Chapter 2Review of selected annual reports
2.1Standing Order 25(20)(b) provides for the committee to consider selected annual reports in more detail. This chapter examines the following reports:
Education portfolio
Department of Education; and
Australian National University
Employment and Workplace Relations portfolio
Department of Employment and Workplace Relations; and
Office of the Fair Work Ombudsman
Education portfolio
Department of Education
2.2The 2023-24 Annual Report for the Department of Education (department) was tabled in the Senate on 28 October 2024.
2.3In the secretary's review, Mr Tony Cook PSM reflected on the major reviews that had been highlighted in the previous year's Annual Report and noted that they have all been delivered to the Australian Government (government):
The government’s reform initiatives stemming from these reviews provide the department with a strong direction to support our ministers and the government in their goal to create a better and fairer education system for all Australians.
…
In 2023–24 the department started to respond to initial elements of the reviews, and began work on implementation of the recommendations agreed to by the government, including the necessary future policy reforms that will also be required.
2.4Mr Cook also reported on the department's other key areas of work during the reporting period, which included:
beginning work on implementing recommendations from the major reviews delivered to the government;
implementing the Australian Government's Child Care Subsidy (CCS) reforms;
launching the Early Years Strategy in May 2024;
supporting the process to negotiate the Better and Fairer Schools Agreement and associated bilateral agreements between the Australian Government and all state and territory governments;
establishing a capital works fund to build or improve boarding facilities in central Australia for First Nations students;
providing $215.8 million as part of the Schools Upgrade Fund to 202 large capital works projects in government schools;
releasing three consultation papers to progress key areas of structural reform in the university sector;
releasing a draft International Education and Skills Strategic Framework for targeted consultation;
participating in the supported bargaining process for the early childhood education and care (ECEC) workforce sector;
continuing to support the implementation of the National Teacher Workforce Action Plan;
working with the states and territories to support pilots to reduce teacher and school leader workload pressures;
launching the national 'Be That Teacher' campaign in October 2023; and
establishing the Commonwealth Teaching Scholarships in November 2023.
Performance reporting
2.5As noted in its 2023-24 corporate plan, the department's purpose is to 'create a better future for all Australians through education'. The department measures its performance on delivering its purpose by reporting against two outcomes and 13 programs. The two outcomes are:
Outcome 1
Improved early learning, schooling, student educational outcomes and transitions to and from school through access to quality child care, support, parent engagement, quality teaching and learning environments.
Outcome 2
Promote growth in economic productivity and social wellbeing through access to quality higher education, international education, and international quality research.
2.6The department stated that it had made some 'non-significant' amendments to the four out of 25 of its performance measures published in its 2023-24 Corporate Plan. The changes to the performance measures related to clarifying of wording. The department also noted that during 2023-24:
… the department focused on refining its performance reporting processes and improving the analysis of factors that have contributed to the department’s performance in achieving its purpose. We reviewed our performance measures as part of the performance cycle, to ensure they remained appropriate for measuring and assessing our performance in achieving our purpose: to create a better future for all Australians through education.
2.7Additionally, the department's annual performance statements were audited for the third year by the Australian National Audit Office (ANAO). The department stated that it had taken the feedback from the ANAO into consideration when reviewing and refining its performance measures, processes, and analysis for 2023-24, as well as for future performance cycles.
2.8For this reporting period, the department measured its performance against 27 performance targets, however two of the performance targets do not have 2023–24 results as the department stated that ' the measures are establishing a new baseline for future reporting cycles'. The results for the performance targets under each outcome were:
Outcome 1: out of the 12 performance targets, eight were achieved, one was on track, one was not on track, and two were listed as not applicable due to new baselines being established in 2023.
Outcome 2: out of the 15 performance targets, 12 were achieved and three were not achieved.
2.9The performance target under Outcome 1 that was reported as not on track related to increasing the proportion of people (aged 20 to 24) attaining Year 12, or equivalent, or gaining a qualification at Certificate III or above. This performance measure is a new measure for 2023–24.
2.10The committee notes that the three performance targets under Outcome 2 that were not achieved during this reporting period were also not achieved in the previous reporting period. These performance targets relate to:
the proportion of employers who are satisfied with the skills of graduates (overall across all skills);
the proportion of international students employed or enrolled in further study after graduation; and
the number of students enrolled in offshore and transnational education and training delivered by Australian providers.
2.11The department noted that while it did not achieve these targets, the results 'did not represent a statistically significant year-on-year change' and in one of the measures the results had improved from the previous reporting period. The department also explained that the measure relating to the number of students enrolled in offshore and transnational education and training delivered by Australian providers, while it decreased on the previous year, the results from 2020 to 2022 were 'temporarily inflated' due to the impacts of border restrictions during the COVID-19 pandemic. The committee encourages the department to work towards getting these performance measures on track for future reporting periods.
2.12The committee looks forward to reviewing the results in the next annual report and commends the department on achieving majority of its performance targets for this reporting period.
Financial reporting
2.13During this reporting period, the department reported a net accounting gain of $1.3 million after adjusting for unfunded expenses. This is an improvement on the previous reporting period's financial results where the department reported a net accounting loss of $8.1 million. The department noted that in 2023–24, it 'continued to operate in an environment of strong financial discipline'.
2.14On behalf of the government, in 2023–24 the department administered 12 programs with expenses including $43.4 billion for programs under Outcome 1 and $12.1 billion for programs under Outcome 2.
2.15Overall, the committee considers that the department has met the reporting requirements and its 2023–24 annual report is 'apparently satisfactory'.
Australian National University
2.16The Australian National University (ANU) is a corporate commonwealth entity and educational institute first established by an Act of the Australian Parliament in 1946, and now established by the Australian National University Act 1991 (ANU Act). ANU tabled its 2023 annual report in the Senate on 25 June 2024.
2.17In his review, the now former Vice-Chancellor Professor Brian Schmidt reflected on the fact that this would be his last annual report he delivered as the Vice-Chancellor of ANU after eight years in the role:
There is no doubt that our University – and the entire Australian higher education sector has gone through several tough years, weathering natural disasters and the COVID-19 pandemic along with re-establishing our networks and connections across the world. The impacts of the pandemic are long reaching, and ANU continues in a phase of recovery as we grapple with the challenges of re-establishing our stability in a changed world. Underpinning this remains world-leading research to serve the nation, and a place to educate and inspire the best and brightest students in the world. Despite the challenges, our staff and students have been remarkably resilient, and I thank and acknowledge their ongoing support and commitment to recovery, especially in my final year as Vice-Chancellor.
2.18Professor Schmidt also reflected on ANU's key highlights during this reporting period which included:
the opening of a new student accommodation building, Yukeembruk;
welcoming back international students and returning to in-person learning;
hosting Her Royal Highness Crown Princess Victoria of Sweden;
hosting a Dialogue in partnership with 20 other universities in the lead up to the Voice to Parliament referendum;
opening the optical ground station at Mount Stromlo Observatory; and
many ANU academics being recognised for their accomplishments.
2.19Distinguished Professor Geneveive Bell AO has been appointed as the 13th Vice-Chancellor and President of ANU to replace outgoing Professor Schmidt. Professor Bell is the first female Vice-Chancellor in ANU's 75-year plus history.
Performance reporting
2.20ANU has four purposes in which it measures its performance against that include key activities and Key Performance Indicators (KPIs). The four purposes are:
Purpose 1 –Advancing and transmitting knowledge by undertaking research of the highest quality;
Purpose 2 – Advancing and transmitting knowledge by undertaking teaching of the highest quality;
Purpose 3 – Providing facilities for higher education purposes; and
Purpose 4 – Meeting the University’s obligations to the nation and Australian Capital Territory (ACT) through its status as a national institute.
2.21For this reporting period, out of the 10 KPIs that come under the four purposes, four were achieved, four were not achieved, and two are not assessed until 2025. Out of the four KPIs that were not achieved, one came under Purpose 1 for KPI two, two came under Purpose 2 for KPIs five and six, and one came under Purpose 4 for KPI eight (b). The KPIs are:
KPI 2: Category Normalised Citation Impact (CNCI);
KPI 5: Increase the number of commencing domestic undergraduate students from low Socio-Economic Status (low-SES), regional and remote backgrounds, and Indigenous Australians;
KPI 6: Maintain or improve overall graduate employment rates for domestic undergraduate students;
KPI 8 (b): Maintain existing and develop new partnerships with industry, government, and community organisations for the purposes of learning and teaching that benefits our students and staff.
2.22KPI 5 saw a decrease on results compared to 2022 with 16 less Indigenous students, 37 less Low Socio-Economic Statis (SES) students, and 114 less regional and remote students in the 2023 reporting period. ANU stated that 'several factors' may have caused this decline such as 'cost-of-living pressures and a strong job market' which ANU explained would result in students being reluctant to move interstate. The committee encourages ANU to work on strategies to attract and increase the number of commencing domestic graduates from these cohorts for the future.
2.23KPI 6 has consistently been improving with this year's result of 89.5 per cent being the highest over the last five years, however the target of 93 per cent is still not being reached. ANU noted that although its target has not been met:
… a higher percentage of ANU domestic undergraduate students enter further full-time study when compared with the sector. In 2023, 25 per cent of ANU graduates in this group, continued to further full-time study whereas across the sector over five years to 2022, this figure ranged between 19 per cent and 21 per cent.
2.24The committee commends ANU on improving its result and encourages it to continue working towards reaching its target in future reporting periods.
Financial reporting
2.25In 2023, ANU recorded an operating surplus, on a consolidated basis, of $135.3 million. In the previous reporting period, a deficit of $137.9 million was recorded which shows an improved result for 2023. ANU's total income has also increased for this reporting period from $1.225 billion to $1.623 billion.
2.26Overall, the committee considers ANU's annual report for 2023–24 to be 'apparently satisfactory'.
Employment and Workplace Relations portfolio
Department of Employment and Workplace Relations
2.27The Department of Employment and Workplace (DEWR) presented its 2023-24 Annual Report to the Senate on 31 October 2024.
2.28In the secretary's review, Ms Natalie James reflected on the work completed by DEWR in this reporting period, which included:
working with stakeholders to reform employment systems and workplace relations reform;
consulting with relevant stakeholders in designing employment support for First Nations people leaving the justice system, consequently informing the announcement of the Reconnection, Employment and Learning Program;
completing insourcing for DEWR to directly administer the Pacific Australia Labour Mobility scheme;
leading the delivery of the National Skills Agreement;
implementing a National Stewardship model to underpin strategic investment in skills priority areas;
establishing 10 industry-owned and led Jobs and Skills Councils to foster collaboration and change within the VET sector;
commencing the Strategic Review of the Australian Apprenticeships Incentive System, consulting with over 600 stakeholders across 89 engagements;
supporting the development and passage of the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023;
working with Commonwealth, state, and territory governments to outlaw the use, supply, and manufacture of engineered stone;
assessing program data through a gender lens to address inequalities in employment services;
working to strengthen women’s participation in the VET system through the Building Women’s Careers program;
introducing new targets for apprentices, trainees, and paid cadets through the implementation of the Australian Skills Guarantee;
supporting the establishment of the Net Zero Economy Authority as a statutory body; and
providing incentives for new apprenticeships in the clean energy sector through the New Energy Apprenticeships Program.
Performance reporting
2.29As noted in its annual report, DEWR's purpose is to ' support people in Australia to have safe, secure and well-paid work with the skills for a sustainable future'. DEWR measures its performance on achieving its purpose using three outcomes and five programs, of which there are 20 reportable performance measures with 27 targets. The three outcomes are:
Outcome 1
Foster a productive and competitive labour market through policies and programs that assist job seekers into work, including secure work, and meet employer and industry needs.
Outcome 2
Promote growth in economic productivity and social wellbeing through access to quality skills and training.
Outcome 3
Facilitate jobs growth, including secure work, through policies and programs that promote fair, productive and safe workplaces.
2.30In 2023–24, DEWR achieved majority of its performance targets with 21 achieved and six not achieved. Out of the six targets that were not achieved, four related to Workforce Australia performance measures and the remaining two related to workplace relations measures.
2.31The four performance measures that were not achieved that related to Workforce Australia are:
Number of registered Workforce Australia Digital Platform users who log in to the platform
Target: 1 500 000 unique users or more
Number of employers that lodge a vacancy through the Workforce Australia Digital Platform
Target: 16 000 unique employers or more
Proportion of Workforce Australia Services participants who achieve a 26-week employment outcome
Target: 15% or higher
Proportion of participants in work or study three months after exiting services
Target: a) Workforce Australia Online: 80% or higher, b) Workforce Australia Services: 60% or higher, c) Workforce Australia – Transition to Work: 60% or higher.
2.32DEWR explained that these performance measures are impacted by a range of factors including 'underlying labour market conditions'. For example, DEWR noted that lower than expected engagement with the Workforce Australia Digital Platform (WADP) is 'partly explained' by relatively low unemployment rates. Another factor that DEWR noted had influenced these performance measures is the downward trend in job vacancies since 2022.
2.33DEWR committed to improving on these performance measures through various strategies such as regular promotion of WADP through broadcast communication via DEWR's social media channels, website and newsroom and DEWR is also replacing one of the performance measures for 2024–25 to measure qualitative engagement rather than volume.
2.34The committee commends DEWR on achieving the majority of its performance measures and encourages DEWR to continue working towards achieving the measures that were not achieved in this reporting period in the future.
Financial reporting
2.35For the 2023–24 reporting period, DEWR reported an operating deficit on continuing operations of $184.8 million, which was against a budgeted deficit of $83.6 million. This is a greater deficit than what was recorded in DEWR's 2022–23 annual report.
2.36DEWR stated that total expenses in this reporting period were $38.7 million over budget, which it explained was mostly due to 'higher than anticipated Memorandum of Understanding revenue from the Department of Education'.
2.37Overall, the committee considers DEWR's annual report for this reporting period as 'apparently satisfactory'.
Office of the Fair Work Ombudsman
2.38The Office of the Fair Work Ombudsman (OFWO) is an independent statutory agency established by the Fair Work Act 2009. OFWO tabled its annual report in the Senate on 22 October 2024.
2.39In the Ombudsman's review, Ms Anna Booth reflected on it being near her one-year anniversary in the role as the Fair Work Ombudsman:
I am honoured to have been the Fair Work Ombudsman (FWO) for 10 of the 12 months covered in this report. As I approach my anniversary in the role, I am conscious that I couldn’t have done it without the support of my OFWO colleagues. I was embraced by OFWO from the outset and what they have taught me during this time has allowed me to think ahead about how I would like the OFWO to evolve. I have also appreciated the support I have received from the workplace community.
2.40Ms Booth also highlighted some of the significant achievements and key areas of work completed by OFWO in 2023–24, which included:
recovering more than $473 million in unpaid wages and entitlements for workers;
receiving 290 000 calls on OFWO's Infoline; and
providing 3000 pieces of tailored written advice through the Employer Advisory Service.
Performance reporting
2.41OFWO's purpose, derived from the Fair Work Act 2009, is to 'promote harmonious, productive, cooperative and compliant workplace relations in Australia'. OFWO measures its performance against its purpose using nine KPIs. OFWO noted that in 2024 it had reviewed its KPIs to ensure they accurately reflected the work it does, which resulted in some KPIs being retired and others 'amended or retained'. For this reporting period, OFWO achieved eight out of its nine KPIs. The committee commends OFWO on this result for 2023–24.
2.42The performance measure that was not achieved during this reporting period was KPI 8:
The OFWO will use quantitative data to demonstrate that we pursue litigation as an enforcement action in accordance with the OFWO’s Compliance and Enforcement Policy.
2.43OFWO calculates its performance against this measure by number of litigations filed, with a target of 65–75. For this reporting period, OFWO reported a result of 64 litigations filed, which is one lower than the target, but is a decrease on the previous reporting period's result of 81 litigations filed. OFWO noted that given the high number of litigations filed in the previous reporting period, several of them were still progressing through the Court in this reporting period. OFWO stated that it was satisfied that the number of litigations filed in 2023–24 was 'an appropriate and balanced application of this enforcement tool'.
2.44KPI 2 relates to OFWO providing high quality advice and assistance to its customers. OFWO undertakes ongoing surveys to determine customer satisfaction levels with the advice and assistance provided by OFWO through its Fair Work Infoline. This performance measure has a target of greater than 75 per cent of customers demonstrating a rating of satisfied or better. For this reporting period, OFWO recorded a result of 84 per cent, which is consistent with its result for the previous reporting period. The committee commends OFWO on again exceeding the target for this performance measure in this reporting period.
Financial reporting
2.45For 2023-24, the OFWO recorded a net cash operating surplus of $5.77 million.
2.46The OFWO provided an explanation on the major variances between the original budget estimates, as presented in the 2023–24 Portfolio Budget Statements and its actual financial position, performance and cash flows for the year. The major variances included the passing of the government's Fair Work Amendment (Closing Loopholes) Act 2023, buildings and leasehold improvements, and amortisation of computer software.
2.47OFWO noted that the government's Closing Loopholes initiative resulted in:
… higher than anticipated supplier expenses relating to additional information and communications technology requirements needing to be implemented quickly, offset by lower than anticipated employee expenses.
Appropriation receivable is higher than budget due to unspent appropriations including capital funding received as part of the Closing Loopholes initiative.
2.48Overall, the committee considers OFWO's annual report for 2023–24 as 'apparently satisfactory'.
General comments on other annual reports
Compliance indexes
2.49Annual reports are one of the principal accountability mechanisms of the PGPA Act, and the committee considers it vital that these documents be easily accessible and comprehensible for all readers. A compliance index (or list of requirements) is an important tool for accessibility.
2.50The PGPA Rule specifies a particular format for agencies to use when completing a compliance index. The committee encourages all agencies to avoid unnecessary deviation from this format, which it considers best practice.
2.51A compliance index should direct the reader to a specific page within an annual report in order to clearly indicate where a certain mandatory reporting requirement has been satisfied in accordance with the PGPA Rule.
2.52However, the committee identified that some compliance indexes instead contained references to whole sections, subsections, or chapters within a report rather than providing a specific page reference. For example, the Australian Skills Quality Authority, the Seafarers Safety, Rehabilitation and Compensation Authority, the Australian Curriculum, Assessment and Reporting Authority, Comcare, and the Coal Mining Industry (Long Service Leave Funding) Corporation either referenced whole sections or chapters of their annual reports rather than providing specific page references for each mandatory reporting requirement.
2.53The committee also noted that some compliance indexes included incorrect or incomplete page references. For example, Safe Work Australia gave a page reference of 'xx' for the requirement relating to small business (17AG(10)(a)) when there is no page 'xx' in its report and the information could instead be found on page 95.
2.54The committee strongly urges all entities to provide specific and accurate page references for each requirement to enhance readability and ensure overall compliance with the PGPA Rule.
Apparently satisfactory
2.55As noted in Chapter 1, the committee has examined all reports of the Education and Employment and Workplace Relations portfolios as 'apparently satisfactory'.
2.56The committee anticipates that the matters identified in this report will be rectified in future annual reports.
Senator Tony Sheldon
Chair
Senator for New South Wales