Part 3—Report on Performance

• Annual Performance Statement
• Financial reporting

Annual Performance Statement

Statement of preparation

I, Michael Manthorpe, as the accountable authority of the Office of the Commonwealth Ombudsman, present the 2019–20 Annual Performance Statement of the Office, as required under paragraph 39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). In my opinion, this annual performance statement is based on properly maintained records, accurately reflects the performance of the entity, and complies with subsection 39(2) of the PGPA Act.

Michael Manthorpe PSM
Commonwealth Ombudsman

2019–20 Performance Analysis

2019–20 has been a difficult year for Australia, and indeed across the globe. While the early months of the year seem in hindsight to have been benign, they were followed by terrible fires and then, of course, the COVID-19 pandemic.

Inevitably, the pandemic has impacted on the way in which we do our work at the Office of the Commonwealth Ombudsman (the Office). To some extent it has impacted on our performance of certain functions. Overwhelmingly, however, as is true of so many workplaces, we have adjusted and continue to deliver our diverse and important functions.

Indeed, as the months have gone by it has become clearer that the values of good administration which we uphold—such as the need for transparency, fairness, good communication, the right to complain about or seek review of unfavourable decisions, timeliness in service delivery, and lawful exercise of power—are more important than ever. Millions of Australians who have hitherto had limited engagement with Government services have found themselves in receipt of JobKeeper, JobSeeker or other assistance, so effective oversight and the provision of assurance about how services are delivered for the people of Australia is critical.

Despite the current circumstances, this report contains evidence of many positive achievements in 2019–20.

For 2019–20, we improved the way we measure performance and hold ourselves to account. We implemented a new performance framework to better measure our performance. Most importantly, we conducted surveys to seek feedback from both the people who complain to us, and the agencies and organisations we oversee, to objectively test our performance.

The results of these surveys were largely positive, reflecting the public’s confidence in our complaint handling service and agencies’ understanding of our impartiality and independence. Indeed, recognising the nature of our complaint handling role (i.e. that by the time a person comes to us they are already unhappy with a service or a decision), our powers (i.e. that we are limited by our statutory jurisdiction and we can generally only recommend change, not overturn decisions of agencies) and our engagement with agencies and organisations (to ask probing questions and to hold them to account), the results of the surveys were strong. People who complained to us were generally pleased with the outcomes we were able to help them achieve and the way we dealt with them. Agencies we oversee were positively disposed to our professional and constructive approach, while recognising our independence.

More broadly, an overall assessment against all of our performance criteria, including both quantitative and qualitative analysis, shows that we are providing an efficient, effective and accessible service to the public. A majority of the performance measures where a target was established were met. Reasons for missing the target in a minority of areas are described in the performance statement.

As we adopted a new performance framework this year, some measures establish a benchmark against which progress will be measured in subsequent years.

In our oversight role with agencies and organisations we are satisfied that we were able to influence improvements and systemic change in public administration. While harder to measure directly, we are confident we continue to maintain the confidence of Parliament, based on our regular engagement with parliamentarians, both directly and through the parliamentary committee system.

One performance target we were unable to meet in 2019–20 was the delivery of all of our Australian Aid activities, which were significantly curtailed by the COVID-19 travel restrictions. Prior to the pandemic, we were on track to provide 100 per cent of our activities. We are exploring options to continue to work with our International colleagues in a changed environment in 2020–21.

Although some of our activities and way of working might change during 2020–21, we look forward to another successful year.

Our performance framework— Outcome, Purpose and Objectives

This annual performance statement provides details of the Office’s performance against

pages 191-192 of the 2019–20 Portfolio Budget Statement (PBS) Outcome: ‘Fair and accountable administrative action by Australian Government entities and prescribed private sector organisations, by investigating complaints, reviewing administrative action and statutory compliance inspections and reporting’.

Pages 4-8 of our 2019–20 Corporate Plan outlined how we will deliver our outcome by:

• Providing assurance that the Australian Government entities and prescribed private sector organisations that the Office oversights act with integrity and treat people fairly.
• Influencing enduring systemic improvement in public administration in Australia and the region.

In 2019–20 we refined our performance framework, to better capture what we do, and what we achieve in our efforts to meet our outcome and fulfil our purpose. We now measure our outcome performance against five strategic objectives underpinned by seven specific performance criteria. The following framework describes the alignment of our outcome, our strategic objectives and our performance criteria.

Our 2019–20 Detailed Performance

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The table below outlines our end of 2019–20 financial year performance results.

Assessment of Performance Criteria One—We assist the public to resolve issues with agencies and organisations we oversee

Our Office has daily interactions with the public through various functions. While we receive occasional unsolicited feedback (both positive and negative), we did not have a firm grasp on what the public thought of our services. In 2019–20 we made the conscious decision to understand their perspective on our performance, and our effectiveness. We did this by seeking external assessment of our performance through surveys.

At the same time, we have continued work commenced in previous years to improve our internal business processes to enable us to better resolve issues for the public and the agencies we oversee.

Our quantitative data against our performance demonstrates public satisfaction level of between 66 per cent and 94 per cent.

Our Satisfaction Surveys

In 2019–20 we engaged Customer Service Benchmarking Australia (CSBA) to conduct a telephone survey of people who contacted the Office to make a complaint. Specifically, we wanted to know whether people were satisfied with our services and our independence.

Respondents were asked to provide their ratings and views on:

• overall satisfaction with their experience with the Office
• ease of dealing with the Office
• whether they trust the Office to act independently
• how likely they would recommend the Office to others
• several performance attributes.

Overall satisfaction with the assistance we provided in resolving issues with the agencies we oversee was 66 per cent. People who were also satisfied with our independence, an important hall mark of an oversight agency, was 76 per cent. Recognising that sometimes we are unable to achieve the outcome a complainant seeks—for example because the decision at issue was lawful—we consider that these results are strong. The survey did identify some issues where we can do better around timeliness, expectation management and clarity of communication and we will work on these issues in 2020–21.

In addition, we continued the existing surveys we have run for some years relating to three of our particular functions: user satisfaction with the quality of information provided by privatehealth.gov.au (overall satisfaction 72 per cent), our Private Health Insurance Ombudsman services (overall satisfaction 81 per cent) and our Defence Abuse program (overall satisfaction 94 per cent).

Continuous Business improvement

We also assess our performance through ways other than direct feedback. Improvements to our processes also contribute to us providing a better service to the public. For example, in 2019–20 we established an early resolution process for complaints recieved over the phone about Centrelink. This process allows staff to often resolve complaints about Centrelink in one phone call, leading to faster outcomes for people and greater efficiency. We will consider expanding this process to complaints about other agencies.

CASE STUDY

A complainant’s disability support pension (DSP) was cancelled as a result of a staff error and while seeking a review of this error they received an inheritance.

A trustee acting on behalf of the complainant contacted Services Australia however was unable to have the DSP payments reinstated, despite payments not being made in excess of 12 months.

As a result of the Office’s engagement with Services Australia during an investigation, the complainant’s circumstances were reviewed and they were back-paid over $45,000 for the entire period since their DSP was cancelled. Additionally, Services Australia provided feedback to the officer who made the initial error to improve future service.

Assessment against Performance Criteria Two—We are responsive to the public when they contact our Office

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One of the main functions of the Office is to receive and assess complaints and other contacts about the actions of Commonwealth Government and ACT Government agencies and prescribed private sector organisations we oversee. The Office established complaint handling service standards for each of the functions we provide, both to assess our performance and to give people who contact us a better idea of how long they can expect our processes to take.

This year, we were able to meet our service standards 88 per cent of the time, eclipsing the target listed in the PBS, 80 per cent. As part of our commitment to continuous improvement, we have established a higher target for 2020–21 of 90 per cent.

We are also continually seeking to improve the quality of our engagement with the public. During 2019–20, we completed a comprehensive suite of internal procedures on handling parliamentary complaints to provide greater consistency and guidance for staff. We also introduced a quality assurance process where monthly audits are conducted on closed parliamentary complaints, to ensure appropriate outcomes are being reached and procedures are followed. Quarterly reports are provided to the senior leadership group on these audits as well as feedback to staff managing complaints.

We are also looking for ways to improve our online engagement, through the use of ‘smart forms’ to streamline the complaint reporting process.

While there is always room to improve and we are committed to doing so, we are satisfied we have demonstrated we are responsive to the public.

Assessment of Performance Criteria Three—We improve public awareness of our role in influencing public administration and industry practice

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The Office is committed to providing high quality and professional service to members of the public. We are focused on timely resolution and providing regular, easy to understand information. As an oversight agency it is important that people are aware of our Office and our functions.

We measure our achievement of this this through total number of contacts with our Office, including complaints, enquiries or program specific matters, and website hits.

Contact with our Office is done through various channels, but mainly via phone and the website. In 2019-20 we had:

• 54,633 contacts via our phone, online, email and mail channels
• 1.2 million hits on the Commonwealth Ombudsman, ACT Ombudsman, VET Student Loans Ombudsman websites and Privatehealth.gov.au website.

These numbers establish a benchmark which we will use as a basis for measurement over the coming years. Growth in this number may indicate an increase in public awareness of our role and that we are effective in provision of consumer information.

In 2019–20 we also commenced work on a Channel Management Strategy, to improve public access to our services. It will include better identification of how the public would prefer to contact us, how we can most efficiently respond to them and what information people need to more effectively resolve their complaints.

CASE STUDY—COVID-19

In 2019¬20 as a result of COVID-19 we made some changes to our services for health and safety reasons.

After the pandemic began, we ceased all face-to-face contact with the public as part of our response, to ensure both the safety of our staff, but also that of members of the public.

We also introduced changes to our phone service. We reduced our phone hours to 9am to Midday AEST in response to the restrictions in place to contain the virus and the need for many of our staff to work from home. While the number of phone calls decreased following the reduced phone hours, we closely monitored our servicing and saw an increase in the proportion of complaints received online.

Performance Criteria Four—We influence improvements in public administration and practices of the agencies and organisations we oversee

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In 2019–20 we maintained the confidence of government agencies and private sector organisations we oversaw through report publishing and making recommendations to agencies and organisations.

Published Reports

During the 2019–20 financial year the Office published a number of reports relating to our activities. More detailed information about our report types and the ones we published is available on the Commonwealth Ombudsman and ACT Ombudsman websites.

We published three investigation reports, three relating to Defence’s policies for receiving and responding to reports of abuse, the historical administration of military retirement schemes, and the actions of the NDIA to support a person transitioning out of prison. All fourteen recommendations in these reports were accepted.

We published our Immigration Detention Monitoring Report which draws on observations from our inspections of immigration detention centres, as well as other aspects of the Office’s oversight, including handling complaints and assessing the circumstances of people in long-term detention. We made sixteen recommendation in this report of which fifteen were accepted.

We also influence law enforcement and investigatory agencies’ compliance with relevant legislation on their use of certain covert and intrusive powers, by inspecting and reporting on their activities. Where appropriate, we make recommendations for improvement. In 2019–20 we made five formal recommendations to agencies, along with a number of further suggestions for improvement. While we do formally seek a response to our recommendations, we monitor and report on action taken to implement our findings at subsequent inspections.

The Office also makes recommendations to the Department of Defence for Defence Abuse Reparation payments, and to the Department of Education, Skills and Employment (DESE) for VET Student Loan re-credits. Close to 100 per cent of all recommendation were accepted across both agencies. This was a positive result for the members of the public who contacted our Office in relation to these functions and demonstrated the confidence these agencies have in our work and the recommendations we provide. In addition to our recommendations on individual matters, we also provided analysis and support for Secretary Initiated Actions (SIA), which allowed the Secretary of DESE to re credit groups of students.

Through our public reporting, investigations and program delivery, as well as less formal engagement with agencies and organisations, the Office seeks to influence agencies and organisations towards continuous improvement.

This year too we conducted an investigation into whether recommendations we had made to agencies in earlier reports had been implemented by them. Although, at the time of writing, the report from this project has not been published, it reveals that the overwhelming majority of our recommendations are implemented, in whole or in part, over time.

Assessment of Performance Criteria Five—We are responsive in our dealings with agencies

The Office has daily interactions with the agencies and organisations we oversee, so it is important to understand their perspective on our performance. We assessed our performance against this criteria through:

• an agency satisfaction survey
• our timeliness of our oversight reports to agencies
• our engagement and education functions

Agency Satisfaction Survey

In 2019–20 we commissioned Market and Communications Research (MCR) to undertake surveys with representatives of the 15 Australian Government entities and private sector organisations with which we interact the most.

Respondents were asked a series of questions to assess their satisfaction levels with the quality of our work and to identify potential areas for improvement and innovation. This was the first time we had sought feedback from agencies against our whole of agency performance and results were largely positive.

Agency and organisation representatives described our Office as operating in a proactive, transparent and effective way when interacting with them. Importantly, agencies and organisations understood and respected our independence, while still describing our relationships as open and collaborative.

Our staff were described as being competent and knowledgeable. Our positive impacts on systemic, policy and governance issues were recognised. The survey confirmed we have strong standing among the agencies with whom we engage.

There were some opportunities for improvement identified through the survey, including being more timely in communicating the outcomes of our investigations with agencies. We are considering ways to improve in 2020–21 on our processes for requests for information from agencies and our accessibility. We will conduct another agency survey in early 2021 to assess our performance and monitor our improvements.

Reporting to agencies on the results of oversight activities

The Office has set targets to provide our reports on law enforcement and immigration detention oversight activities to agencies. In 2019–20 we were not as timely as we would like, only meeting our target deadline in 60 per cent of cases against a target of 85 per cent. The Office was impacted by significant staff attrition towards the end of 2019, although made significant progress in reducing the backlog between 1 April and 30 June 2020.

For 2020–21, we will take steps to address our performance, including through streamlining of reporting processes.

Education and Engagement

In 2019–20 the Office delivered a number of education and other stakeholder events. We sought feedback from participants through formal surveys on participant satisfaction. Across the Office, we achieved 98 per cent satisfaction rating with 719 of the 733 participants attending various education or outreach events being satisfied with the event. The Office did not conduct any education or outreach events from February 2020 due to COVID-19.

Some of the education and other events we delivered or facilitated included:

• Oversight of Coercive and Intrusive Powers Forum
• ‘Better Practice in Managing Complaints' workshops
• Public Interest Disclosure forums
• ACT Freedom of Information (FOI) practitioner forums.

We are re-focusing our activities to virtual stakeholder engagement and education in 2020–21. To support this, we have commenced the development of web based content as we look for options to continue our outreach. Two avenues where we feel we can continue to connect with agencies is through webinars and podcasts and work is underway to deliver our first webinar in August 2020.

CASE STUDY Best Practice Complaint Handling Project

During 2019–20 we worked with agencies to assess complaint handling best practice, as part of our Complaint Assurance Program. It is a collaborative process involving the agency to complete a self-assessment, the Office assessing a sample of complaints and then providing feedback to the agency on our findings.

The report on the results can be found here. The CAP received positive feedback particularly in relation to our self-assessment tool.

"I think the document was very straightforward and allowed us to discuss a number of facets of our work that might not have been top of mind. It was helpful to spend some time dissecting our role in terms of the larger departmental view. I think it’s easy for us to get wrapped up in our operational issues and the day to day emotions that the unit deals with. It has been beneficial to re-evaluate and clarify our role." Agency representative

We also continue to work with agencies to increase awareness of, and provide education about compliance requirements including reviewing and providing advice to agencies when developing new policies, procedures or templates. In certain circumstances we also help entities solve difficult disputes. An example of this is our effort in May 2020 to address an emerging issue between a large hospital group and a group of private health insurers. In accordance with our powers as the Private Health Insurance Ombudsman, we arranged voluntary mediation for a contract dispute between these parties, and they were able to subsequently reach agreement. This is a positive outcome for the close to 2 million consumers who were at risk of being negatively impacted by failed contractual arrangements between the parties.

Assessment of Performance Criteria Six—We effectively delivered our capacity building programs for the Ombudsmen and allied integrity bodies under the Australian Aid Arrangements

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Our Office works with our peers across the Pacific region and Indonesia as part of our capacity building programs under the Australian Aid arrangement. We currently have partnership arrangements with:

• Ombudsman Commission Papua New Guinea (OCPNG)
• Ombudsman Republik Indonesia (ORI)
• Ombudsman Office of the Solomon Islands (OOSI) and the Leadership Code Commission (LCC)
• Ombudsman Office of Samoa (OOS) and the Samoa Audit Office (SAO)

Our international partnerships with our Ombudsman peers, particularly in Papua New Guinea and Indonesia, represent two of the longest continual Australian Government partnerships in any thematic area supported by Australian Aid arrangements. Our partnership with Indonesia has been active for the last 20 years, and our program with Papua New Guinea has been one of the most enduring partnerships of its type.

Our International activities are developed closely with our International peers. They are developed based on a shared understanding of need and are respectful of cultural requirements which can impact on activity timing.

Our activities with our partners are developed according to the following criteria—needs based, cost effective, maximum.

The activities delivered in 2019–20 included:

• Monitoring and evaluation visit to Port Moresby, Papua New Guinea
• Senior leadership engagement in Jakarta, Indonesia
• Complaint handling system project/workshop in the Solomon Islands

During the 2019–20 financial year a total of 43 activities were due to be delivered across our international programs between 1 July 2019 and 30 June 2020. Prior to COVID¬19, we were on track to deliver 100 per cent of our outcomes across the Pacific region and Indonesia.

COVID-19 curtailed our activities, many of which involve international travel. Overall, we delivered 18 activities but were unable to deliver 25 activities planned for the second half of the year. We have already commenced work with our peers to consider how we might continue to engage and provide support in a significantly changed international context.

Assessment of Performance Criteria Seven—We maintain the confidence of the Parliament

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Maintaining the confidence of Parliament is hard to measure directly. While we do not survey parliamentarians on our performance directly, we use proxy indicators such as our delivery of legislatively required reports to Parliament, and the extent to which parliamentarians seek our assistance with their work by inviting submissions and appearances before inquiries. We consider that continued requests for our advice and insight is a useful indicator that we maintain the confidence of Parliament.

While COVID-19 has impacted the Office’s ability to carry out certain functions (i.e. physical inspections of some law enforcement agencies), we have used the opportunity to prioritise the completion and submission of a back-log of reports. We anticipate further improvement in 2020–21.

Reports

In 2019–20, the Office published 41 reports covering a breadth of topics. These reports include investigation and oversight reports, quarterly updates on various functions and reports on our inspections of immigration detention and law enforcement powers. See our websites for more information on the reports we published during 2019–20.

As an oversight agency, we understand the importance of timely advice and recommendations. Some reports have a legislative deadline, and we met 100 per cent of these deadlines in 2019–20. For other reports, the statutory deadline is ‘as soon as practicable’ after a given date. We have set ourselves the target of providing these reports within six months of that date. We recognise that we have some further work to do, with only three of 11 reports delivered to Parliament in 2019–20 within six months. Staff attrition in late 2019 was a contributing factor, although recent recruitment has assisted us to reduce the backlog of outstanding reports in the final quarter of 2019–20.

Submissions and inquiries

In 2019–20 we made 21 submissions to and appearances before Parliamentary committee processes (both the Australian Parliament and the ACT Legislative Assembly). These appearances and submissions speak to both our enduring role and the value parliamentarians place on our impartial advice across a very diverse array of subject matter. For example, we made submissions or engaged in hearings or briefings on topics as diverse as the planning arrangements used by the National Disability Insurance Agency, matters pertaining to Centrelink debts, our oversight of the Australian Federal Police and other law enforcement agencies’ use of covert powers, the operation of the Public Interest Disclosure Act and various pieces of legislation in which our Office has an interest.

Financial reporting

In 2019–20 the Office recorded an operating surplus of $0.7 million, compared to operating surplus of $1.4 million (excluding depreciation, amortisation and write down of assets, and including principal payments on leases) in 2018–19. The 2019–20 operating surplus was broadly consistent with the balanced outcome estimate reported in the 2019–20 Portfolio Budget Statements.

Expenses

Total expenses increased from $43 million in 2018–19 to $48 million in 2019–20. This increase was mainly due to the additional contractor and support costs incurred for the measure improving integrity of the Vocational and Education Training System.

Income

Appropriation revenue increased from $39.1 million in 2018–19 to $42.4 million in 2019–20, an increase of $3.3 million. This was due to the additional funding received for:

• the VET Student Loan Ombudsman function, including the new measure, net increase of $4.9 million
• the NDIS Participant Service Guarantee—monitoring timeline performance, an increase of $0.5 million.

This was offset by decreased funding for:

• the Private Health Insurance Ombudsman ($0.8 million)
• the Defence Force Ombudsman ($0.8 million).

Rendering of services revenue of $4.2 million is consistent with the 2018–19 outcome. This mainly consists of revenue received from the ACT Government ($3.0 million) and the Department of Foreign Affairs and Trade ($0.7 million).

Assets

Total assets increased by $10.2 million, mainly due to:

• implementation of AASB 16 Leases, recognition of Right of Use asset (net increase $10.7 million)
• acquisition of leasehold improvements, plant and equipment and computer software classes, ($1.0 million), which was offset by depreciation and amortisation ($1.6 million)
• revaluation of the asset classes leasehold improvements and plant and equipment (net increase of $0.1 million).

The Office acquired $1.0 million in new assets in 2019–20, funded through the departmental capital appropriation and the operating surplus. This included new ICT infrastructure, purchase of new software, refurbishment of offices and enhancements to core existing ICT systems. Assets were checked for impairment, a stock take undertaken during the year to ensure completeness and asset classes leasehold improvements and plant and equipment were revalued as at the 30 June 2020. Assets are maintained and kept in good working order by the Office.

Liabilities

Total liabilities increased by $4.6 million, which was mainly due to:

• implementation of AASB 16 Leases, recognition of leases as a liability (net increase $9.4 million)
• trade creditors reduction ($5.0 million)
• employee provisions increase ($0.2 million).