NSW councils need better reporting, says Auditor-General

The NSW Auditor-General has released a major new report which says that councils in the state are not doing a very good job when it comes to reporting on how they deliver services. It is the first such report the Auditor-General has released.

“Councils could do more to demonstrate how well they are delivering services in their reports to the public,” said NSW Auditor-General Margaret Crawford.

“Many councils report activity, but do not report on outcomes in a way that would help their communities assess how well they are performing,” she said, releasing the report on .Council reporting on service delivery’.

“Most councils do not report on the cost of services, making it difficult for communities to see how efficiently they are being delivered. And councils are not consistently publishing targets to demonstrate what they are striving for.”

The report recommends that the Office of Local Government (OLG), the regulator of councils in New South Wales, should issue additional guidance to councils to help them report better. “OLG should develop a performance measurement framework – with associated performance indicators – to support more transparent and informative reporting.”

The report also recommends OLG work with NSW Government agencies to help streamline and consolidate local government reporting requirements.

“While councils report on outputs, reporting on outcomes and performance over time can be improved. Improved reporting would include objectives with targets that better demonstrate performance over time.

“This would help communities understand what services are being delivered, how efficiently and effectively they are being delivered, and what improvements are being made. To ensure greater transparency on service effectiveness and efficiency, the OLG should work with councils to develop guidance principles to improve reporting on service delivery to local communities.

“This audit identified an interest amongst councils in improving their reporting and broad agreement with the good practice principles developed as part of the audit. The Integrated Planning and Reporting Framework, which councils are required to use to report on service delivery, is intended to promote better practice.”

But the report says that the Framework is silent on efficiency reporting and provides limited guidance on how long-term strategic documents link with annual reports produced as part of the Framework.
“OLG’s review of the Framework, currently underway, needs to address these issues. OLG should also work with state agencies to reduce the overall reporting burden on councils by consolidating state agency reporting requirements.”

The reports said that NSW councils’ reporting needs greater emphasis on the efficiency and effectiveness of their services, and their performance over time. It based its findings on an analysis of 105 council annual reports, and found that reporting on inputs and outputs was given much greater emphasis than reporting on service delivery efficiency and outcomes.

“Around 80 percent of reports included service input and output reporting. However, while inputs are frequently reported, cost is seldom reported as an input measure. The absence of this information means that most annual reports do not allow the community to assess how efficiently councils are delivering services.

“Only around a third of the reported activities that we analysed included information on service outcomes and less than 20 percent gave information on performance over time.”

The report is available here.


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