Effectiveness, efficiency and economy

Our performance audits help parliament assess entity performance

17 performance audits completed

Helping to improve public administration

We reported on 17 performance audits in 2016–17, one more than last year. This is the most performance audit reports the Audit Office has produced in a single financial year. In these 17 reports, we made 102 recommendations to improve public administration.

Performance audits aim to inform parliament and the public about how well government programs are delivered and ultimately improve public administration. They examine whether taxpayers’ money is spent efficiently, effectively, economically and in accordance with the law.

These audits may review all or part of an entity’s operations. Some audits consider particular issues across a number of entities. Where we find performance gaps, we make practical recommendations.

The extracts in the box below from published responses to our reports indicate the value the entities we audit attach to our recommendations in improving public administration, and the collaborative approach we adopt.

 

Published agency responses to our reports

I thank the Audit Office for this [Red Tape Reduction] report which will help inform the future of policy in this area.

Department of Premier and Cabinet

Treasury welcomes the contribution from the Audit Office towards further strengthening evaluation in New South Wales and broadly supports the directions of the recommendations. Stronger evaluation informs resource allocation and regulatory decisions and leads to improved outcomes for citizens.

The Treasury

I would like to thank the review team of the Audit Office for working with the officers of the department to make this [Planning for School Infrastructure] audit a worthwhile and constructive exercise

Department of Education

 

Opportunities to improve value to parliament

Parliament is our primary stakeholder and our work supports its role in holding the government to account. Our reports are frequently referred to in parliamentary debates and in budget estimates hearings.

Parliament is an important source of suggestions for performance audit topics and audits required by specific legislation.

Although we add value to the parliamentary process, there are always areas to improve in as illustrated by the comments made by parliamentarians in a recent survey:

 

‘There is lots of valuable information in those reports but it takes time to look for specific information.’

‘Could be promoted more. Also, Parliamentary briefings have fallen away in the past year. PAC needs to work with the Audit Office to reinstate these.’

Average cost of performance audits was below target

The average cost of performance audits published in 2016–17 was $272,166. This was below the target of $308,000 and two per cent higher than the 2015–16 result of $266,726.

The slight cost increase of our performance audit work can be attributed to loss of team members where remaining work was completed by more senior staff, as well as several complex topics requiring increased involvement of senior staff.

Our cost target for performance audits in 2017–18 is higher than last year due to an expectation that our first performance audits of local government will be more expensive than our State government audits, given this is a new sector for us.

 

Choosing performance audit topics

Our three-year performance audit program focuses on the NSW Government’s ‘NSW – Making it Happen’ priority areas and contemporary public sector risks and opportunities. Alongside this program, we continue to work with parliament’s Public Accounts Committee and other key stakeholders, to focus on important issues. We also ensure our program is sufficiently flexible to allow us to respond to emerging priority issues.

 

Leveraging internal and external expertise

In more complex audits, Performance Audit draws on support from senior management and expertise from across our organisation. This provides industry knowledge, agency liaison and data analysis. Performance audits also use specialist advisers for cultural advice, survey design, industry expertise, research and analysis. Five performance audits completed in 2016–17 used external advisors.

Number of performance audits completed

Average cost of performance audits $’000

The year ahead

In 2017–18, we will focus on further improving our performance audit topic selection process and better communicating to stakeholders how we choose performance audit topics.

We will continue to improve how we engage with our external stakeholders, including parliamentarians, in an effort to improve the impact and relevance of our audits and increase the value we deliver to the public sector. This is core to our ‘Influencing for Impact’ strategic initiative for 2017–18.

Also in 2017–18, we will deliver our first local government performance audits. We received the mandate to undertake such audits in October 2016. We expect these audits to include substantial stakeholder consultation given the local government sector will be learning about performance audits and we will be learning about the local government sector.

In 2017–18, we will work with the NSW Data Analytics Centre (DAC) on our performance audit of demand management at NSW Ambulance. Drawing on the DAC’s expertise will increase the depth of our insights into this audit topic, and help identify new ways data can be used to understand and improve performance.