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Vic Auditor-General identifies potential telco savings

by Sam Murphy •
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Victorian Auditor-General, John Doyle, has found inadequate oversight of telecommunications spending means agencies are missing out on potential savings on telecommunications services.

The audit, Managing Telecommunications Usage and Expenditure, examined telecommunications spending on fixed voice and mobile services at Victoria’s three highest spending agencies, Victoria Police, the Department of Human Services (DHS) and the Department of Justice (DOJ).

In 2011-12 the total expenditure on telecommunication services was $53 million, of which Victoria Police accounted for $6 million, while DHS and DOJ accounted for $3.5 million each.

The audit found that while the agencies have achieved some savings by more actively managing their telecommunications spend, none of the three have agency-wide oversight of telecommunications expenditure and they lack clear processes to manage invoice verification and to minimise waste.

Doyle wrote “these weaknesses reduce assurance over the effectiveness of existing arrangements and have impeded the management of key cost drivers including redundant services and excessive personal use.”

The key areas identified for potential savings are improving invoice management, minimising redundant lines, accessing the best available call and data rates, and managing excessive personal use of mobile phones.

Invoice management systems have a clear benefit for agencies. While DHS uses an electronic Mobile Phone Paying System (MPPS) to oversee mobile telecommunications invoicing and spending, Victoria Police and DOJ do not have agency-wide systems in place.

DHS saw declines of 29% on mobile call and data expenditure from 2008, by contrast DOJ and Victoria Police recorded increased spending by 61% and 45%, respectively, over the five years.

Agencies have also been spending unnecessarily on unused fixed voice lines according to the report. Expenditure on fixed voice services was steady or had decreased for DHS and Victoria Police, however DOJ’s spending had risen 39%, which the A-G attributed the lack of agency-wide bill management.

In October 2012, the Department’s Built Environments and Business Sustainability (BEBS) unit requested inventory records to review their fixed voice and mobile services. They found that while they were being charged for 144 fixed voice services, only 51 were active lines being used by BEBS.  “It is not known how long this situation existed before the review or what the total cost implications have been,” the report said.

DOJ was also found to be overspending on mobile data due to a failure to identify the most cost-effective plans. In February 2013 only 6.4% of the mobile data allowance was being used, after users were upgraded to a 4.5GB plan in June 2012. Potentially the agency could have saved $24,000, had it more actively monitored usage and remained on the original plan.

Additionally, agencies were found to be inadequately managing personal usage of mobile phones by employees. Neither DHS nor DOJ ensure that employees declare their personal mobile usage, nor do they systematically reconcile declared personal usage to reimbursed amounts making it difficult to determine if personal use has been reimbursed.

Doyle recommended a number of measures to be taken to ensure future savings, including:

  • Establish systematic agency-wide overview of mobile and fixed voice services;
  • Develop clear guidance on the usage of mobile phones;
  • Optimise value for money by regularly monitoring and managing call and data plans; and
  • Regularly monitor fixed voice and mobile usage and cancel unused services.

The Auditor-General’s recommendations were accepted by all three agencies.

View DHS profile in GovFacts >>>

View DOJ profile in GovFacts >>>


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  • VIC
  • Telecommunications
  • Human Services
  • Justice
  • Victoria Police
  • Victorian Auditor-General
  • Victorian Department of Human Services
  • Victorian Department of Justice