Audit of the Community Development Programme

Posted on 17 November 2017 under APY Lands, Employment & Income management.

The Australian National Audit Office (ANAO) has conducted a performance audit of the Design and Implementation of the Community Development Programme and digging2provided its report to Parliament in October 2017.

Background

The Community Development Programme (CDP) is an Australian Government employment and community development program designed to support jobseekers and reduce welfare dependency in remote Australia.

The Programme started on 1 July 2015 and replaced the Remote Jobs and Communities Program (RJCP).

The Department of the Prime Minister and Cabinet (PM&C) is responsible for the overall design and administration of the CDP; however some aspects of the CDP are administered by other Australian Government agencies. Forty third-party providers deliver employment services to CDP jobseekers

Of the 33,000 job-seekers in the CDP, more than 80 per cent identify as Aboriginal or Torres Strait Islander.

The total expenditure on the Program is estimated to be $1.6 billion over four years from 2014–15 to 2017–18.

The objective of the audit

The objective of the audit was to assess the effectiveness of the transition of the Remote

Jobs and Communities Program to the Community Development Programme including whether the CDP was well designed and is being administered effectively and efficiently.

Audit methodology

The audit methodology included:

  • the examination and analysis of documentation relating to the design and implementation and risk management arrangements for the Community Development Programme;
  • interviews with key officials in the Department of the Prime Minister and Cabinet, the Department of Employment, and the Department of Human Services; and
  • interviews with, and surveys of, key external stakeholders including: Community Development Programme providers; relevant regional and remote employers; state and territory Government entities responsible for delivering related Indigenous programs; community organisations; and peak bodies such as Jobs Australia.

It is noted that the audit methodology does not indicate that community members who participated in the CDP were consulted.

Cost of the audit

The audit cost approximately $547 000.

Audit conclusions and findings

The audit reports states that:

  • the transition from the RJCP to the CDP was largely effective
  • the CDP was supported by stakeholder consultation, as well as risk management and evaluation frameworks
  • PM&C has strengthened its approach to monitoring and responding to compliance issues impacting on provider payments
  • there would be scope to review the incentives created by the revised provider payment structure
  • the implementation of the CDP was supported by an external review of Indigenous Training and Employment, stakeholder engagement, and an effective communication strategy. However, the design of the CDP was not informed entirely by sound analysis of the RJCP
  • the time-frames in which the RJCP was transitioned to the CDP impacted on the ability of providers to understand the changes prior to implementation. In addition, PM&C did not have arrangements in place to ensure funding commitments made by providers from their RJCP Participation Accounts met program requirements. Finally, aspects of the revised provider payment structure may reduce provider incentives to transition job-seekers into ongoing employment.
  • PM&C has established appropriate governance, key program frameworks and guidance material to assist in the administration and delivery of the CDP. PM&C has also strengthened its approach to compliance and fraud prevention in light of identified program risks.
  • PM&C has established transparent performance monitoring and reporting arrangements for CDP providers. These performance indicators are measurable and linked to the CDP’s policy objectives, and have shown improvements in terms of 13 and 26 week employment outcomes; as well as aggregate hours of attendance by participants.
  • PM&C established complementary policies – the Employer Incentive Fund and the Indigenous Enterprise Development fund – aimed at addressing gaps in regional labour markets. However, these programs were significantly undersubscribed. In addition, there is scope to improve the targeting of funding to remote areas by monitoring the number of businesses created to better integrate the CDP Funding Arrangements with related policies.
  • PM&C has developed and implemented a program evaluation strategy for the CDP; however the timing of the review was not aligned to the Government’s consideration of further funding in the 2017–18 Budget.

Supporting findings

Design and transition

The audit report states that:

  • PM&C’s design of the CDP was supported by an analysis of the Review of Indigenous Training and Employment (the Forrest Review) and consultation across Government. In addition, the Minister for Indigenous Affairs consulted with employers, community councils, the Indigenous Advisory Council and representative bodies on the design of the CDP.
  • However, changes introduced as part of the CDP were not informed entirely by a sound evidence base. In particular, the review of the CDP’s predecessor program, the RJCP, was based on incomplete analysis of the data. In addition, there would be scope for PM&C to consider the incentives created by the revised provider payment structure, and its alignment with the underlying policy objectives of the program changes.
  • PM&C developed a suitable phased transition and implementation plan, and communication strategy, to support the transition to the CDP. Due to the short implementation timeframes, many of the risks identified by PM&C materialised. In particular, the timeframes reduced the opportunity for providers to understand the substantial changes prior to implementation. While providers were authorised to access their Participation Accounts to facilitate the transition to the CDP, PM&C did not have arrangements in place to appropriately ensure commitments from the Participation Accounts met the program requirements. Four months following the introduction of the CDP, only 37 per cent of regions were on track to meet performance targets.

Summary and recommendations

Administration of the Community Development Programme

The Audit Report states that:

  • PM&C has established appropriate governance frameworks and guidance material to assist the administration and delivery of the CDP. There are appropriate administrative arrangements in place between the relevant Australian Government entities responsible for delivering the CDP.
  • It is too early to assess whether the CDP is administered efficiently. The CDP is administered by entities at a higher unit cost than the RJCP and the broader JobActive employment services program.
  • PM&C has developed a fit-for-purpose risk management strategy to support the administration of the CDP. In late 2016, PM&C integrated its approach to risk management across the broader Indigenous Affairs Group grants program, which included the CDP. PM&C also established provider risk plans and assessments. However, some key program risks were either not identified in the program level risk plan, or were not fully addressed by mitigation strategies.
  • PM&C has developed a suitable compliance framework for both jobseekers and providers under the CDP. Given the inherent risks associated with issuing payments based on provider-reported data, PM&C has now strengthened its approach to identifying and pursuing suspected instances of non-compliance by providers.
  • PM&C has implemented suitable arrangements to support the administration of provider funding under the CDP. There would be scope to adopt a more transparent and systematic approach to making ancillary payments.
  • PM&C consults with key stakeholders on potential changes to the CDP. The level of engagement between CDP providers, and employers and communities, varied across the 60 regions in which the CDP was implemented.

Monitoring and reporting on CDP performance and outcomes

The Audit Report indicates that:

  • PM&C has established transparent and effective arrangements for measuring the performance of the CDP. Appropriate tailored approaches have been developed to suit delivery across the regional network.
  • PM&C regularly monitors and reports to its Minister on provider performance. While the basis of performance assessment and reporting is set out in provider agreements, there would be scope for greater transparency on the calculation of the Regional Employment Targets.
  • PM&C administers the Employer Incentive Fund to stimulate employment; however, only a small proportion of eligible employers have received the incentive payment. Similarly, there was minimal use of the Indigenous Enterprise Development funds to support the establishment of Indigenous business in CDP regions, resulting in a substantial underspend of allocated funding.
  • PM&C’s evaluation strategy was developed late, some seven months after the CDP commenced and an overview of the evaluation strategy was not agreed by the Minister for
  • Indigenous Affairs until 7 April 2016. This reduced the scope to collect data that was capable of informing an evaluation of the CDP’s impacts.
  • The evaluation strategy was not peer reviewed by a reference group. Evaluation strategy milestones were not consistent with Government timeframes for considering ongoing funding of the CDP.

 You can read the full ANAO Report here.

 A critique of the ANAO Report’s findings

Despite the findings reported in the ANAO Report, a growing body of evidence suggests that the CDP is failing many of its recipients, who are made to work three times as many hours as other job seekers and for well below the minimum wage.

Many CDP participants have claimed that they are frequently left without any real work to do and are required to do menial jobs in unsafe conditions, which won’t lead to ongoing employment or to developing their skills.

An article by SBS NITV News article outlines a number of concerns with the ANAO report and with the Community Development Program.

While one aspect of the Audit’s objective was to assess whether the CDP is being administered effectively and efficiently, it is noted that no CDP participants were interviewed for their evaluation of the Programme’s efficacy or level of efficiency.

There are a number of accounts provided by community members regarding their experiences of being involved in the CDP. Examples of these include a number of the submissions made to the Senate Inquiry led by the Finance and Public Administration References Committee into the appropriateness and effectiveness of the objectives, design, implementation and evaluation of the Community Development Program (CDP). These submissions can be found here.

The submission by Uniting Communities sets out a number of the concerns of community participants in the CDP and can be read here.

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