Appendix E - External scrutiny
The department maintains a collaborative and productive relationship with the Australian National Audit Office (ANAO) and welcomes the audit and assurance activities it undertakes.
Australian National Audit Office
The department coordinates its internal audit activities with the ANAO’s performance audit activities to help ensure the adequacy of audit coverage across the department and to minimise duplication of assurance effort. The department closely monitors implementation of ANAO recommendations.
ANAO audits tabled in the Parliament in 2014-15
Report No. 48 2014-15, tabled 10 June 2015
Limited Tender Procurement
The audit objective was to assess whether Australian Government entities had appropriately justified the use of limited tender procurement and whether processes adopted met the requirements of the Commonwealth Procurement Rules (CPRs) including the consideration and achievement of value for money. The department was 1 of 3 agencies selected as part of the audit. The ANAO’s overall conclusion across the 3 agencies highlights the risks to value for money when applying limited tender to procurement and the need for entities to ensure that procurement processes satisfy the requirements of the CPRs. The ANAO made 2 recommendations aimed at improving entity procurement practices in relation to the use of limited tender, including strengthening pre-approval compliance assurance mechanisms and enhancing the accuracy of AusTender reporting. The department agreed with both recommendations. The department has already completed, or is in the process of completing, a range of actions to enhance its eProcurement system which will address a number of the issues raised within the report. In addition, the introduction of an inflight verification action will support the implementation of the recommendations, as will an increased emphasis on limited tendering in procurement training and guidance material.
Report No. 46 2014–15, tabled 9 June 2015
Administration of the Australian Childhood Immunisation Register
The audit objective was to examine the effectiveness of the department’s administration of the Australian Childhood Immunisation Register (ACIR). The ANAO concluded that the department’s administration of ACIR has been generally effective and that performance targets agreed between the department and the Department of Health (which is responsible for the overall management of the ACIR in the context of the National Immunisation Program) has generally been met or exceeded.
The ANAO made three recommendations relevant to the department and aimed at maintaining and improving ACIR data integrity, and improving the efficiency of information processing. The department agreed with the first recommendation, but with qualifications, noting that the ANAO found that the number of data discrepancies between ACIR and other departmental ICT systems was small. While there is room for improvement this needs to be balanced against the costs associated with resolving known data synchronisation issues and the benefits that can be gained. The department agreed with both the second and third recommendations.
Report No. 37 2014-15, tabled 19 May 2015
Management of Smart Centres’ Centrelink Telephone Services
The audit objective was to assess the effectiveness and efficiency of the department’s management of smart centres’ Centrelink telephone services. The ANAO observed that the large volume of calls handled by the department—43.1 million calls in 2013-14, an average of 800,000 calls each week—is unique in the public and private sectors. The ANAO further observed that many of the calls made by Centrelink customers are technically complex and also involve support for customers with complex needs.
Against this context of unique scale and complexity, the ANAO’s overall conclusion was that the department is making progress in its transition to revised delivery arrangements for Centrelink services through its smart centre and self-service initiatives, while continuing to face challenges in managing a significant volume of telephone calls from customers. The ANAO found that the department is pursuing a number of useful reforms under its transformation programme for smart centres, and has also established a soundly-based quality assurance framework for Centrelink telephone services.
The ANAO made a number of observations about call wait times, customer satisfaction levels, and the rationale underpinning relevant key performance indicators, while noting that department’s overall target for all customer telephone services has been agreed with government. The ANAO made three recommendations concerning the implementation of a coordinated channel strategy—applying the Quality Call Listening process to all staff answering calls, and reviewing performance indicators to better reflect the customer experience and to clarify the service standards that customers can expect.
The department agreed with the first 2 recommendations. The department also agreed with the third recommendation, but with qualifications, noting that reducing the average answer speed from 16 minutes to 5 minutes would require an estimated 1,000 additional staff costing over $100 million each year.
Report No. 36 2014-15, tabled 6 May 2015
Administration of the Assistance for Isolated Children Scheme
The audit objective was to assess the effectiveness of the department’s administration of the Assistance for Isolated Children Scheme. The ANAO’s overall conclusion was that the department’s administration of the scheme has been generally effective. The ANAO did not make any recommendations for the department. The report did suggest opportunities for refinements, including low-cost outreach activities to supplement existing information channels, making better use of surveys to assess customer satisfaction, and considering opportunities to assist the Department of Social Services to assess the scheme’s achievements against policy objectives.
Report No. 25 2014-15, tabled 5 March 2015
Administration of the Fifth Community Pharmacy Agreement
This audit involved the Department of Health and the Department of Human Services. Its objective was to assess the effectiveness of the development and administration of the Fifth Community Pharmacy Agreement, and the extent to which the agreement met its objectives. The ANAO concluded that, overall, the Department of Health’s administration of the agreement has been mixed.
The ANAO made 8 recommendations relevant to the Department of Health, aimed at improving the development of costings, clarity of the next agreement and related public reporting, record-keeping and performance information. One of these recommendations involved the department and concerned improving the accuracy of the Department of Health’s calculation of pharmacy remuneration for reporting and evaluation purposes. The department agreed with this recommendation.
Continuing ANAO audits
The following ANAO performance audits were in progress at 30 June 2015.
Qualifying for the Disability Support Pension
The audit objective is to assess the Department of Social Services’ and the department’s administration of Disability Support Pension eligibility and review processes.
Procurement Initiatives to Support Opportunities for Indigenous Australians
The audit objective was to assess the effectiveness of the administration of procurement initiatives to support opportunities for Indigenous Australians.
In December 2014 the Commonwealth Ombudsman published a section 15 report on Department of Health: Avoiding, acknowledging and fixing mistakes about the Pharmaceutical Benefits Scheme and pharmacy location rules. The Ombudsman made 4 formal recommendations to the Department of Health and the department. The department supports 3 of the 4 recommendations, as one recommendation was directed to the Department of Health.