Administration of the veterans' children education schemes

30 April 2013

This audit assessed the effectiveness of the Department of Veterans' Affairs (DVA) administration of the veterans' children education schemes.

Overall conclusion

The Veterans’ Children Education Scheme and the Military Rehabilitation and Compensation Act Education and Training Scheme (the Schemes) provide assistance to the young dependants of Australian Defence Force (ADF) members who have died or been severely injured as a result of their military service. The Schemes provide assistance to students in the form of financial assistance, student support services, and guidance and counselling. In 2011­–12 the Schemes assisted 3559 eligible students, providing an estimated $15.9 million in benefits, with administrative costs of $3.3 million.

The two Schemes comprise a mature program, and DVA has implemented generally effective administrative arrangements for their delivery. The department has established processes to accurately determine client eligibility, process claims and make payments. In the student sample examined by the ANAO, eligibility was accurately assessed in all cases, and benefit entitlements were paid in accordance with legislation. Further, the Schemes are supported by experienced VCES Secretaries with national responsibility for the Schemes’ day-to-day administration, operating out of Brisbane, Adelaide and Hobart.

However, there are aspects of the Schemes’ administration and current operations that would benefit from review. At a threshold level, there has been a degree of misalignment since 2007–08 between the legislative instruments establishing the Schemes and their practical operation. In 2007–08, DVA reduced the level of administrative support for student assistance provided through the Schemes’ volunteer Education Boards, particularly visits to students living outside capital cities, as provided for in the legislative instruments. While acknowledging the lack of alignment between current practice and the legislative instruments, DVA advised the ANAO that the Schemes’ development since the instruments were made reflects a situation where the level of support and assistance provided to students through the modern education system is much improved. As the Schemes have a legislative basis, the misalignment between the relevant legislative instruments and current administrative practice requires attention, a point acknowledged by DVA during the course of the audit.

Further, the department has not conducted significant formal planning or evaluation for the Schemes since their introduction and there would be benefit in developing an evaluation strategy to assess the extent to which they are achieving their objectives. An evaluation strategy could be developed concurrently with the proposed review of alignment between administrative practice and the legislative instruments, to establish a basis for assessing the effectiveness of any future changes to the Schemes.

During the life of the Schemes, changes in the wider social policy environment have at various times challenged DVA’s policy and coordination capacity. Changes in the external policy and program environment have included: the raising of the minimum school leaving age; and the shift from Youth Allowance to Family Tax Benefit as the main source of government assistance for families with older teenagers; the Education Tax Refund Payment; the Schoolkids Bonus; the Income Support Bonus and changes to student Relocation and Start-up Scholarships. No advice was provided to the Commissions and service delivery staff on the implications for the Schemes when the minimum school leaving age was raised. The ANAO’s analysis also indicates that at least as far back as 2004 some students may have been financially better off by claiming benefits other than those offered by the VCES. However, DVA did not formally notify affected clients of this option until January 2012. While the interaction between the Schemes and other government programs is often complex, appropriate liaison and coordination arrangements with other agencies can contribute to the effective administration of the Schemes. The establishment of an interdepartmental working group on student issues in August 2012 provides a vehicle to improve communication and policy coordination between DVA and the Department of Human Services (DHS).

The Schemes are treated as a stand-alone program in DVA’s Portfolio Budget Statement (PBS) and annual report, providing visibility for reporting purposes. However, DVA currently reports on Scheme deliverables solely in terms of student numbers as at 30 June each year. There is scope to further develop the reporting framework by reporting on the three main services delivered by the Schemes: financial assistance, student support services, and guidance and counselling. In addition, the Schemes’ performance information could be improved by developing key performance indicators (KPIs) to demonstrate the extent to which the Schemes are achieving their objectives, as the current KPI focuses solely on the proportion of critical errors in payments. DVA has acknowledged the benefit of reviewing its deliverables and KPIs with a view to developing measures that are outcomes and quality based, rather than purely output based.

The ANAO has made two recommendations directed towards DVA improving the alignment between administrative practice and legislation, and performance reporting for the Schemes. The ANAO has also noted, as discussed at paragraph 26 below, the need for DVA to ensure that all requirements for Working With Children Checks are satisfied.

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