Long-term, subsidised rental housing is provided to assist people who have extreme difficulty in accessing housing in the private housing market. The collective term for this type of housing is ‘social housing’ which in New South Wales includes: 

• ‘public housing’ managed by Homes NSW (a division of the Department of Communities and Justice) 
• ‘community housing’ managed by non-government organisations (social housing providers) 
• housing for Aboriginal and Torres Strait Islander peoples managed by the Aboriginal Housing Office or Aboriginal social housing providers.

In New South Wales, applications for housing assistance are managed through Housing Pathways. This is a partnership between Homes NSW, including the Aboriginal Housing Office, and participating community housing providers. Housing Pathways provides a single application process, common eligibility criteria, a standard assessment process and a single waiting list known as the NSW Housing Register. 

This audit will assess whether social housing is effectively and efficiently prioritised to meet the needs of vulnerable households, and whether social housing tenants are effectively supported to establish and sustain their tenancies. 

The audit will assess all types of social housing including public housing, community housing and housing for Aboriginal and Torres Strait Islander peoples.

The Audit Office is seeking experiences or views on: 

• the process of applying for social housing (including evidence requirements) 
• the process of being offered and accepting a social housing property
• support programs and services offered to new social housing tenants. 

If you have experiences or views on these areas, you can share them with the Audit Office. This can be done anonymously if you wish. We will consider all feedback provided as we conduct this audit. 

Please note that the audit mailbox will close at 5pm on Friday 28 February 2025. 

You can provide feedback on this audit either through the ‘contribute to this audit’ button in the left hand menu (or the comment icon on top right for mobile) or through this link. 

We may use your feedback to identify key themes, risks or issues which we may investigate further during the audit. In some instances, we may use extracts of contributions in our audit report as examples of feedback provided where appropriate. If we use extracts of a contribution, we will not identify the source in the report.

However, please note: 

• We will not examine individual matters, nor can we investigate all issues or concerns raised. In general, the audit team will look for supporting evidence from other sources (such as documentation, data and audit interviews). Please contact the Department of Communities and Justice, individual community housing providers, the Registrar of Community Housing, Tenants Advice and Advocacy Services, the NSW Ombudsman, or the Independent Commission Against Corruption regarding individual matters (details below). 
• We will not share your feedback with any party, including the Department of Communities and Justice or any community housing providers, nor do we publish feedback on our website. 
• While we will consider all feedback provided, we may not contact you to discuss. 
• We are not able to answer questions or provide information collected during the course of the audit. 
• Performance audits focus on assessing whether public money is spent efficiently, effectively, economically and in compliance with the law. The Auditor-General is not permitted to question the merits of government policy objectives. Please visit the Performance audit guide for audited entities (including non-public sector entities) for more information on how we undertake performance audits.

The Audit Office is required by section 38 of the Government Sector Audit Act 1983 to keep information gathered during the course of a performance audit confidential and the Audit Office takes its responsibilities under these sections seriously. 

Exceptions include the Auditor-General’s Report to Parliament – a public document – and where the Audit Office is permitted or required to disclose information under other legislation. 

All information that the Audit Office receives, and working papers that the Audit Office creates during an audit, are classed as excluded information in Schedule 2 of the Government Information (Public Sector) Act 2009 (GIPA Act). An access application under the GIPA Act cannot be made for excluded information. 

For more information on our confidentiality obligations, please visit Our confidentiality and reporting obligations for contributions page.

If you have questions or feedback about individual matters, you can: 

• contact the Department of Communities and Justice online or by calling 1800 422 322 
• contact a community housing provider through their individual website or contact details 
• contact the Registrar for Community Housing to make a complaint against a community housing provider online or by calling 1800 330 940 
• contact Tenants Advice and Advocacy Services for tenancy and legal advice. Their website provides online forms and phone numbers for advice. 
• make a complaint to the NSW Ombudsman online or by calling 1800 451 524 
• make a complaint about corruption to the Independent Commission Against Corruption online or by calling 02 8281 5999.

The mental health and wellbeing of the police workforce is essential to ensuring the proper function of the justice system and emergency responses. In 2022, the NSW Government announced reforms intended to recruit, retain and take better care of the NSW Police Force. The associated funding included $79m for the PULSE Program – designed to ensure the physical and psychological wellbeing of police officers.

This audit will consider whether the NSW Police Force effectively monitors and addresses mental health related risks to its workforce from recruitment onwards.

Emergency services and justice agencies, such as Fire and Rescue NSW and Corrective Services NSW, have higher rates of unplanned leave and overtime compared to other public sector agencies. When used properly, overtime can help meet workload demands while minimising agency costs. However, excessive overtime can lead to higher costs, negatively impact staff wellbeing and mental health, increase risks to safety, lower service delivery quality and lower employee morale. 

This audit will consider whether a selection of emergency services and justice agencies are effectively managing unplanned leave and overtime, in particular whether the use of overtime is justified and well controlled and whether agencies are effectively managing risks to mental health and wellbeing related to the use of overtime.

The NSW Government is estimated to spend $660 million on First Nations people within the prisons system. In March 2024, there were 3,841 Aboriginal adults in prison in NSW, representing 30.8% of the adult prison population. Of young people in custody, 61.5% were Aboriginal as of December 2023. 

This audit will examine the effectiveness and efficiency of the NSW Government’s responses to Target 10 and Target 11 in Closing the Gap (that First Nations adults and young people are not overrepresented in the criminal justice systems) with a focus on programs and services provided to support First Nations people to prevent recidivism.

About this report

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

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

Findings

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

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

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

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

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

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

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

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

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

Recommendations

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Appendix one – Response from entities

Appendix two – DCJ Organisational Structure for Child Protection

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

Appendix four – About the audit

Appendix five – Performance auditing

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

What the report is about

Effective radio communications are crucial to NSW's emergency services organisations.

The Critical Communications Enhancement Program (CCEP) aims to deliver an enhanced public safety radio network to serve the five emergency services organisations (ESOs), as well as a range of other users.

This report assesses whether the NSW Telco Authority is effectively managing the CCEP.

What we found

Where it has already been delivered (about 50% of the state), the enhanced network meets most of the requirements of ESOs.

The CCEP will provide additional infrastructure for public safety radio coverage in existing buildings agreed to with ESOs. However, radio coverage inside buildings constructed after the CCEP concludes will be at risk because building and fire regulations do not address the need for in-building public safety radio coverage.

Around 98% of radios connected to the network can be authenticated to protect against cloning, though only 42% are.

The NSW Telco Authority has not settled with ESOs on how call encryption will be used across the network. This creates the risk that radio interoperability between ESOs will not be maximised.

When completed, the public safety radio network will be the only mission critical radio network for ESOs. It is unclear whether governance for the ongoing running of the network will allow ESOs to participate in future network operational decisions.

The current estimated capital cost for the NSW Telco Authority to complete the CCEP is $1.293 billion. This is up from an estimated cost of $400 million in 2016. The estimated capital cost was not publicly disclosed until $1.325 billion was shown in the 2021–22 NSW Budget Papers.

We estimate that the full cost to government, including costs to the ESOs, of implementing the enhanced network is likely to exceed $2 billion.

We made recommendations about

• The governance of the enhanced Public Safety Network (PSN) to support agency relationships.
• The need to finalise a Traffic Mitigation Plan for when the network is congested.
• The need to provide advice to the NSW Government about the regulatory gap for ensuring adequate network reach in future buildings.
• The need to clarify how encryption and interoperability will work on the enhanced network.
• The need for the NSW Telco Authority to comply with its policy on Infrastructure Capacity Reservation.
• Expediting measures to protect against the risk of cloning by unauthenticated radios.

Public safety radio networks are critical for operational communications among Emergency Services Organisations (ESOs), which in New South Wales include:

• NSW Ambulance
• Fire and Rescue NSW
• NSW Police Force
• NSW Rural Fire Service
• NSW State Emergency Service.¹

Since 1993, these five ESOs have had access to a NSW Government owned and operated radio communications network, the Public Safety Network (PSN), to support their operational communications. Around 60 to 70 other entities also have access to this network, including other NSW government entities, Commonwealth government entities, local councils, community organisations, and utility companies.

Pursuant to the Government Telecommunications Act 2018 ('the Act'), the New South Wales Government Telecommunications Authority ('NSW Telco Authority') is responsible for the establishment, control, management, maintenance and operation of the PSN.²

Separate to the PSN, all ESOs and other government entities have historically maintained their own radio communication capabilities and networks. Accordingly, the PSN has been a supplementary source of operational radio communications for these entities.

These other radio networks maintained by ESOs and other entities are of varying size and capability, with many ageing and nearing their end-of-life. There was generally little or no interoperability between networks, infrastructure was often co-located and duplicative, and there were large gaps in geographic coverage.

In 2016, the NSW Telco Authority received dedicated NSW Government funding to commence the Critical Communications Enhancement Program (CCEP).

According to NSW Telco Authority's 2021–22 annual report, the CCEP is a transformation program for operational communications for NSW government agencies. The CCEP '…aims to deliver greater access to public safety standard radio communications for the State’s first responders and essential service agencies'. The objective of CCEP is to consolidate the large number of separate radio networks that are owned and operated by various NSW government entities and to enhance the state’s existing shared PSN. The program also aims to deliver increased PSN coverage throughout New South Wales.

The former NSW Government intended that as the enhanced PSN was progressively rolled-out across NSW, ESOs would migrate their radio communications to the enhanced network, before closing and decommissioning their own networks.

About this Audit

This audit assessed whether the CCEP is being effectively managed by the NSW Telco Authority to deliver an enhanced PSN that meets ESOs' requirements for operational communications.

We addressed the audit objective by answering the following two questions:

1. Have agreed ESO user requirements for the enhanced PSN been met under day-to-day and emergency operational conditions?
2. Has there been adequate transparency to the NSW Government and other stakeholders regarding whole-of-government costs related to the CCEP?

In answering the first question, we also considered how the agreed user requirements were determined. This included whether they were supported by evidence, whether they were sufficient to meet the intent of the CCEP (including in considering any role for new or alternative technologies), and whether they met any relevant technical standards and compliance obligations (including for cyber security resilience).

While other NSW government agencies and entities use the PSN, we focused on the experience of the five primary ESOs because these will be the largest users of the enhanced PSN.

Both the cost and time required to complete the CCEP roll-out have increased since 2016. While it was originally intended to be completed in 2020, this is now forecast to be 2027. Infrastructure NSW has previously assessed the reasons for the increases in time and cost. A summary of the findings made by Infrastructure NSW is presented in Chapter 1 of this report. Accordingly, as these matters had already been assessed, we did not re-examine them in this performance audit.

The auditee for this performance audit is the NSW Telco Authority, which is a statutory authority within the Department of Customer Service portfolio.

In addition to being responsible for the operation of the PSN, section 5 of the Act also prescribes that the NSW Telco Authority is:

• to identify, develop and deliver upgrades and enhancements to the government telecommunications network to improve operational communications for government sector agencies
• to develop policies, standards and guidelines for operational communications using telecommunications networks.

The NSW Telco Authority Advisory Board is established under section 10 of the Act. The role of the board is to advise the NSW Telco Authority and the minister on any matter relating to the telecommunications requirements of government sector agencies and on any other matter relating to the functions of the Authority. As of 2 June 2023, the responsible minister is the Minister for Customer Service and Digital Government.

The five identified ESOs are critical stakeholders of the CCEP and therefore they were consulted during this audit. However, the ESOs were not auditees for this performance audit.

The NSW Telco Authority established and tracked its own costs for the CCEP

Over the course of the program from 2016, the NSW Telco Authority prepared a series of business cases and program reviews that estimated its cost of implementing the program in full, including those shown in Exhibit 6 below.

In response to the 2016 CCEP business case, the then NSW Government approved the NSW Telco Authority implementing the CCEP in full, with funding provided in stages. The NSW Telco Authority tracked its costs against approved funding, with monthly reports provided to the multi-agency Program Steering Committee

Throughout the program, the NSW Government was informed of increasing costs being incurred by the NSW Telco Authority for the CCEP

The various business cases, program updates, and program reviews prepared by the NSW Telco Authority were provided to the NSW Government through the required Cabinet process when seeking approval for the program proceeding and requests for both capital and operational funding. These provided clear indication of the changing overall cost of the CCEP to the NSW Telco Authority, as well as the delays that were being experienced.

There was no transparency to the Parliament and community about changes in the capital cost of the CCEP until the 2021–22 NSW Budget

As the business cases for the CCEP were not publicly available, the only sources of information about capital cost were NSW Budget papers and media releases. The information provided in the annual Budget papers prior to the 2021–22 NSW Budget provided no visibility of the estimated full capital cost to complete all stages of the CCEP. As shown in Exhibit 7 below, this information was fragmented and complex.

Media releases about the progress of the CCEP did not provide the estimated total cost to the NSW Telco Authority of $1.325 billion to complete all stages of the CCEP until June 2021. Prior to this date, media releases only provided funding for the initial stages of the program or for the stages subject to a funding announcement.

Even during the September 2019 and March 2020 Parliamentary Estimate Committee hearings where the costings and delays to the CCEP were raised, the estimated full cost of the CCEP was not revealed.

The original business case for the CCEP included estimated ESO costs, though these costs were not tracked throughout the program

Estimates for ESO costs for operating and maintaining their own radio networks over the four years from 2016–17 were included in the original March 2016 business case. They included $75.2 million for capital expenditure and $95 million for one-off operating costs. These costs, as well as costs incurred by ESOs due to the delay in the program, were not subsequently tracked by the NSW Telco Authority.

In January 2017, Infrastructure NSW reviewed the CCEP business case of March 2016. In this review, Infrastructure NSW recommended that the NSW Telco Authority identify combined and apportioned costs and cashflow for all ESOs over the CCEP funding period reflecting all associated costs to deliver the CCEP. These to include additional incidental capital costs accruing to ESOs, transition and migration to the new network and the cost (capital and operational) of maintaining existing networks. This recommendation was implemented in the November 2017 program review, with ESO capital costs estimated as $183 million.

In 2019, Infrastructure NSW conducted a Deep Dive Review on the progress of the CCEP. In this review, Infrastructure NSW made what it described as a 'critical recommendation' that the NSW Telco Authority:

It should be noted that the delay to CCEP completion now is seven years and that further ‘operational bridging solutions’ have been needed by the ESOs.

'Stay Safe and Keep Operational' costs incurred by ESOs will be significantly higher than originally estimated

Stay Safe and Keep Operational (SSKO) funding was established to provide funding to ESOs to maintain their legacy networks while the CCEP was refreshing and enhancing the PSN. This recognised that much of the network infrastructure relied on by ESOs had reached – or was reaching – obsolescence and would either require extensive maintenance or replacement before the PSN was available for ESOs to migrate to it. ESOs may apply to NSW Treasury for SSKO funding, with their specific proposals being reviewed (and endorsed, where appropriate) by the NSW Telco Authority. Accordingly, SSKO expenditure does not fall within the CCEP budget allocation.

As shown in the table below, extracted from the March 2016 CCEP business case, the total expected cost for SSKO purposes over the course of the CCEP was originally $40 million, assuming the enhanced PSN would be fully available by 2020.

In October 2022, the expected completion date for the CCEP was re-baselined to August 2027. Accordingly, ESOs will be required to continue to maintain their radio networks using legacy equipment for seven years longer than the original 2020 forecast. This will likely become progressively more expensive and require additional SSKO funding. For example, NSW Telco Authority endorsed SSKO bids for 2022–23 exceeded $35 million for that year alone.

Compared to the original forecast made in the March 2016 CCEP business case of $40 million, we found ESOs had estimated SSKO spending to 2027 will be $292.5 million.

A refresh of paging network used by ESOs and the decommissioning of redundant sites were both removed from the original 2016 scope of the CCEP

Paging

A paging network is considered an important user requirement by the Fire and Rescue NSW, NSW Rural Fire Service, and NSW State Emergency Service. The 2016 CCEP business case included a paging network refresh within the program scope of works. This was reiterated in the November 2017 internal review of the program. These documents did not estimate a cost for this refresh. The March 2020 and October 2020 business cases excluded paging from the program scope. The audit is unable to identify when, why or by whom the decision was made to remove paging from the program scope, something that was also not well communicated to the affected ESOs.

In 2021, after representations from the affected ESOs, the NSW Telco Authority prepared a separate business case for a refresh of the paging network at an estimated capital cost of $60.31 million. This program was subsequently approved by the NSW Government and included in the 2022–23 NSW Budget.

In determining an estimated full whole-of-government cost of delivering the enhanced PSN, we have included the budgeted cost of the paging network refresh on the basis that:

• it was expressly included in the original approved March 2016 business case
• the capability is deemed essential to the needs of three ESOs.

Decommissioning costs

The 2016 CCEP business case included cost estimates for decommissioning surplus sites (whether ‘old’ GRN sites or sites belonging to ESOs’ own networks). These estimates were provided for both the NSW Telco Authority ($38 million) and for the ESOs ($55 million). However, while these estimates were described, they were not included as part of the NSW Telco Authority's estimated capital cost ($400 million) or (more relevantly) operating cost ($37.3 million) for the CCEP. This is despite decommissioning being included as one of eight planned activities for the rollout of the program.

In the October 2020 business case, an estimate of $201 million was included for decommissioning agency networks based on a model whereby:

• funding would be coordinated by the NSW Telco Authority
• scheduling and reporting through an inter-agency working group and
• where appropriate, agencies would be appointed as the most appropriate decommissioning party.

This estimated cost is not included in the CCEP budget.

In determining an estimated full whole-of-government cost of the enhanced PSN, we have included the estimated cost of decommissioning on the basis that:

• decommissioning was included in the 2016 CCEP business case as one of eight 'planned activities for the rollout of the program'
• effective decommissioning of surplus sites and equipment (including as described in the business case as incorporating asset decommissioning, asset re-use, and site make-good) is an inherent part of the program management for an enhanced PSN
• costs incurred in decommissioning are entirely a consequence of the CCEP program.

The estimated minimum cost of building an enhanced PSN consistent with the original proposal is over $2 billion

We have derived two estimated minimum whole-of-government costs for delivering an enhanced PSN. These are:

• $2.04 billion when calculated from NSW Telco Authority data – shown as estimate A in Exhibit 9 below.
• $2.26 billion when calculated from ESO supplied data – shown as estimate B in Exhibit 9.

Both totals include:

• budgeted amounts for both CCEP capital expenditure ($1,292.8 million) and operating expenditure ($139 million)
• the NSW Telco Authority's 2020 estimated cost for decommissioning ($201 million)
• the NSW Telco Authority's approved funding for paging refresh ($60.3 million).

The two estimated totals primarily vary around the capital expenditure of ESOs (particularly SSKO funding). To determine these costs, we used ESO provided actual SSKO costs to date, as well as their estimates for maintaining their legacy radio networks through to 2027.

The equivalent cost estimates from the NSW Telco Authority were sourced from the November 2017 internal review and the October 2020 business case for CCEP. It should be noted that the amounts for both estimates are not audited, or verified, but do provide an indication of how whole-of-government costs have grown over the course of the program.

The increase in and reasons for the increase in total CCEP costs (capital and one-off operating) incurred or forecast by the NSW Telco Authority (from $437.3 million in 2016 to $1,431.8 million in 2022) have been provided to the NSW Government through various business cases and reviews prepared by the NSW Telco Authority, as well as by reviews conducted by Infrastructure NSW as part of its project assurance responsibilities.

However, the growth in ESO costs and other consequential costs, such as paging and decommissioning, from around $263 million in the 2016 CCEP business case to between $600 million and $800 million, has to a large degree remained invisible and unexplained to the NSW Government and other stakeholders

Appendix one – Response from agency

Appendix two – Trunked public safety radio networks

Appendix three – About the audit

Appendix four – 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 #383 - released 23 June 2023

Click here for the Easy English version of the report highlights

The Easy English version of the report highlights is intended to meet the needs of some people with lower literacy skills, some people with an intellectual disability, and some people from different cultural backgrounds.

The Easy English document is not the final audit report that has been prepared and tabled in NSW Parliament under s.38EB and s.38EC of the Government Sector Audit Act 1983. It should not be relied on or quoted from as the final audit report.

What this report is about

This audit assessed whether NSW Trustee and Guardian is effectively delivering public guardianship and financial management services in line with legislative requirements and standards.

What we found

NSW Trustee and Guardian is delivering guardianship and financial management services in line with its broad legal authority.

However, NSW Trustee and Guardian does not have sufficient oversight to ensure that its services are consistent with legislative principles which aim to promote positive client outcomes.

The agency's governance and practices could be better supported by relevant training and guidance to account for the diversity of its clients.

It does not track the actual costs of service delivery, the quality of services or client experiences and key findings from previous reviews remain unresolved.

Government funding for public guardianship services and direct financial management services for low-wealth clients has not kept pace with the growth in clients.

There is a risk that some fee-paying clients are unknowingly subsidising others.

NSW Trustee and Guardian has applied additional funding to increase frontline staff, but gaps in monitoring and IT system constraints create a risk that it will not address service quality issues, nor be able to demonstrate the impact of this new funding.

What we recommended

We recommended that NSW Trustee and Guardian:

• Broaden governance arrangements to enable input to key decisions from people with lived experience, relevant peak bodies and representatives of diverse communities.
• Implement mechanisms to seek feedback on the effectiveness and quality of services from clients under orders.
• Assess staff competency and implement regular training in effectively serving clients with disability, dementia, mental illness, cognitive impairments and other factors relevant to decision-making incapacity.
• Implement a risk-based quality framework to assess whether public guardian and financial management decisions are in line with policy and the legislative principles.
• Improve data collection and monitoring to track performance, the costs to serve, and client outcomes and report on these publicly.

NSW Trustee and Guardian is a NSW Government agency in the Stronger Communities cluster. It supports the NSW Trustee and the Public Guardian in the exercise of their statutory functions. It is accountable to the relevant Minister, the Attorney General.

The legislative responsibilities for the Public Guardian and the NSW Trustee are provided in separate statutes (NSW Trustee and Guardian Act 2009 and Guardianship Act 1987). Together, these establish a number of functions and services that NSW Trustee and Guardian as an agency is expected to deliver, including:

• acting as executor and administrator of deceased estates
• acting as a trustee responsible for managing trust property on behalf of another person or organisation in line with the trust terms
• drafting Will, Power of Attorney and Enduring Guardianship instruments, and educating the community about the importance of having these documents in place
• making decisions on behalf of people under guardianship or financial management orders as a guardian or a financial manager 'of last resort', or overseeing and assisting private financial managers.

This audit focuses on the last of these - NSW Trustee and Guardian's financial management and guardianship services.

The NSW Trustee and the Public Guardian are appointed to provide direct financial management and/or guardianship services (respectively) to over 13,300 people (as at 30 June 2022) who are deemed by a court or tribunal unable to manage their own affairs. This involves making decisions for people under a relevant court or tribunal order, within the terms of the order. The court or tribunal order enables the appointed guardian or financial manager to make decisions on behalf of the person for whom the order is made. The legislation allows the financial manager or guardian to exercise all the functions of the person under management has or would have were they not incapable of managing for themselves. From a legal perspective, these 'substitute decisions' have the same effect as if the person had made the decision themselves. While the legal presumption is that a person has capacity to care for themselves and manage their own affairs, a financial manager or guardian can be appointed without the person's consent if the court or tribunal finds the person does not have relevant decision-making capacity.

There can be a range of factors that impact on a person's decision-making capacity, including cognitive impairment, intellectual disability, dementia, mental illness and addiction. Guardianship (of both the person and their estate) developed as a response, through European and English law over hundreds of years. In Australia, it was a function of the Supreme Court of NSW before the establishment of government agencies. What is now known as substitute decision-making can sometimes be referred to as a 'protective' function because:

• it relates to decisions or actions that need to be taken, which the person under an order cannot take because they are incapable of managing their own affairs
• due to this lack of competence, the person may be disadvantaged in the conduct of their affairs (for example, their money or property may be dissipated or lost, they may enter agreements unwisely or they may be at risk of abuse or exploitation)
• substitute decisions must be made in the best interests of the person on whose behalf they are made.

An alternative model is 'supported decision-making'. This refers to processes and approaches that assist people with impaired decision-making capacity to exercise their autonomy and legal capacity by supporting them to make decisions. This approach seeks to give effect to the will and preferences of the person requiring decision-making support wherever possible, including decisions involving risk. There has been a longstanding legal and community push for Australian guardianship and administration systems to move from substituted to supported decision-making. However, the legislation in New South Wales provides for 'best interests' substitute decision-making and this is the framework against which we have audited NSW Trustee and Guardian.

The Public Guardian and the NSW Trustee may be appointed as substitute decision makers by the NSW Civil and Administrative Tribunal (NCAT) and the Supreme Court. The NSW Trustee may also be appointed by the Mental Health Review Tribunal for financial management orders only.¹ They are intended to be appointed as a 'last resort' when there is no one willing or suitable to fill the role, or there is significant family conflict regarding decision-making for the person. The Public Guardian and the NSW Trustee cannot refuse to accept a court or tribunal appointment to administer an order for guardianship or financial management.

Public Guardian decisions cover healthcare, lifestyle, accommodation and/or medical decisions such as where a person should live (for example: at home, in an aged care facility or disability group home), what disability or other support services they receive, who can have access to them (for example: through establishing visiting schedules between conflicting family members) and consent to the use of restrictive practices on the advice of independent experts (for example: seclusion, chemical restraint such as anti-psychotic medication, environmental restraints such as limiting access to knives).

Under a financial management order where the NSW Trustee is appointed as financial manager, the NSW Trustee carries out such functions as securing and collecting assets, income and entitlements, paying expenses, debts and designing budgets, investing financial assets, lodging tax returns and paying maintenance for dependents, taking or defending legal proceedings and managing other financial and legal affairs for the person. This is referred to as direct financial management.

A court or tribunal may appoint a private financial manager, such as a family member, friend, private trustee company or other commercial provider. Where a private manager is appointed, the NSW Trustee provides authorisation and directions to the private manager and oversees their performance. As at 30 June 2022, over 6,200 people had private managers.

As an agency, the majority of NSW Trustee and Guardian's overall revenue is from fees (including for services outside the scope of the audit, such as will preparation) and investments. The remainder is from the NSW Government as funding for non-commercial services including guardianship services and subsidised financial management services for low-wealth clients. Public guardian clients do not pay fees. Financial management clients pay fees, but these are subsidised where the client does not have capacity to pay full fees. NSW Trustee and Guardian is considered a self-funded agency by NSW Treasury definitions.

Demand for financial management and guardianship services, and the complexity of clients' circumstances for these services, has grown over the last decade. In November 2020, NSW Trustee and Guardian advised the Attorney General that it had run an operating deficit in 2019–20 driven by an increase in non/low fee paying customers and an increase in the complexity of matters. NSW Trustee and Guardian advised the Attorney General that government funding was no longer meeting the full cost of guardianship services, and of direct financial management services for people with low balances. NSW Trustee and Guardian's analysis had identified a shortfall in government funding of $8.4 million in 2019–20 that was expected to increase over the forward estimates. A working group was established with officers from NSW Trustee and Guardian, NSW Treasury and the Department of Communities and Justice to advise the government on options for improving the financial sustainability of NSW Trustee and Guardian overall.

NSW Trustee and Guardian subsequently received a funding boost of $41.5 million across four years in the 2021–22 State Budget. NSW Trustee and Guardian applied the majority of the budget enhancement to recruit approximately 120 new roles mostly in financial management and guardianship services.

The objective of this audit was to assess whether NSW Trustee and Guardian is effectively delivering guardianship and financial management services in line with legislative requirements and relevant non-legislative standards. These include a legislative duty to observe certain principles when exercising the relevant legislative functions, including to: give primary consideration to clients’ welfare and interests, restrict their freedom of decision and action as little as possible, take account of their views, and encourage their self-reliance.

The audit was guided by three questions:

• Does NSW Trustee and Guardian align its service delivery with its legislative functions and principles, and relevant standards?
• Does NSW Trustee and Guardian drive and monitor performance to give effect to its legislative functions and principles, and relevant standards?
• Has NSW Trustee and Guardian effectively planned the use of additional funding to improve service delivery and adherence to its legislative functions and principles, and relevant standards?

The audit review period was the five years between 1 July 2017 - 30 June 2022.

Throughout this report:

• 'client' refers to a person who is under a guardianship order and/or whose estate is under financial management, for whom the Public Guardian and/or the NSW Trustee is appointed to act or responsible to oversee their private financial manager
• 'financial management' refers to clients under financial management orders (direct and private financial management) and/or the services provided by NSW Trustee and Guardian to these clients or their private managers
• 'guardianship' refers to clients under guardianship orders where the Public Guardian is appointed, and/or the services provided by the Public Guardian to these clients
• 'frontline staff' refers to the staff responsible for engagement with, and decision-making for, clients and private managers (titled client service officers, senior client service officers and principal client service officers in NSW Trustee and Guardian)
• Aboriginal refers to the First Nations peoples of the land and waters now called Australia and includes Aboriginal and Torres Strait Islander peoples.

NSW Trustee and Guardian has only recently identified measures to track the performance of its financial management and guardianship services

Between 2021 and 2022, NSW Trustee and Guardian developed new divisional key performance indicators which aim to track the quality of services delivered to people under financial management and guardianship orders. These measures are reported quarterly to the organisation's executive leadership team. The divisions have started measuring some of these new performance indicators, but many will require changes to consumer engagement processes and IT legacy systems to collect additional data. At this stage it is unclear when these necessary changes will occur, and when relevant data will begin to be collected and analysed.

Before 2021, NSW Trustee and Guardian measured the performance of some of its financial management and guardianship operational processes. While these operational measures identify whether it is fulfilling some of its legislative functions, they are predominantly activity measures and do not inform on the quality of decision-making for direct financial management or guardianship clients, or on client experiences and outcomes.

Operational performance targets and measures have only recently been developed and used to centrally track the time elapsed between requests for certain decisions and the decisions made or relevant actions taken by relevant frontline staff. Baseline data for these measures show that target timeframes are not close to being met for minor medical decisions for people under guardianship orders, or for first customer payment, and redirection of income for people who are directly financially managed.

NSW Trustee and Guardian has proactively developed a benefits realisation framework to monitor the expected benefits from the additional funding received in 2021–22

NSW Trustee and Guardian has developed a benefits realisation framework to monitor the expected benefits from the additional funding (and other elements of the budget bid including increased fees and business improvements for efficiencies). This is not a requirement imposed by NSW Treasury, but a proactive step taken by NSW Trustee and Guardian to account for the use of the additional funding and to attempt to identify its impacts.

The benefits realisation framework includes interim and preferred measures, which reflect the things that can be tracked with existing data, and those that require new data collection, respectively. The measures are underpinned by separate program logics for direct and private financial management, and guardianship, and an overall investment logic. 'Logics' articulate the inputs, outputs and short/medium/long term outcomes expected from a project, program or investment, as well as the underpinning assumptions about how desired changes will occur (the 'mechanism' or 'theory' of change).

The targets and measures for NSW Trustee and Guardian's benefits realisation framework are the responsibility of the organisational divisions delivering guardianship and financial management services. The baseline data against which change will be measured is 30 June 2021, as the budget enhancement funds were allocated from 1 July 2021. The audit has been provided with baseline data, but not first year results (covering 2021–22) and as such, cannot assess whether any progress has been made towards the targets.

The benefits realisation framework may not provide the information needed to demonstrate the effectiveness of the budget enhancement

A lack of available data and limited measures in the benefits realisation framework may mean NSW Trustee and Guardian will not be able to meaningfully assess the impact of the additional funding.

The 22 measures in the benefits realisation framework across guardianship and financial management functions are predominantly monitoring activity and outputs which seek to track staff caseloads, the number of decisions made, the timeliness of key actions/tasks, and annual consumer engagements.

There is one service quality outcome measure: that customers, family and carers report an improved experience. The metrics for this measure will initially be monitored using the whole-of-government customer satisfaction measurement survey administered by the Department of Customer Service, until such time as other additional sources are developed. The whole-of-government survey is built around six core customer commitments relating to respondents' experiences with government services and staff - that they are: 'easy to access, act with empathy, respect my time, explain what to expect, resolve the situation and engage the community'. It is not clear whether or how the whole-of-government survey targets and engages people with impaired decision-making capacity or accessible communication needs.

Some measures in the NSW Trustee and Guardian benefits realisation framework do not yet have targets set, such as the ratio of the number of clients to the number of guardians or financial managers. Many relate to compliance with internal operational policies.

One interim measure for a direct financial management service indicator is 'increased personalised face-to-face consultations by phone or virtually'. It is intended to be replaced with the preferred measure 'ensure the client’s story is understood by staff and systems by consulting stakeholders and adding to the client’s story in the IT system'. However, the interim measure would better align with the national standards regarding regular and accessible engagement (discussed above).

A lack of availability of key data to track the preferred measures was identified by NSW Trustee and Guardian as an enterprise risk, and issues with existing data collected were identified early on, including that:

• data can be entered into systems inconsistently by staff
• current systems mask some issues – for example, a task can be completed within internal timeframes but not reflect the actual waiting time of consumers
• current systems cater to measuring outputs rather than service quality.

IT system improvements are slated in order to allow data to be collected to inform on preferred measures, but these depend on capital funding that has not yet been secured. At the time of writing, data sources were yet to be identified for three of the 22 measures, and NSW Trustee and Guardian did not have staff trained and available to run and analyse data for the benefits realisation framework.

The mechanisms of change and the underlying assumptions in the program and investment logics are also not clearly articulated in the benefits realisation framework, and nor is the underpinning evidence (such as from earlier reviews, research or pilots, or experiences elsewhere). Identifying and evidencing these would give some confidence that the assumptions are sound and that the mechanisms of change will operate as expected (for example, that a decline in frontline staff caseloads will translate into more time spent on individual matters, and improved service quality).

Given these limitations in measures, data collection and logics, there is a risk that the benefits realisation framework may not provide the performance and impact evidence necessary to assess the effectiveness of the budget enhancement, or to justify further additional funding in the future.

NSW Trustee and Guardian cannot track its financial management and guardianship service performance over time

NSW Trustee and Guardian's operational performance activity measures have changed over the audit review period, which limits NSW Trustee and Guardian’s ability to identify whether it has sustained or improved performance in its guardianship and financial management services over time.

NSW Trustee and Guardian has consistently tracked the number and themes of complaints about financial management and guardianship services, which do provide some insight into service quality and experiences. However, this is an incomplete measure as people under financial management and guardianship orders are a more vulnerable cohort than other NSW Trustee and Guardian customers and may require support to make a complaint. There is also a structural power imbalance between clients and their guardian or financial manager which may dissuade clients and their stakeholders from raising concerns. Therefore, it is not clear whether the numbers and themes in complaints received are representative of broader experiences.

Appendix one – Response

Appendix two – Client characteristics

Appendix three – Easy English, Easy Read and Plain English formats

Appendix four – Financial management fees

Appendix five – NSW Trustee and Guardian Common Funds

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 #379 - released 18 May 2023

What the report is about

This audit assessed the effectiveness of the NSW Rural Fire Service (RFS) and local councils in planning and managing equipment for bushfire prevention, mitigation, and suppression.

What we found

The RFS has focused its fleet development activity on modernising and improving the safety of its firefighting fleet, and on the purchase of new firefighting aircraft.

There is limited evidence that the RFS has undertaken strategic fleet planning or assessment of the capability of the firefighting fleet to respond to current bushfire events or emerging fire risks.

The RFS does not have an overarching strategy to guide its planning, procurement, or distribution of the firefighting fleet.

The RFS does not have effective oversight of fleet maintenance activity across the State, and is not ensuring the accuracy of District Service Agreements with local councils, where maintenance responsibilities are described.

What we recommended

1. Develop a fleet enhancement framework and strategy that is informed by an assessment of current fleet capability, and research into appropriate technologies to respond to emerging fire risks.
2. Develop performance measures to assess the performance and capabilities of the fleet in each RFS District by recording and publicly reporting on fire response times, fire response outcomes, and completions of fire hazard reduction works.
3. Report annually on fleet allocations to RFS Districts, and identify the ways in which fleet resources align with district-level fire risks.
4. Develop a strategy to ensure that local brigade volunteers are adequate in numbers and appropriately trained to operate fleet appliances in RFS Districts where they are required.
5. Establish a fleet maintenance framework to ensure regular update of District Service Agreements with local councils.
6. Review and improve processes for timely recording of fleet asset movements, locations, and maintenance status.

This audit assessed how effectively the NSW Rural Fire Service (the RFS) plans and manages the firefighting equipment needed to prevent, mitigate, and suppress bushfires. This audit also examined the role of local councils in managing bushfire equipment fleet assets. Local councils have vested legal ownership of the majority of the land-based firefighting fleet, including a range of legislated responsibilities to carry out fleet maintenance and repairs. The RFS has responsibilities to plan and purchase firefighting fleet assets, and ensure they are ready for use in response to fires and other emergencies.

This report describes the challenges in planning and managing the firefighting fleet, including a confusion of roles and responsibilities between the RFS and local councils in relation to managing certain land-based rural firefighting fleet – a point that has been made in our Local Government financial audits over several years. This role confusion is further demonstrated in the responses of the RFS and local councils to this audit report – included at Appendix one.

The lack of cohesion in roles and responsibilities for managing rural firefighting vehicles increases the risk that these firefighting assets are not properly maintained and managed, and introduces a risk that this could affect their readiness to be mobilised when needed.

While the audit findings and recommendations address some of the operational and organisational inefficiencies in relation to rural firefighting equipment management, they do not question the legislative arrangements that govern them. This is a matter for the NSW Government to consider in ensuring the fleet arrangements are fit for purpose, and are clearly understood by the relevant agencies.

The NSW Rural Fire Service (hereafter the RFS) is the lead combat agency for bushfires in New South Wales, and has the power to take charge of bushfire prevention and response operations anywhere in the State. The RFS has responsibilities to prevent, mitigate and suppress bushfires across 95% of the State, predominantly in the non-metropolitan areas of New South Wales. Fire and Rescue NSW is responsible for fire response activity in the cities and large townships that make up the remaining five per cent of the State.

The RFS bushfire fleet is an integral part of the agency's overall bushfire risk management. The RFS also uses this fleet to respond to other emergencies such as floods and storms, motor vehicle accidents, and structural fires. Fleet planning and management is one of a number of activities that is necessary for fire mitigation and suppression.

The Rural Fires Act 1997 (Rural Fires Act) imposes obligations on all landowners and land managers to prevent the occurrence of bushfires and reduce the risk of bushfires from spreading. Local councils have fire prevention responsibilities within their local government areas, principally to reduce fire hazards near council owned or managed assets, and minor roads.

The RFS is led by a Commissioner and is comprised of both paid employees and volunteer rural firefighters. Its functions are prescribed in the Rural Fires Act and related legislation such as the State Emergency Rescue Management Act 1989. The RFS functions are also described in Bush Fire Risk Management Plans, the State Emergency Management Plan, District Service Agreements, and RFS procedural documents. Some of the core responsibilities of the RFS include:

• preventing, mitigating, and suppressing fires across New South Wales
• recruiting and managing volunteer firefighters in rural fire brigades
• purchasing and allocating firefighting fleet assets to local councils
• establishing District Service Agreements with local councils to give the RFS permissions to use the fleet assets that are vested with local councils
• carrying out fleet maintenance and repairs when authorised to do so by local councils
• inspecting the firefighting fleet
• supporting land managers and private property owners with fire prevention activity.

In order to carry out its legislated firefighting functions, the RFS relies on land-based vehicles, marine craft, and aircraft. These different firefighting appliance types are referred to in this report as the firefighting fleet or fleet assets.

RFS records show that in 2021 there were 6,345 firefighting fleet assets across NSW. Most of the land-based appliances commonly associated with firefighting, such as water pumpers and water tankers, are purchased by the RFS and vested with local councils under the Rural Fires Act. The vesting of firefighting assets with local councils means that the assets are legally owned by the council for which the asset has been purchased. The RFS is able to use the firefighting assets through District Service Agreements with local councils or groups of councils.

In addition to the land-based firefighting fleet, the RFS owns a fleet of aircraft with capabilities for fire mitigation, suppression, and reconnaissance during fire events. The RFS hires a fleet of different appliances to assist with fire prevention and hazard reduction works. These include aircraft for firefighting and fire reconnaissance, and heavy plant equipment such as graders and bulldozers for hazard reduction. Hazard reduction works include the clearance of bush and grasslands around major roads and protected assets, and the creation and maintenance of fire trails and fire corridors to assist with fire response activity.

The RFS is organised into 44 RFS Districts and seven Area Commands. The RFS relies on volunteer firefighters to assist in carrying out most of its firefighting functions. These functions may include the operation of the fleet during fire response activities and training exercises, and the routine inspection of the fleet to ensure it is maintained according to fleet service standards. Volunteer fleet inspections are supervised by the RFS Fire Control Officer.

In 2021 there were approximately 73,000 volunteers located in 1,993 rural fire brigades across the State, making the RFS the largest volunteer fire emergency service in Australia. In addition to brigade volunteers, the RFS has approximately 1,100 salaried staff who occupy leadership and administrative roles at RFS headquarters and in the 44 RFS Districts.

Local councils have legislative responsibilities relating to bushfire planning and management. Some of the core responsibilities of local councils include:

• establishing and equipping rural fire brigades
• contributing to the Rural Fire Fighting Fund
• vested ownership of land-based rural firefighting equipment
• carrying out firefighting fleet maintenance and repairs
• conducting bushfire prevention and hazard reduction activity.

The objective of this audit was to assess the effectiveness of the RFS and local councils in planning and managing equipment for bushfire prevention, mitigation, and suppression. From the period of 2017 to 2022 inclusive, we addressed the audit objective by examining whether the NSW RFS and local councils effectively:

• plan for current and future bushfire fleet requirements
• manage and maintain the fleet required to prevent, mitigate, and suppress bushfires in NSW.

This audit did not assess:

• the operational effectiveness of the RFS bushfire response
• the effectiveness of personal protective equipment and clothing
• the process of vesting of rural firefighting equipment with local councils
• activities of any other statutory authorities responsible for managing bushfires in NSW.

As the lead combat agency for the bushfire response in NSW, the RFS has primary responsibility for bushfire prevention, mitigation, and suppression.

Three local councils were selected as case studies for this audit, Hawkesbury City Council, Wagga Wagga City Council and Uralla Shire Council. These case studies highlight the ways in which the RFS and local councils collaborate and communicate in rural fire districts.

The RFS has not made significant changes to the size or composition of the firefighting fleet in the past five years and does not have an overarching strategy to drive fleet development

Since 2017, the RFS has made minimal changes to its firefighting fleet volumes or vehicle types. The RFS is taking a fleet renewal approach to fleet planning, with a focus on refurbishing and replacing ageing firefighting assets with newer appliances and vehicles of the same classification and type. While the RFS has adopted a fleet renewal approach, driven by its Appliance Replacement Program Guide, it does not have a strategy or framework to guide its future-focused fleet development. There is no document that identifies and analyses bushfire events and risks in NSW, and matches fleet resources and fleet technologies to meet those risks. The RFS does not have fleet performance measures or targets to assess whether the size and composition of the fleet is meeting current or emerging bushfire climate hazards, or fuel load risks across its 44 NSW Fire Districts.

The RFS fleet currently comprises approximately 4,000 frontline, operational firefighting assets such as tankers, pumpers, and air and marine craft, and approximately 2,300 logistical vehicles, such as personnel transport vehicles and specialist support vehicles. Of the land-based firefighting vehicles, the RFS has maintained a steady number of approximately 3,800 tankers and 65 pumpers, year on year, for the past five years. This appliance type is an essential component of the RFS land-based, firefighting fleet with capabilities to suppress and extinguish fires.

Since 2017, most RFS fleet enhancement activity has been directed to upgrades and the modernisation of older fleet assets with new safety features. There is limited evidence of research into new fleet technologies for modern firefighting. The RFS fleet volumes and fleet types have remained relatively static since 2017, with the exception of the aerial firefighting fleet. Since 2017, the RFS has planned for, and purchased, six additional aircraft to add to the existing three aircraft in its permanent fleet.

While the RFS has made minimal changes to its fleet since 2017, in 2016 it reduced the overall number of smaller transport vehicles, by purchasing larger vehicles with increased capacity for personnel transport. The consolidation of logistical and transport vehicles accounts for an attrition in fleet numbers from 7,058 in 2016, to 6,315 in 2017 as shown in Exhibit 2.

The firefighting fleet management system is not always updated in a timely manner due to insufficient RFS personnel with permissions to make changes in the system

The RFS uses a fleet management system known as SAP EAM to record the location and status of firefighting fleet assets. The system holds information about the condition of the firefighting fleet, the home location of each fleet asset, and the maintenance, servicing, and inspection records of all assets. The RFS uses the system for almost all functions related to the firefighting fleet, including the location of vehicles so that they can be dispatched during operational exercises or fire responses.

Staff at RFS Headquarters are responsible for creating and maintaining asset records in the fleet management system. RFS District staff have limited permissions in relation to SAP EAM. They are able to raise work orders for repairs and maintenance, upload evidence to show that work has been done, and close actions in the system.

RFS District staff are not able to enter or update some fleet information in the system, such as the location of vehicles. When an RFS District receives a fleet appliance, it cannot be allocated to a brigade until the location of the asset is accurately recorded in the system. The location of the asset must be updated in the SAP EAM system by staff at RFS Headquarters. District staff can request system support from staff at RFS Headquarters to enter this information. At the time of writing, the position responsible for updating the fleet management system at RFS Headquarters was vacant, and RFS District personnel reported significant wait times in response to their service requests.

The RFS conducts annual audits of SAP EAM system information to ensure data is accurate and complete. RFS staff are currently doing data cleansing work to ensure that fleet allocations are recorded correctly in the system.

Communication between brigades, local councils and the RFS needs improvement to ensure that fleet information is promptly updated in the fleet management system

RFS brigade volunteers do not have access to the fleet management system. When fleet assets are used or moved, volunteers report information about the location and condition of the fleet to RFS District staff using a paper-based form, or by email or phone. Information such as vehicle mileage, engine hours, and defects are all captured by volunteers in a logbook which is scanned and sent to RFS District staff. RFS District staff then enter the relevant information into the fleet management system, or raise a service ticket with RFS Headquarters to enter the information.

Brigade volunteers move fleet assets for a range of reasons, including for fire practice exercises. If volunteers are unable to report the movement of assets to RFS District staff in a timely manner, this can lead to system inaccuracies. Lapses and backlogs in record keeping can occur when RFS staff at district offices or at Headquarters are not available to update records at the times that volunteers report information. A lack of accurate record keeping can potentially impact on RFS operational activities, including fire response activity.

Brigade volunteers notify RFS District staff when fleet appliances are defective, or if they have not been repaired properly. District staff then enter the information into the fleet management system. The inability of volunteers to enter information into the system means they have no visibility over their requests, including whether they have been approved, actioned, or rejected.

Local councils are responsible for servicing and maintaining the firefighting fleet according to the Rural Fires Act, but this responsibility can be transferred to the RFS through arrangements described in local service agreements. Council staff record all fleet servicing and maintenance information in their local systems. The types of fleet information that is captured in local council records can vary between councils. RFS staff described the level of council reporting, and the effectiveness of this process, as 'mixed'.

Councils use different databases and systems to record fleet assets, and some councils are better resourced for this activity than others

Firefighting fleet information is recorded in different asset management systems across NSW. Each council uses its own asset management system to record details about the vested fleet assets. All three councils that were interviewed for this audit had different systems to record information about the fleet. In addition, the type of information captured by the three councils was varied.

Local councils have varying levels of resources and capabilities to manage the administrative tasks associated with the firefighting fleet. Some of the factors that impact on the ability of councils to manage administrative tasks include: the size of the council; the capabilities of the information management systems, the size of the staff team, and the levels of staff training in asset management.

Uralla Shire Council is a small rural council in northern NSW. This council uses financial software to record information about the firefighting fleet. While staff record information about the condition of the asset, its replacement value, and its depreciation, staff do not record the age of the asset, or its location. Staff manually enter fleet maintenance information into their systems. Uralla Shire Council would like to purchase asset maintenance software that generates work orders for fleet repairs and maintenance. However, the council does not have trained staff in the use of asset management software, and the small size of the fleet may not make it financially worthwhile.

The Hawkesbury City Council uses a single system to capture financial and asset information associated with the firefighting fleet. Hawkesbury is a large metropolitan council located north-west of Sydney, with a relatively large staff team in comparison with Uralla Shire Council. The Hawkesbury City Council has given RFS District staff access to their fleet information system. RFS District staff can directly raise work orders for fleet repairs and maintenance through the council system, and receive automated notifications when the work is complete.

Two of the three audited councils report that they conduct annual reviews of fleet assets to assess whether the information they hold is accurate and up-to-date.

More than half of the fleet maintenance service agreements between the RFS and local councils have not been reviewed in ten years, and some do not reflect local practices

Local councils have a legislated responsibility to service, repair, and maintain the firefighting fleet to service standards set by the RFS. Councils may transfer this responsibility to the RFS through District Service Agreements. The RFS Districts are responsible for ensuring that the service agreements are current and effective.

The RFS does not have monitoring and quality control processes to ensure that service agreements with local councils are reviewed regularly. The RFS has 73 service agreements with local councils or groups of councils. Sixty-three per cent of service agreements had not been reviewed in the last ten years. Only four service agreements specify an end date and, of those, one agreement expired in 2010 and had not been reviewed at the time of this audit.

The RFS does not have a framework to ensure that service agreements with local councils reflect actual practices. Of the three councils selected for audit, one agreement does not describe the actual arrangements for fleet maintenance practices in RFS Districts. The service agreement with Hawkesbury City Council specifies that the RFS will maintain the firefighting fleet on behalf of council when, in fact, council maintains the firefighting fleet. The current agreement commenced in 2012, and at the time of writing had not been updated to reflect local maintenance practices.

When District Service Agreements are not reviewed periodically, there is a risk that neither local councils nor the RFS have clear oversight of the status of fleet servicing, maintenance, and repairs.

RFS District Service Agreements set out a requirement that RFS and local councils establish a liaison committee. Liaison committees typically include council staff, RFS District staff, and RFS brigade volunteers. While service agreements state that liaison committees must meet periodically to monitor and review the performance of the service agreement, committee members determine when and how often the committee meets.

RFS District staff and staff at the three audited councils are not meeting routinely to review or update their service agreements. At Wagga Wagga City Council, staff meet with RFS District staff each year to report on activity to fulfil service agreement requirements. Uralla Shire Council staff did not meet routinely with RFS District staff before 2021. When liaison committees do not meet regularly, there is a risk that the RFS and local councils have incorrect or outdated information about the location, status, or condition of the firefighting fleet. Given that councils lack systems to track and monitor fleet locations, regular communication between the RFS and local councils is essential.

The RFS has not established processes to ensure that local councils and RFS District personnel meet and exchange information about the fleet. Of the three councils selected for this audit, one council had not received information about the number, type, or status of the fleet for at least five years, and did not receive an updated list of appliances until there was a change in RFS District personnel. This has impacted on the accuracy of council record keeping. Councils do not always receive notification about new assets or information about the location of assets from the RFS, and therefore cannot reflect this information in their accounting and reporting.

RFS area commands audit system records to ensure fleet inspections occur as planned, but central systems are not always updated, creating operational risks

RFS District staff are required by the Rural Fires Act to ensure the firefighting fleet is inspected at least once a year. Regular inspections of the fleet are vital to ensure that vehicles are fit-for-purpose and safe for brigade volunteers. Inspections are also fundamental to the operational readiness and capability of RFS to respond to fire incidents.

RFS Area Command personnel conduct audits of fleet maintenance data to ensure that fleet inspections are occurring as planned. These inspections provide the RFS with assurance that the fleet is being maintained and serviced by local council workshops, or third-party maintenance contractors.

Some RFS Districts run their own fleet management systems outside of the central management system. They do this to manage their fleet inspection activity effectively. Annual fleet inspection dates are programmed by staff at RFS Headquarters. Most of the inspection dates generated by RFS Headquarters are clustered together and RFS Districts need to separate inspection times to manage workloads over the year. Spreading inspection dates is necessary to avoid exceeding the capacity of local council workshops or third party contractors, and to ensure that fleet are available during the bushfire season.

The fleet inspection records at RFS Headquarters are not always updated in a timely manner to reflect actual inspection and service dates of vehicles. District staff are not able to change fleet inspection and service dates in the central management system because they do not have the necessary permissions to access the system. The usual practice is for RFS District staff to notify staff at RFS Headquarters, and ask them to retrospectively update the system. As there is a lag in updating the central database, at a point in time, the actual inspection and service dates of vehicles can be different to the dates entered in the central fleet management system.

Fleet inspection and maintenance records must be accurately recorded in the central RFS management system for operational reasons. RFS Headquarters personnel need to know the location and maintenance status of fleet vehicles at all times in order to dispatch vehicles to incidents and fires. The RFS fleet management system is integrated with a new Computer Aided Dispatch System. The Computer Aided Dispatch System assigns the nearest and most appropriate vehicles to fire incidents. The system relies on accurate fleet locations and fleet condition information in order to dispatch these vehicles.

There is a risk that RFS Headquarters' systems do not contain accurate information about the location and status of vehicles. Some may be in workshops for servicing and repair, while the system may record them as available for dispatch. As there are many thousands of fleet vehicles, all requiring an annual service and inspection, a lack of accurate record keeping has wide implications for State fire operations.

RFS is currently exploring ways to improve the ways in which fleet inspections are programmed into the fleet management system.

RFS provides funds to councils to assist with maintaining the firefighting fleet, but does not receive fleet maintenance cost information from all local councils

Each year the RFS provides local councils with a lump sum to assist with the cost of repairing and maintaining the firefighting fleet. This lump sum funding is also used for meeting the costs of maintaining brigade stations, utilities, and other miscellaneous matters associated with RFS business.

In 2020–21, the RFS provided NSW local councils with approximately $23 million for maintenance and repairs of appliances, buildings, and utilities. Ninety councils were provided with lump sum funding in 2021, receiving on average $257,000. The amounts received by individual councils ranged from $56,200 to $1,029,884.

Some councils provide itemised repairs and maintenance reports to RFS District staff, showing the work completed and the cost of that work. However, not all councils collect this information or provide it to the RFS. Local councils collect fleet maintenance information in their local council systems. In some cases, the responsibility for fleet maintenance is shared across a group of councils, and not all councils have oversight of this process.

The RFS has not taken steps to require local councils to provide itemised maintenance costings for the firefighting fleet. Thus, the RFS does not have a clear understanding of how local councils are spending their annual fleet maintenance funding allocations. The RFS does not know if the funding allocations are keeping pace with the actual cost of repairing and maintaining the fleet.

RFS District staff report that funding shortfalls are impacting on the prioritisation of fleet servicing and maintenance works in some council areas. When fleet servicing and maintenance is not completed routinely or effectively, there is a risk that it can negatively impact the overall condition and lifespan of the vehicle. Poor processes in relation to fleet maintenance and repair risk impacting on the operational capabilities of the fleet during fire events.

The timeliness and effectiveness of fleet servicing and maintenance is affected by resource levels in RFS Districts and local councils

Local councils have a legislated responsibility to service and maintain the firefighting fleet to the service standards set by the RFS. Fleet maintenance is usually done by the entity with the appropriate workshops and resources, and the maintenance arrangements are described in District Service Agreements. RFS District staff conduct annual inspections to ensure that the firefighting fleet has been serviced and maintained appropriately, and is safe for use by brigade volunteers. If the fleet has not been maintained to RFS service standards or timelines, RFS District staff may work with local councils to support or remediate these works.

The effectiveness of this quality control activity is dependent on relationships and communication between the RFS Districts and local councils. While some RFS staff reported having positive relationships with local councils, others said they struggled to get fleet maintenance work done in a timely manner. Some councils reported that funding shortfalls for fleet maintenance activity was impacting on the prioritisation of RFS fleet maintenance works. When fleet maintenance work is not completed routinely or effectively, it can negatively impact on the overall condition and lifespan of the vehicle. It can also reduce the capacity of the RFS to respond to fire events.

Fleet quality control activities are carried out by RFS District staff. In some of the smaller RFS Districts, one person is responsible for liaising with local councils and brigade volunteers about fleet maintenance and repairs. In the regions where resources are limited, there is less ability to maintain ongoing communication. This is impacting on fleet service and maintenance timelines and the timeliness of fleet monitoring activity.

The RFS has mutual support arrangements with agencies in NSW and interstate, though shared fleet levels are yet to be quantified

The RFS has arrangements with state, federal, and international fire authorities to provide mutual support during fire incidents. In NSW, the RFS has agreements with the three statutory authorities – Fire and Rescue NSW, the Forestry Corporation of NSW, and the NSW National Parks and Wildlife Service. The agreement with Fire and Rescue NSW provides a framework for cooperation and joint operations between the agencies. The agreements with the Forestry Corporation of NSW and the NSW National Parks and Wildlife Service describe the control and coordination arrangements for bush and grass fires across NSW. These arrangements are set out in legislation and incorporated into local Bush Fire Risk Management Plans.

The RFS has agreements with fire authorities in three of the four Australian states and territories that share a border with NSW – the Australian Capital Territory, Queensland, and South Australia. Each agreement sets out the arrangements for mutual assistance and joint operations, including arrangements for sharing aircraft. The agreement between the RFS and Victoria had lapsed. The RFS told the NSW Bushfire Inquiry that the agreement with Victoria would be finalised by June 2020. In June 2022, the RFS reported that the agreement was in the process of being finalised.

The arrangements for mutual aid from Western Australia, Northern Territory and Tasmania, are managed by the National Resource Sharing Centre. These agreements set out the arrangements for interstate assistance between Australian fire services, emergency services, and land management agencies in those states and territories.

These mutual support arrangements may assist during state-based fire events. However, when there are competing demands for resources, such as during the bushfires of 2019–2020, there can be limits on fleet availability. During the 2019–2020 fires, resources were stretched in all jurisdictions as these fires affected NSW, Victoria, and Queensland.

There are opportunities for the RFS and other NSW agencies to quantify fleet resources across the State and identify assets that can be mobilised for different fire activities. This form of fleet planning may be used to enhance surge capabilities during times of high fire activity. There are also opportunities for the RFS and other agencies to match the levels of shared assets to projected bushfire risks.

Appendix one – Responses from agencies 

Appendix two – About the audit 

Appendix three – 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 #376 - released 27 February 2023

What the report is about

This audit assessed the effectiveness of NSW Government agencies’ coordination of the response to COVID-19, with a focus on the Delta variant outbreak in the Dubbo and Fairfield Local Government Areas (LGA) between June and November 2021. We audited five agencies - the Department of Premier and Cabinet, NSW Health, the NSW Police Force, Resilience NSW and the Department of Customer Service.

The audit also considered relevant planning and preparation activities that occurred prior to June 2021 to examine how emergency management and public health responses learned from previous events.

What we found

Prior to Delta, agencies developed capability to respond to COVID-19 related challenges.

However, lessons learned from prior reviews of emergency management arrangements, and from other jurisdictions, had not been implemented when Delta emerged in June 2021. As a result, agencies were not as fully prepared as they could have been to respond to the additional challenges presented by Delta.

Gaps in emergency management plans affected agencies' ability to support individuals, families and businesses impacted by restrictions to movement and gathering such as stay-at-home orders. In LGAs of concern, modest delays of a few days had a significant impact on people, especially those most vulnerable.

On 23 July 2021, the NSW Government established a cross-government coordinating approach, the Delta Microstrategy, which complemented existing emergency management arrangements, improved coordination between NSW Government agencies and led to more effective local responses.

Where possible, advice provided to government was supported by cross-government consultation, up-to-date evidence and insights. Public Health Orders were updated as the response to Delta intensified or to address unintended consequences of previous orders. The frequency of changes hampered agencies' ability to effectively communicate changes to frontline staff and the community in a rapidly evolving situation.

The NSW Government could provide greater transparency and accountability over decisions to apply Public Health Orders during a pandemic.

What we recommended

The audit made seven recommendations intended to improve transparency, accountability and preparedness for future emergency events.

This audit assessed the effectiveness of NSW Government agencies’ coordination (focused on the Department of Premier and Cabinet, NSW Health, the NSW Police Force, Resilience NSW and the Department of Customer Service) of the COVID-19 response in selected Local Government Areas (Fairfield City Council and Dubbo Regional Council) between June and November 2021.

As noted in this report, Resilience NSW was responsible for the coordination of welfare services as part of the emergency management arrangements. On 16 December 2022, the NSW Government abolished Resilience NSW.

During the audited period, Resilience NSW was tasked with supporting the needs of communities subject to stay-at-home orders or stricter restrictions and it provided secretariat support to the State Emergency Management Committee (SEMC). The SEMC was, and remains, responsible for the coordination and oversight of emergency management policy and preparedness.

Our work for this performance audit was completed on 15 November 2022, when we issued the final report to the five audited agencies. While the audit report does not make specific recommendations to Resilience NSW, it does include five recommendations to the State Emergency Management Committee. On 8 December 2022, the then Commissioner of Resilience NSW provided a response to the final report, which we include as it is the formal response from the audited entity at the time the audit was conducted.

The community of New South Wales has experienced significant emergency events during the past three years. COVID-19 first emerged in New South Wales after bushfire and flooding emergencies in 2019–20. The pandemic is now into its third year, and there have been further extreme weather and flooding events during 2021 and 2022.

Lessons taken from the experience of these events are important to informing future responses and reducing future risks to the community from emergencies.

This audit focuses on the NSW Government's response to the COVID-19 pandemic, and in particular, the Delta variant (Delta) that occurred between June and November 2021. The response to the Delta represents six months of heightened challenges for the NSW Government.

Government responses to emergencies are guided by legislation. The State Emergency and Rescue Management Act 1989 (SERM Act) establishes emergency management arrangements in New South Wales and covers:

• coordination at state, regional and local levels through emergency management committees
• emergency management plans, supporting plans and functional areas including the State Emergency Management Plan (EMPLAN)
• operations centres and controllers at state, regional and local levels.

This audit focuses on the activities of five agencies during the audit period:

• The NSW Police Force led the emergency management response and was responsible for coordinating agencies across government in providing the tactical and operational elements that supported and enhanced the health response to the pandemic. The NSW Police Force also led the compliance response which enforced Public Health Orders and included household checks on those required to isolate at home after testing positive to COVID-19. In some parts of NSW, they were supported by the Australian Defence Force in this role.
• NSW Health was responsible for leading the health response which coordinated all parts of the health system, initially to prevent, and then to manage, the pandemic.
• Resilience NSW coordinated welfare services as part of the emergency management arrangements and provided secretariat support to the State Emergency Management Committee (SEMC). The SEMC is responsible for the coordination and oversight of emergency management policy and preparedness. Resilience NSW was also tasked with supporting the needs of communities subject to stay-at-home orders or stricter restrictions.
• The Department of Customer Service (DCS) was responsible for the statewide strategic communications response.
• The Department of Premier and Cabinet (DPC) held a key role in providing policy and legal services, as well as supporting the coordination of activity across a range of functional areas and decision-making by our State’s leaders.

This audit assessed the effectiveness of NSW Government agencies’ coordination (focused on the Department of Premier and Cabinet, NSW Health, the NSW Police Force, Resilience NSW and the Department of Customer Service) of the COVID-19 response in selected Local Government Areas (LGA) (Fairfield City Council and Dubbo Regional Council) after June 2021.

The audit investigated whether:

• government decisions to apply LGA-specific Public Health Orders were supported by effective crisis management governance and planning frameworks
• agencies effectively coordinated in the communication (and enforcement) of Public Health Orders.

While focusing on the coordination of NSW Government agencies’ response to the Delta variant in June through to November 2021, the audit also considered relevant planning and preparation activities that occurred prior to June 2021 to examine how emergency management and public health responses learned from previous events.

This audit does not assess the effectiveness of other specific COVID-19 responses such as business support. It refers to the preparedness, planning and delivery of these activities in the context of supporting communities in selected LGAs. NSW Health's contribution to the Australian COVID-19 vaccine rollout was also subject to a separate audit titled 'New South Wales COVID-19 vaccine rollout' tabled in NSW Parliament on 7 December 2022. 

This audit is part of a series of audits which have been completed, or are in progress, regarding the New South Wales COVID-19 emergency response. The Audit Office of New South Wales '2022–2025 Annual Work Program' details the ongoing focus our audits will have on providing assurance on the effectiveness of emergency responses.

In this document Aboriginal refers to the First Nations peoples of the land and waters now called Australia, and includes Aboriginal and Torres Strait Islander peoples.

The COVID-19 pandemic arrived in Australia in late January 2020 as the bushfire and localised flooding emergencies were in their final stages. Between 2020 and mid-2021, agencies responded to the initial variants of COVID-19, managed a border closure with Victoria that lasted nearly four months and dealt with localised ‘flare-ups’ that required postcode-based restrictions on mobility in northern parts of Sydney and regional New South Wales. During this period, New South Wales had the opportunity to learn from events in Victoria which imposed strict restrictions on mobility across the State and the growing emergence of the Delta variant (Delta) across the Asia Pacific.

This section of the report assesses how emergency management and public health responses adapted to these lessons and determined preparedness for, and responses to, widespread community transmission of Delta in New South Wales.

The previous chapter discusses how agencies had refined the existing emergency management arrangements to suit the needs of a pandemic and describes some gaps that were not addressed. This chapter explores the first month of Delta (mid-June to mid-July 2021). It explores the areas where agencies were prepared and responses in place for the outbreak. It also discusses the impact of the gaps that were not addressed in the period prior to Delta and other issues that emerged.

NSW Health provided advice on the removal of restrictions based on up-to-date advice

The NSW Government discussed the gradual process for removing restrictions using the Doherty Institute modelling provided to National Cabinet on 10 August 2021. NSW Health highlighted the importance of maintaining a level of public health and safety measure bundles to further suppress case numbers. This was based on additional modelling from the Doherty Institute.

The Department of Regional NSW led discussion and planning around reopening with a range of proposal through August and September 2021. The Department of Premier and Cabinet and NSW Health jointly developed a paper to provide options on the restrictions when the State reached a level of 70% double dose vaccinations.

The roadmap to reopening was originally published on 9 September 2021. However, by 11 October 2021, the restrictions were relaxed when the 70% double dose threshold was reached to allow:

• up to ten fully vaccinated visitors to a home (increased from five)
• up to 30 fully vaccinated people attending outdoor gatherings (increased from 20)
• weddings and funerals limits increased to 100 people (from 50)
• the reopening of indoor pools for training, exercise and learning purposes only.

On the same day, the NSW Government announced further relaxation of restrictions once the 80% double dose threshold was reached. These restrictions were further relaxed on 8 November 2021. This included the removal of capacity restrictions to the number of visitors to a private residence, indoor pools to reopen for all purposes and density limits of one person for every two square metres, dancing allowed in nightclubs and 100% capacity in major stadia.

The NSW Government allowed workers in regional areas who received one vaccination dose to return to their workplace from 11 October 2021.

The Premier extended the date of easing of restrictions for unvaccinated people aged over 16 from 1 December to 15 December 2021.

Many agencies have undertaken reviews of their response to the Delta outbreak but a whole-of-government review has yet to be conducted

Various agencies and entities associated with the response to the Delta outbreak conducted after-action review processes. These processes assessed the achievements delivered, lessons learned and opportunities for improvement. However, a whole-of-government level review has not been conducted. This limits the New South Wales public service's ability to improve how it coordinates responses in future emergencies.

The agencies/entities that conducted reviews included:

• South West Metropolitan region, Western NSW region, Fairfield Local Emergency Management Committee (LEMC), Dubbo Local Emergency Operations Controller (LEOCON), which were collated centrally by the State Emergency Operations Centre (SEOC)
• Aboriginal Affairs NSW assessed representation and relevance of the emergency management arrangements for Aboriginal communities following the 2019 bushfires
• Resilience NSW developed case studies to capture improved practice with regard to food security and supply chains
• a community support and empowerment-focused after-action review undertaken by the Pillar 5 workstream of the Microstrategy.

Key lessons collated from the after-action reviews include:

• the impact of variation in capability across agencies on the management of key aspects of the response including welfare support and logistics
• issues with boundary differences between NSW Police Force regions, local government areas (LGA and local health districts (LHD) caused issues in delivering and coordinating services in an emergency situation 
• the need to improve relationships between state and local Government outside of acute emergency responses to improve service delivery 
• issues arising from impediments to information sharing between agencies and jurisdictions, such as:
  • timeliness and accuracy of data used to direct compliance activities
  • the impact of insufficient advance notice on changes to Public Health Orders
  • timely access to data across public sector agencies and other jurisdictions to inform decision-making, analysis and communications
  • gaps in data around ethnicity, geolocation of recent positive cases and infection/vaccination rates in Aboriginal communities.
• the lack of Aboriginal community representation on many LEMCs
• compared with the response to COVID-19 in 2020, improved coordination of communications with Culturally and Linguistically Diverse (CALD) populations with a reduction in overlapping messages and over-communication
• improved attendance from agency representatives in LEMCs, and regional emergency operations centres (REOC) to improve interagency communications, planning, capability development and community engagement issues
• deficiencies in succession planning and fatigue management practices
• the potential for REOC Welfare/Well-being subgroups to be included as part of the wider efforts to community needs during emergencies.

NSW Health commenced a whole of system review of its COVID-19 response in May 2022. At the time of writing, the completion due date for the debrief is 7 November 2022. This debrief is expected to explore:

• governance
• engagement 
• innovation and technology 
• community impact 
• workforce impact
• system impact and performance.

NSW Health is also undertaking a parallel Intra-Action Review that is focused on the public health aspects of the response with finalisation estimated for the end of November 2022. At the time of completing this performance audit report, NSW Health had not finalised these reviews and, as a result, we cannot validate their findings against our own observations.

Recent inquiries are likely to impact the governance of emergency management in New South Wales

In March 2022, the NSW Government established an independent inquiry to examine and report on the causes of, preparedness for, response to and recovery from the 2022 floods. The Flood Inquiry report made 28 recommendations, which the NSW Government supported in full or in principle. Some of the recommendations relate directly to the governance and leadership of emergency management arrangements in New South Wales. 

The State Emergency Management Committee (SEMC) will likely be involved in, and impacted by, the recommendations arising from the Flood Inquiry with potential changes to its membership and reshaping of functional areas and agencies. At the same time, the SEMC may have a role in overseeing the changes that emerge from the SEOC consolidated after-action reviews. This can also extend to ensuring local and regional bodies have incorporated the required actions. There is a risk that the recommendations from the pandemic-based after-action reviews may not be considered due to the priority of action resulting from the Flood Inquiry.

Furthermore, there is potential for the SEMC to work with NSW Health during its system-wide review. Such an approach is likely to improve preparedness for future events.

Appendix one – Response from agencies

Appendix two – Chronology 2020–2021

Appendix three – About the audit

Appendix four – 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 #371 - released 20 December 2022

What the report is about

Results of the Stronger Communities cluster agencies' financial statement audits for the year ended 30 June 2022.

What we found

Unqualified audit opinions were issued on all completed 30 June 2022 financial statement audits. One audit is ongoing.

All 13 cluster agencies that have accommodation arrangements with Property NSW derecognised right-of-use assets and lease liabilities of $917 million and $1 billion respectively. The agencies also collectively recorded a gain on derecognition of $136 million.

The Department of Communities and Justice (the department) assumed the responsibility for delivery of the Process and Technology Harmonisation program from the Department of Customer Service. In 2021–22, the department incurred costs of $42.8 million in relation to the project, which remains ongoing.

The number of monetary misstatements identified during the audits decreased from 50 in 2020–21 to 48 in 2021–22.

What the key issues were

Six of the 15 cluster agencies required to submit 2021–22 mandatory early close procedures did not meet the statutory deadlines. One agency did not complete all mandatory procedures.

Five high-risk findings were identified in 2021–22. They related to deficiencies in:

• user access administration at the department, NSW Rural Fire Service and New South Wales Aboriginal Land Council (NSWALC)
• segregation of duties at the NSW Trustee and Guardian and NSWALC.

Recommendations were made to those agencies to address these control deficiencies.

This report provides Parliament and other users of the Stronger Communities cluster’s financial statements with the results of our audits, analysis, conclusions and recommendations in the following areas:

• financial reporting
• audit observations.

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 Stronger Communities cluster (the cluster) for 2022.

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 Stronger Communities cluster.

Appendix one – Misstatements in financial statements submitted for audit

Appendix two – Early close procedures

Appendix three – Timeliness of financial reporting

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.