Reports
Contracting non-government organisations
This report found the Department of Family and Community Services (FACS) needs to do more to demonstrate it is effectively and efficiently contracting NGOs to deliver community services in the Permanency Support Program (a component of out-of-home-care services) and Specialist Homelessness Services. It notes that FACS is moving to an outcomes-based commissioning model and recommends this be escalated consistent with government policy.
Government agencies, such as the Department of Family and Community Services (FACS), are increasingly contracting non-government organisations (NGOs) to deliver human services in New South Wales. In doing so, agencies are responsible for ensuring these services are achieving expected outcomes. Since the introduction of the Commissioning and Contestability Policy in 2016, all NSW Government agencies are expected to include plans for customer and community outcomes and look for ways to use contestability to raise standards.
Two of the areas receiving the greatest funding from FACS are the Permanency Support Program and Specialist Homelessness Services. In the financial year 2017–18, nearly 500 organisations received $784 million for out-of-home care programs, including the Permanency Support Program. Across New South Wales, specialist homelessness providers assist more than 54,000 people each year and in the financial year 2017–18, 145 organisations received $243 million for providing short term accommodation and homelessness support, including Specialist Homelessness Services.
In the financial year 2017–18, FACS entered into 230 contracts for out-of-home care, of which 49 were for the Permanency Support Program, representing $322 million. FACS also entered into 157 contracts for the provision of Specialist Homelessness Services which totalled $170 million. We reviewed the Permanency Support Program and Specialist Homelessness Services for this audit.
This audit assessed how effectively and efficiently FACS contracts NGOs to deliver community services. The audit could not assess how NGOs used the funds they received from FACS as the Audit Office does not have a mandate that could provide direct assurance that NGOs are using government funds effectively.
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Conclusion
FACS cannot demonstrate it is effectively and efficiently contracting NGOs to deliver community services because it does not always use open tenders to test the market when contracting NGOs, and does not collect adequate performance data to ensure safe and quality services are being provided. While there are some valid reasons for using restricted tenders, it means that new service providers are excluded from consideration - limiting contestability. In the service delivery areas we assessed, FACS does not measure client outcomes as it has not yet moved to outcomes-based contracts. FACS' procurement approach sometimes restricts the selection of NGOs for the Permanency Support Program and Specialist Homelessness Services
FACS has a procurement policy and plan which it follows when contracting NGOs for the provision of human services. This includes the option to use restricted tenders, which FACS sometimes uses rather than opening the process to the market. The use of restricted tenders is consistent with its procurement plan where there is a limited number of possible providers and the services are highly specialised. However, this approach perpetuates existing arrangements and makes it very difficult for new service providers to enter the market. The recontracting of existing providers means FACS may miss the opportunity to benchmark existing providers against the whole market. FACS does not effectively use client data to monitor the performance of NGOs funded under the Permanency Support Program and Specialist Homelessness Services
FACS' contract management staff monitor individual NGO performance including safety, quality of services and compliance with contract requirements. Although FACS does provide training materials on its intranet, FACS does not provide these staff with sufficient training, support or guidance to monitor NGO performance efficiently or effectively. FACS also requires NGOs to self-report their financial performance and contract compliance annually. FACS verifies the accuracy of the financial data but conducts limited validation of client data reported by NGOs to verify its accuracy. Instead, FACS relies on contract management staff to identify errors or inaccurate reporting by NGOs. FACS' ongoing monitoring of the performance of providers under the Permanency Support Program is particularly limited due to problems with timely data collection at the program level. This reduces FACS' ability to monitor and analyse NGO performance at the program level as it does not have access to ongoing performance data for monitoring service quality. In the Specialist Homelessness Services program, FACS and NGOs both provide the data required for the National Minimum Data Set on homelessness and provide it to the Australian Institute of Health and Welfare, as they are required to do. However, this data is not used for NGO performance monitoring or management. FACS does not yet track outcomes for clients of NGOs
FACS began to develop an approach to outcomes-based contracting in 2015. Despite this, none of the contracts we reviewed are using outcomes as a measure of success. Currently, NGOs are required to demonstrate their performance is consistent with the measures stipulated in their contracts as part of an annual check of their contract compliance and financial accounts. NGOs report against activity-based measures (Key Performance Indicators) and not outcomes. FACS advises that the transition to outcomes-based contracting will be made with the new rounds of funding which will take place in 2020–2021 for Specialist Homelessness Services and 2023 for the Permanency Support Program. Once these contracts are in place, FACS can transition NGOs to outcomes based reporting. Incomplete data limits FACS' effectiveness in continuous improvement for the Permanency Support Program and Specialist Homelessness Services
FACS has policies and procedures in place to learn from past experiences and use this to inform future contracting decisions. However, FACS has limited client data related to the Permanency Support Program which restricts the amount of continuous improvement it can undertake. In the Specialist Homelessness Support Program data is collected to inform routine contract management discussions with service providers but FACS is not using this data for continuous improvement. |
Appendix one – Response from agency
Appendix two – About the audit
Appendix three – Performance auditing
Parliamentary Reference: Report number #323 - released 26 June 2019
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Working With Children Check
To be effective the WWCC has to be thorough. Gaps in the checking process such as employers not checking everyone they should mean that people who may pose a risk to children are not identified. We found that the WWCC does not reliably identify all those who may pose a risk to children. Audit conclusion and recommendations Working With Children Check 3 In addition, we found the Commission does not monitor the compliance of employers, the self-employed or volunteer organisations with their obligations or have a formal strategy to promote awareness of the WWCC.
Parliamentary reference - Report number #196 - released 24 February 2010
Grants Administration
We found no significant difference in the funding of government and opposition electorates. However, more money was given to electorates that were safely held by the major parties. These seats received $1.29 for every dollar given to marginal and independent seats with government marginals getting the least. Electorates also receive different levels of funding according to which region they are in. Such variations may reflect valid agency objectives such as meeting State Plan targets or addressing socio-economic disadvantage.
But while agencies publish who gets what, they do not adequately evaluate or explain what grant programs have achieved. As a result, there is a risk that New South Wales may not get the best value for its spending. We recommend that agencies regularly evaluate their grant programs and publish the results.
Parliamentary reference - Report number #186 - released 6 May 2009
Helping older people access a residential aged care facility
Assessment processes for older people needing to go to an Residential Aged Care Facility (RACF) vary depending on the processes of the Aged Care Assessement Teams (ACAT) they see and whether or not they are in hospital. The data collected on ACAT performance was significantly revised during 2004 making comparisons with subsequent years problematic. ACATs have more responsibilities than assessing older people for residential care. It is not clear whether they have sufficient resources for this additional workload.
Parliamentary reference - Report number #160 - released 5 December 2006
