According to Department of Communities and Justice data, the number of children and young people reported to be at ‘risk of significant harm’ of abuse and neglect in NSW has been increasing in recent years. The Department of Communities and Justice has primary responsibility to provide support and a safe living environment for children and young people who are not able to live safely in the family home. Non-government agencies are also funded by the NSW Government to provide services to children and young people who require out-of-home-care and support services. 
 
This audit will focus on the timeliness and quality of the child protection services and responses provided by the Department of Communities and Justice and the non-government agencies funded to provide child protection services on behalf of the government.
 
This audit is being conducted concurrently with another audit on the child protection system: Safeguarding the rights of Aboriginal children and young people in the child protection system. 

Estimated tabling period 

First half 2024

Agencies audited 

The main auditee is the Department of Communities and Justice.

For both this audit and the Safeguarding the rights of Aboriginal children in the child protection system performance audit, we have also included in the scope, as auditees, five non-government organisations who are contracted by the Department of Communities and Justice to deliver child protection services. 

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

The 2016 Future Directions for Social Housing strategy sets out the NSW Government’s ten-year vision for social housing. The $1 billion Social and Affordable Housing Fund is a key initiative under Future Directions and is expected to provide 3,400 new social and affordable dwellings by the end of 2023. The 2020–21 State Budget allocated a further $812 million for new and upgraded social housing across New South Wales. This is intended to deliver a further 1,280 new social homes and Aboriginal housing, place-based redevelopment projects at some existing housing estates, and upgrades to over 3,500 social housing dwellings.

This audit may consider the effectiveness and efficiency of the strategic planning and administration of public housing, delivery and outcomes of the Future Directions strategy, and related additional funding and transfer of housing to community providers.

What the report is about

In this report, we have analysed the key findings and recommendations from our audit reports over the past four years.

This analysis includes financial audits, performance audits, and compliance audits of state and local government entities that were tabled in NSW Parliament between July 2018 and February 2022.

The report is framed by recognition that the past four years have seen significant challenges and emergency events.

The scale of government responses to these events has been wide-ranging, involving emergency response coordination, service delivery, governance and policy.

The report is a resource to support public sector agencies and local government to improve future programs and activities.

What we found

Our analysis of findings and recommendations is structured around six key themes:

• Integrity and transparency
• Performance and monitoring
• Governance and oversight
• Cyber security and data
• System planning for disruption
• Resource management.

The report draws from this analysis to present recommendations for elements of good practice that government agencies should consider in relation to these themes. It also includes relevant examples from recent audit reports.

In this report we particularly call out threats to the integrity of government systems, processes and governance arrangements.

The report highlights the need for balanced advice to government on options and risks, for transparent documentation and reporting of directions and decisions, and for early and open sharing of information with integrity bodies and audit.

A number of the matters highlighted in this report are similar to those described in our previous Insights Report, (Performance Audit Insights: key findings from 2014–2018) specifically in relation to cyber and information security, to performance measurement, reporting and evaluation, and system and workforce planning and capability.

I am pleased to present the Audit Insights 2018–2022 report. This report describes key findings, trends and lessons learned from the last four years of audit. It seeks to inform the New South Wales Parliament of key risks identified and to provide insights and suggestions to the agencies we audit to improve performance across the public sector.

The report is framed by a very clear recognition that governments have been responding to significant events, in number, character and scale, over recent years. Further, it acknowledges that public servants at both state and council levels generally bring their best selves to work and diligently strive to deliver great outcomes for citizens and communities. The role of audit in this context is to provide necessary assurance over government spending, programs and services, and make suggestions for continuous improvement.

A number of the matters highlighted in this report are similar to those described in our previous Insights Report, (Performance Audit Insights: key findings from 2014–2018) specifically in relation to cyber and information security, to performance measurement, reporting and evaluation, and system and workforce planning and capability.

However, in this report we particularly call out threats to the integrity of government systems, processes and governance arrangements. We highlight the need for balanced advice to government on options and risks, for transparent documentation and reporting of directions and decisions, and for early and open sharing of information with integrity bodies and audit. Arguably, these considerations are never more important than in an increasingly complex environment and in the face of significant emergency events and they will be key areas of focus in our future audit program.

While we have acknowledged the challenges of the last few years have required rapid responses to address the short-term impacts of emergency events, there is much to be learned to improve future programs. I trust that the insights developed in this report provide a helpful resource to public sector agencies and local government across New South Wales. I would be pleased to receive any feedback you may wish to offer.

Margaret Crawford
Auditor-General for New South Wales

This report brings together a summary of key findings arising from NSW Audit Office reports tabled in the New South Wales Parliament between July 2018 and February 2022. This includes analysis of financial audits, performance audits, and compliance audits tabled over this period.

• Financial audits provide an independent opinion on the financial statements of NSW Government entities, universities and councils and identify whether they comply with accounting standards, relevant laws, regulations, and government directions.
• Performance audits determine whether government entities carry out their activities effectively, are doing so economically and efficiently, and in accordance with relevant laws. The activities examined by a performance audit may include a selected program or service, all or part of an entity, or more than one government entity. Performance audits can consider issues which affect the whole state and/or the local government sectors.
• Compliance audits and other assurance reviews are audits that assess whether specific legislation, directions, and regulations have been adhered to.

This report follows our earlier edition titled 'Performance Audit Insights: key findings from 2014–2018'. That report sought to highlight issues and themes emerging from performance audit findings, and to share lessons common across government. In this report, we have analysed the key findings and recommendations from our reports over the past four years. The full list of reports is included in Appendix 1. The analysis included findings and recommendations from 58 performance audits, as well as selected financial and compliance reports tabled between July 2018 and February 2022. The number of recommendations and key findings made across different areas of activity and the top issues are summarised at Exhibit 1.

The past four years have seen unprecedented challenges and several emergency events, and the scale of government responses to these events has been wide-ranging involving emergency response coordination, service delivery, governance and policy. While these emergencies are having a significant impact today, they are also likely to continue to have an impact into the future. There is much to learn from the response to those events that will help the government sector to prepare for and respond to future disruption. The following chapters bring together our recommendations for core elements of good practice across a number of areas of government activity, along with relevant examples from recent audit reports.

This 'Audit Insights 2018–2022' report does not make comparative analysis of trends in public sector performance since our 2018 Insights report, but instead highlights areas where government continues to face challenges, as well as new issues that our audits have identified since our 2018 report. We will continue to use the findings of our Insights analysis to shape our future audit priorities, in line with our purpose to help Parliament hold government accountable for its use of public resources in New South Wales.

Appendix one – Included reports, 2018–2022

Appendix two – About this report

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What the report is about

This report draws together the financial impact of COVID-19 on the agencies integral to responses across the state government sector of New South Wales.

What we found

Since the COVID-19 pandemic hit NSW in January 2020, and until 30 June 2021, $7.5 billion was spent by state government agencies for health and economic stimulus. The response was largely funded by borrowings.

The key areas of spending since the start of COVID-19 in NSW to 30 June 2021 were:

• direct health response measures – $2.2 billion
• personal protective equipment – $1.4 billion
• small business grants – $795 million
• quarantine costs – $613 million
• increases in employee expenses and cleaning costs across most agencies
• vaccine distribution, including vaccination hubs – $71 million.

The COVID-19 pandemic significantly impacted the financial performance and position of state government agencies.

Decreases in revenue from providing goods and services were offset by increases in appropriations, grants and contributions, for health and economic stimulus funding in response to the pandemic.

Most agencies had expense growth, due to additional operating requirements to manage and respond to the pandemic along with implementing new or expanded stimulus programs and initiatives.

Response measures for COVID-19 have meant the NSW Government is unlikely to meet targets in the Fiscal Responsibility Act 2012 being:

• annual expense growth kept below long-term average revenue growth
• elimination of State’s unfunded superannuation liability by 2030.

What the report is about

This audit assessed whether the NSW Police Force has effective systems, processes, resources, and capability to respond to domestic and family violence events in New South Wales.

What we found

The NSW Police Force has almost doubled its domestic violence specialist workforce in the past five years and is conducting higher levels of risk monitoring to check that frontline police comply with domestic and family violence policing procedures.

However, a lack of workload monitoring at a whole of agency level is limiting the ability of the NSW Police Force to assess whether specialist and frontline police are sufficient to manage domestic and family violence demands across all 57 local commands.

Rates of compliance checking of domestic violence events vary across local commands, and there is a lack of system level policy or oversight to guide this activity.

While the NSW Police Force has structured training for probationary constables on domestic and family violence policing practices, it does not monitor training or skill levels of the broader workforce to understand levels of expertise in domestic violence policing.

The NSW Police Force does not have regular or consistent methods for seeking feedback and it has a limited understanding of its service quality from the perspective of victim survivors of domestic and family violence.

Performance reporting on domestic and family violence is limited, with most measures focused on activity counts rather than service quality or outcomes.

What we recommended

Improve workforce and workload data collections, analysis and reporting on domestic and family violence workload volumes and allocations of specialist and frontline police to meet demands.

Structure and resource the domestic and family violence strategic policy function to a level commensurate with workload volumes and risks associated with domestic violence policing.

Review debriefing protocols, procedures, and resources for police after domestic and family violence incidents.

Improve databases and information systems for recording domestic violence events so that related events and individuals are automatically connected.

Design a procedure to collect, collate, and analyse service user and stakeholder feedback about police responses to domestic and family violence.

Review existing activity measures and targets for domestic and family violence and expand to include performance measures, service quality measures and outcomes reporting.

Review the process for investigating allegations of domestic and family violence against current and former serving police personnel and implement procedures to ensure processes are independent of interested parties and mitigate conflicts of interest.

The NSW Police Force describes domestic and family violence as a significantly under-reported and complex crime that is mainly perpetrated by men in intimate partner relationships. It is a crime that can include one or more of the following behaviours: emotional and psychological abuse, intimidation, harassment, stalking, physical and sexual assault.

The NSW Police Force responds to over 140,000 domestic and family violence calls for assistance every year. This equates to one call every four minutes. According to NSW Bureau of Crime Statistics and Research statistics, the number and volume of domestic and family violence crime types have increased from October 2016 to September 2021.

The NSW Police Force's responses to domestic and family violence are prescribed in legislation and its own procedural guidance. Principally, the NSW Police Force is required to:

• investigate incidents of domestic and family violence
• take out Apprehended Domestic Violence Orders on behalf of victims and children
• provide safety and support to victims, including taking offenders away from victims
• place alleged perpetrators before the courts
• investigate breaches of Apprehended Domestic Violence Orders and target repeat offenders
• work with local service providers to reduce incidents of domestic and family violence.

Domestic and family violence incident dispatches are attended by general duties police – also described in this report as frontline police.

The objective of this audit was to assess the effectiveness of the NSW Police Force in responding to domestic and family violence. To do this, we assessed whether the NSW Police Force:

• conducts capability planning to ensure its workforce can effectively respond to domestic and family violence incidents and support victim-survivors
• resources its workforce with the required systems, skills, knowledge, and administrative support to monitor, record and respond to domestic and family violence events
• assesses the effectiveness of police responses to domestic and family violence events and the effectiveness of support for victim-survivors.

Where to get help

If you or someone you know is experiencing violence or abuse, you can contact 1800 RESPECT (1800respect.org.au or 1800 737 732).

Appendix one – Response from agency 

Appendix two – Workload and workforce numbers in 2020–21 supporting Exhibits 4, 6 and 7 

Appendix three – Key NSW Police Force initiatives, July 2016–present 

Appendix four – About the audit 

Appendix five – 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 #363 - released 4 April 2022.

This report analyses the results of our audits of the Stronger Communities cluster agencies for the year ended 30 June 2021.

Our preferred approach is to table the ‘Report on State Finances’ in Parliament before any other cluster report. This is because the 'Report on State Finances' focuses on the audit results and observations relating to the Total State Sector Accounts, in effect a consolidation of all government agencies. This year the 'Report on State Finances' has been delayed due to significant accounting issues being considered in the Total State Sector Accounts and which may impact the Treasury and Transport clusters.

As there are no outstanding matters relating to audits in the Stronger Communities cluster impacting the Total State Sector Accounts we have decided to break with normal practice and table this cluster report ahead of the ‘Report on State Finances’.

What the report is about

The results of the Stronger Communities cluster agencies' financial statement audits for the year ended 30 June 2021.

What we found

Unqualified audit opinions were issued for all 30 June 2021 financial statements of cluster agencies.

Eleven of the 15 cluster agencies required to submit 2020–21 early close financial statements and other mandatory procedures did not meet the statutory deadline. Five agencies did not perform all mandatory procedures.

The implementation of AASB 1059 'Service Concession Arrangements: Grantors' had a significant impact on the Department of Communities and Justice's (the department) 2020–21 financial statements. The department applied a modified retrospective approach upon initial adoption at 1 July 2020 and recognised service concession assets and liabilities of $1.0 billion and $1.2 billion respectively (relating to three correctional centres with private sector operators).

The department was, this year for the first time, able to reliably measure Incurred But Not Reported (IBNR) claims relating to its Victims Support Scheme. The department recorded a liability of $200 million at 30 June 2021. Liabilities for Child Sexual Assault IBNR claim continue to be not recorded on the basis they are unable to be reliably measured.

The number of monetary misstatements identified during the audit of the financial statements for the cluster increased from 61 in 2019–20 to 72 in 2020–21.

What the key issues were

The number of issues reported to management decreased from 191 in 2019–20 to 172 in 2020–21. However, 45 per cent were repeat issues related to information technology, governance and oversight controls.

Seven high risk issues were identified in 2020–21, an increase of five compared to last year. High risk issues related to deficiencies in IT access controls at Sydney Cricket and Sports Ground Trust; a lack of a formal agreement between the Office of Sport and Planning Ministerial Corporation over the management of a sporting venue; asset revaluations at both Fire and Rescue NSW and the Trustees of the Anzac Memorial Building; and three issues related to revenue recognition control deficiencies at New South Wales Aboriginal Land Council and two of its subsidiaries.

What we recommended

Cluster agencies should ensure all applicable mandatory early close procedures are completed and the outcomes provided to the audit team in accordance with the deadlines set by NSW Treasury.

We recommend cluster agencies action recommendations to address internal control weaknesses promptly. Focus should be given to addressing high risk and repeat issues.

This report provides Parliament and other users of the Stronger Communities cluster’s financial statements with the results of our audits, our observations, 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 2021.

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.

Findings reported to management

The overall number of findings has decreased, but the level of repeat issues increased

Breakdowns and weaknesses in internal controls increase the risk of fraud and error. Deficiencies in internal controls, matters of governance interest and unresolved issues were reported to management and those charged with governance of agencies. The Audit Office does this through management letters, which include observations, related implications, recommendations and risk ratings.

In 2020–21, there were 172 findings raised across the cluster (191 in 2019–20). 45 per cent of all issues were repeat issues (32 per cent in 2019–20).

Repeat issues largely related to weaknesses in controls over information technology (IT), governance and oversight.

A delay in implementing audit recommendations increases the risk of intentional and accidental errors in processing information, producing management reports and generating financial statements. This can impair decision‑making, affect service delivery and expose agencies to fraud, financial loss and reputational damage. Poor controls may also mean agency staff are less likely to follow internal policies, inadvertently causing the agency not to comply with legislation, regulation and central agency policies.

2020–21 audits identified seven high risk findings

High risk findings were reported at the following cluster agencies. Two high risk findings reported in 2019–20 were resolved.

The table below describes issues commonly identified across the cluster by category and risk rating.

The number of moderate risk findings decreased from prior year

Seventy‑eight moderate risk findings were reported in 2020–21, representing a 22 per cent decrease from 2019–20. Of these, 43 were repeat findings, and 35 were new issues.

Moderate risk findings reported in 2020–21 include:

• weaknesses in governance arrangements, including outdated policies and procedures and arrangements that do not align with NSW Government guidelines, such as the NSW Government Procurement Policy Framework and NSW Cyber Security Policy
• weaknesses in user access administration including:
  • user access reviews
  • monitoring of privileged user access and activities
  • password policy configuration
• cyber security improvements including:
  • implementation and update of governance arrangements
  • monitoring of third‑party system access
  • patch management improvement
• outdated instruments of financial delegation and non‑compliance with established financial delegations
• weaknesses in supplier and employee masterfile maintenance.

 Appendix one – Misstatements in financial statements submitted for audit

Appendix two – Early close procedures

Appendix three – Timeliness of financial reporting

Appendix four – Financial data

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© 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.

Legal Aid NSW and non-government community legal centres (CLCs) provide free legal assistance services across the state, particularly to people experiencing economic hardship, social disadvantage or discrimination. Previous national and state reviews have found unmet demand for legal assistance services and specific service gaps, and made recommendations for adequate and stable funding. In 2019–20 the NSW Government provided $224 million in funding to Legal Aid NSW for legal assistance services, and an additional $88.0 million to enable Legal Aid NSW to increase hourly rates for private lawyers in line with other states and territories. This audit may consider how accessible Legal Aid NSW and CLCs services are, and how effectively they are prioritising their services to meet demand.

What the report is about

The report assessed how effectively the Department of Communities and Justice is responding to homelessness through the NSW Government’s Homelessness Strategy.

It also assessed the effectiveness of the department’s efforts to address street homelessness in its COVID-19 response.

What we found

The strategy was designed to build evidence to inform future state-wide action rather than to end homelessness.

The department received significantly less funding than it sought for the strategy.

Actions delivered under the strategy have a narrow reach in terms of locations and number of people targeted for assistance.

The strategy will have limited short-term impact on homelessness across NSW, but it is building evidence on what works to prevent and reduce homelessness.

The department effectively implemented a crisis response to assist over 4,350 people sleeping rough into temporary accommodation during the pandemic.

While there was an effective crisis response to assist people sleeping rough during the pandemic, more will need to be done to ensure a sustainable response which prevents people returning to homelessness.

What we recommend

The department should:

• provide advice to the NSW Government on sustainably addressing demand and unmet need for homelessness supports
• commence development of a comprehensive strategy to address homelessness, linked to the government’s 10-year plan for social housing and 20-year housing strategy
• enable input to key decisions on homelessness policy from partner agencies, the specialist homelessness services sector, the community housing sector, Aboriginal people, and people with lived experience of homelessness
• partner with Aboriginal stakeholders and communities to design and implement a strategy for early identification and responses to the needs of Aboriginal people vulnerable to homelessness; and build the capacity and resourcing of the Aboriginal Community Controlled Sector to deliver homelessness services
• evaluate the homelessness response to COVID-19, integrate the lessons learned into future practice, and develop protocols to inform actions in future emergencies or disasters
• regularly collect client outcomes data and feedback and use this to drive improvements to responses to homelessness.

Further information

Please contact Ian Goodwin, Deputy Auditor-General on 9275 7347 or by email.

Homelessness exists when a person does not have suitable accommodation alternatives. A person is considered to be experiencing homelessness if their current living arrangement:

• is in a dwelling that is inadequate; or
• has no tenure, or if their initial tenure is short and not extendable; or
• does not allow them to have control of, and access to space for social relations.

The number of people experiencing homelessness in New South Wales increased by 37 per cent between the last two censuses, from 27,479 in 2011, to 37,715 in 2016. New South Wales recorded the largest increase of all the states and territories in both the number of people experiencing homelessness and in the homeless rate (from 40.8 to 50.4 persons per 10,000).

The NSW Government's primary service response to homelessness is crisis, temporary and transitional accommodation, and support services, funded at more than $1.0 billion over four years from 2018–19. These are ‘commissioned services’ delivered by non‑government organisations under contracts with the Department of Communities and Justice (the Department) and out of scope for this audit. We assessed how the Department manages contracts for specialist homelessness services in our 2019 audit 'Contracting non‑government organisations'.

The policy framework for the NSW Government's response to homelessness is the NSW Homelessness Strategy 2018–23 (the Strategy), which is examined in this audit. The Department is responsible for the development, implementation, monitoring and evaluation of the Strategy. The Strategy comprises 21 actions, ten of which directly target people at risk of, or already experiencing, homelessness through measures such as:

• screening high school students for the risk of homelessness and providing supports
• assisting vulnerable people to maintain their tenancies in social housing or the private rental market
• providing purpose‑built social housing.

These ten actions comprise $160 million of the Strategy's $169 million funding.

In December 2019, the first evidence of the COVID‑19 virus emerged. People sleeping without shelter or in public places (sleeping rough) typically live in communal arrangements, with some having limited access to basic hygiene supplies or showering facilities. These factors may increase the risk of transmission of COVID‑19 amongst this population.

In response to the pandemic, the NSW Government provided additional funding for the Department to institute a range of actions aimed at preventing vulnerable people from becoming homeless, and people sleeping rough from contracting or transmitting the virus. These were informed by, but separate to, actions under the Homelessness Strategy.

This audit focused on the temporary accommodation provided to individuals experiencing street homelessness during the pandemic, and the new 'Together Home' program established in 2020 to transition people with experience or history sleeping rough from temporary accommodation into more sustainable longer‑term housing.

This audit assessed how effectively the Department is implementing the Homelessness Strategy and addressing street homelessness in its COVID‑19 response. In making this assessment, the audit examined whether the Department:

• has effectively developed an evidence‑based Strategy and established supporting arrangements to implement it
• is ensuring the Strategy is achieving its objectives and outcomes
• is effectively supporting people sleeping rough into temporary accommodation during COVID‑19 and to transition into more sustainable longer‑term housing.

1. Key findings: the Homelessness Strategy

The Strategy's geographical and client reach is limited because it is building the evidence base on what works

The Department's objectives to intervene early, provide effective supports and create an integrated person‑centred system to address homelessness are clear, but are not being pursued state‑wide.

There were existing gaps in the available evidence which made it difficult for the Department to develop a holistic, state‑wide, long‑term solution to homelessness. Some of the actions under the Strategy have a degree of supporting evidence. Other actions are intended to generate evidence through pilots and by evaluating existing programs more robustly.

At least one Strategy action is available in each of the Department's 16 districts, and there are examples of the Department rolling out practice changes from Strategy pilots across the state. However, progress towards the Strategy aims is confined to pockets where actions are being trialled.

Once fully implemented, Strategy actions will be available in only a quarter of the state's 128 local government areas and will support approximately 8,200 people ‑ which equates to around 22 per cent of the number of people who were experiencing homelessness at the time of the last census in New South Wales in 2016 more than 37,000 people. This does not include the number of people at risk of homelessness.

A key gap in Strategy actions is addressing Aboriginal homelessness.

The Department received significantly less funding than sought and designed the Strategy to build the evidence base rather than eliminate homelessness

The Department could not meet the evidence threshold for a cost benefit analysis required by a Treasury business case, given the limited evidence available locally and internationally on what works to prevent homelessness or intervene earlier. The Department sought new, targeted investment to extend a small number of initiatives with proven effect, and to build the evidence base about other measures that work, rather than the quantum of funding required to end homelessness in New South Wales.

Even so, approved funding was significantly less than that sought by the Department. It repurposed existing resources, dropped some proposed actions and scaled others down to fit within the final funding envelope. It directed 95 per cent of the total Strategy funding to supports and accommodation for people at risk of or experiencing homelessness.

The Department intends to use the gathered data from implementation of the Strategy to expand effective prevention and early intervention measures after it concludes, subject to budget approval. It expects that, over time, these initiatives will reduce the demand for crisis services.

Actions may not be scaled up at the end of the Strategy's term, perpetuating the Strategy's limited reach and narrow impact on homelessness

The Department's approach of testing interventions and building the evidence base through the Strategy was well described and provided a clear rationale in its original advice to government. An evaluation framework has been designed to generate sufficient evidence on the overall Strategy and its individual actions for a cost benefit analysis to support a future budget bid.

The Department intends to use the findings from interim evaluation reports, due by September 2021, to determine the programs and pilots with promising evidence that should continue to the end of the Strategy term. It expects this to enable more qualitative and quantitative data to be available to the evaluations, as well as to support service continuity.

However, delays in delivery of some actions under the Strategy, and the time taken for outcomes to be achieved and show up in the data, will impact on the strength of the evidence available at the mid‑term and final Strategy evaluation points. This raises a risk that future funding for a comprehensive Strategy will not be secured ‑ and prevention and early intervention activities not continued or scaled up beyond pilot sites ‑ if the evidence on effectiveness is incomplete, mixed or unclear when the Strategy concludes.

Given its limited reach, even if the existing Strategy actions were retained, and no expansion occurred, it would continue to have a narrow impact on homelessness in New South Wales. This sits against a backdrop of increasing need for housing and homelessness supports in the state that may become more acute once the full economic impacts of the COVID‑19 pandemic are felt.

2. Key findings: the COVID‑19 response to homelessness

The Department effectively planned and implemented its homelessness response to the pandemic and reduced the risk of transmission of COVID‑19 for people sleeping rough

The Department's crisis response focused on people sleeping rough due to the public health risk of COVID‑19 transmission amongst this group.

The Department engaged with the specialist homelessness services sector from mid‑March 2020 to modify service delivery, advise on infection control and plan extra supports. It explored options with temporary accommodation providers to support self‑isolation for clients, and scaled up its assertive outreach patrols by staff, specialist caseworkers and health professionals to support people sleeping rough into crisis or temporary accommodation for safety.

The Minister directed the Department to address street homelessness in the COVID‑19 response using the Government’s second stage of stimulus funding. The Department procured hotel, motel or serviced apartment accommodation for 400 people who were sleeping rough, or unable to physically distance in large crisis accommodation centres, within a week of the ministerial direction, building on existing programs. The Department provided advice to the Minister on the need to adjust existing policy settings to meet the forecast demand for temporary accommodation services.

The Department secured additional temporary accommodation when and where it was required, to accommodate the number of people sleeping rough who wanted support. Between 1 April 2020 and 31 January 2021, the Department provided temporary accommodation to 32,158 individuals, of which 4,355 people were sleeping rough, totalling more than 70,000 nights of temporary accommodation and services.

The Department met regularly with NSW homelessness peak organisations and established a Taskforce involving other government agencies, peak organisations, and service providers, to assist in quickly executing the measure and resolving issues arising. The Taskforce built on existing collaborative arrangements in place to support cross‑sectoral coordination, enabling it to respond quickly to COVID‑19.

The Department worked with NSW Health and health providers to ensure its COVID‑19 response to homelessness was in line with health guidelines. As of May 2021, just one participant in the Department's enhanced temporary accommodation program had contracted COVID‑19.

The Department does not know how many people sleeping rough who were assisted with enhanced temporary accommodation have returned to homelessness

Within metropolitan Sydney, the Department established a specialist housing team, and contracted a non‑government provider, to connect people placed in hotels with support services, provide tailored support, and to assist and monitor their transition to longer‑term housing.

The Department’s data indicates that between May 2020 and 31 January 2021, over 1,800 people who had previously been sleeping rough had been engaged in this program, more than four times the expected client numbers. Almost half moved into further accommodation when they left the program, including people supported with longer‑term housing such as social housing, community leasing under the Together Home program, and private rental arrangements.

However, the Department did not track the housing outcomes for clients who were not provided with this support, or who disengaged from services. The Department advises that this would have required additional resourcing to do so.

The Department offers assistance to people in temporary accommodation to find longer term options, and has a policy to not knowingly exit someone from temporary accommodation into homelessness. However, it does not track housing outcomes for every client if they do not engage with the Department's housing or funded support services. It intends to conduct research in the future to better understand what happens to people who leave temporary accommodation without seeking further assistance from the Department.

The Department cannot identify precisely how many people sleeping rough who were assisted during COVID‑19 have returned to rough sleeping or other forms of homelessness. The Department’s data suggests that 72 per cent of the approximately 4,000 people formerly sleeping rough who left temporary accommodation between April 2020 and April 2021 left with an unknown housing outcome. This includes people who were not eligible for social housing, were stranded due to border closures, or who disengaged from the Department or funded support services.

The Department also has limited data to understand whether the enhanced temporary accommodation program was more effective in helping to connect participants with services and support them into stable accommodation, than previous approaches.

The Together Home program was established quickly to assist people into more permanent accommodation but will not meet demand as a standalone response

The Department established the Together Home program in September 2020 to provide longer‑term accommodation to people who were sleeping rough during the pandemic. Community housing providers head‑lease properties in the private rental market for two years and sub‑lease these to clients, while ensuring they receive additional support, such as health services, to help them maintain the lease.

Under the initial tranche of funding, the Together Home program aimed to support 400 people sleeping rough. This target was met by April 2021. Due to increased rental demand in many areas of the state, there were some delays in securing properties in certain areas. In addition, people on temporary visas, or with existing public housing debt, are ineligible for this program.

A further $29.0 million was provided to this program through the 2020–21 NSW Budget, creating 400 additional program places. However, the total number of 800 Together Home places will not be sufficient to provide housing for the more than 4,000 individuals who were sleeping rough prior to entering enhanced temporary accommodation.

The Department advises it is using a range of ‘business‑as‑usual’ options to assist other people sleeping rough into stable accommodation outside of the Together Home program. These options include social housing, supported transitional accommodation, subsidised private rental, boarding houses, and referral to mental health and substance addiction rehabilitation facilities.

The Department’s latest annual state‑wide street count suggested that the number of people sleeping rough across New South Wales decreased by 13 per cent between February 2020 and February 2021. The Department has acknowledged that it could do more to monitor and support the housing outcomes for people in temporary accommodation after they exit.

The Department has plans to secure longer‑term housing options for Together Home clients after the two‑year program, through commissioned community housing and private rental assistance. However, it is not clear how this will overcome existing housing challenges given the complexity of needs amongst this client group, the limited availability of affordable rental properties and the existing scale of unmet need for social housing.

3. Recommendations

By July 2022, the Department of Communities and Justice should:

1. use data and analysis identified through the Homelessness Strategy 2018–2023 and provide advice to the NSW Government on sustainably addressing demand and unmet need for homelessness supports

2. use the evidence obtained through the Homelessness Strategy 2018–2023 to commence development of a comprehensive strategy to address homelessness, linked to the government’s ten‑year plan for social housing and 20‑year housing strategy

3. establish and sustain governance arrangements that enable input to key decisions on homelessness policy from partner agencies, the specialist homelessness services sector, the community housing sector, Aboriginal people and people with lived experience of homelessness

4. in partnership with Aboriginal stakeholders and communities, design and implement a strategy for early identification and responses to the needs of Aboriginal people vulnerable to homelessness; and build the capacity and resourcing of the Aboriginal Community Controlled Sector to deliver homelessness services

5. evaluate the homelessness response to COVID‑19 and integrate the lessons learned into future practice; and develop protocols to inform actions in future emergencies/disasters

6. establish and sustain a means to regularly collect client outcomes data and feedback; and use this to drive improvements to responses to homelessness.

This chapter considers how effectively the NSW Homelessness Strategy was developed and is currently being implemented by the Department of Communities and Justice.

This chapter examines how effectively the Department of Communities and Justice addressed homelessness in its response to the COVID‑19 pandemic, and how well it is applying lessons learned from the pandemic to future policy and service development.

Appendix one – Response from agency

Appendix two – Actions within the NSW Homelessness Strategy 2018–23

Appendix three – Reported progress on Homelessness Strategy actions to date (unaudited)

Appendix four – Key homelessness data collections

Appendix five – Temporary accommodation for people sleeping rough standard practice vs COVID 19 response

Appendix six – Key measures in the COVID 19 response to homelessness

Appendix seven – About the audit

Appendix eight – 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 #350 - released (4 June 2021).

The Auditor-General for New South Wales, Margaret Crawford, released a report today examining how effectively NSW emergency response agencies address public inquiry recommendations.

The audit found that agencies’ governance arrangements to address public inquiry recommendations have important and consistent gaps. 

The agencies did not sufficiently verify that they had implemented accepted recommendations as intended, and in line with the outcomes sought. This creates a risk that issues with disaster prevention or responses highlighted by public inquiries are not addressed in a complete or timely way and may persist or recur in the future. 

The audit also found that agencies did not always nominate milestone dates or priority rankings for accepted recommendations, and so could not demonstrate they were managing or monitoring them effectively.

The audit examined how five emergency response agencies – Fire and Rescue NSW, National Parks and Wildlife Service, NSW Rural Fire Service, NSW State Emergency Service and Resilience NSW – have addressed accepted recommendations from public inquiries over the last ten years. The audit assessed the effectiveness of governance arrangements to track recommendation implementation.

The report makes six recommendations to improve disaster response agency arrangements to address public inquiry recommendations.  

While the focus of this audit was agencies that responded to natural disasters, the findings and recommendations from this report have the potential to be applied across the NSW public sector in response to public inquiries related to other areas of government activity.

Major disasters and emergencies often trigger public post-event inquiries and reviews. The purpose of these reviews is to identify the causes of disaster or emergency events and areas for future improvement in prevention, preparedness, response and recovery. Areas identified for future improvement are then the subject of recommendations to government or government agencies and, when accepted, become public commitments to action.

Responses to the bushfires of 2019–20 followed this pattern, producing both NSW and Australian Government commissioned inquiries: the NSW Bushfire Inquiry and the Royal Commission into National Natural Disaster Arrangements. Both highlighted the significant volume of inquiries in recent years. Both asked whether agency responses to previous inquiries were improving Australia's capacity to prevent, prepare for, respond to and recover from natural disasters. The inquiries reflected on the difficulty of answering this question due to insufficient clarity and transparency on whether the improvements and risks that inquiries identified have been addressed in practice.

This audit stems from similar questions about how effectively government agencies in NSW are delivering on public inquiry recommendations. It assessed how five emergency response agencies have addressed accepted recommendations from 17 public inquiries over the last ten years. For this audit, we considered inquiries and reviews that affected agencies' operational capacity to respond to and recover from bushfire, floods and storms. The in scope public inquiries for this audit relate to:

• the 2013–14, the 2016–17 and the 2017–18 bushfire seasons
• severe storms and floods in 2015, 2016 and 2017
• workforce issues affecting the ability of agencies to respond to natural disasters.

The public inquiries we reviewed included coronial inquiries and inquests, parliamentary inquiries, independent reports and reviews, performance audits and recovery coordinator reports. In total, we looked at the processes that agencies used to implement 191 recommendations from these 17 public inquiries.

The objective of this audit was to determine how effective emergency response agencies are in addressing accepted recommendations from public inquiries. To answer our audit objective, we asked two questions:

• Do agencies have effective governance arrangements in place to respond to, monitor and implement accepted recommendations from public reviews and inquiries?
• Do agencies provide timely and accurate information on the implementation of accepted inquiry recommendations to senior decision makers and the public?

The agencies reviewed were:

• Fire and Rescue NSW
• NSW National Parks and Wildlife Service (now a division of the Department of Planning, Industry and Environment)
• NSW Rural Fire Service
• NSW State Emergency Service
• Resilience NSW (formerly the Ministry for Police and Emergency Services; and the Office of Emergency Management).

While the focus of this audit was agencies that respond to natural disasters (flood, bushfire and storms), the findings and recommendations from this report have the potential to be applied across the NSW public sector in response to public inquiries related to other areas of government activity.

This chapter reviews the way agencies have responded to, monitored and ensured they have implemented accepted recommendations from public inquiries.

This chapter reviews how agencies provided information to senior decision makers, agency Audit and Risk Committees and the public on the implementation of accepted recommendations from public inquiries.

Appendix one – Response from agencies

Appendix two – Identifying in scope inquiries

Appendix three – In scope inquiries

Appendix four – Recommendations reported by agencies as still in progress (detail)

Appendix five – Agency reported recommendation implementation status (unaudited) 

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 #348 - released (22 April 2021).

This report analyses the results of our audits of financial statements of the agencies comprising the Stronger Communities cluster for the year ended 30 June 2020. The table below summarises our key observations.

This report provides parliament and other users of the financial statements of agencies in the Stronger Communities cluster with the results of our audits, our observations, analysis, conclusions and recommendations.

Agencies in the Stronger Communities cluster were significantly impacted by the bushfires, floods and the COVID-19 pandemic in 2019–20. Our 2019–20 financial audits of the seven cluster agencies most significantly impacted by the recent emergency events considered:

• the financial implications of the emergency events
• changes to agencies' operating models and control environments
• delivery of new or expanded projects, programs or services at short notice.

Our findings on these seven agencies' responses to the recent emergencies are included throughout this report. These agencies are:

• Department of Communities and Justice
• Fire and Rescue NSW
• NSW Police Force
• Office of the NSW Rural Fire Service
• Office of the NSW State Emergency Service
• Sydney Cricket and Sports Ground Trust
• Venues NSW.

The Department of Communities and Justice is the principal agency of the cluster. The names of all agencies in the Stronger Communities cluster are included in Appendix one.

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 for 2020, including any financial implications from the recent emergency events.

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
• assessment of how well cluster agencies adapted their systems, policies and procedures, and governance arrangements in response to recent emergencies
• review of how the cluster agencies managed the increased risks associated with new programs aimed at stemming the spread of COVID-19 and stimulating the economy.

Appendix one – Timeliness of financial reporting by agency

Appendix two – Management letter findings by agency

Appendix three – List of 2020 recommendations 

Appendix four – Status of 2019 recommendations 

Appendix five – Selected agencies for review of response to emergency events 

Appendix six – 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.