Background

The National Aboriginal Health Strategy program (NAHS program), managed by the Aboriginal and Torres Strait Islander Services (ATSIS), provides funding for capital housing and infrastructure projects to improve environmental health conditions, generally, to remote Indigenous communities. The NAHS program is delivered as an element of ATSIS' Community Housing and Infrastructure Program (CHIP). The objective of the CHIP is to increase the number of Aboriginal and Torres Strait Islanders with access to adequate housing, infrastructure and municipal services. Both the NAHS program and the CHIP have a focus on delivering services and facilities to address specific needs of Indigenous communities.

ANAO Audit Report No.39 of 1998–99, National Aboriginal Health Strategy—Delivery of Housing and Infrastructure to Aboriginal and Torres Strait Islander Communities, assessed the Aboriginal and Torres Strait Islander Commission's (ATSIC) management of the NAHS program in providing housing and related infrastructure to Aboriginal and Torres Strait Islander communities, and
identified areas where program administration could be improved. The report made seven recommendations for improvement and ATSIC agreed to all seven recommendations. The then Department of Employment Workplace Relations and Small Business (DEWRSB) agreed to one recommendation concerning cooperative effort for Indigenous employment and training.

Commencing 1 July 2003, ATSIS is an independent Executive Agency within the Immigration and Multicultural and Indigenous Affairs portfolio. Under the new structure ATSIS provides a range of policy, program and administrative services to ATSIC; while ATSIC (the Board of the Commissioners and Regional Councils) will set national and regional policies and priorities for programs to be delivered by ATSIS. For the purposes of this report, the NAHS program will be referred to as being an ATSIS program from the period commencing 1 July 2003

Key findings

Table 1 summarises the progress that ATSIS has made in implementing the recommendations from the previous audit report with references to the paragraphs in the report that set out the ANAO's findings.

Table 1 Implementation of previous recommendations

The previous audit report found that ‘ATSIC's analysis and reporting of performance information for NAHS was not adequate and that ATSIC should further develop the criteria for assessing, monitoring and reporting its performance'. In addition to assessing ATSIS' progress in implementing the recommendations of the previous audit, this follow-up audit examined ATSIS' performance reporting of the NAHS program.

Conclusion

The ANAO concluded that ATSIS has fully implemented four of the seven recommendations of the previous audit.

Recommendation 1 of the previous audit is partially implemented. The ANAO considers that ATSIS has developed effective internal processes for monitoring funding support of agencies to community housing and infrastructure projects funded by the NAHS program. However, ATSIS does not report to stakeholders against the stated program objective to increase commitment and support for infrastructure projects.

Recommendation 7 of the previous audit is partially implemented. The previous audit report considered that ATSIS should report using more detailed output and cost information to make certain that NAHS reporting complies with the Government's accrual budgeting expectations. This follow-up audit found that, while ATSIS estimates the cost of housing and infrastructure outputs and uses these estimates for program planning and management of the NAHS program, the information is not included in reports on the performance of the NAHS program to external stakeholders.

The ANAO found that Recommendation 3 of the previous audit is no longer relevant. In assessing the status of Recommendation 3, the ANAO took into account the following considerations raised by ATSIS. At the time of the previous audit, the NAHS program reported program objectives, specified resources and five performance indicators, including a performance indicator for employment and training. From the commencement of NAHS Round 2 in 2000, employment and training objectives were retained at the project level but employment and training performance indicators were removed at the program level. This reflects ATSIS' view that external performance information under the new Commonwealth outcomes and outputs framework should focus on elements that directly contribute to the performance of the output and respective output group.

More broadly, the ANAO considers that the current level of aggregation of NAHS program reporting makes it difficult to identify the particular contribution that the NAHS program makes in improving services to Indigenous communities.

The NAHS program is a sub-program of ATSIS' Community Housing and Infrastructure Program (CHIP), which, in turn, is part of Output Group 3—Improvement to Social and Physical Wellbeing. Elements of CHIP contribute across several outputs and the performance measures used by ATSIS are not specific to measuring NAHS program outcomes; rather, they report on the
aggregated performance of activities/sub-programs under the CHIP. The current level of aggregation of ATSIS' performance reporting of the contribution of CHIP elements does not easily allow external stakeholders to identify the contribution of sub-programs such as the NAHS program to the performance of outputs.

In 2002–03, NAHS program capital projects represented 45.1 percent, or approximately $91.3 million, of the total grants and other funding support provided by ATSIS for infrastructure and housing. In consideration of the significant contribution of the NAHS program to the CHIP, the ANAO suggests that ATSIS, at the next available opportunity, consider ways to improve the external performance reporting of the NAHS program. This would allow stakeholders to better understand the contribution of the NAHS program to the performance of outputs and would supplement the higher-level aggregated information currently provided in the annual performance reporting.

The ANAO made no further recommendations in this follow-up audit.

ATSIS' response

ATSIS' response to this follow-up audit can be found in full at Appendix 3 of this audit report. A summary of ATSIS' response is below:

The audit findings in respect to progress in implementing the recommendations of the 1999 NAHS Audit are considered fair and reasonable and therefore accepted by ATSIS.

Furthermore, the audit findings and observations will be useful in improving aspects of the next round of NAHS projects which are scheduled to commence in 2004-05 financial year.