Conclusion
There are two key shortcomings that fundamentally limit the effectiveness of the Department's plans and strategies to respond to the demand for secondary teachers in STEM-related disciplines. First, the Department is not accurately tracking the supply and demand for secondary teachers by discipline due to incomplete data. Second, not all scholarship and sponsorship places are allocated and many scholars withdraw from the programs before completion. The Department has recognised and started to address these problems with a new workforce model, revised incentives and scholarship programs. 

The Department’s current workforce planning model does not provide the information needed to target workforce plans and strategies to areas of need. This is because it does not predict supply and demand for teachers by discipline and location. An internal review in 2017 acknowledged the limitations of this model. In response the Department developed a new model, which it is currently enhancing, to predict supply and demand for teachers by discipline and location. For this to be successful, the Department needs to monitor the level of out-of-field teaching and improve data on the willingness of teachers to work in particular locations. 

The Department does not allocate all available scholarship and sponsorship places and around 30 per cent of recipients do not complete the term of their agreement. An internal review in 2017 highlighted that some programs were not targeting workforce need and that there were no key performance indicators to determine the overall effectiveness of these programs. However, scholarship programs and incentives are promoted well through social media and face-to-face events at Universities. Further, the Department has used findings from internal reviews of incentives and scholarships in 2016 and 2017 to inform recent changes to programs. 

The Department has little oversight of access to practicum placements for pre-service teachers in areas of need. Professional experience agreements were established with each University in 2015 to improve the placement process for disciplines of need. Initial teacher education students must complete several ‘practicum placements’ before they can be qualified to teach in a school. Several universities we consulted reported difficulties finding practicum placements for pre-service teachers specialising in STEM-related disciplines. The Department is now revising the agreements to improve the quality of data it collects on the number, location and subject area of practicum placements. 

The Department is not accurately tracking the supply and demand for secondary teachers by discipline due to incomplete data. 

The Department’s current workforce planning model does not accurately predict supply and demand for teachers by discipline and location. An internal review in 2017 acknowledged the limitations of this model. In response the Department developed a new model which it is currently enhancing to address the findings of the review. For this model to be successful, the Department needs to monitor the level of out-of-field teaching and improve data on the willingness of teachers to work in particular locations. Further work also needs to be undertaken to refine the assumptions that underpin the Department’s workforce planning models as it starts to predict the need for teachers by discipline.

The Department has not publicly reported on the supply and demand for teachers by discipline since 2015. While it does report annually on its current workforce profile, this information is not detailed enough to inform future strategies or programs. More detailed public reporting may help the Department to influence the future supply of teachers by communicating its projected areas of need. Planned improvements to the Department's workforce planning model, as relayed to us, will add to the data available on areas of need. Once available, this should be reported publicly. 

Recommendations
By December 2019, the Department of Education should:

1. Improve its workforce planning model to better understand and communicate supply and demand for teachers by: 
   • determining the extent, and analysing the impact, of out-of-field teaching by permanent and temporary teachers in each school
   • sourcing additional data to more accurately reflect teacher location preferences
   • projecting supply and demand by subject level and geographic area
   • regularly reporting on the supply and demand for secondary teachers in each discipline to communicate future areas of need to future teacher education students.

The Department's current scholarship and sponsorship programs are not allocating all available places and many scholars withdraw from the programs before completion. An internal review in 2017 raised several issues with the effectiveness of programs and the Department has started to revise its scholarship, sponsorship and incentive programs. 

An internal review in 2017 highlighted that scholarship and sponsorship programs were not targeting workforce need, and that there were no key performance indicators to determine the overall effectiveness of these strategies. In addition, the review found that only 79 per cent of available scholarship placements are allocated each year, and 31 per cent of scholarship recipients withdraw prior to completing their required service period. The Department recently announced changes to its scholarship programs from 2019 onwards.

The Department has incentives to encourage teachers to work in rural and remote areas, including teachers in STEM-related disciplines. Incentives include access to priority transfers, rental subsidies and other allowances. Research conducted in 2016 examined the influence of incentives in encouraging teachers to work in rural and remote areas. The Department used findings of this research when updating its set of rural and remote incentives in 2017.

The Department promotes its scholarship and sponsorship programs through the teach.NSW website. It uses social media to direct applicants to this website. It also promotes its programs through careers fairs, University open days, and professional events. Past applicants have reported that the website clearly communicates eligibility criteria and the terms of agreement for all scholarship programs. 

The Department could strengthen its relationship with universities to attract teachers to areas of need by collecting and analysing data on practicum placements, facilitating placements for scholarship recipients, and communicating predicted teacher needs by discipline. 

Recommendations
By December 2019, the Department of Education should:

2. Implement changes to address the findings of the 'Teacher Scholarship Realignment' report, including by:

• testing a range of program designs with target candidates to determine the best options to attract more suitable applicants
• establishing key performance indicators, and setting targets, to better monitor the effectiveness of the programs
• reducing the number of scholars appointed to over-establishment positions
• increasing the proportion of scholars appointed to priority locations 
• further analysing scholarship recipients career paths to inform future improvements to the scholarship programs.

3. Review its role in the practicum placement process of pre-service teachers by:

• analysing how many students each school accommodates per year, to ensure there are appropriate placements available for students in high needs disciplines
• working with universities to facilitate practicum placements for scholarship recipients
• establishing mechanisms for ongoing monitoring of its partnerships with universities to ensure they are meeting their aims.

Conclusion
1. The urban renewal projects on the former railway land are well targeted to support the objectives of the Program. However, there is insufficient evidence that the cost of the light rail will be justified by its contribution to Program objectives.

The planned uses of the former railway land achieve a balance between the economic and social objectives of the Program at a reasonable cost to the Government. HCCDC, and previously UrbanGrowth NSW, identified and considered options for land use that would best meet Program objectives. Required probity processes were followed for developments that involved financial transactions. Our audit did not assess the achievement of these objectives because none of the projects have been completed yet.

Analysis presented in the Program business case and other planning documents showed that the light rail would have small transport benefits and was expected to make a modest contribution to broader Program objectives. Analysis in the Program business case argued that despite this, the light rail was justified because it would attract investment and promote economic development around the route. The Program business case referred to several international examples to support this argument, but did not make a convincing case that these examples were comparable to the proposed light rail in Newcastle.

The audited agencies argue that the contribution of light rail cannot be assessed separately because it is a part of a broader Program. The cost of the light rail makes up around 53 per cent of the total Program funding. Given the cost of the light rail, agencies need to be able to demonstrate that this investment provides value for money by making a measurable contribution to the Program objectives.

2. Consultation and oversight were mostly effective during the implementation stages of the Program. There were weaknesses in both areas in the planning stages.

Consultations about the urban renewal activities from around 2015 onward followed good practice standards. These consultations were based on an internationally accepted framework and met their stated objectives. Community consultations on the decision to close the train line were held in 2006 and 2009. However, the final decision in 2012 was made without a specific community consultation. There was no community consultation on the decision to build a light rail.

The governance arrangements that were in place during the planning stages of the Program did not provide effective oversight. This meant there was not a single agreed set of Program objectives until 2016 and roles and responsibilities for the Program were not clear. Leadership and oversight improved during the implementation phase of the Program. Roles and responsibilities were clarified and a multi-agency steering committee was established to resolve issues that needed multi-agency coordination.

Analysis presented in Program business cases and other planning documents showed that the light rail would have small transport benefits and was expected to make a modest contribution to broader Program objectives. Analysis in the Program business case argued that despite this, the light rail was justified because it would attract investment and promote economic development around the route. The Program business case referred to several international examples to support this argument, but did not make a convincing case that these examples were comparable to the proposed light rail in Newcastle.

The business case analysis of the benefits and costs of light rail was prepared after the decision to build light rail had been made and announced. Our previous reports, and recent reports by others, have emphasised the importance of completing thorough analysis before announcing infrastructure projects. Some advice provided after the initial light rail decision was announced was overly optimistic. It included benefits that cannot reasonably be attributed to light rail and underestimated the scope and cost of the project.

The audited agencies argue that the contribution of light rail cannot be assessed separately because it is part of a broader Program. The cost of the light rail makes up around 53 per cent of the total Program funding. Given the high cost of the light rail, we believe agencies need to be able to demonstrate that this investment provides value for money by making a measurable contribution to the Program objectives.

Recommendations
For future infrastructure programs, NSW Government agencies should support economical decision-making on infrastructure projects by:

• providing balanced advice to decision makers on the benefits and risks of large infrastructure investments at all stages of the decision-making process
• providing scope and cost estimates that are as accurate and complete as possible when initial funding decisions are being made
• making business cases available to the public.​​​​​​

The planned uses of the former railway land achieve a balance between the economic and social objectives of the Program at a reasonable cost to the government.

The planned uses of the former railway land align with the objectives of encouraging people to visit and live in the city centre, creating attractive public spaces, and supporting growth in employment in the city. The transport benefits of the activities are less clear, because the light rail is the major transport project and this will not make significant improvements to transport in Newcastle.

The processes used for selling and leasing parts of the former railway land followed industry standards. Options for the former railway land were identified and assessed systematically. Competitive processes were used for most transactions and the required assessment and approval processes were followed. The sale of land to the University of Newcastle did not use a competitive process, but required processes for direct negotiations were followed.

Recommendation
By March 2019, the Hunter and Central Coast Development Corporation should:

• work with relevant stakeholders to explore options for increasing the focus on the heritage objective of the Program in projects on the former railway land. This could include projects that recognise the cultural and industrial heritage of Newcastle.

Consultations about the urban renewal activities followed good practice standards, but consultation on transport decisions for the Program did not.

Consultations focusing on urban renewal options for the Program included a range of stakeholders and provided opportunities for input into decisions about the use of the former railway land. These consultations received mostly positive feedback from participants. Changes and additions were made to the objectives of the Program and specific projects in response to feedback received. 

There had been several decades of debate about the potential closure of the train line, including community consultations in 2006 and 2009. However, the final decision to close the train line was made and announced in 2012 without a specific community consultation. HCCDC states that consultation with industry and business representatives constitutes community consultation because industry representatives are also members of the community. This does not meet good practice standards because it is not a representative sample of the community.

There was no community consultation on the decision to build a light rail. There were subsequent opportunities for members of the community to comment on the implementation options, but the decision to build it had already been made. A community and industry consultation was held on which route the light rail should use, but the results of this were not made public. 

Recommendation
For future infrastructure programs, NSW Government agencies should consult with a wide range of stakeholders before major decisions are made and announced, and report publicly on the results and outcomes of consultations. 

The governance arrangements that were in place during the planning stages of the Program did not provide effective oversight. Project leadership and oversight improved during the implementation phase of the Program.

Multi-agency coordination and oversight were ineffective during the planning stages of the Program. Examples include: multiple versions of Program objectives being in circulation; unclear reporting lines for project management groups; and poor role definition for the initial advisory board. Program ownership was clarified in mid-2016 with the appointment of a new Program Director with clear accountability for the delivery of the Program. This was supported by the creation of a multi-agency steering committee that was more effective than previous oversight bodies.

The limitations that existed in multi-agency coordination and oversight had some negative consequences in important aspects of project management for the Program. This included whole-of-government benefits management and the coordination of work to mitigate impacts of the Program on small businesses.

Recommendations
For future infrastructure programs, NSW Government agencies should: 

• develop and implement a benefits management approach from the beginning of a program to ensure responsibility for defining benefits and measuring their achievement is clear
• establish whole-of-government oversight early in the program to guide major decisions. This should include:
  • agreeing on objectives and ensuring all agencies understand these
  • clearly defining roles and responsibilities for all agencies
  • establishing whole-of-government coordination for the assessment and mitigation of the impact of major construction projects on businesses and the community.

By March 2019, the Hunter and Central Coast Development Corporation should update and implement the Program Benefits Realisation Plan. This should include:

• setting measurable targets for the desired benefits
• clearly allocating ownership for achieving the desired benefits
• monitoring progress toward achieving the desired benefits and reporting publicly on the results.

The Department effectively consults with industry, training providers and government departments to identify skill needs, and targets subsidies to meet those needs. However, the Department does not have a robust, data driven process to remove subsidies from qualifications which are no longer a priority. There is a risk that some qualifications are being subsidised which do not reflect the skill needs of New South Wales. 
The Department needs to better use the data it has, and collect additional data, to support its analysis of priority skill needs in New South Wales, and direct funding accordingly.

In addition to subsidising priority qualifications, the Department promotes engagement in skills training by:

• funding scholarships and support for disadvantaged students
• funding training in regional and remote areas
• providing additional support to deliver some qualifications that the market is not providing.

The Department needs to evaluate these funding strategies to ensure they are achieving their goals. It should also explore why training providers are not delivering some priority qualifications through Smart and Skilled.

Training providers compete for funding allocations based on their capacity to deliver. The Department successfully manages the budget by capping funding allocated to each Smart and Skilled training provider. However, training providers have only one year of funding certainty at present. Training providers that are performing well are not rewarded with greater certainty.

The Department needs to improve its communication with prospective students to ensure they can make informed decisions in the VET market.

The Department also needs to communicate more transparently to training providers about its funding allocations and decisions about changes to the NSW Skills List. 

The Department relies on stakeholder proposals to update the NSW Skills List. Stakeholders include industry, training providers and government departments. These stakeholders, particularly industry, are likely to be aware of skill needs, and have a strong incentive to propose qualifications that address these needs. The Department’s process of collecting stakeholder proposals helps to ensure that it can identify qualifications needed to address material skill needs. 

It is also important that the Department ensures the NSW Skills List only includes priority qualifications that need to be subsidised by government. The Department does not have robust processes in place to remove qualifications from the NSW Skills List. As a result, there is a risk that the list may include lower priority skill areas. Since the NSW Skills List was first created, new additions to the list have outnumbered those removed by five to one.

The Department does not always validate information gathered from stakeholder proposals, even when it has data to do so. Further, its decision making about what to include on, or delete from, the NSW Skills List is not transparent because the rationale for decisions is not adequately documented. 

The Department is undertaking projects to better use data to support its decisions about what should be on the NSW Skills List. Some of these projects should deliver useful data soon, but some can only provide useful information when sufficient trend data is available. 

Recommendation

The Department should: 

• by June 2019, increase transparency of decisions about proposed changes to the NSW Skills List and improve record-keeping of deliberations regarding these changes
• by December 2019, use data more effectively and consistently to ensure that the NSW Skills List only includes high priority qualifications

Only qualifications on the NSW Skills List are eligible for subsidies under Smart and Skilled. As the Department does not have a robust process for removing low priority qualifications from the NSW Skills list, some low priority qualifications may be subsidised. 

The Department allocates the Smart and Skilled budget through contracts with Smart and Skilled training providers. Training providers that meet contractual obligations and perform well in terms of enrolments and completion rates are rewarded with renewed contracts and more funding for increased enrolments, but these decisions are not based on student outcomes. The Department reduces or removes funding from training providers that do not meet quality standards, breach contract conditions or that are unable to spend their allocated funding effectively. Contracts are for only one year, offering training providers little funding certainty. 

Smart and Skilled provides additional funding for scholarships and for training providers in locations where the cost of delivery is high or to those that cater to students with disabilities. The Department has not yet evaluated whether this additional funding is achieving its intended outcomes. 

Eight per cent of the qualifications that have been on the NSW Skills List since 2015 are not delivered under Smart and Skilled anywhere in New South Wales. A further 14 per cent of the qualifications that are offered by training providers have had no student commencements. The Department is yet to identify the reasons that these high priority qualifications are either not offered or not taken up by students.

Recommendation

The Department should:

• by June 2019, investigate why training providers do not offer, and prospective students do not enrol in, some Smart and Skilled subsidised qualifications 
• by December 2019, evaluate the effectiveness of Smart and Skilled funding which supplements standard subsidies for qualifications on the NSW Skills List, to determine whether it is achieving its objectives
• by December 2019, provide longer term funding certainty to high performing training providers, while retaining incentives for them to continue to perform well.

In a contestable market, it is important for consumers to have sufficient information to make informed decisions. The Department does not provide some key information to prospective VET students to support their decisions, such as measures of provider quality and examples of employment and further education outcomes of students completing particular courses. Existing information is spread across numerous channels and is not presented in a user friendly manner. This is a potential barrier to participation in VET for those less engaged with the system or less ICT literate.

The Department conveys relevant information about the program to training providers through its websites and its regional offices. However, it could better communicate some specific information directly to individual Smart and Skilled training providers, such as reasons their proposals to include new qualifications on the NSW Skills List are accepted or rejected. 

While the Department is implementing a communication strategy for VET in New South Wales, it does not have a specific communications strategy for Smart and Skilled which comprehensively identifies the needs of different stakeholders and how these can be addressed. 

Recommendation

By December 2019, the Department should develop and implement a specific communications strategy for Smart and Skilled to:

• support prospective student engagement and informed decision making
• meet the information needs of training providers 

While Infrastructure NSW and Transport for NSW managed the assessment processes effectively overall, they have not fully maintained all required documentation, such as conflict of interest registers. Keeping accurate records is important to support transparency and accountability to the public about funding allocation. The relevant agencies have taken steps to address this in the current funding rounds for both programs.

For both programs assessed, the relevant agencies have developed good strategies over time to support councils through the application process. These strategies include workshops, briefings and feedback for unsuccessful applicants. Transport for NSW and the Department of Premier and Cabinet have implemented effective tools to assist applicants in demonstrating the economic impact of their projects.

Infrastructure NSW is effective in identifying projects that are 'at‑risk' and assists in bringing them back on track. Infrastructure NSW has a risk‑based methodology to verify payment claims, which includes elements of good practice in grants administration. For example, it requires grant recipients to provide photos and engages Public Works Advisory to review progress claims and visit project sites.

Infrastructure NSW collects project completion reports for all Resources for Regions and Fixing Country Roads funded projects. Infrastructure NSW intends to assess benefits for both programs once each project in a funding round is completed. To date, no funding round has been completed. As a result, no benefits assessment has been done for any completed project funded in either program.

 

The project selection criteria are consistent with the program objectives set by the NSW Government, and the RIAP applied the criteria consistently. Probity and record keeping practices did not fully comply with the probity plans.

The assessment methodology designed by Infrastructure NSW is consistent with2 the program objectives and criteria. In the rounds that we reviewed, all funded projects met the assessment criteria.

Infrastructure NSW developed probity plans for both programs which provided guidance on the record keeping required to maintain an audit trail, including the use of conflict of interest registers. Infrastructure NSW and Transport for NSW did not fully comply with these requirements. The relevant agencies have taken steps to address this in the current funding rounds for both programs.

NSW Procurement Board Directions require agencies to ensure that they do not engage a probity advisor that is engaged elsewhere in the agency. Infrastructure NSW has not fully complied with this requirement. A conflict of interest arose when Infrastructure NSW engaged the same consultancy to act as its internal auditor and probity advisor.

While these infringements of probity arrangements are unlikely to have had a major impact on the assessment process, they weaken the transparency and accountability of the process.

Some councils have identified resourcing and capability issues which impact on their ability to participate in the application process. For both programs, the relevant agencies conducted briefings and webinars with applicants to provide advice on the objectives of the programs and how to improve the quality of their applications. Additionally, Transport for NSW and the Department of Premier and Cabinet have developed tools to assist councils to demonstrate the economic impact of their applications.

The relevant agencies provided feedback on unsuccessful applications to councils. Councils reported that the quality of this feedback has improved over time.

Recommendations

1. By June 2018, Infrastructure NSW should:
   • ensure probity reports address whether all elements of the probity plan have been effectively implemented.

2. By June 2018, Infrastructure NSW and Transport for NSW should:
   • maintain and store all documentation regarding assessment and probity matters according to the State Records Act 1998, the NSW Standard on Records Management and the relevant probity plans

Infrastructure NSW is responsible for overseeing and monitoring projects funded under Resources for Regions and Fixing Country Roads. Infrastructure NSW effectively manages projects to keep them on track, however it could do more to assure itself that all recipients have complied with funding deeds. Benefits and outcomes should also start to be measured and reported as soon as practicable after projects are completed to inform assessment of future projects.

Infrastructure NSW identifies projects experiencing unreasonable delays or higher than expected expenses as 'at‑risk'. After Infrastructure NSW identifies a project as 'at‑risk', it puts in place processes to resolve issues to bring them back on track. Infrastructure NSW, working with Public Works Advisory regional offices, employs a risk‑based approach to validate payment claims, however this process should be strengthened. Infrastructure NSW would get better assurance by also conducting annual audits of compliance with the funding deed for a random sample of projects.

Infrastructure NSW collects project completion reports for all Resources for Regions and Fixing Country Roads funded projects. It applies the Infrastructure Investor Assurance Framework to Resources for Regions and Fixing Country Roads at a program level. This means that each round of funding (under both programs) is treated as a distinct program for the purposes of benefits realisation. It plans to assess whether benefits have been realised once each project in a funding round is completed. As a result, no benefits realisation assessment has been done for any project funded under either Resources for Regions or Fixing Country Roads. Without project‑level benefits realisation, future decisions are not informed by the lessons from previous investments.

Recommendations

3. By December 2018, Infrastructure NSW should:
   • conduct annual audits of compliance with the funding deed for a random sample of projects funded under Resources for Regions and Fixing Country Roads
   • publish the circumstances under which unspent funds can be allocated to changes in project scope
   • measure benefits delivered by projects that were completed before December 2017
   • implement an annual process to measure benefits for projects completed after December 2017

4. By December 2018, Transport for NSW and Infrastructure NSW should:
   • incorporate a benefits realisation framework as part of the detailed application.

Conclusion

The Department of Education effectively and efficiently allocates grants to non‑government schools. Clarifying the objectives of grants, monitoring progress towards these objectives, and improving oversight, would strengthen accountability for the use of public funds by non‑government schools.

We tested a sample of grants provided to non‑government schools under all major schemes, and found that the Department of Education consistently allocates and distributes grants in line with its methodology. The Department has clear processes and procedures to efficiently collect data from schools, calculate the level of funding each school or System should receive, obtain appropriate approvals, and make payments.

We identified three areas where the Department could strengthen its management of grants to provide greater accountability for the use of public funds. First, the Department’s objectives for providing grants to non‑government schools are covered by legislation, intergovernmental agreements and grant guidelines. The Department could consolidate these objectives to allow for more consistent monitoring. Second, the Department relies on schools or System Authorities to engage a registered auditor to certify the accuracy of information on their enrolments and usage of grants. Greater scrutiny of the registration and independence of the auditors would increase confidence in the accuracy of this information. Third, the Department does not monitor how System Authorities reallocate grant funding to their member schools. Further oversight in this area would increase accountability for the use of public funds.

The Department effectively and efficiently allocates grants to non‑government schools. Strengthening its processes would provide greater assurance that the information it collects is accurate.

The Department provides clear guidelines to assist schools to provide the necessary census information to calculate per capita grants. Schools must get an independent external auditor, registered with ASIC, to certify their enrolment figures. The Department checks a sample of the auditors to ensure that they are registered with ASIC. Some other jurisdictions perform additional procedures to increase confidence in the accuracy of the census (for example, independently checking a sample of schools’ census data).

The Department accurately calculates and distributes per capita grants in accordance with its methodology. The previous methodology, used prior to 2018, was not updated frequently enough to reflect changes in schools' circumstances. Over 2014 to 2017, the Department provided additional grants to non‑government schools under the National Education Reform Agreement (NERA), to bring funding more closely in line with the Australian Department of Education and Training's Schooling Resource Standard (SRS). From 2018, the Department has changed the way it calculates per capita grants to more closely align with the Australian Department of Education and Training's approach.

The Department determines eligibility for grants by checking a school's registration status with NESA. However, NESA's approach to monitoring compliance with the registration requirements prioritises student learning and wellbeing requirements over the requirement for policies and procedures for proper governance. Given their importance to the appropriate use of government funding, NESA could increase its monitoring of policies and procedures for proper governance through its program of random inspections. Further, the Department and NESA should enter into a formal agreement to share information to more accurately determine the level of risk of non‑compliance at each school. This may help both agencies more effectively target their monitoring to higher‑risk schools.

By December 2018, the NSW Department of Education should:

2. Strengthen its processes to provide greater assurance that the enrolment and expenditure information it collects from non‑government schools is accurate. This should build on the work the Australian Government already does in this area.
3. Establish formal information‑sharing arrangements with the NSW Education Standards Authority to more effectively monitor schools' eligibility to receive funding.
    

By December 2018, the NSW Education Standards Authority should:

5. Extend its inspection practices to increase coverage of the registration requirement for policies and procedures for the proper governance of schools.
6. Establish formal information‑sharing arrangements with the NSW Department of Education to more effectively monitor schools' continued compliance with the registration requirements.

The Department’s current approach to managing grants to non‑government schools could be improved to provide greater confidence that funds are being spent in line with the objectives of the grant schemes.

The NSW Government provides funding to non‑government schools to improve student learning outcomes, and to support schooling choices by parents, but does not monitor whether these grants are achieving this. In addition, each grant program has specific objectives. The main objectives for the per capita grant program is to increase the rate of students completing Year 12 (or equivalent), and to improve education outcomes for students. While non‑government schools publicly report on some educational measures via the MySchool website, these measures do not address all the objectives. Strengthened monitoring and reporting of progress towards objectives, at a school level, would increase accountability for public funding. This may require the Department to formalise its access to student level information.

The Department has listed five broad categories of acceptable use for per capita grants, however, provides no further guidance on what expenditure would fit into these categories. Clarifying the appropriate use of grants would increase confidence that funding is being used as intended. Schools must engage an independent auditor, registered with ASIC, to certify that the funding has been spent. The Department could strengthen this approach by improving its processes to check the registration of the auditor, and to verify their independence.

The Department has limited oversight of funding provided to System Authorities (Systems). The Department provides grants to Systems for all their member schools. The Systems can distribute the grants to their schools according to their own methodology. Systems are not required to report to the Department how much of their grant was retained for administrative or centralised expenses. Increased oversight over how the Systems distribute this grant could provide increased transparency for the use of public funds by systems.

By December 2018, the NSW Department of Education should:

1. Establish and communicate funding conditions that require funded schools to:
   • adhere to conditions of funding, such as the acceptable use of grants, and accounting requirements to demonstrate compliance
   • report their progress towards the objectives of the scheme or wider Government initiatives
   • allow the Department to conduct investigations to verify enrolment and expenditure of funds
   • provide the Department with access to existing student level data to inform policy development and analysis.

4. Increase its oversight of System Authorities by requiring them to:
   • re‑allocate funds across their system on a needs basis, and report to the Department on this
   • provide a yearly submission with enough detail to demonstrate that each System school has spent their State funding in line with the Department's requirements.

Conclusion
The sharing of school facilities with the community is not fully effective. The Department of Education is implementing strategies to increase shared and joint use but several barriers, some outside the Department’s direct control, must be addressed to fully realise benefits to students and the community of sharing school facilities. In addition, the Department needs to do more to encourage individual schools to share facilities with the community. 

A collaborative, multi-agency approach is needed to overcome barriers to the joint use of facilities, otherwise, the Department may need significantly more funds than planned to deliver sufficient fit-for-purpose school facilities where and when needed.

Government policies encourage, but do not mandate, shared and joint use of facilities.

Since the early 2000’s, several reviews in NSW and other jurisdictions have commented on the benefits of and need to increase the sharing of school facilities. 

Several NSW Government strategies and plans support shared and joint use of facilities between schools and the wider community, but none are backed up with financial incentives, or specific plans with implementation timeframes. In Victoria and Queensland whole-of-government processes are in place to support a more coordinated approach to planning, building and sharing community facilities. For example, Victoria has a comprehensive policy framework encompassing both existing and future use of community facilities and a $50 million program to seed the development of community facilities on school sites over the next four years.  

The Department recognises benefits from the shared use of school facilities, but provides insufficient support to Principals to ensure costs are recovered and that money raised from shared use can be spent by the school in a timely manner. 

There are examples of successful shared use, but more can be done. Information about the available facilities is not readily available to potential community users. Schools should work more closely with councils and other stakeholders to leverage shared use. 

Currently, the administrative burden, costs and risks associated with shared use can exceed the perceived benefits to schools, leading to reluctance amongst some Principals to share. In addition, a substantial backlog of school-initiated infrastructure proposals awaiting Departmental approval means that schools that raise money from sharing their facilities find it difficult to use the funds they raise on improved infrastructure. Some of these proposals have been waiting for approval for more than 12 months. 

The Department could do more to support Principals by ensuring the fees charged for facilities cover the costs incurred by schools, that Principals can access help with negotiating and managing contracts, and that infrastructure proposals initiated and funded by schools are approved in a timely manner. 

The Department is not monitoring shared use across the State, and does not evaluate different approaches as evidence to influence policies and procedures.

Recommendations
By December, 2018, the Department should:

• increase incentives and reduce impediments for school Principals to share school facilities, including:
  • review the methodology for calculating fees charged for facilities to ensure that shared use of school facilities does not result in a financial burden to schools or the Department 
  • improve support provided to Principals by School Infrastructure NSW, including reducing the backlog of school-initiated infrastructure proposals awaiting approval
  • develop service standards, including timeframes, for assessing and approving school-initiated infrastructure proposals.
• provide readily-accessible information about available school facilities to community groups and local councils
• implement processes to monitor and regularly evaluate the implementation of the shared use policy and promote better practice to drive improvements.

The Department is planning a more strategic approach to increase the joint use of school facilities. However, several barriers, some outside the Department’s control, must be addressed to fully realise benefits of joint use agreements.

As discussed in our 2017 audit report on ‘Planning for school infrastructure’, joint use agreements are a key direction of the School Assets Strategic Plan. Joint use of school facilities will be necessary to ensure that there will be enough fit-for-purpose learning spaces for students when and where needed. Under the ‘Community Use of School Facilities Policy’ Principals play the leading role in identifying opportunities, and developing and managing agreements for sharing school facilities. This is impractical for joint use projects which involve substantial investment in new or refurbished assets, in particular for joint use projects in schools that are yet to be built. In addition, the policy does not address joint-use facilities built on land not owned by the Department. For these reasons, the Department is developing a new policy. 

The Department is planning to develop joint use agreements in a more systematic way as part of school community planning, previously known as cluster planning, with a special focus on local councils. Several agreements are currently being piloted, and will be evaluated to provide an evidence-based foundation for this new approach. 

To develop or refurbish school facilities for joint use, the Department, councils and other key stakeholders must work together and prioritise joint use from the earliest stages of any project. A collaborative, multi-agency approach is needed to ensure sufficient fit-for-purpose facilities are available for school students within the funding framework proposed in the School Assets Strategic Plan. 

To increase shared and joint use, the Department is recruiting specialist staff in its Asset Division to assist with the brokerage, community engagement and development of agreements, but these staff are not dedicated to joint use projects and their available time may not be sufficient to provide the necessary support in the timeframes required.

Recommendations
By December, 2018, the Department of Education should:

• ensure that the implementation of the new ‘Joint Use of School Facilities and Land Policy’ is adequately resourced, and has the support of Principals
• implement processes to monitor and regularly evaluate the implementation of joint use policy and promote better practice to drive improvements.  

Conclusion 

Several factors are reducing the effective use of ICT in the classroom. These are primarily:

• ageing ICT equipment and inadequate wireless networks
• variable student access to devices at school
• variable teacher access to centrally provided devices to use outside of the classroom.

Many schools are struggling to keep up with growing ICT needs within available funding. The Department needs to review whether its current technology programs provide schools with sufficient resources and support to meet the Department’s strategic goals for 21st Century classrooms. The Department should also target additional support to schools to improve planning for ICT resources.  

Most teachers are using ICT in the classroom, however, teacher access to devices outside the classroom varies between schools. In practice, teacher working days extend outside classroom hours. Teachers need access to devices for activities such as lesson preparation and student assessment. With limited access to devices outside of the classroom, teachers may not be able to effectively integrate ICT into lessons. Teachers also require further professional learning to support them to develop their skills in using ICT.  

The Department is not sufficiently monitoring the digital literacy of New South Wales students, which has declined in national tests. Teachers could benefit from support to assess these skills at a school level. The Department also needs to investigate links between student use of ICT and learning outcomes, so they can better support teachers with evidence-based approaches to enhancing learning through ICT.