On 17 November 2009, the NSW Auditor-General, Peter Achterstraat, released Volume Six of the Audit Office’s reports to Parliament for 2009. The report covers the agencies now under the Super Department of Human Services as well as the now Department of Services, Technology and Administration.
In filing his report, Achterstraat said “the Departments of Community Services, Ageing Disability and Home Care, the Home Care Service of NSW and NSW Business Link all have some weaknesses in accounting processes and controls that I have raised for a number of years”. “These need to be addressed promptly”, he added.
Among the deficiencies he noted were ‘problems with grants administration at the Department of Ageing Disability and Home Care (DADHC) which issued $48 million in grants to non-government organisations without proper agreements, increasing the risk of agreed services not being provided and unspent money not being returned’. In the 2009-10 Budget, DADHC was allocated $3.7m in capital expenditure for the ongoing development of its client information system (Phase 2). This ongoing project has been allocated $7.4m to date, according to Intermedium’s budget tracking tool, Budget IT.
With the identification of this deficiency in the Auditor-General’s report, it is possible that remedying this problem will become a NSW Department of Human Services priority in 2010-11.
DADHC is not alone in struggling with effective grants management. It has caused many agencies at state and federal level considerable anguish over time.
The Department of Finance and Deregulation, commissioned Strategic Review of Administration of Australian Government Grant Programs which was undertaken by Peter Grant, PSM, a retired senior public servant (and not the Peter Grant who has been Queensland Government CIO). The report was presented in October 2008.
It found amongst other things that:
- ‘Grant programs vary widely in their form, scale and degree of complexity’;
- ‘There is no single, comprehensive source of data on the number of individual grant programs, the number of grants awarded or the total scale of grant program funding across the Commonwealth’;
- ‘More than 49,000 ‘discretionary grants’ were approved in calendar year 2007 under some 250 separate funding programs, to a total value of more than $4.5 billion;’
- ‘Both the number and value of discretionary grants awarded have grown strongly in recent years – from fewer than 4,000 grants with a total value of about $580 million in calendar year 2000 to around 49,000 grants with a total value of $4.5 billion in calendar 2007;’
- ‘The Australian National Audit Office (ANAO) has conducted more than twenty performance audits of grant programs since 2004–05. Many of these audits have raised significant issues going both to the overall framework for the administration of grant programs and to the quality of administration of individual programs’.
With regard to improving efficiency in grant administration, the report found that:
- ‘There are now some 250 separate discretionary grant programs across the Commonwealth, each with its own program guidelines, advertising budget, selection and assessment procedures, funding agreements, payment and acquittal arrangements, monitoring and assessment procedures, and associated administrative costs. On the surface, at least, many of these programs appear strikingly similar in their stated purposes and intended target groups’.
The report also focused on the IT systems used for grants administration:
- ‘A Finance survey conducted early in 2006 found that there were at least 164 separate grant management systems in operation across the Commonwealth, with four agencies accounting for no fewer than 115 separate systems. There were also clear limitations on the functionality of these systems: for example, most agencies advised that they were unable to obtain consolidated management information across different grant programs without significant manual effort.’
At the time of the review, the Gershon Review was just underway. When tabled, the Gershon Review stated:
“The number of grants management systems (GMS) used by FMA Act agencies has declined from 150 to 124 since 2006. Some of this decline could be accounted for by agencies rationalising the number of systems they use. The overwhelming majority of systems are still paper based, Excel or custom developed and manage discrete, stand alone grant programs. The survey data showed that the number of commercial off the shelf products has increased. However, operating expenditure on grants systems is relatively concentrated. Only three agencies reported GMS spend exceeding $1 million per year, with the largest spend being $10.6 million per year. Given the overall limited spend on GMS (0.7% of total ICT spend in 2007–08) there does not appear to be any substantial opportunities for whole of government action in regard to GMS that would have a significant impact on overall ICT spend.”
Clearly from these two reviews, it is apparent that the grants management field is one that is far from mature and contains disparate elements, as described by Peter Grant. This lack of homogeny may help explain the plethora of grants management solutions being offered (and adopted) in the grants management space.
The solutions range from relatively new entrant Software as a Service (SAAS) offerings to major ERP solutions. A number of software companies all list grants management offerings, many of them based on existing Customer Relationship Management or Case Management platforms.
At the Federal level, DEEWR implemented its School Education Management Information System (SEMIS) based on Adobe products; FaHCSIA implemented its Online Funding Management System based on a Siebel platform and the NHMRC's new Research Grants Management System is based on CA Pacific’s Clarity solution.
So the question remains – whither DADHC?