Indigenous employment: the Australian Government's contribution to the Australian Employment Covenant

26 Jun 2013

This audit assessed the effectiveness of the Department of Education, Employment and Workplace Relations’ management of the Australian Government’s contribution to the Australian Employment Covenant Covenant. The scope of the audit is the Australian Government’s role in the initial establishment of the Covenant and its ongoing contribution through other employment programs.

Overall conclusion

The Australian Government agreed to the Australian Employment Covenant (the Covenant) in October 2008 as a means of contributing to Closing the Gap in Indigenous employment. The Covenant represents an innovative approach to collaboration between the public and private sectors to encourage community involvement and support in the delivery of policy outcomes. However, while the partnership has achieved some of its aims in relation to employment outcomes and generating job commitments from business and industry, it did not facilitate the expected level of ongoing collaboration. The Department of Education, Employment and Workplace Relations’ (DEEWR’s) management of the Australian Government’s contribution was effective in part, but there is limited performance information available to accurately measure the Australian Government’s contribution to the Covenant. In supporting the Covenant, DEEWR considered that the existing employment service delivery system was sufficient to meet the Australian Government’s commitments without major changes to the department’s approach. While there were some efforts to facilitate involvement of the employment service network in the early stages of the Covenant, this was not sustained, and as a consequence the department’s approach to the Covenant was not significantly different from the existing service delivery approach. Future joint initiatives would also benefit from consideration as to where existing service delivery models can be adapted to better support partnership approaches.

Establishing effective arrangements to support collaboration between the Australian Employment Covenant (AEC) and DEEWR was an important element of the Covenant. DEEWR developed a number of mechanisms to guide and support delivery of the Australian Government’s commitments and to collaborate with the AEC. These arrangements were largely focused on the initial implementation of the Covenant, and included the establishment of the Australian Government Coordinator for the initiative, an internal implementation team, a departmental taskforce, internal working groups and an inter‑departmental committee. These initial arrangements were not supplemented by the development of ongoing management arrangements tailored to the Australian Government’s role in the Covenant. As a consequence, the department’s long‑term approach to supporting the Covenant was not well‑defined.

To support the Australian Government’s contribution to the Covenant, DEEWR committed to recording and tracking Covenant jobs as well as the placement and retention of Indigenous job seekers into Covenant jobs and training. DEEWR identified gaps in its data collection system after the initial implementation of the Covenant but did not progress further work to address these gaps. Consequently, DEEWR largely relied on data from the AEC to report outcomes in relation to the Covenant. While DEEWR was not responsible for measuring the overall success of the Covenant, the department should, at a minimum, have been able to track and readily identify the extent to which it was meeting the commitments made by the Australian Government to training, referral, placement and ongoing support for Indigenous job seekers.

In order to fulfil its commitments for training and employment support, DEEWR relied on the AEC to provide information from employers about detailed job requirements, including skills and qualifications, against which the department could tailor training solutions. DEEWR’s information requirements did not fully align with the information the AEC provided about job requirements and this resulted in fewer packages of support being developed than expected. There was also limited awareness within the DEEWR service provider network of opportunities associated with the Covenant. At the end of four years, the department had engaged on training needs with approximately 70 Covenant employers, or less than a quarter of employers who had committed jobs under the Covenant. Adopting additional measures to facilitate the improved connections between the employers and job seekers sought through the Covenant, would have better supported the Australian Government’s commitments.

The Covenant initiative is consistent with broader Australian Government objectives of engaging with the private sector in Closing the Gap on Indigenous Disadvantage. As an industry‑led partnership, it represented an innovative approach to delivering employment outcomes that relied on collaboration between parties. The Covenant’s implementation has highlighted a number of issues for further consideration in future partnership arrangements entered into by the Australian Government. These include: establishing a clear understanding of the timeframe of the partnership and when key outcomes are to be achieved, and developing reliable approaches to measuring contributions to partnerships.

Against this background, the Australian National Audit Office (ANAO) has made one recommendation directed at DEEWR developing options, in consultation with the AEC, to clarify the Australian Government’s approach and ongoing contribution of the Covenant and more effectively measuring the Australian Government’s contribution to the initiative.

Partnerships between governments and industry, such as the Covenant, are likely to be ways governments can leverage from, and build greater resilience in, communities going forward. From a policy perspective, it is important that governments learn from and develop such arrangements. In the case of the Australian Employment Covenant, the initiative was innovative, and the experience highlights that benefits can be achieved through this kind of partnership. The experience also underlines the importance of active engagement with existing service delivery mechanisms, adjusting arrangements where necessary and, having the means of assessing both the contributions to the partnership and overall value of the initiative.

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