Introduction

1. The Army Aboriginal Community Assistance Program (AACAP) is administered by the Department of Families, Housing, Community Services and Indigenous Affairs (FaHCSIA) and implemented by the Australian Army. The aim of the program is to develop and upgrade environmental health infrastructure in remote Aboriginal and Torres Strait Islander communities, and to enhance the primary healthcare services and facilities available to these communities.^[1] AACAP also helps build relationships between government agencies and Indigenous communities. Projects consider community requirements and are the result of extensive consultation between the communities and FaHCSIA, Army, and other Australian and state government agencies. Army is assisted in its implementation role by other parts of the Australian Defence Force, which provide logistical and communication support, training and health services.

2. A Memorandum of Understanding (MoU) exists between FaHCSIA and Army which sets out the strategic direction, working arrangements and funding process for AACAP. A key aspect of the working arrangements covered in the MoU is the operation of a joint Steering Committee involving Army and FaHCSIA. The role of the Steering Committee is to provide high-level strategic direction for the program and to assist both FaHCSIA and Army with the implementation of AACAP projects.

3. Each AACAP project has construction, health and training components. Since its commencement, AACAP projects have included building housing, health clinics, water reticulation and treatment systems, sewerage treatment systems, upgrades to roads and air strips and electrical services. An AACAP project takes approximately three years, from short-listing of potential communities through to project completion. At the peak of project delivery, 150 to 200 Defence personnel may be deployed to the community.

4. AACAP has been funded by the Australian Government since 1997 and currently has an annual project budget of $6 million. Overall, some $84 million in direct program funding has been provided, not including the financial and in-kind contributions made by Defence. Army was unable to provide an estimate of its expenditure from the commencement of AACAP, however, its average annual expenditure over the three year period 2002 to 2004 was approximately $3.9 million^[2] rising to $8.1 million over the two year period 2008 to 2009.^[3]

5. Until 2006, AACAP was an element of the National Aboriginal Health Strategy (NAHS) which in turn was part of the Community Housing and Infrastructure Program (CHIP). Funding for AACAP was provided through these initiatives until both CHIP and NAHS were discontinued following a review in 2006. AACAP is now separately funded through to 2013 and its scope has been increased to reflect the Government's priorities under the broader Closing the Gap policy. As a result, a wider set of services can potentially be delivered under AACAP and this is being reflected in the revised MoU between FaHCSIA and Army. In addition, the program has been refocused to target communities within the priorities of the National Partnership Agreement on Remote Service Delivery.^[4]

Audit objectives and methodology

6. The audit assessed FaHCSIA's management of AACAP and how the department monitors the contribution the program is making to the improvement of primary and environmental health, and living conditions, in remote Indigenous communities.

7. The audit examined program delivery under the 2006–2009 MoU, as well as the planning for the 2010 project under the variation to the 2006–2009 MoU. As part of the audit the ANAO considered:

• program strategy and implementation including the roles and responsibilities of the major stakeholders, community selection and scope of works (Chapter 2);
• the financial management of the program and the changing role of the Contracted Program Manager (Chapter 3); and
• performance measures, including FaHCSIA's performance reporting framework, and approach to monitoring and reporting performance against the stated program objectives (Chapter 4).

8. The audit focused on AACAP in so far as it relates to Indigenous community outcomes. It did not consider the program from the perspective of the Australian Defence Force capability building.

Overall conclusion

9. The Army Aboriginal Community Assistance Program (AACAP) has successfully constructed infrastructure and provided training to selected Indigenous communities. Since 1997, the program has implemented projects in 20 discrete locations covering 35 communities in the Northern Territory, Western Australia, South Australia and Queensland. In addition to the main infrastructure focus of AACAP, which has enabled the building of housing, health clinics, and upgrades to roads and air strips, communities have also benefited from Army providing additional services while in the community. These additional services have included assistance such as the removal of old car bodies from the yards of houses, repairs to school fencing and the refurbishment of local waste sites.

10. AACAP is a small program in terms of funding. However, while AACAP projects are small relative to overall Indigenous expenditure, they represent significant investments in small communities. Because of this concentration of investment, a high degree of management consideration has been required to achieve an appropriate balance between a community's expressed needs, the ability of the program to cater for these and the capability of Army to deliver the projects. FaHCSIA has also had to balance limited resources between ensuring the annual project processes are undertaken and investing resources into strengthening the administration of the program.

11. Changes made to the program in 2009 to include health, housing and education initiatives have served to make AACAP consistent with the COAG National Indigenous Reform Agreement priorities. AACAP now co-exists with other COAG initiatives and there is scope for it to become more integrated with other elements of the Government's Indigenous program framework.

12. The ANAO made two recommendations aimed at ensuring the program is operating within relevant legislation and policy, and improving FaHCSIA's approach to performance measurement to better capture the sustainability and long term performance of benefits provided under AACAP.

Key findings by chapter

Program strategy and implementation (Chapter 2)

13. In recent times, the program has operated against a background of significant reform to Indigenous program delivery that has occurred as a result of the development of the Government's Closing the Gap policy and the National Partnership Agreements in 2008. This has introduced challenges for the strategic direction of AACAP.

14. The ANAO observed that the AACAP Steering Committee has generally concentrated on the annual process of selecting a project community and has given less attention to its other role, as set out in the MoU, as a forum to provide high-level strategic direction to assist both FaHCSIA and Army.

15. In terms of program implementation, the procedures and criteria for the AACAP community selection process and establishment of the scope of work are defined in the MoU between FaHCSIA and Army. The selection process emphasises the need to consider community needs, FaHCSIA policy requirements and Army capabilities and resources when selecting a community. The annual community selection process was found by ANAO to give due consideration to these aspects. While the selection process sometimes adds to the time needed to reach decisions and may potentially lead to some communities with higher needs not being selected, it has worked well to weigh the needs of communities and Army. There is, however, a significant risk that the requirement to balance need with capability^[5] to deliver is not well understood by potential stakeholders.

Program management (Chapter 3)

16. AACAP is a grant funded program consisting of four key parties: FaHCSIA; Army; a grantee organisation (the selected community); and a Contracted Program Manager. FaHCSIA is the lead agency. Under the current management arrangement Army and the CPM provide program cohesion by managing the bulk of the operational activities. The current management arrangements enable the successful delivery of community infrastructure projects, while at the same time removing the need for FaHCSIA to be directly involved in the program's operational and construction activity.

17. Program delivery arrangements have remained largely unchanged since the program commenced in 1997. FaHCSIA has commenced a review of the role of the Contracted Program Manager but it would also be appropriate for FaHCSIA to review the approach to managing grant funds to ensure the arrangements fully reflect current legislative and policy requirements.

Performance measurement, monitoring and reporting (Chapter 4)

18. Elements of a performance framework exist to collect and report against some indicators for AACAP. The operational information collected by Army and the CPMs, and provided through regular reports, positions FaHCSIA to understand how individual projects are progressing. Some consideration of this information, drawing on input from other selected stakeholders, would form an important assessment tool that could be used to inform future program activity, management and review processes. There would also be benefit in developing an approach of reviewing and assessing the longer term performance and sustainability of infrastructure provided under AACAP as this has the potential to generate useful data to inform future infrastructure projects undertaken by the Australian Government in remote Indigenous communities.

Summary of agency response

19. FaHCSIA appreciates the opportunity to respond to the ANAO Section 19 Report for the audit Army Aboriginal Community Assistance Program (AACAP).

20. FaHCSIA has considered each of the recommendation provided in the Section 19 Report for AACAP and has agreed to each of the recommendations.

Footnotes

^[1] Community Housing and Infrastructure Program Policy for 2002–2005, p. 52.

^[2] Department of Parliamentary Services Background Note, Commonwealth Indigenous-specific expenditure 1968–2010, 16 September 2010.

^[3] Expenditure figures supplied by Army.

^[4] <www.coag.gov.au/intergov_agreements/federal_financial_relations/docs/national_partnership/national_partnership_on_remote_service_delivery_with_amended_schedule.pdf>

^[5] The AACAP MoU states the “Identification of AACAP projects will take into account FaHCSIA's current policy requirements, previous rounds of AACAP…….and Army's program outcomes, planning requirements and capabilities.”