The Australian National Audit Office (ANAO) recently completed an audit to assess the arrangements established by the Department of Education and Training to monitor the impact of Australian Government school funding.
While much of the media coverage of the Report focussed on its findings in relation to the distribution of funding within systems this was not the only area which was considered. The report also looked at whether the information provided by approved authorities to account for funding is appropriately verified and the processes the Department has in place to monitor the implementation of the reform directions and key policy requirements established under the Australian Education Act 2013 (the Act).
In assessing whether the information provided by approved authorities to account for funding is appropriately verified the ANAO looked at the verification processes around the Financial Questionnaire and Acquittal Certificates provided by all approved authorities. It noted that the assurance obtained by the Department from the acquittal certificates process is primarily based on self-reporting by authorities, with no independent verification of the information provided beyond checking the professional status and credentials of a sample of the accountants who verify the certificate.
While there are more robust verification processes in place in relation to the Financial Questionnaire they are still based on a largely random sample, despite a 2015 review indicating that this was an inappropriate basis for selection and recommending that the Department’s approach to selecting the sample for the verification exercise could be improved by adopting a risk-based approach informed by data analytics.
Even on this non-risk based approach errors were found in an average of 25% of schools verified in the 2013-2015 years being reviewed. Worryingly these rates were considerably higher in non-systemic schools as can be seen in the chart to the right.
The Department’s response to the Report indicates that it ‘is actively working to enhance its risk-based approach to monitoring and assurance activities to ensure compliance with requirements under the Act.’ As part of these changes they have indicated that they are ‘progressively implementing the recommendations of the recent review of the financial questionnaire, including through data collection enhancements in high risk categories reporting on 2017 funding.’
The ANAO also reviewed the monitoring of the ongoing the ongoing policy requirements that all approved authorities must comply with as a condition of funding found in section 77 of the Act. As schools would be aware the Department uses compliance certificates prepared by authorities to monitor the implementation of these obligations. The ANAO concluded, however, that weaknesses in administrative arrangements for these certificates limit the assurance obtained. In particular, the inconsistent follow-up of reported non-compliance; the heavy reliance on self-reporting in the absence of targeted verification activity; and the absence of evidence to demonstrate compliance limit the usefulness of the certificate process. They also noted that the questions that are included in the compliance certificate do not address all aspects of the ongoing policy requirements established under the Act.
The question within the compliance certificate that generated the highest level of non-compliance over both years reviewed related to the implementation of the Australian Teacher Performance and Development Framework. This provides a timely reminder for schools to consider their own compliance with these requirements.
The Department has acknowledged the limitations of the current compliance certificate arrangements and advised the ANAO that it is exploring options for making the compliance certificate process compulsory from 2018. Schools should expect more rigorous monitoring in this area.
The report was also critical of the accountability and outcomes regarding the Students First Support Fund. This fund was established by the department during negotiations between the Australian Government, the Associations of Independent Schools and the Catholic Education Commissions on school funding arrangements in 2013. The fund provided $165 million over four years as implementation funding to non-government representative bodies (NGRBs), of which $55 million was provided to the Catholic Education Commissions and $110 million to the Associations of Independent Schools. According to the ANAO –
‘The review of the fund found that funds had been largely absorbed into existing initiatives rather than allocated to support implementation of national reforms. Consequently, the review concluded that the department had been unable to provide assurance that the funding provided through the fund had been expended in line with the Government’s reform priorities for education. The review did find, however, that the Students First Support Fund had provided a significant stimulus to enable NGRB’s to implement a set of school support strategies, including professional learning opportunities, consultancy advice and coaching and mentoring services.’
Additionally they found that the Department ‘undertook minimal monitoring of the manner in which funds were used or reported and the outcomes achieved by NGRBs. Further, no baseline data was collected by the department to help evaluate the success or otherwise of the program.’
A full copy of the report can be downloaded from the ANAO website here.