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Part 2 I Management and accountability

Corporate governance and performance

Enabling our people

Environmental management

External scrutiny

Financial performance

Information strategies and technology management

Internal controls

Ministerial and parliamentary services

Partnerships for people

Right payments to the right people

Social Security Appeals Tribunal

204 FaCS Annual Report 2002–03 I Volume 2

Corporate governance and performance

FaCS includes the Child Support Agency (CSA) which, as an entity within the FaCS portfolio, has

distinct governance arrangements that recognise the specialist nature of its business in

comparison to the rest of FaCS. Where applicable, these distinct governance and management

arrangements are highlighted in this report.

Boards and committees

FaCS Executive Board

FaCS approaches its governance responsibilities in accordance with Australian National Audit Office(ANAO) recommendations on good practice governance arrangements for Australian Public Service(APS) agencies. FaCS’ Executive Board is an advisory group that helps the Secretary exercise hismanagement and leadership responsibilities. The board builds strong links across the business of thedepartment, supports integration of FaCS outcomes and enables a high level of collegiate and strategicdecision-making across the senior executive.

The board provided strategic guidance for the development of the FaCS Strategic Statement 2002–2005,and the introduction of annual priorities plans in support of it. The board also sponsored theintroduction of a consistent agency-wide approach to project management to better support theintegration of FaCS business and the adoption of business process rigour necessary to ensure theeffective use of resources to deliver intended results.

Towards the end of the year, the board worked to improve assurance and control and performancemonitoring of critical business issues through improvements in its processes and focus. In particular,the board has improved its focus on monitoring performance, risk and strategic priorities, and is makingbetter use of board sub-committees.

The FaCS Executive Board meets monthly. The board consists of the Secretary (chair), both deputysecretaries, all executive directors, the General Manager—Child Support Agency, a branch head and astate/territory manager. Centrelink is also represented.

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Corporate governance and performance 205

Board committees

Five committees underpin the work of the board:

◗ the Business Planning and Resource Allocation Committee is responsible for guiding businessplanning and determining and monitoring resource allocation and expenditure

◗ the Knowledge Committee sets and monitors key strategies associated with knowledgemanagement. Key decisions taken in 2002–03 include the initiation of a FaCS lecture series and tofund the redesign of the FaCS corporate intranet. The Research and Evaluation Committee becamepart of the Knowledge Committee during 2002–03. The transferred functions include coordination ofresearch and evaluation on social policy issues including funding decisions.

◗ the Information, Communication and Technology Committee ensures that FaCS’ investment ininformation technology delivers the best return to the organisation. This year’s focus has been onoverseeing document management, management information, email management improvementsand development of an integrated non-government organisation funding system.

◗ the People Committee works with the board to lead efforts to plan for and build a flexible anddiverse workforce to make sure FaCS has the right people in the right place at the right time. Inplanning the workforce, FaCS maintains a focus on both organisational renewal and the support thatpeople need to develop special skills to do their jobs effectively and meet emerging challenges.

◗ the Network Management Group (NMG) leads the State and Territory Office (STO) Network andmakes decisions in relation to the direction, operation and resourcing of the network to achieveFaCS’ objectives.

Committees reporting to the Secretary

Three committees report directly to the Secretary:

◗ the Portfolio Policy Committee is charged with ensuring that the portfolio produces a focused andcoherent set of Budget measures by establishing and identifying high-priority measures that clearlycontribute to the portfolio’s strategic direction

◗ the Risk Assessment and Audit Committee’s objectives are to:— ensure FaCS’ approach to the implementation of its control framework is effective— provide assurance to the Secretary on the preparation and review of the financial statements of

the department.

◗ the Protective Security Policy Committee also reports directly to the Secretary on significantprotective security matters that affect FaCS’ operations.


Integrated governance, strategy and planning

FaCS—strategy and planning

As well as enhancements at the board and committee level, FaCS took several measures over the yearto improve the integration of its governance arrangements. They include:

◗ the implementation of the FaCS Strategic Statement 2002–2005, and annual priorities plans insupport of it. Taking an annual approach to refreshing the focus of the Strategic Statement throughan annual priorities plan allows flexibility and responsiveness to changes in FaCS’ businessenvironment, while maintaining the integrity of the directions inherent in the long-range plan. Thefirst priorities plan was introduced very early in the year, with the second one in place by the end ofthe year to better align it with business planning processes.

◗ a restructure that established a Business Improvement and Governance Branch within the newPeople, Business Improvement and Support Cluster. This signals the commitment to improvingintegrated governance in FaCS and brings together the functions of:— strategic and business planning— organisational performance and measurement— governance mechanisms, including the Executive Board secretariat— risk management and business continuity planning.

◗ the establishment of a Budget and Financial Management ‘cluster’, led by the Chief Financial Officer(CFO) at executive director level. This has enabled FaCS to demonstrate compliance with the bestpractice guidelines on the role of the CFO, which were developed by the Department of Finance andAdministration following the Budget Estimates and Framework Review.

◗ establishing a project management integration office to build project management competencies inFaCS and to promote a consistent project management approach to FaCS’ business.

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Figure 19 FaCS Committee structure

KnowledgeCommittee

Information,Communicationand Technology

Committee

People Committee

Business Planningand Resource

AllocationCommittee

NetworkManagement

Group

Executive BoardRisk Assessment

and Audit Committee

Portfolio PolicyCommittee

Protective SecurityPolicy Committee

Secretary


Child Support Agency—strategy and planning

CSA works closely with other areas of FaCS, particularly branches within the Family and Children Cluster.CSA draws on its experience with clients and knowledge of community interests to contribute to FaCS’policy advice and implementation decisions, and the 2002–03 CSA business plan clearly linked itsbusiness priorities to FaCS outcomes.

During the past year CSA has enhanced its business management system, which includes frameworksto guide client, resource and project management and to promote quality and innovation. Thisintegrated system contributes to comprehensive and consistent corporate governance across CSA.

Network Management Group

The Network Management Group’s responsibilities include:

◗ setting the strategic directions for the state and territory office network within the context of FaCS’business priorities

◗ making decisions about directions, operations and resourcing for the network

◗ managing the network’s input into policy development and implementation.

The group’s members include the Executive Director—Alliance and Delivery Frameworks and each of thestate and territory office managers.

In 2002–03 the Executive Board agreed that the group become a committee of the Board. This clarifiedthe group’s accountability and governance within FaCS’ corporate governance framework.

Building on the principles of localisation, integration and partnership, the Lead State Model wasimplemented in 2002–03. The model aims to:

◗ provide a single point of contact for state and territory offices and national business owners across12 areas of focus

◗ provide advice, feedback and the capacity to test policy and service delivery options in the regions

◗ provide an early warning system for policy or program issues

◗ identify gaps, overlaps and links with and across programs, portfolios and levels of government

◗ coordinate and disseminate information across the STO network.


Senior management

FaCS—senior management

Two deputy secretaries assist the Secretary in managing FaCS. Lisa Paul transferred to the Departmentof Education, Science and Training in January and Glenys Beauchamp acted as deputy secretary until 30June 2003.

The deputy secretary, Wayne Jackson, works with the following executive directors:

◗ David Kalisch—Family and Children

◗ Kerry Flanagan—Strategic and Ageing

◗ Serena Wilson—Welfare Reform

◗ Cate McKenzie—Alliance and Delivery Frameworks.

The acting deputy secretary, Glenys Beauchamp, works with the following executive directors:

◗ Linda Powell—(acting) Community Development and Support

◗ Peta Winzar—Economic and Social Participation

◗ Virginia Mudie—People, Business Improvement and Support.

The Chief Financial Officer and the General Manager of CSA report directly to the Secretary.

Executive directors are responsible for achieving nominated strategic outcomes. They are responsiblefor the systemic management of ‘cluster’ outputs and making sure that branches work together toachieve policy interests. Branch outputs support outcome achievements, and clustering of branchesaround outcomes reflects this. Assistant secretaries and state/territory managers are responsible formanaging their branches/offices and delivering particular outputs, including programs and services.

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CSA—senior management


Figure 20 Child Support Agency top organisational structure

Assistant General Manager

Client and Community Branch

Sheila Bird

General Manager

Child Support Agency

Catherine Argall

Secretary FaCS

Mark Sullivan


Corporate Governance Branch

Robert Porteous


Business Strategy Branch

Trevor Sutton

Assistant General ManagerNational Operations

Lorraine Sheargold

Regional Registrar Australian CapitalTerritory/New South Wales

Regional Registrar

Victoria/Tasmania

Geoff Mutton

Regional Registrar

Queensland

Angela Tillmanns

Regional Registrar

Western Australia

Glenda Scott

Regional Registrar

South Australia/Northern Territory

Bill Volkers


Information Systems andSupport Branch

Nic Van den Berg

Service charters

FaCS—Service Charter and performance

The service charter sets out the standard of service that people who deal with FaCS can expect and howthey can help FaCS improve service. It also helps FaCS staff develop a better understanding of theirroles and responsibilities. A review of this service charter began in 2002–03 and will be completedin 2003–04.

Complaints recording system

In September 2002 FaCS introduced a new system for recording and managing the complaints thedepartment receives.

FaCS appointed a complaints coordinator who helped staff with recording complaints and acted as a liaison person for issues as they arose. A workshop on how to handle complaints was held in February 2003 and further forums are being planned to help staff.

FaCS staff are now able to consistently record complaints, monitor the progress on resolving them andprovide information on the number and type of complaints that FaCS receives.

Child Support Agency’s complaints service

CSA coordinated and managed complaints from the Commonwealth Ombudsman, Members ofParliament, the Office of the Federal Privacy Commissioner and CSA clients. CSA aims to provide thecomplaints mechanism of choice for clients. In 2002–03, 85 per cent of all complainants contacted CSA’scomplaints service directly, an improvement on 82.6 per cent in 2001–02 and 71.5 per cent in 2000–01.

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Table 70 Complaints recorded 2002–03

Category Total

FaCS FaCS

business service Program Service No

processes standards Policy design provider category Received Finalised

15 20 34 18 104 4 195 178


Child Support Agency—Client Charter

The Client Charter outlines CSA’s commitment to quality service. It explains CSA’s responsibilitiestowards its clients and client responsibilities towards CSA, together with information about clientcontact channels. The supporting Charter Package provides further information about the values andstaff behaviours that enable CSA to meet its Client Charter commitments.

The Client Charter and supporting package are being reviewed to ensure they continue to best meetclient and stakeholder expectations.

Child Support Agency—Client satisfaction and professionalism index

CSA conducted a professionalism survey in 2003. The results remained stable from the previous surveyconducted in February 2002. Staff were rated most highly on the element ‘Personal characteristics ofstaff’ (that is, polite, helpful, sincere and being able to listen), which is consistent with previous years.

In conjunction with an external consultant, CSA has been working to redesign the model used tomeasure client satisfaction. Implementation of the new system will be piloted in 2003, with nationalimplementation taking place in 2004.

Disability Action Plan

FaCS—Disability Action Plan

The implementation of the Commonwealth Disability Strategy (CDS) within FaCS is facilitated throughits Disability Action Plan 2001–04, a public statement of commitment to improving access to policies,programs and facilities for people with disabilities. This commitment is consistent with FaCS’ corporatevision and values of achieving a fair and cohesive Australian society by strengthening the capacity ofindividuals, families and communities to contribute to, and benefit from, greater involvement in allaspects of life.

The purpose of FaCS’ Disability Action Plan is to detail the actions and responsibilities agreed by thedepartment to improve working relationships with clients and staff with a disability. This performance isreported against the indicators established by the CDS.

FaCS continues to face the challenge of making accessibility an issue for all areas of the department.FaCS again concentrated action on ensuring that accessibility is considered as part of normal businessprocesses. For example, the Business Partnership Agreement with Centrelink, FaCS’ main serviceprovider, now incorporates recognition of the CDS requirements.

An accessible information service standard and guidelines have been developed by a representativeworking group and distributed to all FaCS staff. Business planning guidelines for FaCS branches andoffices also include a reminder to consider accessibility issues.


FaCS is consolidating progress that it has made in making accessibility an everyday part of its businessprocesses and continues to look for areas of improvement, with particular emphasis on encouragingand assisting line areas to incorporate accessibility in their business planning. A review of progress hasindicated that the Disability Action Plan contact officer network will need to be strengthened in order tomake further gains in this area.

Child Support Agency—Disability Action Plan

A key component of the CSA Workplace Diversity plan is the support for staff with disabilities. A workingpaper on a review of career path options for staff with disabilities, including hearing-impaired staff, isunder consideration. Employment opportunities in CSA for people with a disability are being considered through an extension of recruiting and advertising via specialised networks such as ACROD, the National Industry Association for Disability Services, within the limitations of the CSAworkplace environment.

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Enabling our people

Certified and workplace agreements

FaCS—Certified Agreement

Following the approval of the FaCS Certified Agreement 2002–2005 in May 2002 work has beenprogressing to meet implementation timetables within the agreement.

In particular the second pay increase provided under the agreement was subject to achieving agreedmilestones. These milestones, which revolved around organisational performance and capabilities,leave management, guideline development and work reviews, were achieved and the pay increase waspaid with effect from 1 April 2003.

Work continues on the implementation of other aspects of the agreement designed at further enhancingefficiency gains and contributing towards the final pay increase due on 1 April 2004.

Child Support Agency—Agency Agreement

The Child Support Agency (General Employees) Agreement was certified in December 2002. Thisagreement has a nominal expiry date of 15 December 2004.

Pay rises specified in the agreement are dependent on achievement of corporate outcomes, includingproductivity gains.

Advancement

CSA introduced a broadbanded staffing structure three years ago and is continuing to review andenhance that structure to maintain its integrity and success.

The Advancement model has continued to improve CSA’s organisational capability by introducing arobust performance management tool. This tool is the cornerstone of the Advancement model and hasresulted in improved feedback to staff, effective performance management processes and improvedstaff satisfaction.

Over the coming year the focus will be on establishing strategies that further streamline theAdvancement process and improve the management tools used to complement advancement andperformance management within CSA. The streamlined process will align with CSA business needs, theAPS merit principles and operate within the CSA Advancement framework in conjunction with theprinciples agreed to in the Child Support Agency (General Employees) Agreement 2002.

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Enabling our people 215

SES remuneration

All FaCS senior executive service (SES) staff have Australian workplace agreements (AWAs) in place.

FaCS’ executive remuneration policy provides for an annual review of SES salaries taking account of theAustralian Public Service SES Remuneration Survey published each year.

FaCS executive remuneration and performance pay is set out in Part four—Financial statements.

Australian workplace agreements

FaCS offers AWAs to all SES staff and key non-SES staff. These agreements provide flexible or speciallytailored remuneration and conditions. AWAs also are used to recruit or retain specialist staff, torecognise particular expertise, additional work responsibility and complexity, or especially valuableindividual contributions to outcomes.

Capability development

FaCS—Learning and development

FaCS is continuing to provide learning and development in response to environmental influences.Activities developed focus on identified workforce capability and skills gaps. In partnership withbusiness units, learning activities developed and/or delivered covered the following themes:

◗ senior executive development—using strategic planning processes and individual coaching

◗ senior leadership development—a program including a series of workshops, peer coaching, learning groups and seminars

◗ partnering and relationship management

◗ financial management

◗ policy development and advising

◗ contract management.

Evaluation data are increasingly used in decision processes in reviewing and developing all learning anddevelopment activities, resulting in activities that are tailored, where appropriate, to both APS-wide andFaCS needs.


Child Support Agency—Capability development

Leadership

CSA recognises the importance of having strong, skilled leaders in the organisation and has reinforcedthis in 2002–03. Key initiatives included:

◗ holding a leadership conference in May 2003 to increase leaders’ alignment with the key strategicdirections of CSA and to give them the opportunity to hear and discuss the views of key clients andstakeholders. The conference was attended by over 300 staff. The use of innovative technologymeant that every attendee could participate actively and make real-time contributions to theconference. Outcomes of the conference included clarification of future challenges and keymessages and opportunities for leaders to submit ideas for improving CSA’s client, people andstakeholder services.

◗ recruiting 18 graduates to join nine current staff in participating in a graduate leadership program,including undertaking a CSA-tailored Graduate Certificate in Public Administration through theUniversity of Canberra.

Business coaching

Since 1999 CSA has invested in placing one or more coaches in every frontline team. The role of thesecoaches is to help staff develop skills to manage complex technical and client issues. A new coachingmodel has been put into action, with a strong emphasis on developing staff capability and knowledgeso as to deliver quality outcomes. It will improve on the old model by:

◗ skilling coaches to enable them to develop staff capabilities in a proactive way. The new method willanticipate skill gaps and emerging business issues.

◗ exploring new ways to measure the outcomes achieved by coaching. The new coaching model willallow CSA to track the capability of its operational staff by evaluating coaching results in key areas.

◗ focusing on career development and sustaining regional coaching arrangements, so all staff canmake the most of career opportunities.

Corporate health

CSA gathers regular information about its culture and people through the Corporate Health Index staffsurvey. This year a new electronic short form was introduced to make completing the survey quickerand simpler, and to provide a more regular picture of staff satisfaction.

Results of the most recent Corporate Health Index, conducted in March 2003, indicate that the moraleof staff at the APS 4 level has decreased significantly over the past year. CSA has identified a need toimprove the job satisfaction of these staff and has already established focus groups to identify keydrivers of the corporate health of this key group of operational staff.

On a more positive note, the results from the March survey also show that efforts to integrate the newinformation technology system ‘Cuba’ into the CSA work environment have paid off, with most staffindicating they are now comfortable using Cuba.

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Rewards and recognition

The rewards and recognition program provides a way for CSA to acknowledge the valuable contributionsof its people to business objectives and values. Every three months one individual or team in each CSAsite is recognised for their input to the business. A national award is given annually to the topnomination(s) from the site winners.

In 2002–03 the efforts of the many staff involved in introducing ‘Cuba’ were recognised in a ceremonyattended by the Minister for Children and Youth Affairs.

National Consultative Forum

The National Consultative Forum is a formal channel for consultation within CSA. The forum has been inplace for several years and continues to provide valuable input into a wide range of initiatives includingthe implementation of the new CSA computer system and the most recent agency agreement. Theforum consists of management representatives and representatives elected by staff.

Diversity

FaCS—Work–life diversity

FaCS is maintaining and improving an accessible and inclusive work environment that values its peopleand their contributions to the organisation.

The following diversity initiatives were delivered:

◗ implementation of the FaCS Diversity Plan 2002–2004, Diversity pays

◗ work–life balance resources, information, support and advice to all managers and employees

◗ analysis, advice and information on diversity issues, including the launch and implementation of theFaCS Statement of Commitment to Aboriginal and Torres Strait Islander People and the FaCSIndigenous Recruitment and Retention Strategy

◗ implementation of supporting guidelines for the Cultural Leave Clause in the FaCS CertifiedAgreement 2002–2005

◗ coordination and support to a number of diversity stakeholder groups (including the FaCSIndigenous Officers’ Network, FaCS–Centrelink Women’s Forum, Disability Stakeholder Group,Disability Action Network and Harassment Contact Officers’ Network) which contribute to thedirection of corporate policy and programs

◗ formation of an Assistive Technology Management Advisory Group comprising senior managementrepresentatives and assistive technology (AT) users. This group discusses the broader strategicissues FaCS faces with the use of AT, the interaction of AT products with other products and thefuture development of AT in the department.

◗ support and advice to managers and their staff with a disability, including assistance with technology

◗ provision of a care referral service for staff.


Child Support Agency—Workplace diversity

The CSA ‘diversity wheel’ has been issued as a ready reference tool for all staff, to reinforce theirawareness of their diversity responsibilities. This was a key component of the 2002–03 CSA WorkplaceDiversity Plan, which consisted of overarching principles and strategies that guided relevant events,activities and day-to-day operations. In this way CSA has incorporated diversity principles throughoutthe business.

The 2003–04 program is in the final stages of development.

Occupational health and safety

FaCS—Occupational health and safety

FaCS has an Occupational Health and Safety (OHS) policy and infrastructure that ensures cooperativeconsultation with FaCS employees about health and safety matters. FaCS’ national office developsnational work environment policies, coordinates nationally consistent work environment policy deliveryand delivers work environment services to national office staff. The Human Resources or BusinessServices Manager is responsible for work environment service delivery, national policy delivery, localpolicy development and local compensation management in each state or territory office.

FaCS has a national OHS committee and local committees in state and territory offices. Health andsafety representatives are elected and trained as required.

No investigations were conducted in FaCS under the Occupational Health and Safety Act. No provisionalimprovement notices or other notices were issued.

FaCS incident reports

There were only four OH&S incidents and these resulted in incapacity of 30 or more days.

Child Support Agency—Occupational health and safety

Occupational health and safety policy and monitoring is undertaken nationally. The NationalOccupational Health and Safety Committee acts as the primary advisory body and meets quarterly.

The case management of all compensation and rehabilitation is contracted to Acumen Alliance, and CSAhas central administration of all claims and incident reporting with a focus on preventive and injurymanagement strategies.

During 2002–03 CSA:

◗ reported three dangerous occurrences

◗ received one provisional improvement notice

◗ received one improvement notice.

CSA has already significantly addressed most of the recommendations made in the improvement notice.

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Internal communication

FaCS—Internal communication

Staff can draw on a range of internal communication media for information on FaCS’ policies andprograms, as well as policy developments and changes to organisational processes, systems andprocedures that affect business. Internal communication vehicles include a weekly email newsletter, anintranet, and monthly meetings that feature presentations by the FaCS executive and project teams.This communication activity is supported by a quarterly hard copy staff magazine that aims to build acohesive staff culture through the sharing of stories from staff across Australia and by providing a forumfor recognising and celebrating individual and team achievements.

Major issues communicated to staff included the development and implementation of a new corporateidentity and strategic directions, the restructure of the department in November 2002, the upgrade ofthe human resources and finance system (IMPACT), and the second phase of welfare reform.

Child Support Agency—Internal communication

CSA has a strong internal communication program, which has achieved awards for excellence on anumber of occasions. Key internal communication vehicles include:

◗ regional newsletters

◗ a monthly national newsletter (available in both hard copy and electronic format)

◗ communication representatives in each CSA site

◗ C3—the CSA intranet site

◗ The guide—an online legal resource to help staff make decisions on child support cases. It is alsoavailable for clients on the CSA web site.

◗ the Community Services Directory—helps staff refer clients to appropriate community services intheir local area.

Major issues communicated to staff included the Agency Agreement, the recent Budget measures andoutcomes of the CSA national leadership conference.


Environmental management

FaCS and ecologically sustainable development

The key ecologically sustainable development principle relevant to FaCS’ activities refers to theintegration and interface of social, economic and environmental issues—that is:

Decision making processes should effectively integrate both long and short-term economic,

environmental, social and equitable considerations

—Section 516A, Environment Protection and Biodiversity Conservation Act 1999

FaCS needs to consider the wider economic, social and environmental implications of its decisions andactions for Australia, the international community and the biosphere. Triple bottom line (TBL) reportinghelps FaCS change the way it thinks, acts and makes decisions.

FaCS has produced a TBL report for the 2002–03 year, covering our social, environmental and economicperformance. The environmental performance indicators have been drawn from the guide bookpublished by the Department of Environment and Heritage. These indicators have been used toestablish a baseline of FaCS’ current performance. FaCS has also set a number of commitments toimprove performance in targeted areas.

The Child Support Agency (CSA) is working closely with FaCS on TBL reporting and is included in thefirst report, which will be released with this annual report.

Centrelink, as the provider of building services in the Tuggeranong Office Park building in Canberra thathouses FaCS’ national office, is assisting FaCS with its TBL reporting in relation to operations.

FaCS’ contribution to ecologically

sustainable development

FaCS’ role is to achieve three major outcomes for the Australian Government.

FaCS’ main business contributes directly to positive social and economic outcomes for Australianfamilies, communities and individuals and it is working to benchmark and understand the impact thatits operations have on the environment.

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Measures to minimise FaCS’ environmental impacts

Environmental management system

In line with FaCS’ commitment to better understanding and improving its environmental performance,and broader Australian Government policy, FaCS is implementing an environmental management systemfor two sites, Juliana House in the ACT and the CSA premises in Newcastle.

The systems and processes being put in place conform with the internationally recognised InternationalOrganisation for Standardisation (ISO) 14001 standard and specifications. It is expected that systemsand processes put in place in both buildings will receive certification in 2004.

Environmental performance improvement process

The Executive Board has endorsed an environmental policy that commits FaCS to integratesustainability and environmental accountability into daily operations by:

◗ seeking to minimise adverse environmental impacts from all operations

◗ adhering to all Commonwealth environmental legislation, policies and initiatives

◗ working continuously to improve FaCS’ environmental performance.

FaCS will implement and maintain an environmental management system to ISO14001 requirements,which involves the following actions:

◗ improving purchasing practices to reflect environmental sustainability

◗ reducing waste output and adopting recycling practices

◗ monitoring energy use and implementing an energy management plan

◗ reducing consumption of water

◗ educating and motivating staff to participate actively in and contribute to environmentalmanagement initiatives and action.

Integration of environment with other businessmanagement systems

As part of FaCS’ commitment to improving its environmental performance there will be a strong focus onintegrating environmental performance issues within business management systems. A first step in thisprocess is the articulation and senior management endorsement of FaCS’ environmental policy. FaCShas also committed to the Greenhouse Challenge. This commitment means that FaCS is working tointegrate environmental considerations into its business management practices.


FaCS Triple Bottom Line Reporting

FaCS has produced a triple bottom line (TBL) report for 2002–03, which covers the department’soperations and performance against social, economic and environmental indicators. The report is abaseline record from which FaCS can benchmark future performance.

Other measures are being explored to integrate environmental aspects with business managementsystems as part of a larger process to develop and implement a TBL framework for FaCS. These willinclude:

◗ adopting environmental procurement guidelines currently being developed for the APS

◗ building environmental data and performance requirements into tender, contracting andleasing arrangements

◗ working with other agencies on the development of whole-of-government operations policy andguidelines in relation to the environment.

Commitments to reduce impacts on the environment

After reviewing the environmental performance of its operations in 2002–03, FaCS established thatthere were six areas where it has the greatest impact and where it needs to focus future work: electricityconsumption, transport, paper consumption, waste and recycling, and water.

Summary of impacts

Table 71 Overview of FaCS environmental performance

Total direct energy use

23 930 380 Megajoules (MJ) 12 386 MJ per employee

Total Greenhouse emissions

5123 tonnes CO2 equivalent (tCO2-e)- 2.65 tCO2-e per employee

Total paper consumed

87.6 tonnes 45.3 kg per employee 33 683 reams 17.4 reams per employee

Total volume of waste produced Not currently known

Total recycling undertaken Not currently known

Total water consumption Not currently known

Note: Does not include CSA because data not available.

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Measures to review and minimise impacts

TBL reporting

FaCS has established a set of social, economic and environmental performance indicators. FaCS willmonitor its performance annually against the benchmarks established in 2002–03.

Greenhouse Challenge

FaCS has committed to the Greenhouse Challenge, a voluntary agreement to take cost-effectivemeasures to abate greenhouse emissions. FaCS will focus on electricity consumption and transport.This will involve:

◗ preparing an inventory of relevant greenhouse emissions

◗ developing an action plan that identifies opportunities to abate greenhouse emissions

◗ developing appropriate Key Performance Indicators (KPI) to measure emission intensity

◗ reporting annually on an emissions inventory, significant abatement actions and updated KPI data

◗ accepting that the organisation may be selected for the performance to be verified independently.


External scrutiny

Fraud control

See Part four—Financial statements—Certification of departmental fraud control arrangements.

Privacy

FaCS—privacy

FaCS adopts practices to protect the privacy of the information obtained from people accessingportfolio services.

As a purchaser of services, FaCS is confident that Centrelink and the Family Assistance Office haveeffective mechanisms in place to protect clients’ personal information. Centrelink also is bound by theCentrelink Privacy Guidelines, issued by the Minister in June 1999, which complement the currentprivacy regime, ensure Centrelink fully complies with the principles underlying the Privacy Act, andaddress privacy issues particular to the Centrelink environment.

FaCS’ business partnership agreements with its partner service delivery agencies includes mechanismsto allow FaCS to monitor and contribute to the protection of client privacy. FaCS operates anAdministrative Law Protocol with its family assistance partner service delivery agencies for handlingmatters related to privacy and freedom of information. FaCS also maintains a separate memorandum ofunderstanding in its Business Partnership Agreement with Centrelink. As part of the protocols andmemorandum, partner service delivery agencies are required to provide FaCS with quarterly reports onprivacy, confidentiality and freedom of information matters. Centrelink and FaCS officers meet regularlyto discuss and resolve privacy issues.

Liaison with the Privacy Commissioner

FaCS liaised with the Privacy Commissioner on issues relating to social security and family assistancepolicy development, and on personal information handling and complaints the Privacy Commissionerreceived about the department. Complaints about interferences with privacy alleged by clients of FaCS’service delivery agencies were forwarded directly to those agencies to investigate and resolve.

FaCS consulted the Privacy Commissioner on privacy issues as they arose, such as the implementationof the joint dataset. FaCS also participated as a member of the Privacy Contact Officers NetworkSteering Committee and participated in regular Privacy Contact Officer meetings.

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External scrutiny 225

Complaints, reports and determinations by the Privacy Commissioner

In 2002–03, FaCS received no formal complaints from the Privacy Commissioner’s Office. One complaintreceived in 2001–02 that involved an allegation of unauthorised use of client personal information wasresolved. The breach was substantiated.

Under sections 30 and 52 of the Privacy Act 1988, the Privacy Commissioner may issue a report ordetermination about FaCS. The Privacy Commissioner did not issue any reports or determinations underthese sections.

Under section 73 of the Privacy Act 1988, an agency may apply, in accordance with the regulations, for apublic interest determination under section 72 by the Privacy Commissioner, about an act or practicethat breaches an information privacy principle. FaCS did not apply for any such determination.

Privacy compliance and investigations

FaCS considers that any improper use or disclosure of personal information by staff, and soliciting ofpersonal information from staff, would be of serious concern. The confidentiality provisions oflegislation that fall under the operational jurisdiction of the FaCS portfolio expressly forbid the releaseof client information, except in limited circumstances. FaCS therefore investigates all complaints andallegations of breaches of privacy or confidentiality.

FaCS maintains a memorandum of understanding with Centrelink under which Centrelink investigatesalleged breaches of privacy by FaCS staff, service providers or departmental procedures. FaCS’Administrative Law Protocol with the Australian Taxation Office (ATO) and Health Insurance Commissionrequires those agencies to report to FaCS outcomes of investigations they conduct into allegedbreaches of privacy involving the service delivery of family assistance to clients. The ATO and HealthInsurance Commission are yet to report on any investigations carried out in 2002–03.

In 2002–03, FaCS dealt with 15 incidents that alleged the loss, use and unauthorised access topersonal information.

Child Support Agency—Privacy

CSA has a strong commitment to protecting its clients’ privacy, and privacy issues are covered ininduction and other staff training programs. Most privacy concerns and potential privacy breachesreported by staff and clients of CSA are resolved internally through a national network ofprivacy officers.

The Office of the Federal Privacy Commissioner refers child support matters to CSA in the first instance.Most concerns are resolved in this way. In 2002–03, four new matters were formally investigated by theOffice of the Federal Privacy Commissioner and five cases were finalised. In three cases CSA was foundto have breached the Privacy Act 1988, resulting in two compensation payments totalling $750. Theother two cases concluded with a finding of no breach of the Privacy Act.

Over the past year CSA has delivered information sessions on child support, both to the steeringcommittee of the Australian Government and ACT Government privacy contact officers network and tostaff of the Office of the Federal Privacy Commissioner.


Child Support Agency—Client compensation

In 2002–03, CSA finalised 122 compensation claims, compared to 144 in 2001–02 and 101 in 2000–01. Ofthe 122 claims finalised, 35 were upheld. CSA paid $61 833 in compensation during 2002–03 comparedto $45 487 in 2001–02. This comprised $59 517 in payments under the Compensation for Detriment dueto Defective Administration Scheme, and $2316 in payments for legal liability.

Of the total amount paid, $48 843 related to compensation payments offered in 2002–03 and $12 990related to compensation payments offered in 2001–02.

Complaints to the Ombudsman

FaCS—Complaints to the Ombudsman

The Commonwealth Ombudsman received 25 complaints relating to 29 issues about the department,which is a 9 per cent reduction on the 2001–02 figure of 32 issues.

On 28 February 2003 the Ombudsman released his Own Motion investigation into family assistanceadministration and the impact on Family Assistance Office customers.

Table 72 Complaints received by the Ombudsman

Department/Program 2002–03

Family and Children’s Program 7

Disability programs 3

Tender/contracts 3

Family Assistance Office 1

Income security 1

FOI general access 1

Other 13

Total 29

Under section 15 of the Ombudsman Act 1976, the Ombudsman may report to a department andrequest details of any action it proposes to take in relation to matters and recommendations included inthe Ombudsman’s report. The Ombudsman did not release any such reports for FaCS in 2002–03.

The Ombudsman Act also provides for the Ombudsman to make reports to the Prime Minister (section16), reports to Parliament (section 17) and annual and additional reports (section 19) that may containcomments about departments. The Ombudsman did not release any such reports for FaCS in 2002–03.

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Child Support Agency—Complaints to the Ombudsman

The Ombudsman received 2435 complaints about CSA in 2002–03 (2007 were received in the previousyear). There were 2509 complaints finalised, covering 3102 issues.

The increase in complaints can be attributed to:

◗ an increase in the CSA client base

◗ some residual implementation issues with the introduction of CSA’s new IT system ‘Cuba’ in March2002. These issues are now fully resolved and complaint numbers are stabilising in response.

The CSA complaints service continues to be an effective mechanism to resolve client concerns. In2002–03, the Ombudsman referred 78 per cent of all complaints made about CSA back to thecomplaints service before investigating. CSA continues to draw valuable learnings from issues raisedthrough the Ombudsman to drive improvements in the quality of client service.

Act of Grace payments

FaCS made 25 Act of Grace payments in 2002–03 totalling $144 419.80.

Australian National Audit Office (ANAO) activity

The following ANAO performance audits undertaken in 2002–03 included reference to FaCS or werecross-agency reviews.

No. 44: Review of the Parenting Payment Single Program

The objective of the audit was to determine whether the controls and measures employed by FaCS andCentrelink to deliver Parenting Payment Single (PPS) payments were effective and efficient.

Recommendations from the key findings from this audit included:

◗ application of ANAO better practice performance information criteria

◗ transparency in reporting of and calculating errors

◗ increased skills training for Centrelink customer service officers.

FaCS is monitoring the implementation of these recommendations.

No. 45: Reporting of financial statements and audit reports in annual reports

This cross-agency report examined the publication of financial statements and audit reports of117 Commonwealth reporting entities. The objective of the audit was to determine whether the financialstatements and audit reports published in the annual reports of Commonwealth reporting entitiesagreed in all respects with their certified financial statements and audit reports.

There were no specific recommendations for FaCS; however, FaCS has in place the necessary frameworkto implement the generally relevant recommendations.


No. 27: Management of Commonwealth guarantees, warranties, indemnities and

letters of comfort

This ANAO cross-agency audit sought to capture the extent of the Australian Government’s exposure tocontingent financial exposures (for example, guarantees, warranties and indemnities), report onprogress in implementing previous ANAO recommendations and identify examples of better practice.ANAO made three recommendations aimed at improving departments’ and agencies’ managementpractices associated with Australian Government guarantees, warranties, indemnities and letters ofcomfort. FaCS was one of several government agencies that agreed with the audit recommendationsand have a process in place for the implementation of these recommendations.

No. 17: Age Pension entitlements—FaCS and Centrelink

The objective of the audit was to assess whether the controls employed by FaCS and Centrelink toensure the correctness of payments made under the Age Pension Program were effective and efficient.The audit resulted in the following recommendations:

◗ both agencies to look closely at quality assurance on error information resulting from randomsample Surveys

◗ Centrelink to monitor and assess the revised guidelines for Pensioner Entitlement Reviews (PERs)

◗ Centrelink to look at and assess the new decision-making tools for improving correctness ofpayments, and to assess whether customer service officers require additional technical training toreduce administrative errors in processing PERs.

FaCS is monitoring the implementation of these recommendations.

No. 24: Energy efficiency in Commonwealth operations—Follow-up audit

This was a follow-up audit on Energy Efficiency in Commonwealth Operations carried out in 1999. Ingeneral, agencies in this follow-up audit have pursued the intent of those recommendations publishinga clear indication of how they will achieve the Energy Policy objectives; adopting a strategic andplanned approach to introducing energy efficiency initiatives; and demonstrating a willingness to reporton agency achievements in relation to energy use and the outcomes of energy efficiency initiatives.

FaCS is implementing the recommendations of the audit.

No. 16: Administration of grants (post-approval) in small to medium organisations

The recommendations set out in this report also have relevance to other Australian Governmentorganisations. There were generally opportunities for organisations to enhance their performance in thissignificant area of operations by adopting the sound and better practices highlighted in this report.

No. 7: Client Service in CSA—Follow-up audit

The report from the most recent ANAO performance audit of CSA was tabled in Parliament in September 2002. It was a positive report, noting the strong progress CSA had made in implementingthe 12 recommendations of the previous ANAO audit and the three recommendations pertaining to it inJoint Committee of Public Accounts and Audit Report 367 of 1999. The audit report concluded that CSA’sperformance has improved in many aspects of client service since the previous ANAO audit, and thatCSA has made substantial achievements against previous recommendations. There were four newrecommendations arising from the report. CSA has largely completed implementation of all four.

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Parliamentary committees

Senate Standing Committee on Community Affairs

The committee examined the department’s Annual Report 2001–02 and tabled its report on 23 October2002. It noted that all requirements were met in a ‘user-friendly’ structure and that performanceinformation is generally well presented. The committee also said it would have liked to see moreanalysis and evaluation in acknowledging where outcomes have not been achieved. Performancereporting across output groups was not consistent in this respect.

Supplementary Budget Estimates 2002–03 hearings were held on 21 November 2002. The portfoliosubsequently provided written answers to 184 questions either taken on notice or received in writingfrom committee members.

On 19 March 2003 the committee tabled the report on the portfolio Additional Estimates hearings of12 and 13 February 2003. The committee discussed much of the information contained in the PortfolioAdditional Estimates Statements, particularly relating to Family Tax Benefit, Child Care Benefit, datamatching and issues around overpayments. The portfolio had provided written answers to145 questions taken on notice or received in writing from committee members.

On 4 and 5 June 2003 the committee held its 2003–04 Budget Estimates hearings. Written answerswere provided in July 2003 to 166 questions taken on notice or received in writing fromcommittee members.

Inquiry into Family and Community Services Legislation Amendment (Special Benefit

Activity Test) Bill 2002

FaCS provided a detailed submission to the committee that included an overview of the legislation, the possible impacts upon those affected and some of the services that would be available to them. The committee’s report was tabled on 2 December 2002. Parliament passed the legislation on13 December 2002 and it received Royal Assent on 19 December 2002. The activity test commenced on 1 January 2003.

Inquiry into Participation requirements and penalties

This inquiry related to the passage of the Family and Community Services Legislation (AustraliansWorking Together and other 2001 Budget Measures) Bill 2002. FaCS lodged a written submission andalso appeared at public hearings on 6 August 2002. The report of the committee was tabled on25 September 2002 and made a total of 13 recommendations. The Government responded to therecommendations through a number of government amendments to the Bill, which was passed on27 March 2003 and received Royal Assent on 24 April 2003 as the Family and Community Services

Legislation (Australians Working Together and other 2001 Budget Measures) Act 2003.

Inquiry into poverty and financial hardship

FaCS provided a detailed submission to the committee on 31 March 2003 covering lifetime participation,technical measurement issues and the environment, as well as economic and social trends. FaCSwitnesses appeared before the committee on 20 June 2003.


Senate Employment, Workplace Relations and Education Legislation Committee

(Inquiry into the Workplace Relations Amendment (Paid Maternity Leave)

Bill 2002)

FaCS witnesses appeared before the committee on 22 August 2002.

Senate Select Committee on Superannuation (Inquiry into superannuation and

living standards in retirement)

The committee examined the adequacy of the tax arrangements for superannuation and related policyto address the retirement income and health care needs of aged Australians. FaCS lodged a submissionin July 2002 and FaCS witnesses appeared before the committee on 19 July 2002 and 8 October 2002.

Senate Select Committee on Superannuation (Inquiry into planning for retirement)

The committee examined mechanisms that help people to plan and make the transition from work toretirement. FaCS lodged a submission in April 2003, and on 15 May 2003 FaCS witnesses appearedbefore the committee to highlight the importance of boosting labour force participation as a criticalpathway to helping people plan and build their retirement income.

Joint Standing Committee on Treaties

A treaty agreement between Australia and the United States for the reciprocal enforcement ofmaintenance obligations was tabled on 18 June 2002. Child Support Agency witnesses appeared beforethe committee at its public hearings on 12 July 2002. The committee recommended that binding treatyaction be taken and the new treaty came into effect on 12 December 2002, replacing former non-treatyagreements with US states.

New social security treaties with Belgium, Chile and Slovenia were tabled in Parliament on 14 May 2003.FaCS witnesses appeared before the committee at its public hearing on 16 June 2003.

A new social security treaty with Croatia was tabled in Parliament on 17 June 2003.

Joint Standing Committee on the National Capital and External Territories

In April 2003 the Joint Standing Committee on the National Capital and External Territories sought FaCS’views and suggestions on possible ways to improve governance on Norfolk Island, in particular thepossibility of the Australian Government providing Norfolk Island residents with income supportpayments and programs that are currently provided to the rest of the Australian community.

FaCS prepared a submission to the committee, which outlined Australia’s social security and familyassistance systems and their applicability to Norfolk Island. The submission discussed the reasons forthe different arrangements that currently apply to residents of Norfolk Island and issues arising fromany changes to governance arrangements on the island.

Joint Standing Committee on Foreign Affairs, Defence and Trade (Inquiry into

Australia’s relations with Indonesia)

FaCS provided a submission to this inquiry in November 2003 and gave evidence and supplementaryinformation to the sub-committee on 15 June 2003.

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Joint Committee on Public Accounts and Audit

FaCS witnesses appeared in June 2002 before the Joint Committee on Public Accounts and Audit inresponse to an ANAO Audit of Age Pension New Claims. FaCS provided its response to the committee inDecember 2002 and this was tabled in June 2003.

Joint Committee on Corporations and Financial Services (Inquiry into the level of

banking and financial services in rural, regional and remote areas of Australia)

In September 2002, FaCS provided a submission to the Joint Committee on Corporations and FinancialServices and gave evidence before the committee at hearings on 12 November 2002.

The House of Representatives Standing Committee on Aboriginal and Torres Strait

Islander Affairs (Inquiry into Capacity Building in Indigenous Communities)

The committee is examining strategies to help Aboriginal and Torres Strait Islander peoples to bettermanage the delivery of services within their communities. A submission was provided to the committeein September 2002 advising of the work being done by FaCS, including findings, lessons learned,research and strategic options to address the issues identified by the committee.

House of Representatives Standing Committee on Ageing (long-term strategies to

address the ageing of the Australian population over the next 40 years)

FaCS provided a submission to the Standing Committee on Ageing on 16 December 2002 and appearedbefore the committee on 7 February 2003. At the hearing, FaCS witnesses expanded on the key themesof increasing participation, consolidating retirement incomes, supporting family formation andresilience, and responding to ageing communities.

The committee complimented FaCS on the quality of its submission, and asked for extra informationprompted by the 140 submissions it had received. FaCS met this request on 5 May 2003.

House of Representatives Standing Committee on Legal and Constitutional Affairs

(Inquiry into crime in the community: victims, offenders and fear of crime)

FaCS provided a submission to the committee on 16 August 2002 outlining potential for countering andpreventing crime through select programs such as the Stronger Families and Communities Strategy andthe Family and Community Networks Initiative.


Financial performance

FaCS ensures that the portfolio’s financial resources—particularly operational resources—are

obtained, allocated and monitored in a fair, effective, accountable and efficient manner,

facilitating the delivery of quality services to clients. See also Part four—Financial statements.

This section covers the financial management processes of FaCS including CSA.

FaCS—Significant financial events

Portfolio transfers

On 1 July 2002, administrative control of CRS Australia transferred to the Department of Health andAgeing. This gives effect to the agreement between the secretaries of FaCS and the Department of Health and Ageing flowing from the revised administrative arrangements announced in November 2001. For comparative reporting purposes, the results of CRS Australia are included in FaCS’ financial statements.

Asset management

In June 2003, FaCS conducted a review of its assets; in particular, costs that had been capitalised forinternally developed software. This evaluation resulted in write-off of some of these costs amounting to$7.3 million. FaCS also carried out a stocktake of both IT and non-IT assets.

Financial relationship between FaCS and Centrelink

Centrelink delivers most of FaCS’ administered payments under a purchaser–provider relationship,governed by the Business Partnership Agreement (BPA). Funds for the purchase of services fromCentrelink are appropriated to FaCS and then paid to Centrelink by FaCS in accordance with an agreedpayment schedule. Funds for the payment of benefit entitlements administered by FaCS are drawndown by Centrelink under a delegation given to Centrelink by the Secretary of FaCS.

The current BPA has been in place since 1 July 2001 and will conclude on 30 June 2004. The content ofthe BPA has been reviewed and updated each year to ensure it continues to reflect current priorities. As the end of the current agreement approaches, a new one must be negotiated with Centrelink. Thisnew BPA is expected to be ready for signing by the Secretary of FaCS and the CEO of Centrelink by 1 July 2004.

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Child Support Agency

Managing finances and assets

CSA achieved:

◗ an unqualified set of financial statements

◗ consolidation of the internally developed client software, ‘Cuba’, that produces an automated double entry, real-time set of administered financial accounts, which improves transparencyand accountability

◗ integration of the financial management framework into the overall corporate governance system

◗ further refinement of the role of the CSA’s Finance Steering Committee to oversee strategicfinancial issues

◗ continued implementation of CSA’s market testing plan.

Funding

The year 2002–03 is the third of a four-year funding agreement between CSA and the Department ofFinance and Administration. The agreement funds CSA based on the number of clients and provides astrong basis for financial planning. It is based on CSA’s Output Pricing Model and results in a pricingefficiency of 3 per cent per year, cumulative. This means that CSA services are delivered to a larger clientgroup at a lower price, indicating significant productivity improvements.

The primary driver of productivity improvements is the proportion of private collect cases compared toagency collect cases. The agreed target rate is 50 per cent by 30 June 2003. CSA exceeded this target byachieving a private collect rate of 50.6 per cent. This reflects the success of CSA’s role in encouragingparents, where feasible, to manage their child support payments with minimal intervention.

Negotiations have already begun for a new agreement for the period from June 2004.

Competitive tendering and contracting

CSA has a comprehensive outsourcing program and has tested or plans to test all feasible non-coreactivities, in line with the objectives of government policy. Information technology infrastructure isalready provided through the Australian Taxation Office, outsourced to EDS.

Mobile telephone services and senior case officer services were contracted on a competitive basisduring 2002–03.

Accommodation

CSA continued to rationalise its accommodation, planning relocations of the Hobart and Newcastleoffices in the first half of the 2003–04 financial year. These moves will realise ongoing annual savings ofapproximately $0.8 million in property operating expenses. Any further accommodation moves will beas a result of CSA or the Australian Taxation Office identifying opportunities as need andcircumstances arise.


Information strategies and technology management

FaCS—Information strategies and

technology management

FaCS undertook a number of key information communication and technology initiatives during the year.These are summarised below.

IT outsourcing

FaCS has issued a Request For Tender (RFT) for the provision of IT operations management services,which include helpdesk, floorwalking and infrastructure support services.

The responses from this tender are being evaluated. It is anticipated that the announcement of apreferred supplier and final handover of the services to the successful tenderer will occur in the fourthquarter of 2003.

The IT Operations Management RFT is the first of several tenders FaCS plans to release as part of itsIT Selective Sourcing Strategy.

FaCS Online Funding Management System

FaCS is developing integrated solutions for the department’s funding management requirements.

The proposed IT system—FaCS Online Funding Management System (FOFMS)—will facilitate theimplementation of a common approach for managing FaCS’ arrangements with service providers acrossall funding programs. It will support the lifecycle of funding arrangements—from applications toestablishing the service, managing the agreement, making payments, through to reporting andevaluation. The system is being designed to deliver online claims-driven payments and case basedfunding functionality. It will also meet the department’s obligations under the Government Onlineinitiative—specifically, guidelines on information provision, electronic publishing, metadata electronicrecord keeping and archiving, accessibility, security, privacy and authentication.

A request for proposal process, undertaken in October 2002, was followed by a restricted request fortender process that closed on 2 May 2003.

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Electronic document management system

Following extensive consultation with departmental staff an RFT was released in October 2002 for anelectronic document management system. Inform Systems, with the iManage product, was selected asthe preferred supplier.

A pilot involving up to 300 departmental staff will be undertaken in the first half of the 2003–04financial year, with full implementation of the system expected to begin in January 2004 and finish byOctober 2004.

Edge Expert System Project

FaCS and Centrelink have worked jointly to develop the Edge expert system for the Family AssistanceOffice. Its primary aim is to improve accuracy, consistency and transparency in decision-making. Thesystem applies the legislative and policy rules to assess a client’s entitlement to family assistancepayments. It provides a record of the decision, and the reasons for eligibility or ineligibility. Itdetermines which questions to ask based on answers to previous questions. An online commentaryexplains why questions are asked and gives help in answering them.

The system will have the ability to produce a provisional assessment notice advising clients of theireligibility and estimated rate, and a personalised claim form. Edge can also be used to assess theresults of potential and actual changes to client circumstances.

Edge has been tested extensively and piloted in several Family Assistance Offices as well as withmembers of the social policy community. The staged rollout of Edge began in July 2002.

Child Support Agency—IT performance solutions

Cuba—Consolidation of a new IT system

In March 2002 the CSA implemented a new core business computer system. This system, called ‘Cuba’,was the biggest technological change undertaken by CSA since its inception and the rollout periodcreated some problems for both clients and staff. These problems involved data integrity difficulties intransferring information from the old system into the new system, as well as providing new skilling forstaff who had uncertainties about using ‘Cuba’. This year CSA substantially resolved all these issuesthrough an ongoing enhancement program to identify areas needing attention and solutions to improvethem. ‘Cuba’ is now widely accepted by CSA staff as helping them provide better outcomes for clients.Business improvements attributed to ‘Cuba’ include:

◗ a more complete focus on clients, with staff spending less time processing and more time resolvingclient concerns

◗ an integrated communication and information technology platform to allow faster responses toclient calls

◗ clearer client letters and statements

◗ more frequent disbursements of child support payments

◗ improved accountability due to better quality data and reporting on CSA performance.


Disaster recovery program

A major investment this year was in a disaster recovery program for IT and telephony. The program has been developed as a backup capability for key elements of technological infrastructure. It is part of a whole-of-government innovation to ensure continuity of client service is not affected bytechnical problems.

e-Business

CSA is exploring new e-Business initiatives that will update the business to take advantage oftechnology trends and prepare for emerging technologies. Some of the developments being consideredare to broaden the existing range of payment options, offer more services through the CSA web site andexpand the capability of the interactive telephone system. Initiatives in each of these areas will beimplemented over the coming year to complement the existing range of tools available to help parentsmanage their separation and child support issues.

FaCS—Library and research services

The library and information research service continued to expand its information delivery, researchprovision, research training and tailored information services to all four client agencies—FaCS,Centrelink, CSA and the Social Security Appeals Tribunal. A digital archive of the Guide to the SocialSecurity Act has been completed, and a pilot study of information needs within FaCS was completedacross three sample branches. The service also conducted the Knowledge Management—Guided SelfAssessment Program (part of the Business Excellence Framework from Standards Australia)across FaCS.

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Internal controls

In this section of the report, FaCS and the Child Support Agency (CSA) report on their risk

management and ethical standards.

Internal audit

FaCS—Internal audit

FaCS finalised 10 internal audits and a spot audit in 2002–03. A panel of audit firms provided resourcesfor conducting the audits. However, following the completion of the market testing process of FaCS’internal audit and risk functions, a contract was signed with Ernst & Young on 16 April 2003 for them tobe the primary provider of FaCS’ internal audit, risk management, business continuity planning andfraud control and investigation functions. Ernst & Young took over responsibility for all audits remainingfrom the 2002–03 audit work plan.

Work on the following audits was completed during 2002–03:

◗ EDGE Project Management

◗ IT Change Control—follow-up audit

◗ Regulatory Compliance and Business Processes

◗ Personal Support Programme

◗ Business Planning, Risk Management and Fraud Control

◗ IT Information Management

◗ Management of Payroll, Leave and Flex time

◗ IMPACT Upgrade

◗ Budgetary Processes and Resource Management

◗ Administration of Grants in FaCS

◗ Spot audit—follow-up review of leave entitlements.

Other major activities included:

◗ monitoring the implementation of recommendations by the ANAO, the Joint Committee of PublicAccounts and Audit and FaCS’ internal audits

◗ enhancements to the audit monitoring database to improve the process for following up progress onimplementing audit recommendations.

In general, recent audit findings have indicated that the department’s processes continue to improve.

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Child Support Agency—Internal audit

Audits finalised through the FaCS internal audit program examined:

◗ business planning, risk management and fraud control

◗ regulatory compliance and business processes

◗ CITEC—payment distribution system

◗ IT change control and information management.

In addition to the FaCS program, CSA conducts its own program of internal process audits. Finalisedaudits from this program examined:

◗ making payment arrangements with clients

◗ actions taken the first time a client defaults on their payments

◗ staff advancement.

Risk management

FaCS—Risk management

FaCS continued to work towards a more integrated approach to risk management under the overalldirection of the FaCS Executive Board. As part of this initiative, a review of the strategic risks facing thedepartment was undertaken. In addition, increased focus was given to a business continuity frameworkand the establishment of a crisis response team. This team was activated for the first time in responseto the January bushfires in Canberra.

Achievements included:

◗ review of FaCS’ strategic risks by the FaCS Executive Board and implementation of amonitoring process

◗ implementation of a business continuity planning framework

◗ linkage of the management of FaCS’ strategic risks with the business planning process.

Child Support Agency—Risk management

This year CSA further incorporated the prediction and management of business risks into all aspects ofthe business. Some of the key achievements in this area were:

◗ delivering risk assessment and risk management training, fully aligned with the FaCS riskmanagement framework

◗ mandating that all major change initiatives be run in accordance with a project managementframework to improve transparency and accountability. The framework emphasises risk assessmentand management throughout the life of each project.

◗ conducting an assessment of CSA risks


◗ establishing business continuity contingencies for IT and telephony systems

◗ continuing to ensure that any new CSA accommodation is subject to a rigorous riskassessment process.

Protective security

FaCS—Protective security

FaCS has committed additional resources to protective security, which will allow it to strengthen areasof the FaCS protective security framework, especially staff awareness and training.

FaCS plans to integrate other aspects of security by including the IT security function with protectivesecurity, facilitating a more holistic approach to dealing with security issues.

During 2002–03, emphasis was given to the security clearance program, meaning that all staff requiringa security clearance will have at least begun the process by September 2003.

In 2002–03, FaCS had no significant security incidents.

Child Support Agency—Protective security

CSA has continued to assume a more autonomous role in security management and implementation. Ithas increased the security awareness of staff by recently implementing an e-learning security fraud andprivacy package through its intranet.

Strong liaison points have been established between CSA and the police to help streamline thereporting of security incidents requiring police input. Through rigorous implementation of new policiesand procedures, CSA has achieved greater compliance with the Commonwealth Protective Security

Manual 2000.

The first internal quality audit of home-based work was completed and, on the whole, itsrecommendations have been fully implemented.

Management of ethical standards

FaCS—Management of ethical standards

The FaCS Strategic Statement 2002–2005 includes an ethics statement that sets out the behavioursstaff should adopt in dealings with our ministers, partners, the people of Australia and our colleagues.

FaCS ensures that staff observe the Australian Public Service Code of Conduct and takes appropriateaction if it is determined that a breach has occurred. FaCS staff are aware that breaches of the code willbe taken seriously and may result in disciplinary action.

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Staff commencing in FaCS are provided with a copy of the Australian Public Service Code of Conduct

and the APS Values. The orientation and graduate training programs include information on ethicsand values.

The FaCS Ethics Statement, Australian Public Service Code of Conduct and the APS Values are availableto staff through the department’s intranet.

Six investigations were completed to determine if a breach of the code had occurred. All investigationsfound that a breach had occurred and action was taken against the officers concerned.

Results of investigations

◗ Four investigations resulted in a fine for the employee concerned

◗ One investigation resulted in counselling for the employee concerned

◗ One investigation resulted in a reduction of one salary point for the employee concerned.

Causes of breaches of the code

◗ Three breaches from inappropriate use of the Internet

◗ One breach from improper use of Australian Government resources

◗ Two breaches from improper use of Australian Government resources and failure to behave in a waythat upholds APS values and the integrity and good reputation of the APS.

Child Support Agency—Management of ethical standards

All CSA staff undertake training about recognising and preventing fraud in the workplace. Onlinetraining for staff relating to fraud awareness and prevention is being developed.

CSA staff are provided with the Australian Public Service Code of Conduct on commencement and thevalues of this code, together with the CSA Core Values, are built into the entry-level training program.


Ministerial and parliamentary services

FaCS delivered services to both ministers and to the parliamentary secretary on behalf of the

Family and Community Services portfolio, including the Child Support Agency, Centrelink, the

Social Security Appeals Tribunal and the Australian Institute of Family Studies.

Main achievements

During 2002–03 FaCS upgraded the ministerial correspondence tracking system to provide writers witha better tool for preparing replies and to address timeliness issues and improve the reporting database.

A FaCS Style Guide was published to explain standard usage. A number of training sessions wereprovided to staff throughout the state and territory office network to improve writing skills andunderstanding of ministers’ needs in this area.

FaCS undertook a project to develop best practice policy advice guidelines. The project involvedestablishing a panel to assess the quality of policy advice submissions to the ministers. This was aresponse to Audit Report 21 of 2001–02 Developing Policy Advice by the ANAO.

The criteria used to rate submissions were based on three broad elements of form, content and process.An eight-measure rating scale was used:

excellent—very good—good—satisfactory—marginally satisfactory—unsatisfactory—incomplete—unable to be ranked.

The panel, consisting of three former senior FaCS staff, applied the criteria to 31 submissions dealingwith policy advice. While the sample submissions were generally rated as satisfactory, there is room forimprovement. Improvement initiatives include formal FaCS training based on feedback from the paneland self-assessment actions by branches against the criteria.

This pilot review provided aggregate ranking of FaCS’ policy advice at outcome level only. In 2003–04the assessment process will be implemented fully with the intention that it be continued on an annualbasis and the ratings will be applied to each output group.

Areas of continuing improvement

The volume of ministerial correspondence increased by about 3 per cent to 17 571. Twenty-eight percent of draft replies were provided to Minister Vanstone within her standard of 14 days, a significantlybetter result than the previous year. Forty-five per cent, a figure comparable to the previous year, wereprovided to other signatories within the standard of 21 days, indicating a need for further improvement.

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In 2002–03 FaCS obtained specific feedback from Minister Vanstone’s office about office satisfactionwith the service provided by FaCS. The office considers FaCS responsive to the Minister’s needs andprovides sound policy advice but in some instances would like briefings to be more timely and moreconcise. The number of redrafts of ministerial correspondence also needs to be reduced.

Figure 21 Signatories for ministerial correspondence

The ministers and the parliamentary secretary sign replies to members and senators, and toconstituents from their respective electorates. FaCS replies directly to others (more than half ofall correspondents).

Figure 22 Timeliness for responding to Questions on Notice

Minister Vanstone expects to receive draft answers to questions on notice within 23 days. This allowssufficient time for clearance within the Parliament’s standard of 30 days (Senate) or 60 days (House ofRepresentatives). FaCS is meeting the 23-day standard in around three out of four cases.

0

20

40

60

80

100

120

4

More than 23 daysLess than 23 days

2002–032001–022000–011999–2000

Num

ber o

f que

stio

ns p

roce

ssed

Departmental 55%

Parliamentary Secretary 8%

Minister Anthony 14%

Minister Vanstone 22%


Table 73 Ministerial and parliamentary services—number of briefings, submissions,

ministerial correspondence and questions on notice

Ministerial Question Questions

Output group correspondencea time briefsb Briefingsc Submissionsd on notice

1.1 Family Assistance 2459 211 132 215 4

1.2 Youth and Student Support 1 044 216 71 240 5

1.3 Child Support 1 262 15 12 27 9

1.4 Child Care Support 3 524 143 55 167 20

2.1 Housing Support 456 62 15 84 6

2.2 Community Support 395 101 43 175 2

3.1 Labour Market Assistance 670 135 9 77 4

3.2 Support for People with a Disability 848 117 29 113 8

3.3 Support for Carers 283 39 7 17 1

3.4 Support for the Aged 1 045 61 3 30 6

Not directly attributablee 3 105 138 68 280 20

FaCS subtotal 15 091 1 238 444 1 425 85

Centrelink 2 480 86 18 262 48

Total 17 571 1 324 462 1 687 133

a These figures include campaign mail.b New Question Time Briefings and each major revision.c Written submissions requested by the ministers, the parliamentary secretary or their staff.d Written submissions initiated by departmental officers, for the attention of the ministers or the parliamentary secretary.e Material that cannot be attributed to any single output group. It includes policy that covers multiple programs and

correspondence referred to other departments for a response.

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Partnerships for people

This section describes how FaCS implements the Government’s commitment to encouraging

the wider community to become involved in creating and delivering its policies, programs

and services.

To encourage wider community involvement, FaCS:

◗ administers Australian Government funding to service providers and peak community organisations

◗ works collaboratively with business, the community and other government organisations through a‘social coalition’

◗ works with Centrelink to make sure government policies are delivered effectively to theAustralian community.

External providers

FaCS administered almost $1.3 billion in payments to the states, territories and the community sector in2002–03 to provide services in areas including public housing, disability, child care, youth, communityand Indigenous programs, family relationships and homelessness. Within the community sector FaCSfunds in total, directly and indirectly, almost 13 000 organisations.

FaCS identified service delivery and implementation as priorities in its Priority Plan 2002–03. A servicedelivery policy promoting best practice and consistency of practice across FaCS is under development.To underpin this policy a number of resources will be produced, including a practical guide for FaCS staffthat will support them through the service delivery lifecycle.

FaCS is a leader in managing funding arrangements with the community sector and developing standardfunding agreements. It has made its funding agreements more consistent, with a focus on deliveringservices and outcomes for the community. FaCS’ relationships with service providers, however, gobeyond the mechanics. Its partnership approach—working collaboratively with Australian Government,state, territory and non-government community agencies—has made project development, serviceplanning, funding and service delivery more holistic.

The Community Builders project in South Australia (SA) is an example. FaCS and the SA Office ofRegional Development identified a need for a community-based leadership program. A partnershipreference group, with FaCS, the SA Office of Regional Development and the Local GovernmentAssociation of South Australia as members, guided the project implementation.

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Funding for peak bodies

Through the National Secretariat Program, FaCS supports peak organisations to contribute togovernment policy and service delivery and channel information between government and theirmembership. It also provides a consultative mechanism for the ministers and the portfolio.

The National Secretariat Program provided financial support to 20 national community peak bodiesrepresenting six portfolio programs: community services, homelessness, welfare, disabilities, children’sservices and family relationships.

Total expenditure 2002–03: $3 396 486 (GST exclusive).

Table 74 Organisations funded under the National Secretariat Program

PEAK BODY 2002–03a

National Secretariat

Australian Council of Social Service $467 227National Industry Association for Disability Services (ACROD) $250 000Families Australia $250 000Australian Early Childhood Association $250 000Australian Federation of Homelessness Organisations $250 000Volunteering Australia $150 000

Secretariat support

Blind Citizens Australia $120 000Deafness Forum of Australia $120 000Head Injury Council of Australia $120 000National Council on Intellectual Disability $120 000National Ethnic Disability Alliance $120 000Australian Association of the Deaf $120 000Physical Disability Council of Australia $120 000Women with Disabilities Australia $120 000

Program support grants

Centacare Australia $107 720Family Services Australia $153 822Relationships Australia $105 730Secretariat of National Aboriginal and Islander Child Care $129 785Lone Fathers Association $50 000National Council of Single Mothers and their Children $50 000Australian Early Childhood Association $50 000Australian Federation of Homelessness Organisations $50 000Australian Association of the Deaf $40 000Blind Citizens Australia $40 000Deafness Forum of Australia $40 000

Total $3 396 486

a The nature of this program means that some funding is also reported in the individual output group performance reports.


FaCS–Centrelink relationship

Centrelink is the primary agency for delivering income support on behalf of FaCS and it acts as agateway for related services.

The Business Partnership Agreement (BPA) between FaCS and Centrelink is a significant purchasingagreement. FaCS and Centrelink are committed to continuing development of the partnership and ensuring policy and service delivery improvements flow on to the Government andAustralian community.

The agreement details the principles and corporate aspect of the relationship, and identifies Centrelink’srole in delivering FaCS outputs and contributions to outcomes. The agreement continues to recogniseand respect the simultaneous independence and interdependence of the two organisations. It is basedon an efficient and cooperative partnership, relying on communication, open accountability, mutualunderstanding and trust, rather than being a legalistic and prescriptive contract. Annual changes to theagreement reflect the maturing relationship as well as variations and additions to the work ofthe portfolio.

State and territory office network

The state and territory office (STO) network takes on ‘lead state’ roles, contributing to specific policyareas (see Table 75).

With their unique expertise and local networks, lead states added value to FaCS’ work by:

◗ assuring ministers that FaCS’ advice is informed by community input

◗ enhancing our capacity to do business in a ‘joined-up’ way

◗ providing links across programs and with other levels of government

◗ using local knowledge to give us a competitive advantage in a contestable policy environment

◗ highlighting ‘hot spots’ and trends

◗ gathering and disseminating information within the department and between Centrelink and otherservice providers.

For example, as the lead state on youth, the New South Wales office had regular teleconferences andcontact with the STO Youth Managers Network and with youth branches at National Office. During theyear it took responsibility for the Youth Lead State discussion database, which went ‘live’ on 12 February 2003.

To fulfil its responsibilities as the lead state on Families, the South Australian office used itscollaborative model to ensure effective two-way communication with both external and internalstakeholders. With contributions from National Office and the rest of the STOs, the South Australianoffice issued quarterly reports, invaluable in raising and tracking emerging childhood and family issues,most recently in the areas of foster care and work and family.

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Table 75 FaCS lead state responsibilities

Area of focus Output group Lead state

Families 1.1 South Australia

Youth 1.2 New South Wales

Children 1.3 & 1.4 Victoria

Housing/Homelessness 2.1 South Australia

Community 2.2 Victoria (Tasmania as support)

Indigenous 2.1 & 2.2 New South Wales

Labour Market 3.1 New South Wales

Disabilities 3.2 Western Australia and Queensland

Carers 3.3 Indigenous Policy and Northern Australia Office

Aged 3.4 Victoria


Right payments to the right people

Portfolio spending on providing programs and services to approximately 6.4 million members of thecommunity accounts for around one-third of the Australian Government’s Budget. FaCS develops policythat aims to target support and intervention to where it is most needed and at the same time protectgovernment outlays and minimise the risk of fraud and incorrect payments. The portfolio has acomprehensive compliance framework that is continually being improved and enhanced by FaCS andCentrelink to detect instances where Centrelink customers have not provided the correct information.

Simplification

Work continues on recommendations from A simpler way (August 2001), an interim report to MinisterVanstone by the Rules Simplification Taskforce.

Simplifications include:

◗ clients can now apply for advance payments over the phone

◗ simple amendments to debt repayments under $1000 can be arranged by phone

◗ Indigenous clients can apply for Community Development Employment Project (CDEP) andparticipation supplement on a single form

◗ Centrelink staff can now check the value of property assets online with the Australian ValuationOffice, resulting in time savings for staff

◗ concept trials have begun to assess electronic verification of earnings by employers.

A final report on the work of the taskforce will be given to Minister Vanstone early in 2003–04.

Customer Account

‘Customer Account’ is a web browser application that gathers customer information into easily viewablescreens. Centrelink staff will no longer need extensive experience with the Centrelink mainframe,allowing new staff to be trained and become effective more quickly. Processing for new claims will beadded to the Customer Account in the first half of the new financial year. FaCS expects that by July 2006customers will be able to interact with their personal accounts and supply simple updates via theInternet. FaCS keeps a watching brief on Customer Account to monitor budgeted savings and ensurethat policy is correctly applied within the technology.

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Profiling

Service profiling is a method of selectively identifying and reviewing clients who need a more focusedlevel of service to help them meet program outcomes, including payment correctness, activity testingand economic and social participation.

Service profiling has been implemented for the Age Pension, Wife Pension, Widow B Pension, NewstartAllowance, Mature Age Allowance, Widow Allowance, Parenting Payment and Youth Allowance. Previousprogram reviews, based largely on the length of time a client has been receiving payment, have beenreplaced with more intensive contacts for those clients most at risk of not achieving program outcomes.

Business Assurance

The Business Assurance Framework (BAF) builds on a number of existing quality control and qualityassurance mechanisms. It is designed to provide a comprehensive picture of the effectiveness ofcontrols, in relation to the maintenance of the integrity of administered outlays for payments andservices. The BAF defines accuracy of outlays, correctness and sources of error, while also identifyingand analysing operational processes deemed critical to payment correctness.

The BAF, in relation to accuracy of outlays and payment correctness, was piloted during 2002–03.Recommendations from the pilot will be progressed as part of full implementation during 2003–04.Further development of the BAF will focus on services to clients provided through Centrelink, such asparticipation support services and information on rights and responsibilities, and the integrity ofinformation on the effectiveness of those services.

Control of program fraud and incorrect payment

On FaCS’ behalf, Centrelink ensures that controls are in place to minimise the risk of fraud and incorrectpayments. The BPA details these controls and provides a framework for maximising correct payments.

The framework consists of three key strategies:

◗ prevention, through systems and procedures that minimise the risk of incorrect payment and fraud

◗ deterrence, through creating public recognition of the risks and penalties involved in fraud andincorrect payment

◗ detection and recovery, through processes aimed at detecting incorrect payments and promptrecovery of any debts.

Control strategies aim to prevent incorrect payments where it is cost-effective to do so rather thandetect them later. While the controls are risk-based, Centrelink gives due consideration, in consultationwith FaCS, to efficiency and good client service.

Debts are identified and raised in an accurate and timely manner to specified standards. Affected clientsare notified in writing of review outcomes that affect payment eligibility and debt.


FaCS requires Centrelink to provide assurance of payment correctness by:

◗ adhering to agreed procedures and processes that maximise correct payments, and by providingongoing assessment of control framework effectiveness, particularly proof-of-identity proceduresthat ensure identity fraud minimisation

◗ undertaking comprehensive risk assessments of service and payment delivery for each incomesupport program

◗ providing data on the accuracy of decision-making to assure FaCS that the incidence of incorrectpayment arising through incorrect decisions is minimal.

FaCS monitors Centrelink’s performance to measure the success of the control and prevention strategies.

Maximising correctness of payments

Debt prevention

Through the BPA, FaCS emphasises preventive measures for all clients by ensuring a framework ofprocedures, controls and systems, including:

◗ undertaking identification checks

◗ advising clients on correct claim procedures

◗ alerting clients of their obligations and the existing detection mechanisms

◗ verifying key information supplied by clients

◗ applying risk-based admission procedures that target cases with a high risk of incorrectness

◗ requiring that clients provide their tax file numbers as a condition for receipt of payment.

Centrelink is required to deal decisively with detected cases of incorrect payment. This helps toencourage voluntary compliance and highlights the risks and penalties of attempting to claim paymentsfraudulently. Such mechanisms include:

◗ prompt identification and investigation of possible offences

◗ referral of possible fraud cases to the Australian Federal Police

◗ referral of appropriate fraud cases to the Director of Public Prosecutions.

Detection

Review activity

FaCS funds Centrelink to undertake specific review activities that target identified key risks. Reviewactivity is conducted in accordance with the Privacy Act 1988.

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Data matching

Data matching involves comparing client identity details, including in some cases tax file numbers, withrecords from other federal and state bodies, to identify declared income or assets anomalies.

Data matching activities include:

◗ Australian Taxation Office (ATO) individual tax data

◗ ATO Tax File Number Declaration Forms

◗ ATO rental assets data

◗ State and territory registrar-general deaths data

◗ Department of Immigration, Multicultural and Indigenous Affairs immigration records

◗ State and territory departments of corrective services data

◗ Defence Housing Authority and Commonwealth Superannuation Administration data

◗ Australian Securities and Investment Commission data

◗ Investment property reviews with the ATO

◗ Department of Employment and Workplace Relations Job Placement Matching

◗ Youth Allowance and Austudy Payment enrolment checking

◗ Department of Veterans’ Affairs pensions data.

Other activities

Other methods to identify possible incorrect payments include:

◗ joint case work between Centrelink and the ATO

◗ information from members of the public (tip-offs)

◗ risk-based review selections generated from statistical analysis of client characteristics

◗ duration reviews that examine client entitlements at specific intervals from payment commencement

◗ profiling that targets clients at risk of not achieving program outcomes.

Identity fraud

Sophisticated computer detection methods continue to detect identity-related fraud. In 2002–03, thesemethods identified 212 cases of identity fraud. This relates to 469 claims for payment as one fraudulentidentity may be used for a number of claims.

FaCS is also participating in ongoing negotiations aimed at developing a whole-of-government approachto address identity fraud.


Debt recovery

FaCS, through Centrelink, recovers debts by withholding a percentage of ongoing payments orrecovering overpayments in cash. In certain cases, garnishee action recovers debts from tax refunds andother lump-sum payments. Debt recovery actions seek to ensure that clients are not placed underundue hardship due to withholding ongoing payments or garnishee action.

Centrelink has contracted mercantile agents to recover some client debts when the debtor’swhereabouts are unknown or when pursuit of the debts through standard debt recovery processes isnot cost effective.

Compensation

Compensation provisions reflect the principle that income support for people suffering fromcompensable injuries lies primarily with relevant compensation authorities, rather than with thetaxpayer-funded social security system.

Compensation provisions provide for:

◗ recovery of past payments of social security from arrears payment of period compensation paymentand lump-sum compensation payments

◗ preclusion periods, where social security payments cannot be paid due to the receipt of lump-sumcompensation payments

◗ periodic payments, such as weekly workers’ compensation payments, to reduce directly, dollar-for-dollar, the rate of social security payments otherwise payable. Any excess is treated as income forpartners of compensation recipients.

To ensure the community understands the social security implications of receiving compensation,Centrelink provides a high-level outreach and information service to compensation authorities and tolegal, insurance, union and community representatives.

In 2002–03, application of the compliance provisions achieved estimated savings to outlays of$413 million.

Prosecutions

Where clients may have committed offences against the Australian Government and where cases fallwithin referral guidelines, they are investigated (or referred to the Australian Federal Police ifappropriate) and referred to the Director of Public Prosecutions for consideration of prosecution action.In 2002–03, 4160 cases of alleged social security fraud were referred to the Director of PublicProsecutions. The courts dealt with 2874 cases, resulting in 2829 (98 per cent) convictions.

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Random samples

The random sample surveys measure the level of payment incorrectness, provide data on the reasonsfor payment incorrectness and provide information on emerging risks and on the effectiveness of theoverall control framework. During 2002–03, FaCS commissioned Centrelink to conduct rolling randomsample surveys on 8750 clients receiving benefits including the Age Pension (1500), Youth Allowance(1500), Parenting Payment Partnered (750), Parenting Payment Single (750), Disability Support Pension (1125), Newstart Allowance (1125), Special Benefit (500), Sickness Allowance (500) and Austudy Payment (1000).

Achievements

Savings to outlays

◗ Review activity achieved $101.92 million in savings to future fortnightly outlays.

◗ Review activity raised debts of $413.07 million.

Review activity

◗ Centrelink reviewed 4 389 906 social security payments. Of these, 819 231 were compliance reviews.

◗ Compliance review activity resulted in 110 761 social security payments (13.5 per cent) beingcancelled or reduced. Overall, 15.5 per cent of compliance reviews identified an incorrect payment.

Debt raising and recovery

◗ Centrelink raised 1 588 371 debts under social security law and family assistance law, valued at $909.3 million

◗ Of the above amount $886.8 million was raised for recovery. The balance was waivedat determination.

◗ Recoveries of debts under social security law and family assistance law by cash and withholdingsamounted to $682.77 million. These figures include compensation debts.

◗ Total recoveries were equivalent to 77 per cent of the amount of new debt raised over the sameperiod, and 90 per cent were raised within 56 days (target: 80 per cent)

◗ These figures exclude Child Care Benefit and Family Tax Benefit reconciliations and tax returnnon-lodger debts.

Prosecutions

Eighty-five per cent of cases met the Director of Public Prosecutions’ quality requirements (target: atleast 80 per cent).


Budget measures

Detection

Data matching reveals incorrect payments by the detection of undeclared property assets and income.Increased resources have also been allocated to reviews resulting from ‘tip-offs’ received fromthe public.

Research and development

To help detect employment and business-derived income not reported to Centrelink, FaCS conductedfeasibility studies to look at the effectiveness of:

◗ data matching with ATO group certificates

◗ data matching with the Australian Business Number.

Evaluation of the studies resulted in measures to include these activities in the 2003–04 Budget.

2002–03 compliance Budget measures

Compliance measures that have been implemented during the 2002–03 financial year include:improving the processes for updating benefit recipient information; automating the linking of YouthAllowance records with the records of parents and siblings who are also Centrelink clients; andincreasing the number of annual reviews of Rent Assistance. A wider criterion for selecting cases forcompliance reviews has been piloted and preliminary results support extending the pilot to apermanent arrangement. This was announced in the 2003–04 Budget. Further joint efforts with othergovernment agencies will also help improve detection of incorrect payments and address complianceissues with the cash economy.

Communication campaign

As part of the 2000–01 Budget, the Government announced a multimedia communication campaign toencourage Centrelink clients to do the right thing by notifying Centrelink of changes that may affecttheir payments. Two bursts of publicity (April 2002 and September 2002) targeted people on NewstartAllowance, Youth Allowance and Parenting Payment Single. Market research shows that the voluntarycompliance communication campaign had a significant impact on the target audiences in relation to:

◗ capturing the attention of the various segments of the target groups

◗ sustaining recall even when the campaign was between ‘bursts’

◗ clearly communicating the core message about the need to report changes in circumstances

◗ shifting attitudes on people’s responsibility to remind family and friends to notify Centrelink, or tonotify Centrelink themselves of changes.

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Social Security Appeals Tribunal

The Social Security Appeals Tribunal (SSAT) is part of the FaCS portfolio and is responsible to

the Minister for Family and Community Services. It is a statutory body created by the Social

Security (Administration) Act 1999 to conduct merit reviews of administrative decisions made

under a number of enactments, in particular the social security law and family assistance law.

Tribunal structure and membership

The SSAT consists of an Executive Director, directors, members and staff. The current Executive Director,Les Blacklow, was appointed for a three-year term from 1 April 2002. The Secretary of FaCS delegatesfinancial and employment powers to the Executive Director.

The Executive Director of the SSAT is responsible to the Minister for Family and Community Services forthe overall operation and administration of the tribunal, including taking reasonable steps to ensurethat its decisions are consistent and that it performs its functions efficiently and effectively.

The national office of the SSAT is in Melbourne. The National Manager and staff in the national officeassist the Executive Director.

There is an office of the tribunal in each state and territory, each headed by a Director (the Director ofthe Victorian office is also responsible for the Tasmanian office, the Director of the Queensland office isalso responsible for the Northern Territory office and the Director of the New South Wales office is alsoresponsible for the Australian Capital Territory office).

At 30 June 2003, the tribunal had 144 members, working either full-time or part-time. Members areselected for general skills such as an understanding of, and commitment to, the principles ofadministrative review, a knowledge of the social security system, interpersonal skills and particularexpertise in disciplines such as law, welfare or community work, medicine or public administration.

The Governor-General in Council appoints the Executive Director, directors and members. Thisdemonstrates a clear demarcation between FaCS personnel and tribunal membership.

In line with the tribunal’s reporting obligations under section 25 of Part 3 of Schedule 3 to the Social

Security (Administration) Act 1999, the Executive Director submits an annual report to the Minister forFamily and Community Services, to be laid before both Houses of Parliament.

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Governance

Under the tribunal’s corporate governance arrangements, the Executive Group advises and assists theExecutive Director in the overall operation and administration of the core business of the SSAT. Chairedby the Executive Director, with the National Manager and directors as members, this group focusesprincipally on the strategic direction and overall performance of the tribunal.

The SSAT is a member of the Council of Australasian Tribunals.

Appeal management and client service

As provided for in the Social Security (Administration) Act 1999, the tribunal provides a reviewmechanism that is ‘fair, just, economical, informal and quick’. To this end, it is independent of Centrelinkand FaCS.

The SSAT’s Strategic Plan for 2003–05 sets out its core values and service standards, within theframework of its primary objectives.

In 2002–03, 9576 appeals were lodged with the tribunal. At the start of the year, 1586 appeals were onhand. During the year, the tribunal finalised 9762 appeals; of these, it finalised 8166 at hearing. Theaverage time between lodging and finalising an appeal was 9.3 weeks. At 30 June 2003, 1400 appealswere on hand.

The SSAT provides a quarterly performance report to Minister Vanstone.

Relationship management

Although the tribunal has the independent power to review appeals, it has a memorandum ofunderstanding with FaCS for administrative services to support the tribunal in functioning effectively. Itpurchases the use of FaCS’ financial and personnel management information systems to assist inperforming its purchasing, accounts payment, budgeting and staff management functions.

In June 2003, the tribunal signed an Administration Arrangements Agreement with Centrelink, aimed atestablishing a long-term professional relationship between both organisations. The key focus of thisagreement is to enhance service delivery outcomes for appellants and to improve liaison across a broadrange of administrative matters.


Financial management

Funding for the tribunal’s running costs (salary, administration, property and IT) is provided in the FaCSportfolio budget. While the tribunal prepares and submits budget bids to FaCS to incorporate into totalportfolio requirements, it does so in aggregate. FaCS provides funds to the tribunal in fortnightlyinstalments of one twenty-sixth of the budget allocation.

The tribunal manages its own financial resources. In 2002–03, the tribunal operated within its budget of$12.9 million.

People management

The tribunal is responsible for managing its human resources. It purchases human resource policyadvice and administrative support from FaCS, as required, to perform this function.

As mentioned above, FaCS performs some administrative functions on behalf of the tribunal, such asleave processing and payment of salaries and fees for all tribunal staff and members.

Information management

The tribunal has its own electronic appeal management system to manage and administer thelodgement of appeals. The tribunal purchases IT infrastructure services from FaCS.

Risk management

The tribunal has a security and fraud control plan, and has implemented the Government OnlineStrategy and the Commonwealth Disability Strategy. It is also further developing a comprehensiveinternal audit program to provide a framework for the measurement (both quantitative and qualitative)of performance and identification of risk across all areas of tribunal activity.

Service Charter

The tribunal’s Service Charter expresses its commitment to providing high-quality, timely and courteousservices to its applicants and stakeholders.

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