Introduction

1. In 2008 the Council of Australian Governments (COAG) committed to a national effort to address the levels of disadvantage experienced by Indigenous Australians. The National Indigenous Reform Agreement (NIRA) established an overall framework for action by governments, as well as identifying six key targets to Close the Gap in Indigenous disadvantage. Improving early childhood outcomes was recognised as underpinning the achievement of the COAG targets in the longer term.¹ In that context, the National Partnership Agreement on Indigenous Early Childhood Development (IECD NP) was agreed to in October 2008 and sought to address disadvantage experienced by Indigenous children. The IECD NP was the first National Partnership Agreement to be developed and its objectives were to:

• improve developmental outcomes for Indigenous children and achieve agreed key COAG targets;
• achieve sustained improvements in pregnancy and birth outcomes for Indigenous women and infants;
• improve Indigenous families’ use of the early childhood development services they need to optimise the development of their children; and
• contribute to COAG’s social inclusion agenda, early childhood development, education, health, housing, and safety agendas, by identifying reforms and models of service delivery that will improve outcomes for Indigenous children.²

2. National Partnership Agreements are funding mechanisms that operate under the Intergovernmental Agreement on Federal Financial Relations (IGAFFR), which is the overarching framework guiding the Commonwealth’s financial relationships with states and territories. An important underlying feature of the IGAFFR is to recognise the primary role of states and territories in delivering government services in key sectors, and the importance of collaboration between the states and territories and the Australian Government in achieving national outcomes.

3. The IECD NP was described by COAG as the first stage of a multi stage reform program to improve outcomes for Indigenous children. The IECD NP was also complemented by the National Partnership on Early Childhood Education (NP ECE) which was agreed in December 2008. In relation to Indigenous children, the NP ECE had a target of ensuring access to preschool by all four year olds in remote communities.

The National Partnership Agreement on Indigenous Early Childhood Development

4. The IECD NP consists of three components, each of which is implemented under separate arrangements. The components are:

• integration of early childhood services through Children and Family Centres (CFCs);
• increased access to antenatal care, pre-pregnancy and teenage sexual and reproductive health; and
• increased access to, and use of, maternal and child health services by Indigenous families.

5. The IECD NP provides $564 million over six years to June 2014. Of this, $292.62 million has been allocated to the Children and Family Centres component, all of which is provided by the Australian Government. During the life of the agreement this funding is available to support the establishment and initial operations of CFCs. The remaining two health related components are mainly funded by the Australian Government with a contribution by the state and territory governments.

Children and Family Centres

6. COAG sought the achievement of two specific outputs in relation to the Children and Family Centres component of the IECD NP. These were:

• the establishment of a minimum of 35 Children and Family Centres in urban, regional and remote areas with high Indigenous populations and disadvantage; and
• the provision of early learning, child care and parent and family support services to Indigenous families at or through each of the CFCs.

7. Providing services that were better integrated, and were responsive to community needs, were other important factors considered by COAG in establishing the agreement. To promote integration, COAG required all services provided through the CFCs to have integrated management, governance and service systems.³

8. In agreeing to fund the IECD NP, the Australian Government sought to ensure that long term outcomes would be facilitated by the investment in CFCs. In particular it anticipated that the CFCs would facilitate the provision of both state and Australian Government services beyond the timeframe of the IECD NP and that all levels of government would pay close attention to the effectiveness of local services to ensure that investments contributed to the Closing the Gap targets.⁴

Funding and distribution of CFCs

9. The IECD NP identified the number of CFCs each jurisdiction was required to establish, along with expectations for the number of centres to be built in urban areas and in regional/remote areas. COAG requested that states and territories consider establishing more than the number of CFCs allocated to them through the IECD NP by using the capacity of existing services and leveraging other related programs. Table S1 provides a breakdown of the funds and CFCs allocated to each state and territory.

Table S1 Funding allocation and distribution by jurisdiction

Source: ANAO, based on data sourced from the IECD NP and DEEWR.
* Note: Queensland, South Australia and Tasmania each agreed to provide one additional CFC to the number they were allocated in the IECD NP, bringing the total to 38 centres.

Roles and responsibilities

10. The responsibility for service delivery in relation to CFCs rests with the state and territory governments. The IECD NP, however, emphasises that the pursuit of its broad reform objective is a responsibility shared between the Australian and state/territory governments which are expected to work in partnership to ensure effective implementation. The Department of Education, Employment and Workplace Relations (DEEWR) is the lead Australian Government agency in relation to the Children and Family Centres component of the IECD NP.

11. In addition to the shared responsibility and accountability for the achievement of the policy outcomes expected by the Australian Government, a limited set of specific responsibilities were allocated to DEEWR. These were to:

• facilitate the Australian Government’s financial contribution;
• participate in consultations as appropriate; and
• participate in planning for bilateral workplans⁵ as appropriate and when requested by state and territory governments.

12. The Australian Government Minister for Education, Employment, and Workplace Relations (the Minister), is authorised by COAG to revise state and territory Implementation Plans on behalf of the Australian Government and to certify payments to the states and territories on the achievement of agreed milestones.⁶ As the lead Australian Government agency for the CFC component of the partnership, DEEWR supports the Minister in this function.

Audit objective, criteria and scope

13. The objective of the audit was to assess the effectiveness of DEEWR’s role in the delivery of the CFC component of the IECD NP.

14. To conclude against this objective the audit considered whether:

• DEEWR had established effective arrangements, with the jurisdictions, for the management of the Children and Family Centres component of the IECD NP; and
• DEEWR effectively monitored the performance of state and territory government agencies.

Overall conclusion

15. The establishment of Children and Family Centres (CFCs) was intended by the Council of Australian Governments (COAG) to be an important service delivery reform which was to provide a platform for ongoing integrated service delivery for both Australian Government and state funded programs aimed at providing early childhood and family services to Indigenous families. Progress against the key outputs of establishing CFCs and using them to deliver integrated services has been made but not to the level expected. The funding of $292.62 million provided in the IECD NP was based on the expectation that all CFCs would be constructed and operational by June 2012. As at May 2013, services were being provided from 33 locations. Of these, however, only 13 centres⁷ were operating from completed premises with 20 centres operating from interim facilities. There are five locations where no services are being provided. Due to the longer than expected construction times, and other performance information issues (discussed in paragraph 20), DEEWR is not well positioned to determine the impact that funding provided to date has had in relation to the IECD NP’s objectives.

16. The IECD NP was a partnership between governments, requiring a collaborative approach to managing its overall implementation. To this end, the Department of Education, Employment and Workplace Relations (DEEWR) chairs the IECD Steering Committee and, increasingly, has regular bilateral communication and meetings with each jurisdiction. The IECD Steering Committee meets at least twice per year and has acted as a forum for monitoring progress of centre construction, agreeing to reporting templates and discussing a number of cross-jurisdictional challenges such as data collection. However, the committee has given more limited attention to monitoring progress toward the stated objectives of the IECD NP. Further, it has not considered the effectiveness of the various approaches in achieving more integrated service delivery. In 2013, DEEWR has taken steps to increase the strategic focus of the steering committee and strengthen reporting arrangements from the committee to the COAG Standing Council on School Education and Early Childhood.

17. The Australian Government, as the sole provider of funding, had a clear expectation of the results to be achieved through its funding. In this respect DEEWR had an important role to play in ensuring the Australian Government’s interests were being adequately progressed through the partnership. Under the agreed structure of the IECD NP, the development and regular review of Implementation Plans represented an important opportunity to ensure that the priorities and approaches proposed by each jurisdiction were appropriate in terms of the overall policy outcomes being sought.

18. DEEWR provided guidance for the development of Implementation Plans to assist the states and territories to identify how they intended to effectively integrate services for children and families, as well as outlining their respective implementation priorities and performance milestones. Despite this guidance, the resulting Implementation Plans varied in the extent to which key implementation issues were being addressed and ultimately did not provide DEEWR with a robust process to monitor implementation.

19. The IECD NP provided the states and territories with flexibility in their approaches to implementation. The bilateral nature of Implementation Plans, while providing state and territory governments with flexibility, meant that DEEWR was only able to assess Implementation Plans according to the priorities proposed by each jurisdiction. While it is not necessarily the case that there should be a uniform approach across all jurisdictions, national level outcomes are being sought through the IECD NP and there would be value in DEEWR undertaking a more in depth assessment of Implementation Plans to be assured that, overall, the priorities and proposed pace of service delivery reforms is appropriately meeting the Australian Government’s expectations.

20. State and territory government departments report twice a year to DEEWR on implementation progress. To date there has been very limited coverage in these reports against the outcomes expected or against the performance indicators established in the IECD NP. Due to the slow development of an agreed data collection mechanism for CFCs overall, there is limited performance data available to support an assessment of whether the CFCs have contributed to an improvement in Indigenous early childhood development outcomes and whether adequate progress has been made to improve access to integrated early childhood and family services. Further, while the Intergovernmental Agreement on Federal Financial Relations (IGAFFR) emphasises the accountability of the states and territories to their respective constituents, public reporting on progress of the CFC component of the IECD NP has been minimal, unlike some other National Partnerships.

21. Sustaining the ongoing contribution of the CFCs to addressing Indigenous disadvantage following the expiry of the IECD NP in June 2014 is an important consideration for the operation of each centre. As a partial solution, DEEWR has proposed that the financial viability of CFCs will be assisted through CFC operators accessing existing child care program funding. However, not all CFCs are providing child care services and are therefore not all eligible for child care funding. Further consideration of different approaches is required if CFCs are to be able to serve as the platform for integrated service delivery in future reforms as anticipated in the IECD NP.⁸

22. The ANAO has made two recommendations aimed at strengthening the delivery of DEEWR’s central role in the IECD NP. The first relates to conducting analysis and developing advice regarding the effectiveness of CFC service delivery and operating models to assist in informing any future initiatives in relation to improving Indigenous early childhood outcomes. The second is aimed at increasing the public reporting on progress and the achievement of the objectives of the IECD NP, including the service delivery reforms anticipated to improve outcomes for Indigenous children.

Key findings by chapter

The IECD NP Implementation Arrangements (Chapter 2)

23. In situations where programs funded by the Australian Government are delivered in multiple states and territories, and where shared responsibilities for outcomes exist, it is important that the relevant Australian Government department establishes appropriate arrangements to maintain visibility over implementation so as to be assured that it remains consistent with the expressed policy directions and objectives.

24. The IECD Steering Committee is the principal overarching governing mechanism for the IECD NP. The steering committee meets at least twice annually and provides a forum where progress, particularly in relation to construction targets, is discussed between IECD NP partners and issues impacting on implementation are shared. The steering committee has not, however, given attention to whether broader national service delivery reforms are being effectively implemented. The steering committee has had an ongoing and critical role to develop and agree national data collection mechanisms for CFC performance although this has progressed slowly and performance data will only commence to be reported from August 2013.

25. Implementation Plans were required to be developed by each state and territory government and submitted to DEEWR for approval. Although templates and guidance were provided by DEEWR to promote consistency across the plans, the type of information and level of detail included varied across states and territories. DEEWR was also required to undertake annual reviews of the plans following the receipt of progress reports from state and territory governments so that plans could be jointly adjusted to reflect actual implementation experience. At the time of preparing this report, while Implementation Plans had been reviewed, no revised Implementation Plans had been made publicly available.

Service Site Location Planning and Consultations (Chapter 3)

26. The identification of locations for CFCs was undertaken by state and territory governments. The majority of the locations subsequently proposed by the states and territories, and agreed by DEEWR, were consistent with the requirements of the IECD NP that CFCs be located in areas of high Indigenous populations and disadvantage within each jurisdiction. The IECD NP also required that CFCs be established in urban, regional and remote areas. Nationally, this distribution has been achieved, although in Victoria, Tasmania and the Australian Capital Territory the nature of Indigenous population distribution and the numbers of CFCs to be established resulted in CFCs being established in urban and/or regional areas only.

27. Consultation processes were led by state and territory governments with DEEWR to be involved as appropriate. Other than preparing a factsheet on the potential decisions that consultations might contribute to, DEEWR did not clarify the interpretation of ‘appropriate involvement’ in the context of CFCs and, as a result, the involvement of DEEWR staff in consultations was variable and not systematic. Some information about consultations and consultation processes was included in state and territory reports but no significant information about the outcomes of consultations was prepared and the opportunity envisaged by COAG for sharing best practice on consultation approaches between states and territories was limited.

Implementation (Chapter 4)

28. The early implementation of the IECD NP was affected by the need to revise the partnership in order to align with the IGAFFR framework. While workplans were developed and in place to guide implementation, the construction schedule initially agreed to in the IECD NP was revised during the development of Implementation Plans. Where construction was deferred or delayed most of the states and territories sought to achieve similar levels of services to those initially anticipated by using interim facilities.

29. At the time the IECD NP was agreed in 2008, COAG anticipated that all CFCs would be constructed and fully operational by June 2012. In subsequent Implementation Plans the construction of centres in many locations was revised to later years and the option for interim services from temporary premises was provided. As at May 2013, services were being provided from 33 locations. Of these, however, only 13 centres were operating from completed premises with 20 centres operating from interim facilities. In five locations, no services have commenced and communities in those areas will therefore have limited opportunity to access the services prior to the completion of the IECD NP in June 2014.

30. A number of factors will impact on the ongoing ability of CFCs to contribute towards achieving the broad and ongoing reforms anticipated in the IECD NP, including: the financial viability of each centre; the extent to which CFCs engage with and focus on Indigenous families; and the extent to which CFCs effectively integrate quality services. Direct Australian Government funding for the operation of CFCs is planned to cease on the expiry of the IECD NP and a combination of approaches will need to be considered by all governments to support the achievement of outcomes from the funding to date. In the context of broader funding considerations, early agreement on options to support CFCs will assist centres in their forward operational planning. DEEWR has proposed that CFC services can be supported by accessing mainstream program funding provided through child care programs. Funding for child care services, however, would only partially cover the anticipated costs and will only do so for a portion of centres. Any proposed future funding models will need to take into account that an ongoing focus on Indigenous clients is important if the CFCs are to contribute to the longer term Closing the Gap targets, as originally intended.

Performance Monitoring and Reporting (Chapter 5)

31. To achieve the COAG targets, Australian governments have committed to a reform program for Indigenous early childhood development that will be delivered in stages to achieve tangible improvements in outcomes for Indigenous children and generational change over the longer term.⁹ Developing mechanisms to monitor and report on the CFCs is particularly important to demonstrate improvements in early childhood outcomes, facilitate public accountability and to help inform future policy directions in the area of Indigenous early childhood development as anticipated in the IECD NP.

32. Performance reporting to date has provided limited value in measuring the objectives of the CFC component of the IECD NP. There is presently limited performance data available to support an assessment of whether the CFCs have contributed to an improvement in Indigenous early childhood development. Finalising data collection methodologies through the steering committee has progressed slowly and as a consequence, limited reporting against the performance indicators outlined in the IECD NP will be available prior to its expiry in June 2014. Leading strengthened efforts to improve data collection approaches will be an important focus for DEEWR in the remaining period of the IECD NP so that assessments of the impact of the IECD NP can be made.

33. DEEWR assesses progress against milestones through the six monthly progress and annual reports provided by the state and territory governments. Although jurisdictions have been reporting on progress, there has been minimal reporting against the performance indicators established in the IECD NP. The assessment of the effectiveness of the various approaches adopted by jurisdictions has not been a focus for DEEWR to date. An understanding of the ability of each of the approaches to deliver the outcomes sought will be important in informing the future stages of the reform program anticipated in the IECD NP.¹⁰

Summary of agency response

34. A summary of DEEWR’s response is as follows:

The Auditor General's report acknowledges that DEEWR has a central role in the delivery of the National Partnership on Indigenous Early Childhood Development Element One (NPA IECD) ­ Children and Family Centres.

The Department acknowledges that it has a key role in the delivery of the Children and Family Centres element of the NPA IECD and that analysing service delivery models for Children and Family Centres will assist in assessing the effectiveness of the investment in Children and Family Centres and outcomes achieved.

The Department also acknowledges the value of greater public accountability of progress on the Children and Family Centres in meeting the objectives of the NPA IECD, including jurisdictional performance and progress through periodic reporting to the Working Group on Indigenous Reform and the COAG Standing Council on School Education and Early Childhood.

Recommendations

Footnotes

[1] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 11.

[2] ibid., paragraph 20.

[3] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 27.

[4] In 2008 COAG identified six targets relating to Indigenous life expectancy, health, education and employment that need to be in place in order to comprehensibly address the existing level of disadvantage.

[5] The original IECD NP (agreed in October 2008) called for the development of workplans which provided details on how outputs (such as building CFCs) would be delivered. These were later known as Implementation Plans.

[6] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 16.

[7] There were two additional centres where construction had been completed but services had not yet commenced from the permanent facility. A complete breakdown of the status of all centres is at Appendix 3.

[8] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 12.

[9] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 11.

[10] National Partnership Agreement on Indigenous Early Childhood Development, paragraph 12.