeing in line with the Care Act.

While child protection reports have significantly increased over the past ten years, around 40% do not meet the threshold for suspected abuse and neglect to warrant a response

The overall number of child protection reports received by the Helpline has increased significantly over the past ten years. Reports to the Helpline ensure that children at risk of significant harm come to the attention of DCJ, but around 40% of reports do not meet the threshold of abuse and neglect to warrant a child protection report and response from child protection caseworkers. DCJ has finite resources, and responding to reports that do not require intervention reduces the capacity of DCJ to effectively respond to children who are at risk of significant harm.

In 2022–2023, the Helpline received 404,611 concern reports, an increase of over 60% since 2012–2013 when there were 246,173 reports. Between 2012–2013 and 2017–2018, reports grew slowly, then increased rapidly for three following years up until 2021. While the number of Helpline reports fell in 2021–2022, this reduction was partly due to a drop in reports by teachers during COVID school closures, and was not maintained in 2022–2023.

DCJ attributes the rapid growth in child protection reports to increasing awareness amongst mandatory reporters about their statutory responsibilities to report, along with the introduction of the online reporting option. Mandatory reporters include medical practitioners, psychologists, teachers, social workers, and police officers. These personnel are legally required to report children that they suspect are at risk of significant harm. In one 3-month period from April to June 2021 there were over 40,000 reports from mandatory reporters that did not meet the threshold that activates a statutory child protection response from DCJ caseworkers. The assessment of these reports consumes significant resources, costing over $4 million during the three month period in 2021, which equates to over $15 million per annum.

In 2010, Child Wellbeing Units were established so that mandatory reporters from Education, Police and Health could be assisted in child protection reporting. The units were established in response to recommendations made by the Wood Special Commission of Inquiry into Child Protection Services. They aimed to reduce the number of reports to the Helpline and to support mandatory reporters to assist children and families to receive an appropriate response. DCJ managers advise that the units are underutilised, and mandatory reporters continue to submit reports to the Helpline. The Child Wellbeing Units have not successfully reduced the overall number of reports to the Helpline.

DCJ advised that it is evaluating the Child Wellbeing Units and is developing new guidance for mandatory reporters that aims to address the culture of over-reporting.

Exhibit 7 shows the ten years of Helpline reports from 2012–2013 to 2022–2023.

DCJ does not collate or analyse its service referral data, and as a result, is unable to commission relevant services for families engaged in the child protection system

DCJ lacks data to understand the supply and demand requirements for therapeutic services across the child protection system. DCJ does not collect or report aggregate data about service referrals for children and families, nor does DCJ report data about service uptake across its Districts. DCJ does not collect the necessary information to plan for commissioned therapeutic services, or to fill its service gaps. DCJ does not know whether its funded services are competing with, or complimentary to, services funded by other agencies.

DCJ is required to monitor its therapeutic service interventions in order to comply with the objectives and principles of the Care Act. The Care Act requires that ‘appropriate assistance is rendered to parents and other persons … in the performance of their child-rearing responsibilities in order to promote a safe and nurturing environment’, and that any intervention ‘must … promote the child’s or young person’s development.

DCJ does not collect reliable data on the success of service referrals after a child has been identified as being at risk of significant harm. DCJ does not collect information or report on the uptake and outcomes of its referrals where there is a low to intermediate risk of significant harm to the child or young person. In most cases, DCJ does not know whether children or families received a therapeutic service after a referral. The uptake of referrals is voluntary, and families may decide that they do not want to access therapeutic services. DCJ does not routinely record data about the numbers of families that decline services.

DCJ does not collect data on instances where a referral was needed but not made because there was no available service in the District or there were no available places in the service. It is well known within DCJ that therapeutic services are lacking in regional and remote NSW. These include poor access to paediatricians and adolescent psychiatrists, disability assessors, mental health services, alcohol and other drug rehabilitation services, and domestic violence services.

Over the past five years, there is no evidence that DCJ has conducted an assessment of the statewide therapeutic service needs of children and families in NSW, or matched its statewide service profile to these needs through the targeted commissioning of therapeutic services. There has been a lack of system stewardship to ensure there is equity of service access for children and families in all Districts.

In each District, Commissioning and Planning units undertake market analyses at the point when programs are due for recommissioning, generally every three to five years. This market analysis includes an assessment of the availability of local services. There is no consistency in how this work is done across the Districts. While the purpose of District-level, market analysis is to identify gaps and opportunities for services, we did not find evidence of services being newly commissioned where gaps were identified.

District-level Commissioning and Planning units conduct some assessment of the demographics of the local area, as well as information about socio-economic characteristics, and expected population growth. For example, one DCJ District identified that their population is expected to grow by 33% by 2031. This means that more contracts for family preservation places will be needed. Another District identified that they do not have culturally appropriate services. However, the contracts for this District are in place for at least three years, so the District cannot provide the required service profile for local families.

While DCJ is taking some steps to arrange an expanded service profile, the efforts are piecemeal. Different programs are managed and commissioned across different parts of DCJ. For example, one District has developed a localised partnership with the Ministry of Health, but DCJ has not developed a state-wide Memorandum of Understanding with NSW Health to give priority access to all children engaged in the statutory child protection system.

In 2015, the Independent Review of Out of Home Care in New South Wales recommended that DCJ ‘establish local cross-agency boards in each … district to provide local advice, and commission services in line with its priorities and defined outcomes.’ In response, DCJ developed a program known as Their Futures Matter. In 2020, the NSW Audit Office’s assessed this program and found that DCJ had not established any cross-agency boards with the power to commission services. At the time of this audit, in 2024, there is no evidence that DCJ has created cross-agency boards.

DCJ advises that, in future, it plans to issue extra contracts to increase the number of intensive therapeutic care services. DCJ is using data on the locations of children in emergency out of home care placements as part of its needs analysis. The process includes mapping the service system across the State. DCJ’s work to date, has identified a lack of intensive therapeutic care places in Western NSW. The lack of services in Western NSW impacts on the ability of DCJ to keep Aboriginal children on their traditional country, and connected to family and kin.

DCJ is using District-level data in its future-focused recommissioning for family preservation services. DCJ advises that, commencing in 2024, the agency will identify family support service requirements by matching data on instances of risk of significant harm to children by category of harm, and assess service availability at the District level. This audit has not received evidence that the work has begun.

DCJ lacks an integrated performance management system to collect, collate, and compare data about the effectiveness of NGO providers or the outcomes of child support programs

DCJ does not have an integrated performance management system to manage its many programs and contracts with NGO service providers. DCJ advises that at March 2024, it had 1,816 active contracts in its contract management system. DCJ has multiple reporting systems for its different program streams, with information on early intervention programs provided through a different information technology system than the system that is used for out of home care placements. Central program teams do not have good oversight of historical data or trends.

Until 2022, data related to DCJ’s Family Preservation Program was collected separately from each NGO provider, via quarterly spreadsheets. There was no consistency in the ways in which the data was collated or analysed. This means that DCJ does not know how many families entered the Brighter Futures program in each District, even though contracts were issued at a District level and over 7,000 families entered Brighter Futures program in 2018–2019, 2019–2020 and 2020–2021. DCJ does not have a statewide view of the location or effectiveness of this, or any of its other family preservation services.

Contracts with NGOs for out of home care contain service volume requirements, for example a minimum number of children in out of home care each year. Contracts also include performance measures and financial penalties for underperformance. Underperformance includes failure to notify DCJ about out of home care placement changes within contracted time periods. Due to problems with NGOs accessing the ChildStory system, DCJ does not collect reliable data on out of home care placements provided by NGOs and therefore DCJ is not able to issue financial penalties.

DCJ has also failed to deliver expected outcomes from the Human Services Dataset. The dataset was recommended by the 2015 Independent Review of Out of Home Care, and approved by the NSW Government in August 2016. The aim of the dataset was to bring together a range of service demand data in order to prioritise support for the most vulnerable children and families. It was intended to deliver whole-of-system reform that would lead to improved outcomes for children and families with the highest needs.

The dataset brings together 27 years of data, and over seven million records about children, young people, and families. The records contain de-identified information about all NSW residents born on or after 1 January 1990 (the Primary Cohort) and their relatives such as family members, guardians, and carers (the Secondary Cohort). The Independent Review of Out of Home Care recommended that the dataset include information about the service requirements of the most vulnerable families. This recommendation has not been implemented to date. The Human Services Dataset does not contain records about the service interventions made by NGOs, and has minimal child protection and out of home care placement data.

DCJ’s package-based funding system has not been successful in tailoring services to children in out of home care

When a child is transferred to an NGO for out of home care services, DCJ provides the NGO with relevant funding packages to support the child. NGOs receive different funding packages according to the care needs of the child. Some packages relate to the placement of the child, whether it be a foster care placement, or an intensive therapeutic care placement for children with complex needs. Other packages relate to the permanency goals for each child. These goals can include restoring the child to their parents, establishing the child in long-term foster care, or supporting the child through an adoption process. Each funding package is based on an average cost for the different service type.

While the funding packages are attached to individual children, in practice, NGOs can allocate this funding flexibly. NGOs can integrate the funds from the packages into their global budgets and use the funds for a range of activities. The package-based system that was intended to deliver tailored services to individual children in out of home care, is not being implemented in the ways it was intended.

NGOs do not receive funding for administrative or management costs. They are not funded for supporting Children’s Court work, or the recruitment of new foster carers. NGOs calculate how much they need for these different activities, and use the required funds from funding packages and other sources of income.

DCJ does not collect data from NGOs to determine the nature of the services that were delivered to the child against the funding for each package. In fact, NGOs are not required to report on the expenditure of package funds in relation to any outcomes that relate to the child’s health, wellbeing, cultural, or educational needs.

An external evaluation of the permanency support package system was completed in 2023. It found that children receiving permanency support packages did not achieve better outcomes than children in a control group who did not receive them. This indicates that the package-based system has not achieved its objective to shift the out of home care system from a bed per night payment model, to a child-centred funding model, aimed at supporting safety, wellbeing, and permanency in out of home care.

DCJ’s contract arrangements for NGO funding are overly complex and administratively burdensome

NGO recipients of package-based funding must liaise with separate DCJ contract managers for the different types of funding packages they receive. Within each DCJ District, a range of contract managers have oversight of the different package types – including the packages for out of home care placements, and for the family preservation program. In addition, many NGOs have contracts in more than one DCJ District. This means that NGOs must liaise with a number of different contract managers and operational teams across different units in multiple DCJ Districts. NGOs advise that the time spent navigating the DCJ system reduces the time they can spend actively supporting children and families.

NGOs report that DCJ District personnel can vary in their preferred communication styles and channels. Some District staff prefer email contact, others prefer phone calls, and some prefer service requests that are entered into ChildStory. NGOs must adapt to these different styles depending on the District.

DCJ Districts also vary in the processes that NGOs must follow to have a child’s needs reassessed. This is a routine process, but some Districts take three months to consider and approve a reassessment, while others complete the process more rapidly. If a child is reassessed as requiring a higher category of support, DCJ does not back-pay any increased allowances. This is regardless of the time during which the NGO has provided the child with increased services. In these Districts, NGOs must carry the financial burden for the time it takes for re-assessment approval processes.

The NSW Procurement Policy Framework includes an objective of ‘easy to do business’. This includes a requirement to pay suppliers within specific timeframes, and recommends that government agencies should limit contract length and complexity.

An external evaluation of the package-based system found that that the funding packages are complex and administratively burdensome, and that DCJ Districts have different models and approaches to implementing them. As a result, a child and family living in one District could receive very different care from a child in another District. In 2023, DCJ advised that it is considering the recommendations of the evaluation with the aim of operationalising relevant system reforms, while not increasing the administrative burden on NGOs.

Exhibit 16 shows the multiple stages that NGOs must navigate in DCJ’s complex, contract environment.

DCJ’s case management system lacks an effective business to business interface with NGO partners, and has not produced data on key deliverables

DCJ’s case management system promised a single entry point for NGOs to interact with DCJ. In 2017, DCJ commenced the rollout of ChildStory, its new case management system, at a cost of more than $130 million. While the ChildStory system has become an important repository for information about children in the child protection system, it has failed to deliver on some of its key intended functionalities. ChildStory does not provide an integrated business to business system interface with commissioned NGOs where they can record information about children and families in their care.

Most of the ChildStory system is locked off to NGOs, meaning that NGOs cannot use it as a case management system. NGO personnel must enter data into their own client information systems before manually replicating any required data into the ChildStory system. Until June 2022, NGO staff lost access to ChildStory if they did not log onto the system for a three month period, and staff had to reapply for access, increasing the administrative burden on some NGO personnel.

The lack of an integrated business to business interface between DCJ’s ChildStory and the NGO case management systems, has vastly increased levels of administrative handling for all parties, and frequently results in mismatched data between DCJ and NGOs. The process for NGOs to correct data errors in ChildStory requires contact with DCJ, and the process can be protracted. NGOs advise that they spend significant time on complex data reconciliation processes and that these processes have financial implications. In some instances, NGOs are asked to repay contract ‘underspends’ as a result of DCJ data errors.

The lack of system interface between DCJ and NGOs has been a lost opportunity to produce and report NGO trend data on a wide range of metrics. While some data is manually entered by NGOs into ChildStory Partner, and some systemwide data produced, it is only available for a limited number of key performance indicators. For example, it was intended that ChildStory would be used to collect and collate information about the status and wellbeing of children. According to DCJ, this has not been possible, as the system does not have the functionality to collate data from questionnaires or instruments that assess child wellbeing.

Given that many of the smaller NGO data systems have limited sophistication and functionality, the failure of ChildStory to become a case management system for all NGOs, means they are not able to produce trend data on a wider range of metrics. The inability to collate key data from all NGO service providers limits the statewide data that is available for service planning.

Until 2022−2023, DCJ did not contribute all required data to a national, publicly-reported dataset on child protection. The Australian Institute for Health and Wellbeing (AIHW) collates data from Australian states and territories every year. Child protection information is published on the AIHW website and provided to the Productivity Commission for the annual Report on Government Services. Since 2014−2015, AIHW requested that all states and territories provide anonymised child-level data for reporting and research purposes. DCJ did not provide this requested child-level data until 2022−2023. In previous years, DCJ provided the AIHW with aggregated data tables that lacked some of the required information.

ChildStory has not been effective for the contract management of NGOs and commissioned services. The system cannot be used to report and generate information about NGO contract activity, nor can it be used to make payments to NGOs.

Caseworkers advise that they spend significant time updating the case management system, limiting the time they have for child and family visits

DCJ has not quantified the amount of time that staff spend entering information and updating records. While DCJ completed a time and motion study on caseworker activity in 2021, the study did not include information on the time it takes for caseworkers to enter data for individual tasks. The DCJ caseworkers who were interviewed for this audit, advised that they spend a large proportion of their total working week entering data into the case management system, rather than visiting families or providing phone support to families.

DCJ’s ChildStory system does not display all of the summary information that caseworkers need in order to be efficient and effective in their role. For example, triage caseworkers need to know when a report was made to the Helpline, in order to meet the statutory period for response of 28 days after the report was received. This information is not shown in the triage transfer list and is only visible by clicking into case notes for each child, one at a time.

ChildStory does not contain accurate information about decisions made by frontline staff. Caseworkers are required to choose a reason when they close a child protection case. Reasons can include that the family was referred to an external service. There is no field for a caseworker to indicate that a case was closed because the child protection report related to a person who was external to the family. ChildStory does not have a case closure field to record that the parents were protective in instances when a child was at risk from someone outside the home. These cases are closed with the reason ‘No capacity to allocate’, resulting in inaccurate management reporting. This incorrect record keeping can be problematic for the family. It can mean that if the child is re-reported, there may be unnecessary interventions by DCJ in future.

DCJ advises that ChildStory is not being used to its full functionality and that District DCJ Offices have created arrangements that increase the administrative burden on staff. For example, in some Districts before a caseworker can submit an approval request in ChildStory to the relevant Director, the caseworker must attach an email with the same Director’s written approval. DCJ managers advise that ChildStory is not being used in ways that would allow for efficient approvals of ‘out of guidelines’ expenses. It is not known whether this is a training deficit, or related to another matter.

Up until recently, DCJ’s information management system did not have functionality to record and collate information about the service needs of children and families. DCJ advises that in 2022, a referral function was added to ChildStory. While DCJ advise that this functionality is being used for referrals to family preservation services, there is no evidence that caseworkers are using the function, or that referral data is collated and reported. Prior to July 2022, decisions to refer a child or family to therapeutic services were recorded in individual ChildStory case notes, and could not be extracted and reported as trend data.

Some Districts have developed local monitoring systems to track vacancies in local family preservation and targeted early intervention services. These local initiatives go some way to improving the planning for child protection services responses at the local level, but they are yet to be systematised.

DCJ advises that it is developing a service vacancy dashboard and it is due to be rolled out to all Districts in late 2023. In order for service information to be visible to DCJ staff, NGO partner agencies will need to regularly update their service vacancy information in the dashboard. Initially DCJ will collect data on which families were referred to services, and NGOs will be expected to enter information on attendance at program sessions at a later date.

DCJ has management reporting systems to track activity and outputs for child protection work, however some key metrics are missing

DCJ’s interactive internal dashboards effectively report against an agreed performance framework that measures caseworker activity. This provides DCJ managers with caseworker progress against targets such as seeing new children and families within specified timeframes. Managers can drill into the dashboard data to see individual cases and the caseworkers behind the numbers. This assists managers in allocating new cases to their frontline staff. While DCJ managers advise that they use the dashboards on a daily or weekly basis, they raised concerns that dashboards did not account for staff vacancies or new recruits who cannot carry a full caseload.

DCJ dashboards do not allow managers to focus on groups of children who are at greater risk of harm, or on children who require a tailored service. This limits the effectiveness of DCJ’s response. While Aboriginal children are identified on most internal dashboards, there are gaps in the identification of Aboriginal children, especially at the early Helpline assessments of child protection reports and at the initial caseworker assessment of child safety and risk. There is no indication in DCJ’s system to show whether a family has experienced intergenerational removal, despite these families needing a specific trauma-informed response. Children from Culturally and Linguistically Diverse (CALD) backgrounds are not reported clearly on dashboards and refugee children are not flagged.

Children and parents with disability are not identified accurately in ChildStory and are not reported on dashboards. The Disability Royal Commission found that parents with disability are over-represented in all stages of the child protection system, and that they are more likely to have their children removed from their care. The Commission found that child protection agencies are less likely to try to place children back in the care of parents with disability.

DCJ data is stored in a Corporate Information Warehouse, which combines child protection data and data about children in out of home care. This information is sourced from ChildStory. The Corporate Information Warehouse also includes staffing data, and contract management data from the Contracting Online Management System. The Warehouse is updated every night to ensure that management reports and dashboards are current. However, some key datasets are not included in the Warehouse, such as the Helpline report backlog, which means that the DCJ Executive does not have easy visibility of Helpline workload or delays in responding to electronic reports.

DCJ’s external dashboards provide limited public transparency about child protection and out of home care activity. Until early 2024 the dashboards did not show the numbers of children in emergency out of home care. In addition, the main quarterly and annual dashboards do not show the average time that children have been in out of home care. 

External reporting is managed by DCJ’s Insights Analysis and Research directorate, known as FACSIAR. In addition to quarterly and annual dashboards reporting key statistics, FACSIAR hosts monthly seminars presenting research findings aimed at improving caseworker practice. The seminars are well attended by DCJ and NGO caseworkers. FACSIAR also maintains a public evidence hub summarising research papers and evaluations.

While regular quantitative data is necessary for day-to-day management purposes, it is not sufficient to understand the experience and outcomes of children in out of home care. In order to deliver additional insights, DCJ has invested in a long-term study of children in out of home care through the Pathways of Care Longitudinal Study. This study follows children who entered care in NSW for the first time between May 2010 and October 2011 and includes data from external sources such as Medicare data, health and education records, and youth offending data. DCJ has used this data for research studies on topics such as outcomes for children with disability in out of home care, and to assist caseworkers in working with children and families through Evidence to Action notes.

DCJ’s system for requesting out of home care placements is ineffective, resulting in multiple unsuccessful requests to NGOs to place children

DCJ does not have a centralised system where its NGO service providers can indicate that they are able to take on new children requiring out of home care. There are almost 50 providers of out of home care services across the State, but no consolidated database showing that there are foster carers who are able to take on new children by location.

DCJ uses a system (known as the broadcast system) to notify NGOs that it needs a foster care placement or another placement type for a child. The number of placement broadcasts has increased from around 450 per month in 2018–2019, to over 1200 per month in 2022–2023, even though the number of children in out of home care has not risen during this timeframe.

Exhibit 17 shows the monthly numbers of children that were ‘broadcast’ to NGOs as requiring out of home care placements from July 2018 to June 2023.

Appendix one – Response from entities

Appendix two – DCJ Organisational Structure for Child Protection

Appendix three – Child protection flowchart from Family is culture review report 2019

Appendix four – About the audit

Appendix five – Performance auditing

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Parliamentary reference - Report number #394 - released 6 June 2024

Schools collect and maintain detailed student data, including sensitive personal information. Schools can also require or encourage students, parents and carers to use third party software applications for learning and other school related activities. This audit will consider how effectively schools ensure student data is secure within their own systems and when provided to third or fourth parties.

What this report is about 

This report assesses how effectively SafeWork NSW, a part of the Department of Customer Service (DCS), has performed its regulatory compliance functions for work health and safety in New South Wales. 

The report includes a case study examining SafeWork NSW's management of a project to develop a real-time monitoring device for airborne silica in workplaces. 

Findings 

There is limited transparency about SafeWork NSW's effectiveness as a regulator. The limited performance information that is available is either subsumed within DCS reporting (or other sources) and is focused on activity, not outcomes. 

As a work health and safety (WHS) regulator, SafeWork NSW lacks an effective strategic and data-driven approach to respond to emerging WHS risks. 

It was slow to respond to the risk of respirable crystalline silica in manufactured stone. 

SafeWork NSW is constrained by an information management system that is over 20 years old and has passed its effective useful life. 

While it has invested effort into ensuring consistent regulatory decisions, SafeWork NSW needs to maintain a focus on this objective, including by ensuring that there is a comprehensive approach to quality assurance. 

SafeWork NSW's engagement of a commercial partner to develop a real-time silica monitoring device did not comply with key procurement obligations. 

There was ineffective governance and process to address important concerns about the accuracy of the real-time silica monitoring device. 

As such, SafeWork NSW did not adequately manage potential WHS risks. 

Recommendations 

The report recommended that DCS should: 

• ensure there is an independent investigation into the procurement of the research partner for the real-time silica detector 
• embed a formal process to review and set its annual regulatory priorities 
• publish a consolidated performance report 
• set long-term priorities, including for workforce planning and technology uplift 
• improve its use of data, and start work to replace its existing complaints handling system 
• review its risk culture and its risk management framework 
• review the quality assurance measures that support consistent regulatory decisions

SafeWork NSW is the work health and safety regulator in New South Wales. It was established by the State Insurance and Care Governance Act 2015.

As the regulator, SafeWork NSW is responsible for, among other things, enforcing compliance with the Work Health and Safety Act 2011 (the WHS Act) and the Work Health and Safety Regulation 2017. The regulator’s full functions are set out in section 152 of the WHS Act.

SafeWork NSW’s operations are guided by seven regulatory priorities for 2023, which contribute to three strategic outcomes:

• Workers understand their rights and responsibilities.
• Employers ensure that work is healthy and safe, with no advantage for cutting corners.
• Regulation is fair and efficient.

This audit assesses the effectiveness of SafeWork NSW in monitoring and enforcing compliance with the WHS Act, through the examination of three lines of inquiry:

1. Does SafeWork NSW have evidence-based processes to set its objectives and priorities for monitoring and enforcing compliance?
2. How effectively does SafeWork NSW measure and report its performance in monitoring and enforcing compliance against the WHS Act?
3. Are SafeWork NSW's policies and procedures for monitoring and enforcing compliance applied consistency across different sectors?

As SafeWork NSW is part of the NSW Department of Customer Service (DCS), the department is the auditee. Prior to 2019, SafeWork NSW was located in the former Department of Finance, Services and Innovation. Unless otherwise stated, any reference to SafeWork NSW should be read as including the broader department in which it sits.

This chapter considers whether SafeWork NSW has evidence-based processes to set its objectives and priorities, including how it takes into account operational feedback and expertise. It also includes how existing and emerging risks are assessed as part of the priority-setting process, and how planning and prioritisation takes into account resourcing, including workforce skills and capacity.

SafeWork NSW's operating model is now based on annual regulatory priorities, rather than longer-term priorities

From 2016 to 2022, SafeWork NSW worked under a six-year Work Health and Safety Roadmap (‘the Roadmap’). The Roadmap was revised in August 2018 and included the following statements:

In addition to the Roadmap, SafeWork NSW operated under its 2019–20 Strategic Business Plan.

After SafeWork NSW was moved into DCS, the Roadmap was subject to a mid-term evaluation by ARTD Consultants in 2020. SafeWork NSW management subsequently accepted all nine recommendations of that mid-term evaluation, which included the following:

• Strengthen business intelligence data systems to allow managers and inspectors to access to real-time data on safety incidents and workers compensation claim data (Rec 5).
• Improve evidence available to assess Roadmap outcomes in 2022 (Rec 9).

In 2023, SafeWork NSW replaced its six-year Roadmap with a model of setting annual regulatory priorities. Seven regulatory priorities were set for 2023. These priorities were:

•  gig economy – increase safety and WHS compliance in the sector, particularly food delivery riders and health care
• safety around moving plant – reduce workplace safety incidents, particularly forklifts
• seasonal workplaces – increase WHS compliance to support itinerant workers, particularly in the agricultural sector and those working with amusement devices
• psychological safety – reduce the prevalence of psychological injury at workplaces, with a focus on mental health and well being
• respect at work – reduce the incidence of bullying, sexual harassment, and customer aggression in the workplace, particularly in make dominated sectors and healthcare
• exposure to harmful substances – reduce the incidence of worker exposure to dangerous substances in the workplace, particularly silica and dangerous chemicals
• falls – reduce the incidence of falls from heights with a particular focus on construction.

These priorities are intended 'to deliver on three strategic outcomes’:

• Workers understand their rights and responsibilities.
• Employers ensure that work is healthy and safe, with no advantage for cutting corners.
• Regulation is efficient and fair.

As SafeWork NSW works to deliver on these outcomes, the focus is on priority or vulnerable groups of workers – these being younger workers, workers from culturally and linguistically diverse backgrounds (especially newly arrived workers), and Aboriginal people.

Shorter-term priorities are intended to enable SafeWork NSW to be more responsive to work health and safety risks and were developed in consultation with operational staff

The adoption of shorter-term priority-setting is intended to enable a more agile approach to regulation that, according to DCS, is better able to adapt to changes in risk profiles and industries. It was put to the audit by some interviewees that the six-year plan was less able to respond to rapid changes in the economy that may lead to quickly emerging work health safety risks. An example commonly cited was the significant increase in gig economy workers, including in areas such as food delivery workers and personal care workers. It was put to the audit that this example highlighted new WHS risks unique to those emerging workplaces.

According to DCS, in addition to being more agile and responsive to macro changes in the workforce, the annual priorities are intended to enhance accountability by creating a more timely and contemporaneous link between activities and outcomes. The more immediate nature of annual priorities is also designed to provide a more immediate and tangible link to SafeWork NSW’s activities and ensure better accountability for delivery.

The annual priorities are intended to complement SafeWork NSW’s commitments under the national Australian Work Health and Safety Strategy 2023-33. This strategy sets a high-level vision and goal for Australia’s work health and safety regulators, including to address agreed persistent challenges, such as psychosocial risks, vulnerable workers, and ensuring that small businesses are adequately supported to meet their work health and safety obligations.

The process for developing regulatory priorities for 2023 involved internal consultation with SafeWork NSW executive directors, directors, managers, inspectors, project leads, as well as consultation with external stakeholders and experts. There is evidence that SafeWork NSW considered the feedback it received, including from its inspectors.

SafeWork NSW staff identified potential risks that SafeWork NSW will need to manage as the process for developing regulatory priorities continues to develop

The audit team interviewed almost all SafeWork NSW executive directors, directors, and team managers, particularly those performing regulatory functions. These interviews revealed a strong level of commitment to the purpose and functions of SafeWork NSW, as well as a shared desire to see the organisation fulfil its potential.

In regard to the annual priorities, senior executives and the majority of team managers we interviewed supported the adoption of annual priorities and expressed confidence that establishing annual priorities would improve the effectiveness of SafeWork NSW in delivering its compliance functions. It was noted by SafeWork NSW that the shift towards regulatory priorities 'brings us to a level of maturity mirroring the approach of regulators such as ASIC and the ACCC'.

While most staff interviewed during this audit welcomed the sharper focus and greater flexibility afforded by shorter-term priorities, others identified a range of risks. Some experienced people managers in SafeWork NSW expressed significant doubts about the pursuit of annual regulatory priorities. Risks identified during audit interviews included:

• That the short-term focus had prevented SafeWork NSW from establishing a longer-term goal or vision.
• That the annual priorities were simplistic and lacked sufficient detail to engage the regulator, industry, and the community.
• That short-term priorities would make it difficult to meaningfully measure and report progress, especially for activities and initiatives that may take longer to achieve demonstratable change.
• That the process of considering the next annual priorities may need to commence well before initiatives for the current year have been completed (or even commenced), hindering how effectively lessons can be incorporated into future planning.
• That frequent changes in regulatory priorities may make it difficult to ensure that the SafeWork NSW workforce has appropriate capability and capacity, particularly for potentially complex emerging threats such as artificial intelligence in workplaces.

In response to these risks, SafeWork NSW has noted that:

• SafeWork NSW has a separate vision in addition to the regulatory priorities. This is 'healthy, safe and productive working lives'.
• A review process will occur to understand what went well and what did not from the first year of regulatory priorities before finalising priorities for 2024.
• Planning will improve over time as the process reoccurs, and lessons learned will be linked to future priorities.

The inability to achieve full ‘buy-in’ from experienced people managers in SafeWork NSW suggests that change management, including consultative and communication processes, has not been completely successful. SafeWork NSW advised that this initiative was a significant shift for all its staff and in particular middle management. Given this, the leadership of SafeWork NSW should prioritise investment in effective change management processes, especially if the annual regulatory priorities are anticipated to change in 2024.

Importantly, the SafeWork NSW leadership team should undertake strategic planning to ensure that a meaningful set of longer-term priorities underpin their investment decision-making on organisational fundamentals, such as a capable and sustainable workforce and fit-for purpose technology systems. Without this, there is a real risk that the regulator's business needs and priorities will be overtaken by the priorities of a much bigger department.

SafeWork NSW consulted with external stakeholders in determining its 2023 annual regulatory priorities

SafeWork NSW developed a discussion paper in 2022 for external stakeholders as a precursor to consultation on its 2023 annual priorities. This discussion paper outlined an intent by SafeWork NSW to develop a new strategy that would prioritise activities that were the biggest points of leverage to drive material change and were the biggest risks and most important trends affecting WHS in NSW.

SafeWork NSW considered expert feedback and expertise in the development of its regulatory priorities through this process. A summary document detailing the rationale for its regulatory priorities provides evidence that feedback from external stakeholders, such as unions and industry groups, were taken into account.

SafeWork NSW has not established a formal process for determining its regulatory priorities for 2024 and beyond

SafeWork NSW has an indicative timeline for preparing its 2024 priorities which provides that the priorities will not be settled until March 2024 and will be based on the results of the previous year’s priorities to December 2023. However, no ongoing process for determining annual priorities in each future year was settled at the time of writing this report. Some priorities might be expected to remain relatively constant, especially persistent challenges such as preventing falls from heights. However, if the annual priorities model is to meet the expectation of being agile, then new and emerging priorities will need to be identified, understood, scoped, and responded to with relatively short notice.

Elements of the 2023 regulatory priorities will overlap with any new or revised priorities, such as the monitoring and evaluation framework, and the three-year Construction Services Blueprint. SafeWork NSW explains that these longer-term initiatives are 'intended to support the delivery of priorities that are likely to run over many years, providing more granular detail on specific drivers of harm, regulatory responses and targets'.

SafeWork NSW does not effectively use data to inform its priority-setting or assessment of risk, despite adopting the recommendations from the 2020 mid-term Roadmap evaluation

SafeWork NSW states that it chose its regulatory priorities in 2023 based on the following factors - potential for serious harm or death, new or emerging risks, and increases in the frequency of an issue. An emerging issue is where:

SafeWork NSW has a substantial data repository, with over 20 years of case and activity data contained in its Workplace Services Management System (WSMS). However, SafeWork NSW does not effectively interrogate this data to provide an evidence base for its regulatory functions.

SafeWork NSW has only recently established a data governance committee. SafeWork NSW also advised that a data science function was created within the Centre for Work Health and Safety during 2023, repurposing existing resources and supported by a business intelligence working group comprising of inspector representatives from operational directorates.

While this data science function is newly created, SafeWork NSW does not have a strategic business intelligence function that is both recognised and understood across each directorate and team, and the ability of its technology infrastructure to deliver sophisticated strategic and operational data intelligence has been limited.

As a result of this lack of central coordination and capability, directorates have sought to develop their own data analysis capability, with inconsistent, fragmented and potentially duplicative results. The audit did find specific (albeit isolated) examples of data being used to inform decision-making, though these efforts were disparate and uncoordinated at the directorate level.

SafeWork NSW said that data is used to inform leadership discussions at the quarterly SafeWork NSW Leadership Meetings, and monthly operational executive meetings. The audit did not review the agenda papers for these meetings.

At the 2020–21 NSW Parliament Budget Estimates Committee hearing, SafeWork NSW stated that it:

SafeWork NSW has started to use artificial intelligence to interrogate historical compliance data to rate the risk of different employers. However, this is used inconsistently across SafeWork NSW and there is limited evidence about its effectiveness. A similar tool does not exist for industry or product-related trends or relationships that may assist SafeWork to proactively identify high-risk workplaces and issues.

Outdated technology and uncertainty in planning its replacement is limiting SafeWork NSW's ability to effectively use its data for analytics and insights

SafeWork NSW uses WSMS to manage work health and safety data. This system has been in place for over 20 years. It was noted in interviews conducted during this audit that this data system is at the end of its effective life.

Issues noted by users of WSMS include:

The lack of governance associated with data management of WSMS. There is no data custodian, and a formalised data quality assurance process does not exist. This means that data can be extracted from the system with no controls on the accuracy of the analysis.

Access to WSMS cannot be tracked (and is therefore not auditable).

• Data quality is variable, depending on the quality of notes provided by inspectors (with individuals noting that these notes could be full of speculation), and inconsistent approaches to entering information into the system. At the same time, inspectors noted that entering information into the system can be an administrative burden due to duplication and time requirements.
• Analysis cannot readily be undertaken on a geographic basis (for example, all high-risk employers within a particular region).
• As WSMS does not track information about the directors of companies, it is unable to identify risks associated with 'phoenixing', where directors of wound-up businesses establish new entities, or other forms of related-entity risk. The audit team linked WSMS data with ASIC data to match company directors with company and notice data. This was done in order to understand the additional intelligence that could be used to inform risk-based decision-making. As an example, the audit found that there is a large number of companies that have not received notices from SafeWork NSW but may be at higher risk due to the conduct of their directors:
  • There were approximately 151,000 companies with directors that were also linked to at least one other company that had received at least one type of notice from SafeWork NSW.
  • There were approximately 24,500 companies with directors that were also linked to one or more companies that had cumulatively received over 100 notices from SafeWork NSW.
  • There were approximately 8,600 companies with directors that were also linked to one or more other companies that had cumulatively received over 400 notices from SafeWork NSW.

In addition to the feedback provided by WSMS users within SafeWork NSW, the audit team also found related data quality issues during the course of our own analysis, including:

•  Industry analysis is more challenging to perform because specific industry data points and grouping details are not captured in WSMS.
• There was no systematic method to identify all silica-related incidents. The search terms were not standardised and relied on judgement, for example: ‘silic’ (potentially capturing both ‘silica’ and ‘silicosis’) and ‘benchtop’, though SafeWork NSW advised that consultation with subject matter experts informed these searches. There is a high-risk of false positives and incomplete analysis without time intensive manual review of each identified case. WSMS was not readily able to provide data on silica-related complaints without workarounds and manual file review (which proved unreliable) and requiring significant effort from data staff in both the Audit Office and SafeWork NSW.
• Test data is captured in production systems, rather than in test systems. These records do not have a unique identifier and are difficult to identify and isolate for business intelligence analysis.
• Data validations are not enforced (for example, on Australian Business Number, Australian Company Number columns). Instead, the data entry fields allow for incorrect details to be captured or left blank without explanation from the staff entering the data.

SafeWork NSW provided advice to the audit team that an upgrade of WSMS was planned as part of the broader e-regulation program across DCS (that is, the single digital platform for all 28 business regulators). However, this upgrade is now uncertain as there is no funding for SafeWork NSW to be onboarded to the new platform. This means that for the foreseeable future SafeWork NSW will be constrained by the limitations inherent to WSMS.

SafeWork NSW took around eight years to actively and sufficiently respond to the emerging risk of respirable crystalline silica in manufactured stone

Silicosis is a progressive, occupational lung disease resulting from inhalation of respirable crystalline silica (RCS). Silicosis is one of the oldest known occupational diseases, particularly affecting industries like mining. In Australia, silicosis has been a known cause of death and disability for over 100 years. This disease is preventable through appropriate workplace practices in a hierarchy of controls, which includes the use of correct personal protective equipment.

The use of manufactured stone for applications such as kitchen benchtops became popular in Australia in the early 2000s. Other substances that contain silica, such as rock, stone, clay, gravel, concrete and brick, may contain between 2% and 40% silica. In contrast, manufactured stone contains up to 95% silica. Workers exposed to respirable crystalline silica from manufactured stone are more likely to develop severe silicosis (and other serious lung diseases), and more quickly, than workers exposed to silica from other sources.

In 2010, international research was published that pointed to the specific heightened risk posed by the high silica content of manufactured stone used primarily for kitchen countertops and bathroom fixtures. This was confirmed by subsequent research published in 2012, which concluded that, in regard to a documented outbreak of silicosis among manufactured stone workers in Israel:

This research was relevant to Australia as the sample of workers was derived from the same Israeli-based manufacturer and exporter of manufactured stone that supplies the majority of the product used in Australia.

The first identified group of related workers who contracted silicosis in NSW was reported in literature in 2015. Further cases have been reported in the media since 2015. These included examples of relatively young workers developing silicosis, presumptively from inhaling silica dust derived from manufactured stone.

In 2017, SafeWork NSW listed RCS as one of the top ten priority chemicals in its 2017–2022 Hazardous Chemicals and Materials Exposures Baseline and Reduction Strategy (dated October 2017).

A legislatively-mandated case finding study conducted by SafeWork NSW in 2021³ reported that screening conducted by icare between 2017–18 and 2019–20 found an average of 29 cases per year of silicosis among workers in the manufactured stone industry.⁴ Despite the relatively small size of this workforce, this was three times the number of cases of all workers engaged in all other at-risk industries.

While the heightened risk posed by respirable crystalline silica in manufactured stone was first published in research in 2010 and detected in cases from 2015, SafeWork NSW’s first substantial practical response commenced in 2018–19.

From July 2018, SafeWork NSW convened a Manufactured Stone Industry Taskforce, including representatives from industry, unions, health, education and other government agencies. During the term of this taskforce (which ended at 30 June 2019), SafeWork NSW conducted 523 visits to 246 manufactured stone sites. These inspections resulted in 656 improvement notices being issued, along with 43 prohibition notices (this included matters not related to silica). Prior to this, the extent of SafeWork NSW’s active response to the emerging risk was to conduct a limited inspection program of six work sites in May 2017 (one site) and August 2017 (five sites). The results of these six workplace visits were incorporated into a research project report that was finalised in August 2018.

In the period from 2012 to 2018, SafeWork NSW also received complaints about silica-related matters, including matters not related to manufactured stone. These are detailed in Exhibit 1 below. The number of complaints was a relatively small proportion of all complaints received, though the number increased after 2018. This increase may be a result of increased community and industry awareness through media reporting and SafeWork NSW’s proactive audit work.⁵ The majority of these complaints did not result in further regulatory action by SafeWork NSW beyond preliminary inquiries and, in some cases, site visits. The right-hand column of the below table shows key events leading up to and shortly after SafeWork NSW’s first regulatory interventions.

*         2023 data are to 30 November 2023.
Note: Complaints received by SafeWork NSW where the issue description includes ‘silic*’ or ‘benchtop’. This will include silica derived from sources other than manufactured stone, including relating to those products listed in the Safe Work Australia 2020 national guide.
Source: Audit Office analysis of WSMS data.

High-profile media reporting in 2018, 2021, and early 2023 appeared to provide impetus to SafeWork NSW’s regulatory actions. SafeWork NSW subsequently conducted further rounds of proactive compliance, education and awareness activities among identified workplaces. This work increasingly targeted high-risk workplaces. Since 2018–19, SafeWork NSW has conducted three rounds of workplace inspections that have progressively focused on the highest risk workplaces. This program has adopted a strategic and evidence-based approach.

Since October 2019, 17 matters were progressed to further investigation with a view to prosecution. Five silica-related matters have been filed in court for prosecution. Three of these matters were still in court at the time of this audit, and two matters have been finalised.

In 2020, NSW introduced a range of legislative reforms including:

• Banning the practice of dry cutting engineered stone containing crystalline silica. Maximum penalty of $30,000 for a body corporate and $6,000 for an individual, with on-the-spot fines for uncontrolled dry processing of engineered stone.
• Halving the Workplace Exposure Standard from 0.1mg/m3 to 0.05 mg/m3 (ahead of the national deadline to implement it).
• Silicosis becoming a notifiable disease requiring clinicians to report each case of silicosis diagnosed in NSW. Those notifications are shared with SafeWork NSW to manage a NSW Dust Disease Register. An annual report is tabled in Parliament and published on the NSW Government website www.nsw.gov.au (NSW Silica Dashboard) alongside some information on compliance activities.
• On 27 October 2020, silicosis became a notifiable disease requiring clinicians to report each case of silicosis diagnosed in NSW. Those notifications are shared with SafeWork NSW to manage a NSW Dust Disease Register. In August 2021, SafeWork NSW published the first NSW Dust Disease Register Annual Report, detailing diagnosed cases of silicosis, asbestosis, and mesothelioma in NSW during 2020–21 and the Case Finding Study Report on silica exposure in the Manufactured Stone Industry. The Annual Report is tabled in Parliament and published on the NSW Government website www.nsw.gov.au (NSW Silica Dashboard) alongside some information on compliance activities.

Also in 2020, SafeWork NSW released the NSW Dust Strategy 2020-2022, which identified silica as one of three focus areas for the regulator.

In February 2022, New South Wales introduced the NSW Code of Practice – Managing the risks of respirable crystalline silica from engineered stone in the workplace, based on the National Model Code that was finalised in late 2021. The Code provides practical information on how to manage health and safety risks associated with respirable crystalline silica from engineered stone in the workplace.

Silica continues to be a priority for SafeWork NSW in 2023 under the SafeWork NSW regulatory priority: Exposure to harmful substances - Reduce the incidence of worker exposure to dangerous substances in the workplace, particularly silica and dangerous chemicals.

The online NSW Silica Dashboard provides members of the public with information on SafeWork NSW’s silica workplace visit program that commenced in 2018 through to 30 September 2023.

Organisational silos within SafeWork NSW contribute to inconsistent regulatory decision-making, duplication of effort, and inefficient practices

There is evidence indicating that SafeWork NSW works in silos, with limited communication, collaboration, and awareness of activities across functions.

We note the finding made by the South Australian Independent Commission Against Corruption in reviewing SafeWork SA:

The existence of silos was evidenced by the audit team through:

• The inconsistent application of policies and procedures. For example, performance management practices differ between directorates and individual teams. This is further discussed in Chapter 4.
• How data is used across SafeWork NSW. While there are pockets of effective data analysis, they often seem to operate in isolation from each other, resulting in duplication and a failure to achieve economies of scale and the benefits of synergies.
• Limited feedback loops across SafeWork NSW. SafeWork NSW does not have an overarching continuous improvement framework, and communication surrounding decision-making is limited. For example, where the Investigations and Emergency Response team decide to discontinue an investigation, there is no requirement to inform the referring inspector that this has occurred, or the rationale behind the decision.

Similar findings on the existence of silos, and the need to improve teamwork and collaboration, have been made by SafeWork NSW in internal reviews undertaken as part of restructuring activities.

This audit also found broader issues of concern regarding organisational structure. SafeWork NSW staff frequently expressed reservations about the effectiveness of the current structure and compared it unfavourably to the regulator’s previous form. In particular, some SafeWork NSW staff said that the existing structure:

• reduced SafeWork NSW’s profile as the regulator for work health and safety in NSW
• confused lines of accountability for senior strategic leadership
• diluted the regulator’s focus and the cohesion of the staff.

The Independent Review of SafeWork NSW being conducted by Mr Robert McDougall KC is examining organisational structural issues. In the interim, the decision has been made by DCS that SafeWork NSW will transition out of the Better Regulation Division of DCS from 1 December 2023, to become a standalone division within DCS.

Organisational restructuring and any uncertainty that it involves in the short- to medium-term could impact on the SafeWork NSW's progress in achieving desired policy outcomes, especially if the change management process is not effective.

The lack of a strategic approach to data and intelligence by SafeWork NSW hampers effective targeting and prioritisation of proactive compliance activity

Effective proactive compliance work is an important part of an effective regulatory approach. For SafeWork NSW, these activities range from dedicated state-wide programs over extended periods through to specific, localised ‘blitzes’ of targeted workplaces. These activities are performed alongside 'reactive compliance activities' such as responding to incidents, complaints, or requests by ‘persons conducting a business or undertaking’ (PCBUs) for education and awareness-building activities.

In accordance with Safe Work Australia’s National Compliance and Enforcement Policy, proactive compliance activities are intended to be:

SafeWork NSW’s proactive compliance activity is intended to be based on:

• SafeWork NSW’s annual regulatory priorities
• data and insights on high-risk harms, industries or businesses
• the identification of new or emerging risks
• targeted programs focused on reducing the greatest harms.

As discussed earlier in this section, SafeWork NSW does not effectively use data to inform priorities or to assess risk.

While managers at SafeWork NSW referred to an overall target for proactive work (it was commonly suggested that between 60% and 70% of regulatory activities should be proactive), we were informed by the Head of SafeWork NSW (and Deputy Secretary of the Better Regulation Division) that there was no specific target.

In practice, there is significant variation in the mix of proactive and reactive compliance activities between directorates and teams, with some teams doing either largely proactive or largely reactive activities. This can depend on the nature of the industry sectors and geographic areas in which they function, and the extent of teams’ non-discretionary reactive workload.

Planning, implementing and evaluating proactive compliance work is inconsistently done across SafeWork NSW, making it hard to assess whether resources are being used effectively

The audit team found widely differing approaches to how directorates and even individual teams within the same directorate used evidence to identify and target risk areas for proactive work programs, such as blitzes. While there was evidence that data was used to inform how activities would be targeted, this was not consistent. For example, some teams draw on intelligence generated by dedicated interventions staff in their directorates, while others rely entirely on opportunistically identifying potential worksites for proactive work by driving or walking past sites. The audit found examples of effective use of data and intelligence to plan proactive activities.

There is also no consistent approach to planning, implementing, or evaluating proactive compliance work across SafeWork NSW. Even within the same directorate, there can be significant differences in approach. Some of these differences can be explained by the different types of matters and circumstances that apply to PCBUs across different industries. However, inconsistencies extended to fundamental aspects of proactive compliance work such as:

• the rigour of evidence and intelligence by which priorities are determined and targeted, which was partly reflected by directorates having different levels of internal data capability
• the degree of project management capability and resourcing, including where some directorates have dedicated specialist project management skills, while others rely on inspectors to perform project management
• the extent to which different directorates and teams had a clear approach to how programs would be evaluated, beyond simply measuring activity, something which appears undermined by the absence of an evaluation framework
• whether the strategic intent of programs and blitz activities are to drive meaningful behavioural change or just, as some interviewees expressed it, to ‘make sure they tick some boxes.’

These material differences and lack of consistency in approaches to proactive compliance makes it difficult to assess whether these activities are effective and efficient regulatory interventions. While there was strong support for proactive compliance activity among both managers and inspectors (indeed, most thought that there should be more proactive activity), there were relatively few who could provide an evidence base to justify the significant staff resources that they consume.

The Centre for Work Health and Safety has a function to improve data, research, and evidence to support risk identification

The Centre for Work Health and Safety (CWHS), a functional unit within SafeWork NSW, was established in December 2017 under the WHS Roadmap 2016-2022. Among other things, it has an insights and analytics function. Its establishment was driven by the recognition that SafeWork NSW was not effectively using data and evidence to support its decision-making and activities.

Two pieces of work undertaken by the CWHS are intended to provide SafeWork NSW with greater capability in identifying and addressing risk in both strategic and operational contexts.

First, the WHS Radar project is intended to deliver ‘…regular and actionable insights about WHS in an Australian context.’ Conducted twice a year, the WHS Radar synthesises information about work health and safety by drawing on five sources of evidence:

• existing data, including incidents, worker’s compensation, ABS, and prosecutions
• analysis of grey literature (non-peer reviewed sources, such as government reports, some conference papers, and reports from academic, business and industry bodies)
• social media listening
• nationwide survey of WHS inspectors and experts
• nationwide survey of Australian workers across all industries.

The WHS Radar is intended to reduce the extent to which SafeWork NSW is dependent on lag data, by actively collecting more contemporaneous data from multiple sources. The first WHS Radar report was released publicly in April 2023.

A second piece of work delivered by the CWHS is the WHS Risk Rating tool for a PCBU.⁶ This tool attributes a rating to many businesses in NSW based on assessment of their future risk of non-compliance with WHS legislation. The WHS Risk Rating is intended to:

• support existing SafeWork NSW Triage decision-making
• support IDMP decision-making
• select high-risk profiles during blitz operations
• proactively screen and target high-risk profiles.

While some managers in SafeWork NSW did use the WHS Risk Rating tool, others were less confident in its value, expressing doubts about the accuracy and completeness of the data, or were not aware of it at all. These inconsistent views between different managers and directors, between those who use the WHS Risk Rating tool and those who do not use it or do not even have awareness about it, suggests that its purpose and functionalities have not been fully communicated to the wider inspectorate.

The governance of the CWHS, and particularly its relationship to SafeWork NSW, is somewhat unclear. While the Centre sits under the Executive Director, Regulatory Engagement, it identifies on its website as ‘A division of the Department of Customer Service’. Structurally, it is equivalent to a directorate under the Regulatory Engagement business area of SafeWork NSW, rather than a division of the department.

SafeWork NSW's inspectors are its core asset, and its ability to recruit, train and retain inspectors is key to fully performing its functions and meeting the internationally recognised benchmark

SafeWork NSW is funded to fully operate with up to 370 inspectors, though with 352 inspectors at August 2023 it has not recruited to full capacity.

Staff retention within the inspectorate has been a historic strength of the regulator. However, there has been a recent increase in inspector turnover. SafeWork NSW notes that from 2020 to 2022 attrition rates doubled from 5.3% to 10.6% within the inspectorate, which – due to the average age of its workers – was anticipated. Nearly one-third of inspectors were 56 years or older in the 2021–22 financial year. SafeWork NSW also experienced a general increase in resignations since the COVID-19 pandemic.

Increased recruitment activity is intended to mitigate the impact of ongoing attrition due to retirement. However, given the training requirements for new inspectors, there is a significant lag time between recruitment and the utility of inspectors in the field to progress regulatory priorities. SafeWork NSW notes however that inspectors receive authorisations to use their powers throughout the 12-month training period, with individuals assessed at a number of stages based on individual competence.

Where there have been capacity limitations, there have been localised responses such as the sharing of inspectors between teams, or the change in resourcing profile of investigations where instead of one inspector working on a case, a case is assigned to a team.

The International Labour Organization sets a benchmark of one labour inspector per 10,000 workers in industrial market economies. This benchmark is considered the number of inspectors deemed sufficient to ensure the effective discharge of the duties of the inspectorate. In October 2022, SafeWork NSW reported at the Parliamentary Budget Estimates Committee hearings that recruiting the full contingent of 370 inspectors would have meant that there was one SafeWork NSW inspector for every 10,000 workers, allowing it to meet this benchmark.

SafeWork NSW provided advice to the audit team that forecast increases in the number of workers and workplaces in New South Wales will result in 471 inspectors being required to meet the International Labour Organization benchmark by 2027.

SafeWork NSW inspectors can take up to two years to be considered ready to be fully utilised, due to training requirements and variations in their experience

Once recruitment is completed and new inspectors commence employment, they will start the New Inspector Training Program (NITP). The NITP is a 12-month comprehensive training program which prepares new Inspectors to perform the duties required of an Inspector within SafeWork NSW as well as providing training and assessment required for the PSP50116 Diploma of Government (Workplace Inspection) qualification. Inspectors will be fully trained after 12 months.

They will be issued with their instrument of appointment (authorities) to use their powers throughout the 12 month course. However it was noted throughout interviews with the inspectorate that it can take up to two years for new inspectors to be deployed in the field on their own and confidently making decisions. SafeWork NSW notes that the level of mentoring and support provided to individual inspectors, and access to a variety of experiences to build a range of skills contributes to variations in new inspectors building their confidence.

SafeWork NSW also provides:

• a structured framework for new inspector onboarding and capacity-building, including in May 2023 formalising requirements for accompanied field visits, and delivering the NITP, delivered by the SafeWork NSW Registered Training Organisation (RTO) and utilising experienced inspectors from across the directorate to deliver training across the 12-month period
• a SafeWork NSW Inspectorate and Manager Continuing Professional Development Program Policy
• formal processes for Inspectorate Continuing Professional Development and Manager Continuing Professional Development, including recognition of prior learning through credit transfer from other registered training organisations
• a formalised procedure for inspectors to progress to senior inspector and principal inspector.

While it was beyond the scope of this audit to assess the effectiveness of this training and capability development framework, it was recognised by interviewees that the commitment of time and resources provided by SafeWork NSW to training inspectors was significant. This underscores the importance of ensuring the effective use of inspectors.

There are inconsistent expectations around the responsibilities of SafeWork NSW inspectors and managers for identifying new and emerging issues

Inspectors may apply to the Inspector Progression Panel of SafeWork NSW to progress from Inspector to the level of Senior Inspector, or Senior Inspector to the level of Principal Inspector. In addition to the overarching requirements of the (Department of Customer Service – SafeWork NSW Inspectors 2007) Reviewed Award, this process is governed by a formal written procedure.

This procedure sets out that in considering applications for progression, the panel should take into account whether the applicant has fulfilled the responsibilities of their current role. The procedure specifies that inspectors and principal inspectors are accountable to:

It is unclear why inspectors and principal inspectors have this responsibility, but not the intermediate level of senior inspectors. It is also unclear whether people managers, such as team managers, directors, and executive directors, also have similar formal obligations to proactively identify emerging issues.

Moreover, as senior inspectors are not accountable for identifying trends and emerging issues, inspectors are not assessed against this accountability when seeking progression to the senior inspector level. In contrast, when seeking progression from senior inspector to principal inspector, the applicant is required to provide evidence of how they meet this accountability, even though it is not an accountability specified for senior inspectors.

The accuracy of SafeWork NSW’s workforce planning is uncertain

Workload capacity is managed at the directorate level, with a forecasting report on the capacity across all teams discussed quarterly at the SafeWork NSW Leadership Group. Inspectors do not fill out timesheets, instead, this is based on time estimates for specific activities undertaken by inspectors. Directorates are also responsible for leading or supporting work against specific regulatory priorities, requiring directorates to discuss workforce capacity as part of planning proactive work.

SafeWork NSW has a 'workload management treatment model' that provides operation guidance once certain thresholds are reached within this forecasting report. These mechanisms include the reallocation of resources within the directorate at 125% of capacity reached, sharing and reallocation of work between equivalent portfolios at 150% of capacity reached, and cross directorate sharing of work and resources as well as the cessation or deference of work at 175% of capacity reached.

The actual allocation of inspectors to individual directorates is determined at the executive level when vacancies arise, with SafeWork NSW noting that 'consideration is given to the demand for regulatory services (current and expected future) across all teams to determine which directorate and office location a replacement position should be allocated'.

Audit interviews identified some concern that the calculations the forecasting reports are based on were not accurate, overestimated time, and that the data was used inconsistently and as a method to 'grab for resources'. While this audit did not examine SafeWork NSW's forecasting methodology in detail, a sample of the workforce forecasting report for April to June 2023 showed average capacity ranging from 9% to 390%, which may indicate under-utilised or over-utilised teams, or under or overweighted activities.

While there are mechanisms in place to review operational capacity, longer-term strategic workforce planning does not seem to form part of these review processes.

As part of developing its regulatory priorities, SafeWork NSW released a discussion paper that noted broader trends affecting workplaces and communities that it regulates, for example the rise in mental health issues in the workplace, automation, and the return of regional on-shore manufacturing. SafeWork NSW has a SafeWork Inspectorate and Manager Continuing Professional Development Program Policy, however this policy was only finalised in July 2023.

³ This study, conducted by a third-party, stemmed from a recommendation made by the NSW Parliament’s 2019 Dust Disease Review to amend the WHS Act to require SafeWork NSW to ensure that a case finding study was carried out:

• to investigate respirable crystalline silica exposure in the manufactured stone industry, and

• to gather information to improve the identification and assessment of workers at risk of exposure.

The purpose of this recommendation was to ‘to improve the identification and assessment of workers at risk of exposure.

⁴ The authors of this case finding study identified significant data limitations, which meant that it was not possible to estimate with confidence the complete number of workers potentially affected by silicosis.

⁵ Because of the lag period between when a worker is exposed to risky work practices and when they may develop silicosis, complaint data is not necessarily a useful tool to identify the emerging risk, especially where awareness of the risk is low. Unlike with risks that pose a more immediate and direct harm – such as falling off an insecure elevated platform - individuals may be less conscious to complain about a risk where the potential injury is not immediately visible.

⁶ A person conducting a business or undertaking has the primary duty of care for work health and safety.

This chapter considers how effectively SafeWork NSW measures and reports its performance in monitoring and enforcing compliance with the WHS Act. This includes whether it has meaningful performance measures, whether its performance is transparent to all stakeholders, and whether it uses performance information to support continuous improvement and quality assurance.

Performance measurement and reporting are essential to demonstrating a regulator's effectiveness

The Audit Office’s 2022 Audit Insights 2018–22 report noted that:

The same report also observed that government activity should:

Relatedly, the Organisation for Economic Co-Operation and Development has said that it is important for regulators to be aware of the impacts of their regulatory actions and decisions, and that this:

SafeWork NSW reports its activities and performance against certain KPIs, along with equivalent regulators in other Australian jurisdictions

Safe Work Australia, the national policy body for work health and safety, collects, analyses and publishes data across jurisdictions. SafeWork NSW provides data on regulatory activities such as the volume of proactive and reactive regulatory work, and performance measures such as injuries and fatalities. This is contained in the Safe Work Australia Comparative Performance Monitoring – Work Health and Safety Performance, and Work Health and Safety Compliance and Enforcement Activities reports.

The data published by Safe Work Australia provides comparative and longitudinal performance data relating to workplace injuries, fatalities, and compliance activities. This is ‘lag’ data, often 12 months or more in arrears. SafeWork NSW notes that due to the currency of data, it is not useful for planning purposes.

The ability to directly compare jurisdictional activities to form a view on the effectiveness of each regulator is limited, due to differences in how each work health and safety regulator works and the scope of their powers and responsibilities. For example, unlike in other states and territories, SafeWork NSW is not responsible for claims management or return to work matters.

Data reported by SafeWork NSW to Safe Work Australia indicates that, while fatalities have decreased, SafeWork NSW may not have had meaningful impact on the rates of serious injuries and disease claims since 2016–17

The data provided to Safe Work Australia shows that SafeWork NSW has presided over a period where there has been an increase in the incident rate of serious injury and disease claims in New South Wales. While SafeWork NSW is not responsible for workers compensation, the payment of workers compensation necessitates that a workplace injury has occurred.

The audit team has not seen evidence that SafeWork NSW has interrogated the root cause data trends since 2016–17 (discussed below). While the causes of workplace injury are often complex and multifaceted, the data suggests that SafeWork NSW may not be having a meaningful impact on reducing rates of serious injuries, but the poor data quality means that we cannot be sure. It was beyond the scope of this audit to specifically examine serious injuries and disease claims, or the root cause(s) for the upward trend.

An extract of one performance indicator is shown in Exhibit 2 below. It shows serious injury and disease claim data from 2012–13 through to 2020–21 (where 2020–21p stands for preliminary data). The 2015–16 financial year is highlighted to indicate the establishment phase of SafeWork NSW.

This chapter considers selected policies and procedures that SafeWork NSW has implemented to ensure that it performs its compliance functions in a manner that is consistent with regulatory good practice. This includes that regulatory decisions are fair, consistent, predictable, transparent and in accordance with any laws or government policy. This extends to how complaints and incidents are initially triaged, the decisions inspectors make in response to complaints or incidents, and decisions made about whether a matter is referred to investigation for possible prosecution.

SafeWork NSW has made significant efforts to promote consistency in regulatory decision-making

A core element of an effective compliance regime is that the regulator’s behaviour and decision-making should be consistent and predictable. This encourages trust and confidence in the regulator, while promoting clarity and certainty among regulated entities.

SafeWork NSW faces particular challenges to achieving consistency in regulatory outcomes without fettering the legislative decision-making authority of individual inspectors. The audit was made aware of cases where stakeholders could not understand the rationale by which decisions were made, including in matters raised in Parliamentary Budget Estimates Committee hearings.

The reasons for the lack of consistency, whether perceived or actual, includes such matters as:

• the unique circumstances that may apply to individual risks, hazards, or incidents
• the wide variation in characteristics of PCBUs, including in regard to matters that might affect their culpability for non-compliance, such as their size or compliance history
• varying levels of experience across inspectors
• potential differences between individual inspectors in risk appetite, regulatory posture and attitudes to varying regulatory interventions.

These complexities have received heightened attention by SafeWork NSW since the 2020 findings of the NSW Ombudsman’s inquiry into SafeWork NSW and the Blue Mountains City Council. Among other things, in this inquiry the Ombudsman found that:

• only inspectors had the authority to form a ‘reasonable belief’ that non-compliance with the WHS Act or regulation had occurred
• where an inspector forms a ‘reasonable belief’ of non-compliance, then they must issue a regulatory notice
• instances had occurred where inspectors had issued notices without forming the necessary ‘reasonable belief’ that valid grounds existed for those notices
• inspectors had issued notices without forming their own requisite ‘reasonable belief’ because they had been directed to issue notices by management.

Notwithstanding these challenges, SafeWork NSW was able to demonstrate that it has implemented measures aimed at promoting consistency in regulatory decision-making. These measures include:

• extensive guidance in exercising discretionary decision-making
• inspector practice notes
• directorate and team level discussions intended to promote consistency in decision-making.

These measures are primarily focused at encouraging consistency in the application of the law prospectively. There was less evidence that decisions were consistently, formally, and robustly reviewed retrospectively, such as by:

• peer review
• internal audit or quality assurance of decisions
• managerial coaching and mentoring.

The audit found varying practices and processes across SafeWork NSW teams and directorates for these sorts of retrospective and reflexive learning processes. Some managers and directors were able to describe regular review activities, either through one-on-one case reviews with individual inspectors, or through team meetings, though the evidence was that these activities were not consistent across regulatory decision-making areas of SafeWork NSW.

Such retrospective mechanisms would not be aimed at varying decisions already made, but at contributing to standardising how inspectors make future decisions by promoting consistency through setting precedents for responding to substantively similar matters.

Staff performance management is inconsistent across SafeWork NSW, which may hinder consistent practices, behaviours and outcomes

The use of organisational performance management and planning systems can be an important tool for promoting consistent behaviours, understandings and outcomes.
This audit included a survey of all members of the inspectorate, excluding team managers. Approximately 60% the inspectorate responded to the survey. The survey of found that:

• 36% said that they did not have an annual performance agreement – almost one in every two inspectors (46%) in the two metropolitan focused directorates said they did not have performance agreements that set out what was required of them
• the Investigation and Emergency Response directorate had a comparatively higher rate of reported performance agreements in place (80%) than all the other directorates that comprised SafeWork NSW (57%) – the reasons for this were not examined by the survey.

Findings from a survey of the inspectorate highlight the role of discretion in decision-making, and how these factors can be inconsistently applied

The survey conducted by the audit also asked inspectors about how different factors might affect their decision to issue a penalty notice for a breach of the WHS Act (excluding the most serious categories of matters that would ordinarily be immediately referred to full investigation and possible prosecution).

The discretionary factors that were included in the survey included:

• a sample taken from SafeWork NSW's written procedure for issuing penalty notices (shown in Exhibit 5 below)
• a small number that had been raised with the audit team by SafeWork NSW staff during interviews, namely: current regulatory priorities, media or political interest, and the size of the PCBU (specifically, whether or not a hypothetical PCBU was a small, family-owned business).

Source: SafeWork NSW, Penalty Notice Procedure.

Inspectors were asked whether a range of selected factors were in general more, less, or not at all likely to influence their decision to issue a penalty notice.

As shown in Exhibit 6 below, the survey found that the most common response to most of the factors was that they made it neither more nor less likely that an inspector would issue a penalty notice in response to non-compliance. In some cases, this is probably to be expected.

For example, whether or not a non-compliant PCBU is a NSW government agency should probably not affect whether it is issued with a penalty notice. This was the case for 80% of respondents (though notably, 20% of inspectors responded that it would affect their decision, including 3% who responded that they would be much more likely to issue a penalty notice).

Other variations seem less intuitive to explain. This is particularly the case when a factor is written in policy or procedures. For example, 44% of inspectors responded that their decision would not be affected by whether or not the PCBU had prior notice of the risk, even though prior notice is prescribed in the SafeWork NSW procedure as a factor that should be taken into account (see item 7 of Exhibit 5).

The role played by SafeWork NSW regulatory priorities is also uncertain. On the one hand, 62% of inspectors said that they would be more (39%) or much more (23%) likely to issue a penalty if the non-compliance related to a regulatory priority, while 38% said it would have no impact.

The survey also found noticeable variations in responses between directorates regarding when penalty notices would be more or less likely to be issued. This included in regard to:

• whether a non-compliant PCBU was a small business or not
• the role of PCBU culpability
• whether non-compliance related to a matter of media or political interest.

This chapter presents a case study that arose during the course of this audit. The case study demonstrates issues discussed in earlier chapters of this report, particularly in relation to the management of risk and the proper application of policies and procedures to ensure SafeWork NSW’s effectiveness as a regulator.

About the case study

The case study concerns the activities of the Department of Customer Service and SafeWork NSW, the latter of which is located within the department. Neither the case study nor this performance audit generally examined the activities of the commercial partner (including any related companies) referenced in the case study, including Trolex Ltd (UK), Trolex Nome Australia Pty Ltd., or Trolex Sensors Pty Ltd. No findings have been made, either express or implied, in relation to the commercial partner.

The case study was based on a review of evidentiary documents, primarily in the form of emails sourced from SafeWork NSW. To avoid compromising other processes, interviews were not held.

SafeWork NSW’s respirable crystalline silica real-time detection project

As discussed earlier, silicosis is a progressive, occupational lung disease resulting from inhalation of respirable crystalline silica. In recent years, there has been high profile attention to respirable crystalline silica exposure from manufactured stone products (such as kitchen benchtops), though these risks had been published in international research since at least 2010. Unlike asbestos, respirable crystalline silica from manufactured stone can lead to the development of silicosis and other lung diseases after relatively short exposure and latency periods, resulting in relatively young workers developing serious diseases.

From 2016 to 2022, SafeWork NSW’s Work Health and Safety Roadmap included a target to reduce workplace exposure to priority hazardous chemicals and materials by 30%. This focus was retained in SafeWork NSW's regulatory priorities for 2023, which included the aim of reducing the incidence of worker exposure to harmful substances such as silica.

In 2018, SafeWork NSW commenced a project to fund a ‘research partner’ to develop a device that would detect in real-time the presence of respirable crystalline silica in workplaces. This project was led by the Centre for Work Health and Safety within SafeWork NSW.

Following a selection process, Trolex, a private company from the United Kingdom, was selected as the research partner. Trolex developed a device intended to meet the objective of the project. This device is called the Air XS and sells for approximately $18,500 AUD. The Air XS device was launched on 7 April 2022. The first-generation of the Air XS devices are no longer on the market, however up to 60 second-generation devices are currently in use across Australia.

In December 2022, this research project won the DCS Secretary’s Award for Excellence in Digital Innovation and was also one of the department’s nominees for a Premier’s Award in 2022.

As part of understanding SafeWork NSW’s response to the work health and safety risks of respirable crystalline silica from manufactured stone products, the audit examined this research project to procure a 'research partner' to develop a respirable crystalline silica real-time detection device. The findings of this examination are set out below.

SafeWork NSW’s processes were ineffective in responding to and mitigating risk and in ensuring compliance

As detailed below, our examination of this project found significant governance failings in SafeWork NSW, including the absence of key documentation, which created risks relating to whether the project would deliver its objective and whether it complied with procurement requirements. Concerns about whether the Air XS device would satisfy project objectives were not properly addressed.

We also found non-compliance with mandatory procurement policies. The failure to ensure compliance with procurement requirements leaves open the risk that value for money was not achieved, or that the procurement was not fair, transparent, consistent with promoting competition, or free from corruption or maladministration.

As a result of the Audit Office raising these issues with the Head of SafeWork NSW, the regulator undertook to enter into discussions with the CSIRO to conduct further testing of the real-time RCS detection device.

Concerns were raised by staff about the accuracy of the Air XS devices, though these concerns were not escalated beyond Director-level staff

Both before and after the launch of the Air XS device, concerns were raised by technical staff within SafeWork NSW about the accuracy of the devices and the rigour with which they had been tested during development.

It should be noted that the manufacturer, in correspondence with SafeWork NSW, defended the accuracy of the Air XS devices. It was beyond the scope of the audit to reconcile apparently conflicting technical assessments. Rather, the audit examined how SafeWork NSW managed the potential project delivery risk when these material concerns were raised.

Toward the end of 2021, concerns first emerged about the accuracy of the Air XS devices in emails between staff in the Regulatory Engagement business area of SafeWork NSW. These emails outlined concerns that the Air XS devices were not sufficiently accurate in detecting respirable crystalline silica. These views were derived from testing performed outside of any technical assurance process. At the time, these concerns were not shared with executive-level staff, including with any relevant Directors.

By the end of March 2022, the Centre for Work Health and Safety had requested and received from Trolex testing reports on the Air XS device. Two technical staff in the Testing Services directorate of SafeWork NSW were asked to review the testing reports. They were given five days to conduct these reviews.

On 5 April 2022, two days before the product was launched, one of the technical staff emailed the Director, Testing Services, advising that each of the two technical staff had independently prepared assessments and that their conclusions were ‘…not what DCS will want to hear’.

The internal assessment reports were subsequently provided to the Director, Testing Services, and to the Centre for Work Health and Safety. One of the reports stated that the product was not ‘market ready’ and that further testing was required. The audit did not find evidence that these conclusions were escalated to the Executive Director, Regulatory Engagement.

On 6 April 2022, the research project manager was advised by a staff member in the Centre for Work Health and Safety that an independent expert’s report (commissioned by the Centre for Work Health and Safety) concluded that ‘…there isn’t enough data to assess the validity of the device’.

Despite these concerns, the product launch occurred on 7 April 2022.

The audit found that concerns were again documented on at least two occasions after the product was launched. First, in September 2022, a senior technical staff member in the Centre for Work Health and Safety expressed concerns to colleagues, including the Director, Testing Services, that the staff member was uncomfortable promoting the Air XS without further testing being conducted.

Secondly, in May 2023, an internal test report prepared within the Testing Services business unit highlighted specific concerns about the accuracy of a first-generation Air XS device. This internal test report was provided to the Director, Testing Services, and was conducted with at least the knowledge of the Director, Research and Evaluation.

In both cases (September 2022 and May 2023), there are gaps in the evidence concerning how widely these internal concerns were shared. The audit found no evidence of:

• any material response by SafeWork NSW management to address the concerns that had been raised
• any assessment of risks posed to SafeWork NSW and other stakeholders
• any escalation of the concerns to the relevant Executive Director or to the Head of SafeWork NSW.

This apparent lack of management action was despite the potential risks to the work health and safety of workers who may have relied on the Air XS, and to the reputation of the regulator.

Some SafeWork NSW staff were hesitant to raise concerns about the Air XS device

Some staff reported to us that they did not raise these risks with their managers due to concerns that to do so might affect their employment. In the Auditor-General’s 2018 audit report Managing risks in the NSW public sector: risk culture and capability, it was noted that:

The report also observed that 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. This includes ensuring that agencies have a culture of open communication so that all employees feel comfortable speaking openly about risks.

In this case, SafeWork NSW lacked the risk processes and culture to encourage all staff to identify, raise, escalate, and respond to risk appropriately. While the department does have a mechanism (via dedicated phone and email contacts) for staff to report integrity concerns, this mechanism was not used.

Concerns about the Air XS device were also raised by an external user of the device, though there is no evidence that these concerns were substantively addressed

On 21 August 2023, a senior manager from an external user emailed staff in SafeWork NSW’s Testing Services Directorate to advise that they had told the local distributor that they no longer wished to conduct further testing, nor purchase any Air XS devices. The senior manager stated that:

The senior manager further stated that they were:

The audit found no evidence that these concerns were meaningfully addressed by SafeWork NSW.

The process of procuring a ‘research partner’ to develop the Air XS device was flawed, in that there was non-compliance with procurement obligations and inadequate record keeping

The cost of procuring the Air XS research partner increased from an initial estimated cost of $200,000 when the request for tender was issued in May 2019 to $1.34 million when the final contract was executed in August 2019.

The audit found non-compliance in the process undertaken by the CWHS to procure the research partner. This non-compliance related to the requirements of the applicable departmental procurement manual, as well as with DCS financial delegations, and with the tender evaluation plan prepared for the process.

Examples of non-compliance and other poor practices are outlined below.

• The Director, Research and Evaluation, was a voting member of the evaluation committee and also signed the acceptance letter for the successful proposal. This contravened the department’s procurement requirement that an approving delegate may not also evaluate tender responses. At the time, the estimated cost of the engagement was $200,000 and was therefore within the Director’s financial delegation.
• The evaluation of the submitted tenders included an assessment provided by a designated non-voting member of the tender evaluation committee who had a declared conflict of interest.
• One member of the tender evaluation committee lodged a strong objection to the preferred provider. SafeWork NSW could not provide documentation about how this objection was addressed.
• When the final cost of the engagement increased to $1.34 million by August 2019, the Director, Research and Evaluation, no longer had the necessary delegation to approve the engagement of Trolex. Under the delegations issued by the DCS Secretary on 29 August 2019, the approval of an Executive Director was required for contracts valued between $500,000 and $2 million.
• The scoring in the tender evaluation committee’s (unsigned) evaluation report did not comply with the approach set out in the tender evaluation plan. This was material as, had the tender evaluation plan been followed, two tenders would have been assessed as having the same successful score.
• SafeWork NSW was unable to provide:
  • a signed and dated copy of an approval to issue the initial request for tender
  • a signed and dated copy of an approval for SafeWork NSW to enter into a formal agreement with Trolex
  • a final tender evaluation report signed by all members of the tender evaluation panel
  • evidence of any approval to increase the value of the contract from the $200,000 anticipated in the initial request for tender up to the $1.34 million final value of the contract.

Such non-compliance can contribute to the risk of maladministration in procurement activities, including by undermining probity and challenging whether value for money is achieved.

Appendix one – Response from agency

Appendix two – About the audit

Appendix Three – Performance auditing

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Parliamentary reference - Report number #390 - released 27 February 2024

What this report is about

Around one-third of the state’s population lives in regional NSW, but deaths on regional roads make up around two-thirds of the state’s road toll.

Transport for NSW (TfNSW) is responsible for managing road safety outcomes across the NSW road network. This audit assessed the effectiveness of TfNSW’s delivery of road safety strategies, plans and policies in regional areas.

The NSW Road Safety Action Plan 2022–2026 has the stated goal of ‘no death or serious injury occurring on the road transport network’ by 2050.

What we found

There is a disproportionate amount of trauma on regional roads, but there are no specific road safety plans or trauma reduction targets for regional NSW.

TfNSW advises that the setting of state-wide road safety targets is consistent with other jurisdictions and international best practice. However, the proportion of road fatalities and serious injuries in regional NSW is almost the same as ten years ago.

There is no regional implementation plan to assist TfNSW to target the Road Safety Action Plan 2026 to regional areas.

TfNSW considers that local road safety outcomes should be managed by councils, but only 52% of regional councils participated in its Local Government Road Safety Program (LGRSP) in 2022–23. This program has not been updated since 2014, despite commitments to do so in 2021 and 2022.

TfNSW has not undertaken a systematic and integrated analysis of the combined impact of its road safety strategies and plans in regional NSW since 2012.

TfNSW reports against the Community Road Safety Fund (CRSF) annually but there is no consolidated, public reporting on total road safety funding allocated to regional NSW. The Fund underspend increased from 12% in 2019–20 to 20% in 2022–23.

What we recommended

We recommended TfNSW:

• develop a regional implementation plan to support the NSW Road Safety Action Plan, including a framework to annually measure, analyse and publicly report on progress
• develop a plan to measure and mitigate risks causing underspend in the CRSF
• expedite the review of the LGRSP including recommendations to increase involvement of regional councils.

Disclosure of confidential information

Under the Government Sector Audit Act 1983 (the Act), the Auditor-General may disclose confidential information if, in the Auditor-General’s opinion, the disclosure is in the public interest, and that disclosure is necessary for the exercise of the Auditor-General’s functions.

Confidential information in the Act means Cabinet information or information subject to legal privilege. This performance audit report contained confidential information.

The NSW Premier has certified that in his opinion the disclosure of the confidential information was not in the public interest.

The confidential information has been redacted from this report.

Under section 36A(2) of the Government Sector Audit Act 1983, the Auditor-General may authorise the disclosure of confidential information if, in the Auditor-General’s opinion, the disclosure is in the public interest and necessary for the exercise of the Auditor-General’s functions. Confidential information under the Government Sector Audit Act 1983 means Cabinet information, or information that could be subject to a claim of privilege by the State or a public official in a court of law. This performance audit report contained confidential information which, in the opinion of the Auditor-General, is in the public interest to disclose and that disclosure is necessary for the exercise of the Auditor-General’s functions.

On 26 October 2023, pursuant to section 36A(2)(b) of the Government Sector Audit Act 1983, the Auditor-General notified the NSW Premier of the intention to include this information in the published report, having formed the opinion that its disclosure is in the public interest and is necessary for the exercise of the Auditor-General’s functions.

On 23 November 2023, pursuant to section 36A(2)(c) of the Government Sector Audit Act 1983, the NSW Premier certified that, in his opinion, the proposed disclosure of the confidential information contained in this report was not in the public interest. The Premier’s certificate follows. Section 36A(4) states that a certificate of the Premier that it is not in the public interest to disclose confidential information is conclusive evidence of that fact.

The issuance of the certificate by the NSW Premier prevents the publication of this information. The relevant sections of the report containing confidential information have been redacted.

One-third of the New South Wales population resides in regional areas, but two-thirds of the state’s road crash fatalities take place on regional roads.

Between 2017 and 2021, the average number of fatalities for every 100,000 of the population living in regional New South Wales was 8.33 — approximately four times higher than the equivalent measure for Greater Sydney. Similarly, the average number of serious injuries in regional New South Wales over the same period was 75.24 per 100,000 of the population, compared with 50.53 in Greater Sydney. Further, more than 70% of people who lose their lives in accidents on regional roads are residents of regional areas.

Residents of regional areas face particular transport challenges. They often need to travel longer distances for work, health care, or recreation purposes, yet their public transport options are more limited than metropolitan residents. Vehicle safety is also an issue. According to the NSW Road Safety Progress Report 2021, of the light vehicles registered in New South Wales that were manufactured in or after 2000, 48.4% of light vehicles in regional areas had a five-star Australasian New Car Assessment Program (ANCAP) rating, compared to 54.8% in metropolitan areas. Road conditions in regional areas can also be more challenging for drivers.

Regional New South Wales covers 98.5% of the total area of the state. The road network in New South Wales is vast — spanning approximately 200,000 kilometres.

The road network includes major highways, state roads and local roads. Speed limits range from 10 km/hr in high pedestrian shared zones, up to 110 km/hr on high volume and critical road corridors. Eighty per cent of the network has a 100 km/h speed limit, which is mostly applied as a default speed limit, regardless of the presence of safety features and treatments.

Speed is the primary causal factor in more crashes in New South Wales than any other factor, and car crashes in regional areas are more likely to be fatal because of the higher average speeds involved.

The responsibility for managing road safety outcomes across the entire New South Wales road network lies with Transport for NSW (TfNSW), pursuant to Schedule 1 of the Transport Administration Act 1988.

While its safety responsibilities are state-wide, TfNSW does not own or directly manage all of the road network in regional New South Wales, which spans approximately 200,000 kilometres. Approximately 80% of the roads are classified as Local Roads and are administered and managed by local councils. Local councils also maintain Regional Roads that run through their local government areas. TfNSW is responsible for managing State Roads (approximately 20% of roads), which are major arterial roads. It also provides funding for councils to manage over 18,000 km (approximately 10%) of state-significant Regional Roads.

According to TfNSW, between 2016 and 2020, there were 9,776 people killed or seriously injured on roads in regional New South Wales. Adding to the tragic loss of life, according to TfNSW, the estimated cost to the community between 2016 and 2020 resulting from regional road trauma and fatalities was around $13.7 billion.

TfNSW also noted that the ‘risk of road trauma is pervasive, and a combination of effective road safety measures is required to systematically reduce this risk’.

TfNSW released its first long-term road-safety strategy in December 2012, which introduced the goal of ‘Vision Zero’ — a long-term goal of zero deaths or serious injuries on NSW roads. The terminology was changed to ‘Towards Zero’ in the 2021 Road Safety Plan and has been retained in the NSW Road Safety Action Plan 2022–2026. Towards Zero has the stated goal of ‘no death or serious injury occurring on the road transport network’ by 2050.

The objective of this audit is to assess the effectiveness of TfNSW’s delivery of ‘Towards Zero’ in regional areas.

In making this assessment, the audit examined whether TfNSW:

• is effectively reducing the number of fatalities and serious injuries on regional roads
• has an effective framework, including governance arrangements, for designing and refreshing the NSW Road Safety Strategy 2012–2021 and the NSW Road Safety Action Plan 2022–2026
• effectively makes use of whole-of-government and other relevant sources of data to support decision-making, and to evaluate progress and outcomes
• effectively manages accountabilities, including roles and responsibilities, with respect to road safety outcomes and the use of data.

This audit focused on the policies and strategies used by TfNSW for managing road safety outcomes in regional areas. We did not evaluate individual road safety projects, programs and initiatives as part of this audit.

Whilst Regional Roads and Local Roads (as defined by the Road Network Classifications) are owned and maintained by local councils, we included these roads in this audit as TfNSW may advise and assist councils to promote and improve road safety, as well as manage grant programs that focus on improving road safety outcomes on these roads. Hereafter, unless otherwise stated, references to ‘regional roads’ refer to all classifications of roads in the state which are in regional New South Wales, irrespective of their ownership.

Local councils in regional areas are key stakeholders for the purposes of this audit, and we interviewed eight as part of the audit process (noting that this was not intended to be a representative sample). Road asset management by local councils is also out of scope for this audit as it is the focus of a subsequent performance audit by the Audit Office of New South Wales.b

The Audit Office of New South Wales has undertaken several performance audits relating to road safety since 2009 and these have been referenced while undertaking this audit. They include:

• Condition of State Roads (August 2006)
• Improving Road Safety: Heavy Vehicles (May 2009)
• Improving Road Safety: School Zones (March 2010)
• Improving Road Safety: Speed Cameras (July 2011)
• Regional Assistance Programs (May 2018)
• Mobile speed cameras (October 2018)
• Rail freight and Greater Sydney (October 2021).

Appendix one – Response from Transport for NSW

Appendix two – The Safe Systems framework and NSW road safety strategies and plans

Appendix three – About the audit

Appendix four – Performance auditing

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Parliamentary reference - Report number #386 - released 30 November 2023