Independent News For The Australian Public Service
Edition Number 399. Updated Tuesday, 04 March 2014

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Agencies struggle with KPIs

The Australian National Audit Office (ANAO) has published its latest report on a continuing pilot program of auditing Key Performance Indicators across the Australian Public Service.

The report Pilot Project to Audit Key Performance Indicators reveals that shortcomings uncovered in the ANAO's 2011-12 pilot remained largely unresolved when the project was continued in 2012-13.

The 2011-12 Pilot said Agencies were still struggling to develop and implement meaningful KPIs and that the administrative support for developing and auditing KPIs remained problematic.

The report highlighted the key areas that needed work.

They included the suitability of one framework for all Agencies, without recognition of their varied activities; cross-Agency performance reporting, in which one Agency develops the policy initiative, but actual delivery of services is carried out by another Agency; and the development of intermediate objectives where an overall outcome can only be achieved over the longer-term.

Other areas that needed work included the development and implementation of "efficiency" indicators to complement the "effectiveness" indicator and the need for clear outcome statements and well defined objectives.

Shortcomings continue: ANAO

It also called for greater rigour within the framework to support provision of independent assurance over Agencies' performance measurement and reporting.

The 2011-12 Pilot also pointed out that there were multiple sources of policy and guidance, rather than a single reference document that consolidated the requirements for the Outcomes and Programs framework.

The audit report was examined by the Joint Committee of Public Accounts and Audit, which recommended that the Department of Finance and Deregulation, in consultation with the Australian National Audit Office, prioritise the review and update of the performance measurement and reporting framework.

It said a clear policy and guidance should be in place for the 2014-15 financial year that can be used by Agencies to produce auditable Key Performance Indicators.

The Committee also recommended that the Government reinforce the requirements for Agencies to incorporate specific performance monitoring, reporting and evaluation activities into the design and costing of their programs.

It said the Agencies should be appropriately funded for these activities and they should be monitored for implementation.

Completion of the pilot project has resulted in the development of a preliminary methodology to support ongoing audits of KPIs.

The full report can be accessed at this PS News link.

The Audit Team comprised Warren Cochrane, Natasha Brennan, Corinne Horton, Jennifer Hutchinson, Ben Nicholls, Claudia Shepherd, Michael White.

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