The Australian Government spends approximately $800 million annually on Disability Employment Services (DES) to provide open employment opportunities for people with disability. DES provides specialist employment assistance to help people with disability, injury or health conditions find and retain sustainable employment in the open labour market. DES also provides support to employers and has a key role in assisting people in receipt of income support to meet their mutual obligation and participation requirements.

DES was introduced in 2010 as part of the consolidation of two previous government programs, Vocational Rehabilitation Services and Disability Employment Network. Despite these reforms, labour force participation rates for people with disability have remained static for the past 20 years at around 53 per cent, compared to 83 per cent for people without disability.

The Department of Social Services (DSS) engages providers to deliver DES services for eligible job seekers with disability. The Community Grants Hub within DSS is responsible for managing risk and compliance of the DES providers with the terms of the DES Grant Agreement. Accordingly, DSS has primary responsibility for managing DES, with assistance from Services Australia in assessing job seekers’ eligibility, and the Department of Education, Skills and Employment (Employment) that hosts the DES payment system.

The audit objective was to assess the effectiveness of the Department of Social Services’ arrangements for managing Disability Employment Services provider agreements.

Main findings:

• DSS is largely effective in managing Disability Employment Services provider agreements.
• DSS’ arrangements with DES providers were largely appropriate to support the achievement of employment outcomes for people with disability. The department established processes to ensure DES agreements meet legislative and other relevant requirements. It also clearly defined outcomes to be achieved under the new arrangements, albeit without targets, but had not developed a framework to clearly measure the success of the DES reforms.
• DSS has largely effective processes for assessing and reporting DES outcomes, assuring the accuracy of DES payments, and systems for managing DES complaints. Opportunities for improvement include DSS broadening performance information to better measure success in improving employment outcomes for people with disability, and consolidating DES complaints data to address any systemic issues and improve service delivery.