Reports
Actions for One TAFE NSW modernisation program
One TAFE NSW modernisation program
The Auditor-General for New South Wales, Margaret Crawford, released a report today examining the management of the One TAFE NSW modernisation program.
In 2016, the Government released 'A Vision for TAFE NSW' which stated that TAFE NSW needed to become more flexible, efficient and competitive. It set out the need to progressively reduce significant cost inefficiencies, including by moving away from separate institutes to a single institute model. TAFE NSW established the One TAFE NSW modernisation program to deliver on that vision.
The Auditor General found that the One TAFE NSW modernisation program did not deliver against its key objectives within planned timeframes. The modernisation program originally aimed to realise $250 million in annual savings from 2018–19. Because of project delays and higher than expected transition costs, TAFE NSW did not meet the original savings target. TAFE NSW has made progress on key elements of the program and anticipates that savings will be realised in coming years.
The report makes two recommendations to improve governance arrangements for delivering on commercial objectives and increasing transparency of non commercial activities.
The report also identifies a series of lessons for future government transformation programs.
TAFE NSW is the public provider of Vocational Education and Training (VET) in New South Wales. In 2018, TAFE NSW enrolled 436,000 students in more than 1,200 courses at around 130 locations across the State.
There have been major policy changes impacting TAFE NSW over the past decade. Under the Smart and Skilled reform, TAFE NSW started to compete with other Registered Training Organisations (RTOs) for a share of the student market.
In 2016, the NSW Government released 'A Vision for TAFE NSW'. The Vision stated that a failure to adapt to market circumstances had left TAFE NSW with unsustainable costs and inefficiencies. To address this, TAFE NSW needed to become more flexible, efficient and competitive. It set out that TAFE NSW must progressively reduce significant cost inefficiencies, including by moving away from a model of separate institutes to a One TAFE NSW model. The NSW Government set TAFE NSW a target to achieve savings through implementing the Vision.
TAFE NSW established the One TAFE NSW modernisation program to deliver on that vision. The program initially aimed to deliver savings of $250 million per year from 2018–19, but this target was reviewed and updated as the program was being delivered.
This audit assessed whether TAFE NSW effectively managed the One TAFE NSW modernisation program to deliver on the NSW Government's vision for TAFE NSW. In making this assessment, the audit examined whether:
- delivery of the program was well planned
- the program was driven by sound governance arrangements
- TAFE NSW is making progress against the intended outcomes of the program.
The audit focused on the effectiveness of planning, governance and reporting arrangements. It examined five projects within the overall modernisation program as case studies.
Conclusion
The One TAFE NSW modernisation program was an ambitious plan to deliver on the NSW Government’s vision for TAFE NSW, while achieving ongoing savings. Several factors contributed to TAFE NSW not effectively managing the program to deliver on planned timeframes and objectives. These factors include unclear expectations of the primary role of TAFE NSW, unrealistic timeframes, undertaking a large number of complex projects concurrently, governance arrangements that were not fit-for-purpose and poor-quality data.
Planning for the modernisation program and its projects was driven by top-down savings targets and pre-determined timeframes. This led to TAFE NSW attempting to deliver a large number of programs concurrently within tight timeframes. Program management capability was underdeveloped at the commencement of the program and this affected the quality of planning for delivery.
There was a lack of clarity around TAFE NSW's primary purpose. Part of the NSW Government's vision for TAFE NSW was for it to be more commercial, competitive and efficient. These objectives were not fully supported by existing legislation. The commercial objectives of the modernisation program conflicted with legislated social objectives for TAFE NSW. TAFE NSW did not have the autonomy to operate like a government-owned business in a market environment. And while TAFE NSW received separate funding to support students facing disadvantage this did not cover the costs of other non-commercial activities undertaken for social purposes, such as delivering uneconomic courses. The role of the TAFE Commission Board was ambiguous during the initial years of the program, which increased reporting requirements and blurred accountabilities for decision-making.
TAFE NSW's Strategic Plan 2016-22 nominated ten key milestones for delivery by January 2019. TAFE NSW has made progress against several important milestones, including that TAFE ‘is a single TAFE NSW brand’ and has 'industry specific TAFE NSW SkillsPoints'. Other key elements have yet to be delivered, including that TAFE NSW achieves 'integrated enterprise-wide business systems'. Because of delays to projects and higher than expected transition costs, TAFE NSW reported that it did not meet the originally targeted $250 million in annual savings for 2018–19 (which was reviewed and updated as the program was being delivered).
Appendix one – Response from agency
Appendix two – About the audit
Appendix three – 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 #346 - released 17 December 2020
Actions for Transport 2020
Transport 2020
1. Financial Reporting |
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Audit opinion | Unmodified audit opinions issued for the financial statements of all Transport cluster entities. |
Quality and timeliness of financial reporting | All cluster agencies met the statutory deadlines for completing the early close and submitting the financial statements. Transport cluster agencies continued to experience some challenges with accounting for land and infrastructure assets. The former Roads and Maritime Services and Sydney Metro recorded prior period corrections to property, plant and equipment balances. |
Impact of COVID-19 on passenger revenue and patronage | Total patronage and revenue for public transport decreased by approximately 18 per cent in 2019–20 due to COVID-19. The Transport cluster received additional funding from NSW Treasury during the year to support the reduced revenue and additional costs incurred such as cleaning on all modes of public transport and additional staff to manage physical distancing. |
Completion of the CBD and South East Light Rail | The CBD and South East Light Rail project was completed and commenced operations in this financial year. At 30 June 2020, the total cost of the project related to the CBD and South East Light Rail was $3.3 billion. Of this total cost, $2.6 billion was recorded as assets, whilst $700 million was expensed. |
2. Audit Observations |
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Internal control | While internal controls issues raised in management letters in the Transport cluster have decreased compared to the prior year, control weaknesses continue to exist in access security for financial systems. We identified 56 management letter findings across the cluster and 43 per cent of all issues were repeat issues. The majority of the repeat issues relate to information technology controls around user access management. There were three high risk issues identified - two related to financial reporting of assets and one for implementation of TAHE (see below). |
Agency responses to emergency events | Transport for NSW established the COVID-19 Taskforce in March 2020 to take responsibility for the overall response of planning and coordination for the Transport cluster. It also implemented the COVIDSafe Transport Plan which incorporates guidance on physical distancing, increasing services to support social distancing and cleaning. |
RailCorp transition to TAHE | On 1 July 2020, RailCorp was renamed Transport Asset Holding Entity of New South Wales (TAHE) and converted to a for-profit statutory State-Owned Corporation. TAHE is a commercial for-profit Public Trading Entity with the intent to provide a commercial return to its shareholders. A plan was established by NSW Treasury to transition RailCorp to TAHE which covered the period 1 July 2015 to 1 July 2019. A large portion of the planned arrangements were not implemented by 1 July 2020. As at the time of this report, the TAHE operating model, Statement of Corporate Intent (SCI) and other key plans and commercial agreements are not finalised. The State Owned Corporations Act 1989 generally requires finalisation of an SCI three months after the commencement of each financial year. However, under the Transport Administration Act 1988, TAHE received an extension from the voting shareholders, the Treasurer and Minister for Finance and Small Business, to submit its first SCI by 31 December 2020. In accordance with the original plan, interim commercial access arrangements were supposed to be in place with RailCorp prior to commencement of TAHE. Under the transitional arrangements, TAHE is continuing to operate in accordance with the asset and safety management plans of RailCorp. The final operating model is expected to include considerations of safety, operational, financial and fiscal risks. This should include a consideration of the potential conflicting objectives of a commercial return, and maintenance and safety measures. This matter has been included as a high risk finding in our management letter due to the significance of the financial reporting impacts and business risks for TAHE. Recommendation: TAHE management should:
Resolution of the above matters are critical as they may significantly impact the financial reporting arrangements for TAHE for 2020–21, in particular, accounting policies adopted as well as measurement principles of its significant infrastructure asset base. |
Completeness and accuracy of contracts registers | Across the Transport cluster, contracts and agreements are maintained by the transport agencies using disparate registers. Recommendation (repeat): Transport agencies should continue to implement a process to centrally capture all contracts and agreements entered. This will ensure:
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This report provides parliament and other users of the Transport cluster’s financial statements with the results of our audits, our observations, analysis, conclusions and recommendations in the following areas:
- financial reporting
- audit observations
- the impact of emergencies and the pandemic.
Financial reporting is an important element of good governance. Confidence and transparency in public sector decision making are enhanced when financial reporting is accurate and timely.
This chapter outlines our audit observations related to the financial reporting of agencies in the Transport cluster for 2020, including any financial implications from the recent emergency events.
Section highlights
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Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are essential for quality and timely decision making.
This chapter outlines our:
- observations and insights from our financial statement audits of agencies in the Transport cluster
- assessment of how well cluster agencies adapted their systems, policies and procedures, and governance arrangements in response to recent emergencies.
Section highlights
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Appendix one – List of 2020 recommendations
Appendix two – Status of 2019, 2018 and 2017 recommendations
Appendix three – Management letter findings
Appendix four – Financial data
Copyright notice
© 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.
Actions for Education 2020
Education 2020
The Auditor-General for New South Wales, Margaret Crawford, released a report today titled Education 2020. This report focuses on key observations and findings from the most recent audits of agencies in the Education cluster.
Unqualified audit opinions were issued for all cluster agencies’ financial statements. However, internal control deficiencies were identified across the cluster agencies, including deficiencies in the management of purchasing cards and 15 internal control issues that were repeated from the previous year.
The 2019–20 natural disasters caused widespread damage in both Northern and Southern NSW. The COVID‑19 pandemic further challenged agencies, requiring social distancing and other infection control measures which disrupted the traditional means of teaching students. Agencies have adjusted their operations to respond to these emergency events.
The TAFE Commission’s revenues 2019–20 were impacted by the pandemic. Lower enrolments and an increase in fee-free short courses offered during the year contributed to the result.
This report analyses the results of our audits of financial statements of entities within the Education cluster for the year ended 30 June 2020. The table below summarises our key observations and recommendations.
1. Financial reporting
Audit opinions | Unqualified audit opinions were issued for all cluster agencies' 30 June 2020 financial statements audits. |
New accounting standards |
Agencies implemented three new accounting standards during the year. Our financial statement audits of the Department of Education (the Department) and NSW Education Standards Authority (NESA) identified issues with the leasing information provided by Property NSW (PNSW). Despite the outsourcing arrangement, both the Department and NESA remain ultimately responsible for the completeness and accuracy of this information, which would have benefited from a more thorough quality assurance, validation and review process before they placed reliance upon it. Recommendation: We recommend the Department and NESA:
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Changes were made to the financial reporting requirements this year to account for the impact of the pandemic |
Emergency legislation was enacted during the year in response to the COVID-19 pandemic. The legislation revised the statutory reporting deadlines for agencies to submit their financial statements and allowed the Treasurer to continue authorising payments from the consolidated fund until the enactment of the 2020–21 budget. All cluster agencies prepared their financial statements on a going concern basis and submitted their financial statements within the revised statutory deadlines. The State provided $159.0 million in stimulus funding to support the operations of cluster agencies during emergency events. Nearly half of this funding was to support cleaning activities by the Department and the Technical and Further Education Commission (the TAFE Commission) during the COVID-19 pandemic. |
Quality and timeliness of financial reporting |
The number of monetary misstatements identified in agencies' financial statements decreased to 14 (23 in 2018–19). While the number of corrections made to the financial statements after the submission date increased to eight (two in 2018–19), it is important to note these corrections provide parliament and other users of the financial statements increased confidence in the accuracy and presentation of agencies' performance and financial position. |
Sustainability of cluster agencies | The TAFE Commission's enrolments declined, and operating margins reduced, both being impacted by the COVID-19 pandemic. |
2. Audit observations
Internal control deficiencies |
We identified 33 internal control issues, including 15 findings that were repeated from previous years. A high-risk issue was reported at the Department relating to the inadequate monitoring and follow up of privileged user activity in its enterprise resource planning system – SAP. Repeat findings relate to ongoing deficiencies in information technology controls and management policies, practices and procedures. Recommendation: Cluster agencies should:
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Agency responses to emergency events |
The Department established a separate bushfire relief directorate and COVID-19 Taskforce to assist and support school communities in response to recent emergencies. Other cluster agencies have established committees or response teams to oversee and address all aspects of the impact of COVID-19. |
Schools review 2019 | We continue to identify instances of non-compliance in relation to cash management and procurement at schools. |
Use of purchasing cards at the Department of Education |
Since 2015, the NSW Government has encouraged the use of purchasing cards by public sector agencies. Purchasing cards are efficient to transact low value, high volume procurement of goods and services, but the use must be effectively monitored. Our review of the Department's purchasing cards identified weaknesses in its oversight and monitoring controls, including the issue and cancellation of purchasing cards Opportunities exist for the Department to better monitor card use. Tools such as data analytics are an efficient and effective detective control to identify irregular activity or misuse by cardholders. Recommendation: The Department should:
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This report provides parliament and other users of the Education cluster’s financial statements with the results of our audits, our observations, analysis, conclusions and recommendations in the following areas:
- financial reporting
- audit observations
- the impact of emergencies and the COVID-19 pandemic.
Financial reporting is an important element of good governance. Confidence and transparency in public sector decision making are enhanced when financial reporting is accurate and timely.
The COVID-19 Legislation Amendment (Emergency Measures–Treasurer) Act 2020 amended legislation administered by the Treasurer to implement further emergency measures as a result of the COVID-19 pandemic. These amendments:
- allowed the Treasurer to authorise payments from the consolidated fund until the enactment of the 2020–21 budget – supporting the going concern assessments of cluster agencies
- revised budgetary, financial and annual reporting time frames – impacting the timeliness of financial reporting
- exempted certain statutory bodies and departments from preparing financial statements.
This chapter outlines our audit observations related to the financial reporting of agencies in the Education cluster for 2020, including any financial implications from the recent emergency events.
Section highlightsUnqualified audit opinions were issued on the financial statements of cluster agencies.
All cluster agencies met the revised statutory deadlines for completing early close procedures and submitting their financial statements. Emergency legislation allowing the Treasurer to continue authorising payments from the consolidated fund under the existing Appropriations Act enabled cluster agencies to prepare financial statements on a going concern basis.
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Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are essential for quality and timely decision making.
This chapter outlines our:
- observations and insights from our financial statement audits of agencies in the Education cluster. It also comments on our review of elements of the financial control framework applied by schools in NSW whose financial results form part of the Department of Education's (the Department) financial statements.
- assessment of how well cluster agencies adapted their systems, policies and procedures, and governance arrangements in response to recent emergencies.
Section highlights
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Appendix one – List of 2020 recommendations
Appendix two – Status of 2019 and 2018 recommendations
Appendix three – Financial data
Copyright notice
© 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.
Actions for Train station crowding
Train station crowding
This report focuses on how Transport for NSW and Sydney Trains manage crowding at selected metropolitan train stations.
The audit found that while Sydney Trains has identified platform crowding as a key strategic risk, it does not have an overarching strategy to manage crowding in the short to medium term. Sydney Trains 'do not have sufficient oversight to know if crowding is being effectively managed’, the Auditor-General said.
Sydney Trains' operational response to crowding involves restricting customer access to platforms or station entries before crowding reaches unsafe levels or when it impacts on-time running. Assuming rail patronage increases, it is likely that Sydney Trains will restrict more customers from accessing platforms or station entries, causing customer delay. ‘Restricting customer access to platforms or station entries is not a sustainable approach to manage station crowding’, said the Auditor-General.
The Auditor-General made seven recommendations to improve Transport for NSW and Sydney Trains' management of station crowding. Transport for NSW have accepted these recommendations on behalf of the Transport cluster.
Public transport patronage has been impacted by COVID-19. This audit was conducted before these impacts occurred.
Sydney Trains patronage has increased by close to 34 per cent over the last five years, and Transport for NSW (TfNSW) expects the growth in patronage to continue over the next 30 years. As patronage increases there are more passengers entering and exiting stations, moving within stations to change services, and waiting on platforms. As a result, some Sydney metropolitan train stations are becoming increasingly crowded.
There are three main causes of station crowding:
- patronage growth exceeding the current capacity limits of the rail network
- service disruptions
- special events.
Crowds can inhibit movement, cause discomfort and can lead to increased health and safety risks to customers. In the context of a train service, unmanaged crowds can affect service operation as trains spend longer at platforms waiting for customers to alight and board services which can cause service delays. Crowding can also prevent customers from accessing services.
Our 2017 performance audit, ‘Passenger Rail Punctuality’, found that rail agencies would find it hard to maintain train punctuality after 2019 unless they significantly increased the capacity of the network to carry trains and people. TfNSW and Sydney Trains have plans to improve the network to move more passengers. These plans are set out in strategies such as More Trains, More Services and in the continued implementation of new infrastructure such as the Sydney Metro. Since 2017, TfNSW and Sydney Trains have introduced 1,500 more weekly services to increase capacity. Additional network capacity improvements are in progress for delivery from 2022 onwards.
In the meantime, TfNSW and Sydney Trains need to use other ways of managing crowding at train stations until increased capacity comes on line.
This audit examined how effectively TfNSW and Sydney Trains are managing crowding at selected metropolitan train stations in the short and medium term. In doing so, the audit examined how TfNSW and Sydney Trains know whether there is a crowding problem at stations and how they manage that crowding.
TfNSW is the lead agency for transport in NSW. TfNSW is responsible for setting the standard working timetable that Sydney Trains must implement. Sydney Trains is responsible for operating and maintaining the Sydney metropolitan heavy rail passenger service. This includes operating, staffing and maintaining most metropolitan stations. Sydney Trains’ overall responsibility is to run a safe rail network to timetable.
ConclusionSydney Trains has identified platform crowding as a key strategic risk, but does not have an overarching strategy to manage crowding in the short to medium term. TfNSW and Sydney Trains devolve responsibility for managing crowding at stations to Customer Area Managers, but do not have sufficient oversight to know if crowding is being effectively managed. TfNSW is delivering a program to influence demand for transport in key precincts but the effectiveness of this program and its impact on station crowding is unclear as Transport for NSW has not evaluated the outcomes of the program. TfNSW and Sydney Trains do not directly measure or collect data on station crowding. Data and observation on dwell time, which is the time a train waits at a platform for customers to get on and off trains, inform the development of operational approaches to manage crowding at stations. Sydney Trains has KPIs on reliability, punctuality and customer experience and use these to indirectly assess the impact of station crowding. TfNSW and Sydney Trains only formally assess station crowding as part of planning for major projects, developments or events. Sydney Trains devolve responsibility for crowd management to Customer Area Managers, who rely on frontline Sydney Trains staff to understand how crowding affects individual stations. Station staff at identified key metropolitan train stations have developed customer management plans (also known as crowd management plans). However, Sydney Trains does not have policies to support the creation, monitoring and evaluation of these plans and does not systematically collect data on when station staff activate crowding interventions under these plans. Sydney Trains stated focus is on providing a safe and reliable rail service. As such, management of station crowding is a by-product of its strategies to manage customer safety and ensure on-time running of services. Sydney Trains' operational response to crowding involves restricting customer access to platforms or stations before crowding reaches unsafe levels, or when it impacts on-time running. As rail patronage increases, it is likely that Sydney Trains will need to increase its use of interventions to manage crowding. As Sydney Trains restrict more customers from accessing platforms or station entries, it is likely these customers will experience delays caused by these interventions. Since 2015, TfNSW has been delivering the 'Travel Choices' program which aims to influence customer behaviour and to manage the demand for public transport services in key precincts. TfNSW is unable to provide data demonstrating the overall effectiveness of this program and the impact the program has on distributing public transport usage out of peak AM and PM times. TfNSW and Sydney Trains continue to explore initiatives to specifically address crowd management. |
ConclusionTfNSW and Sydney Trains do not directly measure or collect data on station crowding. There are no key performance indicators directly related to station crowding. Sydney Trains uses performance indicators on reliability, punctuality and customer experience to indirectly assess the impact of station crowding. Sydney Trains does not have a routine process for identifying whether crowding contributed to minor safety incidents. TfNSW and Sydney Trains formally assess station crowding as part of planning for major projects, developments or events. |
ConclusionSydney Trains has identified platform crowding as a strategic risk but does not have an overarching strategy to manage station crowding. Sydney Trains' stated focus is on providing a safe and reliable rail service. As such, management of station crowding is a by-product of its strategies to manage customer safety and ensure on-time running of services. Sydney Trains devolve responsibility for managing crowding at stations to Customer Area Managers but does not have sufficient oversight to know that station crowding is effectively managed. Sydney Trains does not have policies to support the creation, monitoring or evaluation of crowd management plans at key metropolitan train stations. The use of crowding interventions is likely to increase due to increasing patronage, causing more customers to experience delays directly caused by these activities. TfNSW and Sydney Trains have developed interventions to influence customer behaviour and to manage the demand for public transport services but are yet to evaluate these interventions. As such, their impact on managing station crowding is unclear. |
Appendix one – Response from agency
Appendix two – Sydney rail network
Appendix three – Rail services contract
Appendix four – Crowding pedestrian modelling
Appendix five – Airport Link stations case study
Appendix six – About the audit
Appendix seven – Performance auditing
Copyright notice
© 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 #333 - released 30 April 2020
Actions for Education 2019
Education 2019
This report focuses on key observations and findings from the most recent financial audits of agencies in the Education cluster. From 1 July 2019, the Technical and Further Education Commission, the NSW Skills Board and the functions and activities associated with vocational training and skills form part of the Education cluster.
Unqualified audit opinions were issued for all cluster agencies’ financial statements. However, internal control deficiencies were identified across the cluster agencies, including 14 findings that were repeated from the previous year. Control deficiencies were also identified in a sample of the state’s 2,200 schools. Schools did not always apply the guidance in the Department of Education's ‘Finance in Schools Handbook’, resulting in control weaknesses in key areas such as governance, cash management and procurement.
'In addition, we continue to observe inconsistencies in the employee leave data reported from the Department of Education’s payroll system, which impact the reliability of estimates of the Department’s liability for employee benefits. The robustness of the Department's quality assurance over leave liability data should be improved', the Auditor-General said.
This report analyses the results of our audits of financial statements of entities within the Education cluster for the year ended 30 June 2019. The table below summarises our key observations.
1. Machinery of Government changes
The Education cluster has expanded | From 1 July 2019, the Technical and Further Education Commission, the NSW Skills Board and the functions and activities associated with vocational training and skills now form part of the Education cluster. |
2. Financial reporting
Audit opinions |
Unqualified audit opinions were issued for all cluster agencies' 30 June 2019 financial statements audits. The number of corrections to disclosures in the financial statements, which increased this year, could have been reduced by a more thorough quality assurance over the information underpinning the financial statements. Recommendation: Cluster agencies should improve their quality assurance processes for financial reporting to improve the accuracy of financial statements presented for audit. |
Preparedness for new accounting standards |
Agencies will implement four new accounting standards shortly. Three are effective from 1 July 2019 and the fourth is effective from 1 July 2020. Cluster agencies needed to do more work on their impact assessments to better prepare for their implementation from 1 July 2019. Recommendation: Cluster agencies should finalise their plans to implement the new accounting standards as soon as possible. |
Timeliness of financial reporting |
All cluster agencies met the statutory deadline for completing early close procedures and submitting their financial statements for audit. The Department of Education (the Department) delays tabling its financial statements in parliament so it can report its operational outcomes, which are aligned to the calendar year, in a single report. This reduces transparency over the Department's financial statements as they are tabled more than ten months after the end of the financial year. Recommendation: The Department should table its financial statements in parliament earlier, in line with other NSW Government agencies. |
Inconsistencies in the employee leave data | We continue to observe inconsistencies in the employee leave data reported from the Department’s payroll system, which impacts the reliability of estimates of the Department's liability for employee benefits. The robustness of the Department's quality assurance over leave liability data should be improved. |
3. Audit observations
Internal control deficiencies |
We identified 55 internal control issues, including 14 findings that were repeated from the previous year. Issues were identified with user access administration, segregation of duties in the Department's key application system and timely preparation and review of key reconciliations. Recommendation: Cluster agencies should prioritise and action recommendations to address internal control weaknesses. |
Schools review 2018 |
Our review of a selection of NSW schools identified deficiencies in how they applied the Department of Education's ‘Finance in Schools Handbook’, resulting in control weaknesses in key areas such as governance, cash management and procurement. Recommendation: The Department should ensure all schools apply the Department’s ‘Finance in Schools Handbook’ as it is a key internal control. |
This report provides parliament and other users of the Education cluster’s financial statements with the results of our audits, our observations, analysis, conclusions and recommendations in the following areas:
- financial reporting
- audit observations.
This cluster was significantly impacted by the Machinery of Government changes. The Technical and Further Education Commission and the NSW Skills Board, part of the former Industry cluster, were transferred on 1 July 2019. This report focuses on agencies in the Education cluster from 1 July 2019. Please refer to the section on Machinery of Government changes for more details.
Machinery of Government refers to how the government organises the structures and functions of the public service. Machinery of Government changes are where the government reorganises these structures and functions, and the changes are given effect by Administrative Arrangements Orders.
Section highlights
The 2019 Machinery of Government changes significantly impacted the Education cluster. From 1 July 2019, the functions and activities associated with the administration of legislation allocated to the Minister for Skills and Tertiary Education were transferred from the former Industry cluster to the Education cluster. Aboriginal Affairs NSW was transferred from the Department of Education (the Department) to the Department of Premier and Cabinet.
The Department is the principal agency in the cluster. The Machinery of Government changes bring new responsibilities, risks and challenges to the cluster.
Financial reporting is an important element of good governance. Confidence and transparency in public sector decision making are enhanced when financial reporting is accurate and timely.
This chapter outlines our audit observations related to the financial reporting of agencies in the Education cluster for 2019.
Section highlights
Unqualified audit opinions were issued on the financial statements of cluster agencies. However, a more thorough quality review process of the financial statements submitted for audit would help reduce the number of corrections to those statements.
All cluster agencies met the statutory deadlines for completing the early close procedures and submitting the financial statements.
We continue to observe inconsistencies in the employee leave data reported from the Department of Education’s (the Department) payroll system. The robustness of the Department's quality assurance over leave liability data should be improved.
Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are essential for quality and timely decision making.
This chapter outlines our observations and insights from our financial statement audits of agencies in the Education cluster. It also comments on our review of the financial control framework applied by 70 schools in NSW whose financial results form part of the Department of Education's (the Department) financial statements.
Section highlights
- Audit Office management letter recommendations to address internal control weaknesses should be actioned promptly, with a focus on addressing repeat issues. The 2018–19 financial audits of cluster agencies identified 55 internal control issues, including 14 that were carried forward from the previous year.
- Application controls are procedures that operate at a business process level designed to ensure the integrity of accounting records. The Department can mitigate the risk of fraud or error in preparing its financial statements if segregation of duties are appropriately configured in their key application system.
- Our review of a selection of schools across NSW identified deficiencies in how schools apply the Department’s financial management practices and governance arrangements.
Appendix one – List of 2019 recommendations
Appendix two – Status of 2018 recommendations
Appendix three – Cluster agencies
Appendix four – Financial data
Copyright notice
© 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.
Actions for Transport 2019
Transport 2019
This report details the results of the financial audits of NSW Government's Transport cluster for the financial year ended 30 June 2019. The report focuses on key observations and findings from the most recent financial statement audits of agencies in the Transport cluster.
Unqualified audit opinions were issued for all agencies' financial statements. However, valuations of assets continue to create challenges across the cluster. The Audit Office identified some deficiencies in relation to asset valuations at Transport for NSW, Roads and Maritime Services, Rail Corporation New South Wales and Sydney Metro.
The Audit Office noted an increase in findings on internal controls across the Transport cluster. Key themes related to information technology, asset management and employee leave entitlements. The report also highlights the status of significant infrastructure projects across the Transport cluster.
The report makes several recommendations including:
- agency finance teams need to be consulted on major business decisions and commercial transactions at the time of their execution to assess the financial reporting impacts
- the Department of Transport should ensure consistent accounting policies are applied across its controlled entities.
This report analyses the results of our audits of financial statements of the Transport cluster for the year ended 30 June 2019. The table below summarises our key observations.
1. Machinery of Government changes
Transport for NSW, as the lead agency, will absorb the functions of Roads and Maritime Services |
The NSW Government announced its intention to integrate Roads and Maritime Services (RMS) into Transport for NSW (TfNSW) as part of the Machinery of Government changes. This change was not included in the Administrative Orders as the Transport Administration Act 1988 No. 109 governs the composition of the Transport cluster. The Transport Administration Amendment (RMS Dissolution) Act 2019 (the Act) received assent on 22 November 2019. The Act dissolves RMS and transfers the assets, rights and liabilities of RMS to TfNSW. As at the date of this Report, the Act is not yet in force. Transport is considering the impact of the changes on its operating model and financial reporting. |
2. Financial reporting
Audit opinions |
Unqualified audit opinions were issued on the 2018–19 financial statements of all agencies in the Transport cluster. TfNSW and Sydney Metro obtained a three-week extension from NSW Treasury to submit their financial statements for audit to resolve accounting issues surrounding the valuation of property, plant and equipment. The Department of Transport reported total consolidated property, plant and equipment of $158 billion at 30 June 2019. In 2018–19, there were issues with asset valuations at TfNSW, RMS, Sydney Metro and Rail Corporation New South Wales (RailCorp), resulting in adjustments after the submission of financial statements for audit and the correction of a prior period error. |
Preparedness for new accounting standards |
Agencies across the cluster are progressing in their implementation of the new accounting standards. Transport cluster agencies need to improve their contracts registers to ensure they have a complete list of contracts and agreements to assess the impact of the new accounting standards. |
Valuation of assets remains a challenge in the Transport cluster |
Whilst agencies complied with the requirements of the accounting standards and NSW Treasury policies on valuations, the Audit Office identified some deficiencies in relation to asset valuations across the cluster.
Sydney Metro North West officially opened in May 2019 and reported total assets of $9.1 billion. Sydney Metro derecognised $322 million in assets constructed to facilitate its operation but transferred to councils and utilities. |
Inconsistent accounting policies across the Transport cluster |
There was an inconsistency identified in the cluster relating to the valuation of substratum land. In 2018–19, RailCorp derecognised $109 million of substratum land to ensure consistency in its approach with other Transport agencies. As the parent entity, the Department of Transport needs to ensure accounting policies are consistently applied across all controlled entities for consolidation purposes. Inconsistencies in the application of accounting standards across agencies will impact comparability of financial reporting and decision making across the Transport cluster. |
Revenue growth |
Public transport passenger revenue increased by $89.0 million (5.9 per cent) in 2018–19, and patronage increased by 37.8 million (4.9 per cent) across all modes of transport based on data provided by TfNSW. The increase in revenue is mainly due to an increase in patronage as well as the annual increase in fares. |
Negative Opal cards |
Negative balance Opal cards resulted in $2.9 million in revenue not collected in 2018–19 ($10.4 million since the introduction of Opal). In January 2019, Transport made a change to the Sydney Airport stations to prevent customers with high negative balances exiting the station. In addition, in late 2018, Transport increased the minimum top up values for new cards at the airport stations. |
3. Audit observations
Internal controls | There was an increase in findings on internal controls across the Transport cluster. Key themes relate to information technology, employee leave entitlements and asset management. Twenty-nine per cent of all issues were repeat issues. The majority of the repeat issues related to information technology controls. |
Write-off of assets | In addition to a $322 million derecognition of assets transferred to councils and utilities by Sydney Metro and a $109 million derecognition of substratum land at RailCorp, the Transport cluster wrote-off $278 million of assets related to roads, bridges, maritime assets, traffic signals and controls network. These mainly related to roads, bridges, maritime assets, traffic signals and the control network where new infrastructure assets substantially replaced an existing asset as part of construction activities. |
Transport Asset Holding Entity (TAHE) |
TAHE was established to be a dedicated asset manager for the delivery of public transport asset management. The Transport Administration Amendment (Transport Entities) Act 2017 will transition RailCorp into TAHE. RailCorp is now expected to transition to TAHE from 1 July 2020 (previously 1 July 2019). Several working groups have been considering various aspects of the TAHE transition including its status as a for profit Public Trading Enterprise, the operating model and the impact of the new accounting standards AASB 16 'Leases' and AASB 1059 'Service Concession Arrangements: Grantors'. The considerations of these aspects identified several challenges in the implementation of TAHE which has led to the revised transition date. Given the delays in implementation, it is important to clarify the intent of the TAHE model. |
Excess annual leave |
Twenty-six per cent of Transport employees have annual leave balances exceeding 30 days. Of the employees with excess leave balances, 732 (10.3 per cent) did not take any annual leave in 2018–19.
|
Completeness and accuracy of contracts registers |
There are no centralised processes to record all significant contracts and agreements in a register across the Transport cluster.
|
This report provides parliament and other users of the Transport cluster’s financial statements with the results of our audits, our observations, analysis, conclusions and recommendations in the following areas:
- financial reporting
- audit observations.
This cluster was impacted by the Machinery of Government changes on 1 July 2019. The NSW Government announced its intention to integrate Roads and Maritime Services (RMS) into Transport for NSW (TfNSW). This report is focused on the Transport cluster prior to these changes. Please refer to the section on Machinery of Government changes for more details.
Machinery of Government refers to how the government organises the structures and functions of the public service. Machinery of Government changes are where the government reorganises these structures and functions, and are given effect by Administrative orders.
The Transport cluster was impacted by recent Machinery of Government changes. These changes were announced by the Department of Premier and Cabinet but were not included in the Administrative Orders as the Transport Administration Act 1988 No. 109 governs the composition of the Transport cluster. It was the intention of government to transfer the functions of the RMS into TfNSW. This requires legislative changes to the Transport Administration Act 1988 No. 109.
Section highlights
Under the Machinery of Government changes, the NSW Government will transfer the functions of RMS into TfNSW.
- The Transport Administration Amendment (RMS Dissolution) Act 2019 (the Act) received assent on 22 November 2019.
- The Act will dissolve RMS and transfer its functions, assets, rights and liabilities to TfNSW.
- As at the date of this report, the Act is not yet in force.
- There are risks and challenges for asset and liability transfers, governance and retention of knowledge.
- As of 1 July 2019, administrative arrangements (delegations and reporting line changes) were put in place to enable TfNSW and RMS to operate within a single management structure, while still remaining as separate legal entities.
- Transport is working on a number of options as to how to implement the changes.
Financial reporting is an important element of good governance. Confidence and transparency in public sector decision making are enhanced when financial reporting is accurate and timely.
This chapter outlines our audit observations related to the financial reporting of agencies in the Transport cluster for 2019.
Section highlights
- Unqualified audit opinions were issued on all agencies' financial statements.
- RMS required an extension from NSW Treasury for their early close procedures.
- TfNSW and Sydney Metro required extensions to submit their year-end financial statements.
- Valuation of assets remains a challenge across the cluster.
- There remains Opal cards with negative balances.
- Sydney Metro derecognised assets of $322 million in relation to assets constructed for third parties.
- Inconsistencies in the application of accounting policies across cluster agencies impact comparability of financial reporting across the Transport cluster.
Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are essential for quality and timely decision making.
This chapter outlines our observations and insights from our financial statement audits of agencies in the Transport cluster.
Section highlights
- There was an increase in findings on internal controls across the Transport cluster. Twenty-nine per cent of all issues were repeat issues.
- Transport entities wrote-off over $278 million of assets which were replaced by new assets or technology.
- Twenty-six per cent of Transport employees have excess annual leave.
- There are no processes to ensure all significant contracts and agreements are captured by agencies in a centralised register.
Appendix one – Timeliness of financial reporting by agency
Appendix two – Management letter findings by agency
Appendix three – List of 2019 recommendations
Appendix four – Status of 2017 and 2018 recommendations
Appendix five – Cluster agencies
© 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.
Actions for Ensuring teaching quality in NSW public schools
Ensuring teaching quality in NSW public schools
The Auditor-General for New South Wales, Margaret Crawford, has released a report on how the New South Wales Education and Standards Authority (NESA) and the Department of Education (the Department) ensure teaching quality in NSW public schools.
Around 2,200 NSW public school principals are responsible for accrediting their teachers in line with the Australian Professional Standards for Teachers. The report found that NESA does not oversight principals’ decisions to ensure that minimum standards for teaching quality are consistently met.
The Department does not effectively monitor teaching quality across the state. With limited data, it is difficult for the Department to ensure its strategies to improve teaching quality are appropriately targeted to improve teaching quality.
The Department’s Performance and Development Framework does not adequately support principals and supervisors to effectively manage and improve teacher performance or actively improve teaching quality. The Department manages those teachers formally identified as underperforming through teacher improvement programs. Only 53 of over 66,000 teachers employed by the Department were involved in these programs in 2018.
The report makes three recommendations towards NESA to improve accreditation processes, and four recommendations to the Department to improve its systems and processes for ensuring teaching quality across the State.
Australian research has shown that quality teaching is the greatest in-school influence on student engagement and outcomes, accounting for 30 per cent of the variance in student performance. An international comparative study of 15-year-old students showed the performance of New South Wales students in reading, mathematics and science has declined between 2006 and 2015.
The Australian Professional Standards for Teachers (the Standards) describe the knowledge, skills and understanding expected of effective teachers at different career stages. Teachers must be accredited against the Standards to be employed in NSW schools. The NSW Education Standards Authority (NESA) is responsible for ensuring all teachers in NSW schools are accredited. As part of the accreditation process the NSW Department of Education (The Department) assesses whether public school teachers meet proficient accreditation standards and advises NESA of its decisions.
The School Excellence Framework provides a method for the Department to monitor teaching quality at a school level across four elements of effective teaching practice. The Performance and Development Framework provides a method for teachers and their supervisors to monitor and improve teaching quality through setting professional goals to guide their performance and development.
The Department has a strategic goal that every student, every teacher, every leader and every school improves every year. In line with this goal, the Department has a range of strategies targeted to improving teaching quality at different career stages. These include additional resources to support new teachers, a program to support teachers to gain higher-level accreditation, support for principals to manage underperforming teachers, and a professional learning program where teachers observe and discuss each other's practice.
The objective of this audit was to assess the effectiveness of the NSW Department of Education's and the NSW Education Standards Authority's arrangements to ensure teaching quality in NSW public schools. To address this objective, the audit examined whether:
- agencies effectively monitor the quality of teaching in NSW public schools
- strategies to improve the quality of teaching are planned, communicated, implemented and monitored well.
Appendix one – Response from agencies
Appendix two – About the audit
Appendix three – 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 #327 - released 26 September 2019
Actions for Ensuring contract management capability in government - Department of Education
Ensuring contract management capability in government - Department of Education
This report examines whether the Department of Education has the required contract management capability to effectively manage high-value goods and services contracts (over $250,000). In 2017–18, the department managed high-value goods and services contracts worth $3.08 billion, with most of the contracts running over multiple years.
NSW government agencies are increasingly delivering services and projects through contracts with third parties. These contracts can be complex and governments face challenges in negotiating and implementing them effectively.
Contract management capability is a broad term, which can include aspects of individual staff capability as well as organisational capability (such as policies, frameworks and processes).
In 2017–18, the Department of Education (the Department) managed high-value (over $250,000) goods and services contracts worth $3.08 billion, with most of the contracts running over multiple years. The Department delivers, funds and regulates education services for NSW students from early childhood to secondary school.
This audit examined whether the Department has the required capability to effectively manage high-value goods and services contracts.
We did not examine infrastructure, construction or information communication and technology contracts. We assessed the Department against the following criteria:
- The Department’s policies and procedures support effective contract management and are consistent with relevant frameworks, policies and guidelines.
- The Department has capable personnel to effectively conduct the monitoring activities throughout the life of the contract.
The NSW Public Service Commission and the Department of Finance, Services and Innovation are included as auditees as they administer policies which directly affect contract management capability, including:
- NSW Procurement Board Directions and policies
- NSW Procurement Agency Accreditation Scheme
- NSW Public Sector Capability Framework.
The Department of Finance, Services and Innovation's responsibility for NSW Procurement will transfer to NSW Treasury on 1 July 2019 as part of changes to government administrative arrangements announced on 2 April 2019 and amended on 1 May 2019.
Conclusion The Department of Education's procedures and policies for goods and services contract management are consistent with relevant guidance. It also has a systemic approach to defining the capability required for contract management roles. That said, there are gaps in how well the Department uses this capability to ensure its contracts are performing. We also found one program (comprising 645 contracts) that was not compliant with the Department's policies. The Department has up-to-date policies and procedures that are consistent with relevant guidance. The Department also communicates changes to procurement related policies, monitors compliance with policies and conducts regular reviews aiming to identify non-compliance. The Department uses the NSW Public Service Commission's capability framework to support its workforce management and development. The capability framework includes general contract management capability for all staff and occupation specific capabilities for contract managers. The Department also provides learning and development for staff who manage contracts to improve their capability. The Department provides some guidance on different ways that contract managers can validate performance information provided by suppliers. However, the Department does not provide guidance to assist contract managers to choose the best validation strategy according to contract risk. This could lead to inconsistent practice and contracts not delivering what they are supposed to. We found that none of the 645 contracts associated with the Assisted Schools Travel Program (estimated value of $182 million in 2018–19) have contract management plans. This is contrary to the Department's policies and increases the risk that contract managers are not effectively reviewing performance and resolving disputes. |
Appendix one - Response from agencies
Appendix two - About the audit
Appendix three - Performance auditing
Parliamentary Reference: Report number #325 - released 28 June 2019
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.
Actions for Engagement of probity advisers and probity auditors
Engagement of probity advisers and probity auditors
Three key agencies are not fully complying with the NSW Procurement Board’s Direction for engaging probity practitioners, according to a report released today by the Acting Auditor-General for New South Wales, Ian Goodwin. They also do not have effective processes to achieve compliance or assure that probity engagements achieved value for money.
Probity is defined as the quality of having strong moral principles, honesty and decency. Probity is important for NSW Government agencies as it helps ensure decisions are made with integrity, fairness and accountability, while attaining value for money.
Probity advisers provide guidance on issues concerning integrity, fairness and accountability that may arise throughout asset procurement and disposal processes. Probity auditors verify that agencies' processes are consistent with government laws and legislation, guidelines and best practice principles.
According to the NSW State Infrastructure Strategy 2018-2038, New South Wales has more infrastructure projects underway than any state or territory in Australia. The scale of the spend on procuring and constructing new public transport networks, roads, schools and hospitals, the complexity of these projects and public scrutiny of aspects of their delivery has increased the focus on probity in the public sector.
A Procurement Board Direction, 'PBD-2013-05 Engagement of probity advisers and probity auditors' (the Direction), sets out the requirements for NSW Government agencies' use and engagement of probity practitioners. It confirms agencies should routinely take into account probity considerations in their procurement. The Direction also specifies that NSW Government agencies can use probity advisers and probity auditors (probity practitioners) when making decisions on procuring and disposing of assets, but that agencies:
- should use external probity practitioners as the exception rather than the rule
- should not use external probity practitioners as an 'insurance policy'
- must be accountable for decisions made
- cannot substitute the use of probity practitioners for good management practices
- not engage the same probity practitioner on an ongoing basis, and ensure the relationship remains robustly independent.
The scale of probity spend may be small in the context of the NSW Government's spend on projects. However, government agencies remain responsible for probity considerations whether they engage external probity practitioners or not.
The audit assessed whether Transport for NSW, the Department of Education and the Ministry of Health:
- complied with the requirements of ‘PBD-2013-05 Engagement of Probity Advisers and Probity Auditors’
- effectively ensured they achieved value for money when they used probity practitioners.
These entities are referred to as 'participating agencies' in this report.
We also surveyed 40 NSW Government agencies with the largest total expenditures (top 40 agencies) to get a cross sector view of their use of probity practitioners. These agencies are listed in Appendix two.
Conclusion
We found instances where each of the three participating agencies had not fully complied with the requirements of the NSW Procurement Board Direction ‘PBD-2013-05 Engagement of Probity Advisers and Probity Auditors’ when they engaged probity practitioners. We also found they did not have effective processes to achieve compliance or assure the engagements achieved value for money.
In the sample of engagements we selected, we found instances where the participating agencies did not always:
- document detailed terms of reference
- ensure the practitioner was sufficiently independent
- manage probity practitioners' independence and conflict of interest issues transparently
- provide practitioners with full access to records, people and meetings
- establish independent reporting lines reporting was limited to project managers
- evaluate whether value for money was achieved.
We also found:
- agencies tend to rely on only a limited number of probity service providers, sometimes using them on a continuous basis, which may threaten the actual or perceived independence of probity practitioners
- the NSW Procurement Board does not effectively monitor agencies' compliance with the Direction's requirements. Our enquiries revealed that the Board has not asked any agency to report on its use of probity practitioners since the Direction's inception in 2013.
There are no professional standards and capability requirements for probity practitioners
NSW Government agencies use probity practitioners to independently verify that their procurement and asset disposal processes are transparent, fair and accountable in the pursuit of value for money.
Probity practitioners are not subject to regulations that require them to have professional qualifications, experience and capability. Government agencies in New South Wales have difficulty finding probity standards, regulations or best practice guides to reference, which may diminish the degree of reliance stakeholders can place on practitioners’ work.
The NSW Procurement Board provides direction for the use of probity practitioners
The NSW Procurement Board Direction 'PBD-2013-15 for engagement of probity advisers and probity auditors' outlines the requirements for agencies' use of probity practitioners in the New South Wales public sector. All NSW Government agencies, except local government, state owned corporations and universities, must comply with the Direction when engaging probity practitioners. This is illustrated in Exhibit 1 below.
Actions for Wellbeing of secondary school students
Wellbeing of secondary school students
The Department of Education has a strong focus on supporting secondary school students’ wellbeing. However, it is difficult to assess how well the Department is progressing as it is yet to measure or report on the outcomes of this work at a whole-of-state level.
The Department of Education’s (the Department) purpose is to prepare young people for rewarding lives as engaged citizens in a complex and dynamic society. The Department commits to creating quality learning opportunities for children and young people, including a commitment to student wellbeing, which is seen as directly linked to positive learning outcomes. Wellbeing is defined broadly by the Department as “the quality of a person’s life…It is more than the absence of physical or psychological illness”. Student wellbeing can be supported by everything a school does to enhance a student's learning—from curriculum to teacher quality to targeted policies and programs to whole-school approaches to wellbeing.
Several reforms have aimed to support student wellbeing in recent years. 'Local Schools, Local Decisions' gave NSW schools more local authority to make decisions, including schools' approaches to support student wellbeing. In 2016, the 'Supported Students, Successful Students' initiative provided $167 million over four years to support the wellbeing of students. From 2018, the 'Every Student is Known, Valued and Cared For' initiative provides a principal led mentoring program, and a website with policies, procedures and resources to support student wellbeing.
This audit assessed how well the Department of Education supports secondary schools to promote and support the wellbeing of their students and how well secondary schools are promoting and supporting the wellbeing of their students.
Conclusion
The Department has implemented a range of programs and reforms aimed at supporting student wellbeing. However, the outcomes of this work have yet to be measured or reported on at a system level, making it difficult to assess the Department's progress in improving student wellbeing.
Secondary schools have generally adopted a structured approach to deliver wellbeing support and programs, using both Department and localised resources. The approaches have been tailored to meet the needs of their school community. That said, public reporting on wellbeing improvement measures via annual school reports is of variable quality and needs to improve.
The Department’s wellbeing initiatives are supported by research and consultation, but outcomes have not been reported on
The Department’s development of wellbeing policy, guidance, tools and resources has been transparent, consultative and well researched. It has drawn on international and domestic evidence to support its aim to deliver a fundamental shift from welfare to wellbeing at the school and system level.
However, the key performance indicator to monitor and track progress in wellbeing has yet to be reported on despite the strategic plan including this as a priority for the period 2018 to 2022. This includes not yet reporting a baseline for the target, nor how it will be measured.
The Department’s wellbeing resources are mostly well targeted but there is room for improvement
The Department’s allocation of resources to deliver wellbeing initiatives in schools is mostly well targeted, reflects a needs basis and supports current strategic directions. This could be improved with some changes to formula allocations and clearer definitions of the resourcing required for identified wellbeing positions in schools. The workforce modelling for forecasting supply and demand, specifically for school counsellors and psychologists, needs to separately identify these positions as they are currently subsumed in general teacher numbers.
Schools' reporting on wellbeing improvement measures is of variable quality and needs to improve
Schools we visited demonstrated a variety of approaches to wellbeing depending on their local circumstances and student populations. They make use of Department policies, guidelines, and resources, particularly mandatory policies and data collections, which have good compliance and take-up at school level. Professional learning supports specific wellbeing initiatives and online systems for monitoring and reporting have contributed to schools’ capacity and capabilities.
Schools report publicly on wellbeing improvement measures through annual school reports but this reporting is of variable quality. The Department plans to improve the capability of schools in data analysis and we recommend that this include the setting and evaluation of improvement targets for wellbeing.
The implementation of the 2015 Wellbeing Framework in schools is incomplete and the Department has not effectively prioritised and consolidated tools, systems and reporting for wellbeing
Schools' take up of the 2015 Wellbeing Framework is hindered by it not being linked to the school planning and reporting policy and tools—the School Excellence Framework. At some schools we visited, this disconnect has led to a lack of knowledge and confidence in using it in schools. The Department has identified the need to improve alignment of policies, frameworks and plans and has commenced work on this.
We found evidence of overburdening in schools for addressing student wellbeing—in the number of tools, online systems for information collection, and duplication in reporting. Following the significant reforms of recent years, the Department should consolidate its efforts by reinforcing existing effective programs and systems and addressing identified gaps and equity issues, rather than introducing further change for schools. In particular, methods and processes for complex case coordination need improvement.
The NSW Department of Education commits to creating quality learning opportunities for students. This includes strengthening students’ physical, social, emotional and spiritual development. The Department sets out to enable students to be healthy, happy, engaged and successful.
Welfare and wellbeing
The Department’s approach has significantly shifted from student welfare to wellbeing of the whole child and young person. Wellbeing is defined in departmental policy and strategy documents broadly, and as directly linked to learning and positive learning outcomes. “Wellbeing can be described as the quality of a person’s life…It is more than the absence of physical or psychological illness…Wellbeing, or the lack of it, can affect a student’s engagement and success in learning…”
Student wellbeing can be supported by everything a school does to enhance a student's learning—from curriculum to teacher quality to targeted policies and programs to whole-school approaches to wellbeing. Distinctions between wellbeing and welfare in the school context are outlined below.
Welfare | Wellbeing |
---|---|
Operates from a basis of student need and doesn't always take into account a whole child view. | For all students. |
Rather than building on the strengths of students, operates from a deficit model of individual student problems or negative behaviours. | Goes beyond just welfare needs of a few students and aims for all students to be healthy, happy, successful and productive individuals who are active and positive contributors to the school and society in which they live. |
Appendix one - Response from agency
Appendix two - Key policies, guidance, and systems
Appendix three - Funding and resources for schools
Appendix four - Measuring wellbeing
Appendix five - About the audit
Appendix six - Performance auditing
Parliamentary Reference: Report number #318 - released 23 May 2019