9.29 At the national level, as part of its internal performance management activities, Centrelink produces performance reports on various aspects of its operations, including breaching.
Centrelink advised that:
Performance against the BPAs has been reported to the Centrelink network, Area Managers, monthly via the National Scorecards. Performance against the breach KPIs is reported against the Client partnership Outcomes section of the scorecard.
Lower level reports against KPIs were also produced monthly and circulated to the Area Activity Test Coordinators. This included:
• KPIs for Activity Test measures (FaCS BPA), and
• Breach KPIs (DEWRSB BPA)
(Centrelink advised that these lower level reports have not been produced since the first half of 2001, but the relevant performance information is now made available to Centrelink staff on the Centrelink intranet.)
9.30 Relevant Centrelink staff were also provided with reports comparing performance outcomes for their area and local office with national averages.
9.31 As noted above, the balanced scorecard reports appear to contain no commentary on breach indicators to indicate the performance emphasis.
However our examination of a sample of the lower level, monthly report on DEWRSB breach indicators identified a number of concerns, in terms of the performance emphasis.
• The reports based on the 1999/2000 DEWRSB indicators do appear to show that the indicator relating to the proportion of possible breach notifications which lead to an actual breach penalty was being viewed as a performance requirement for Centrelink and not simply a measure designed to improve job network provider performance.
For instance, the April 2000 report includes the following commentary:
Information contained in Table 2 provides details of Centrelink’s performance against part one of the Key Performance Indicator (KPI), the requirement for Centrelink to ‘achieve an initial applied rate of 60% for all possible breach notifications determined’. For April, Centrelink achieved an initial applied rate of 56.0%, which is equivalent to March’s result and equals the highest achievement for the financial year. The delivery of breach training to JNMs plus the implementation of guidelines to assist both Centrelink CSOs and JNMs in the breach process should help Centrelink achieve target in the near future.3
• There is a strong emphasis in the commentary on the need for Centrelink to
“improve breach performance” by increasing the proportion of breaches applied.
3 (Bolding and underlining added)
• Reports against the previous indicator on the timeliness of breach processing (80% completed within 10 days) include an emphasis on maximising those processed within 7 days and the “performance improvement” indicated appears to be driven by an emphasis on this very quick turnaround of breach decisions. There is a significant risk that this was achieved through shortcuts in the investigation process.
9.32 Copies of the “DEWRSB Monthly Reports - Breach Outcomes” are provided for information at Attachment C.
Conclusion
9.33 It is possible that the inappropriate design of the former DEWRSB KPIs relating to breaching and associated performance management activity within Centrelink contributed to some Centrelink staff adopting inadequate investigation practices when considering breach decisions. Those performance management practices appear to have been in place over the period from late 1998 to early 2001. That period coincides with the substantial rise in the incidence of breach penalties. As discussed in Chapter 6 this performance emphasis may have been reinforced by some of the training and guidelines provided for Centrelink staff.
9.34 The appropriate application of breach penalties can have an important impact on the effectiveness and efficiency of employment assistance programs such as the job network. It is important that job seekers are encouraged to cooperate and comply with measures designed to improve their prospects of employment. It is also important that job network providers, who provide reports to Centrelink on possible breaches, can be confident that those reports will be actioned promptly and appropriately. However, policy responsibility for breaching lies with FaCS and it would, therefore, seem appropriate that any performance indicators for
Centrelink relating to breaching should appear in the FaCS/Centrelink BPA rather than the DEWR/Centrelink agreement. FaCS should ensure that any performance indicators relating to breaching are appropriately specified and take into account DEWR concerns in relation to the effective operation of employment assistance programs. Indicators should be designed to ensure a balance of
timeliness/quantity and accuracy/quality considerations, with an overriding
requirement for any actions and decisions to be in accordance with the legislation and principles of procedural fairness.
9
Recommendations
R28 Performance indicators for Centrelink relating to breaching should appear in the FaCS/Centrelink BPA rather than the DEWR/ Centrelink agreement.
(FaCS should consult with DEWR to ensure that their interests, in relation to the processing of advices from employment service providers about
possible breaches, are adequately addressed.)
R29 FaCS should ensure that any performance indicators relating to breaching are appropriately designed and specified. Indicators should be designed to ensure a balance of timeliness/quantity and accuracy/quality
considerations, with an overriding requirement for any actions and decisions to be in accordance with the legislation and principles of procedural fairness.
R29.1 As an interim measure, FaCS and Centrelink should agree on a measure of the quality of breach decision making (based on sample testing against defined investigation and decision making standards) to be reported in conjunction with the current breach timeliness indicator.
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Abbreviations
AAT Administrative Appeals Tribunal
ACOSS Australian Council of Social Services ARO Authorised Review Officer
BPA Business Partnership Agreement CEO Chief Executive Officer
CES Commonwealth Employment Service DEWRSB Department of Employment Workplace Relations
and Small Business
DEWR Department of Employment and Workplace
Relations
FaCS Department of Family and Community Services
Independent Review The Independent Review of Breaches and Penalties in the Social Security System
KPI Key Performance Indicator NSA Newstart Allowance
ODM Original Decision Maker
SSAT Social Security Appeals Tribunal
the Act The Social Security Act 1991
the Administration Act The Social Security (Administration) Act 1999 YA Youth Allowance
Appendix 1
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