The Guardian

Criticism of government’s Indigenous advancement strategy is dismissed by minister as a ‘historical observation’

 Indigenous affairs minister, Nigel Scullion The minister for Indigenous affairs Nigel Scullion said the audit office’s criticism of the IAS was out of date. Photograph: Mick Tsikas/AAP

The federal government’s Indigenous advancement strategy was rushed and failed to meet required standards and guidelines, the National Audit Office has said in a damning report.

The Australian National Audit Office’s report – which was labelled a “historical observation” by the Indigenous affairs minister, Nigel Scullion – was published on Friday following a review of the strategy, a competitive tender policy which dramatically reworked federal Indigenous affairs funding in 2014.

It was widely criticised at the time as “chaotic” and in a subsequent Senate inquiry for the confusing application process, reductions in funding and timeframe commitments, and for the inclusion of sporting teams and government agencies among recipients. The criticism came despite a marked increase in the proportion of Indigenous-owned or -run groups given funding, and funding boosts the following year.

The Indigenous advancement strategy (IAS) consolidated more than 150 programs and redistributed via five streams more than $1bn a year in federal funding – a figure cut by more than $500m in the 2014 budget.

However the report (PDF) found it was not effectively implemented.

It noted that planning and design of the IAS was done in too short a timeframe, “which limited the department’s ability to fully implement key processes and frameworks, such as consultation, risk management and advice to ministers, as intended”.

The implementation was similarly rushed, affecting transitional arrangements and structures which focused on prioritising the needs of Indigenous communities, the report said.

“The department’s grants administration processes fell short of the standard required to effectively manage a billion dollars of commonwealth resources,” it continued.

“The basis by which projects were recommended to the minister was not clear and, as a result, limited assurance is available that the projects funded support the department’s desired outcomes.”

The report also found the IAS’s assessment of funding applications was not consistent with guidelines or public statements from the department. Nor did it meet all of its commonwealth obligations, keep records of key decisions, or establish targets for all funded programs.

While the department did develop a consultation strategy, it failed to fully implement the outlined approach.

The report said the initial premise of the IAS, to reduce programs and activities and concentrate on five areas seen by the government as key targets, was designed to be broad and flexible.

However it said clearer links were needed between the funded programs and outcomes of the five targets.

It made four recommendations on greater transparency and communication with the community and government.

Nigel Scullion, the minister for Indigenous affairs, said the report should be looked at as a “historical observation”, and accused the audit office of talking only to service providers which were competing for funds, not Indigenous communities.

He said it was “premature” to assess the IAS based on the introductory period two-and-a-half years ago, and that the report didn’t recognise improved outcomes and the maintaining of frontline service delivery under the IAS.

“By focusing its audit on the grants round, the ANAO has paid insufficient regard to the state Indigenous affairs was in when the Coalition government came to office in 2013 – and hence the need for the government to implement its reforms,” he said.

Earlier on Friday morning Scullion had announced funding of $40m over four years to “strengthen the evaluation” of the IAS programs. “Evaluation at the contract, programme and outcome level will ensure we not only know where the money is being spent, but we will know what works and why,” he said.

He said the rollout of new evaluation processes would be done in consultation with Indigenous stakeholders, and experts would undertake robust and independent assessments of IAS activities.

Sara Hudson, Indigenous research manager at the Centre for Independent Studies, said the report followed another scathing review by the Productivity Commission last year, which was consistent with CIS findings that just 8% of more than 1000 programs had been evaluated.

Labor called on the government to end the policy and replace it with “something that respects local voices, gives more control to communities, and prioritises evidence-based outcomes”.

Opposition leader Bill Shorten, senator Patrick Dodson, and senator Warren Snowdon in a joint statement: “This debacle is an example of what happens when you ignore the voices of Aboriginal and Torres Strait Islander people.”

“This is what happens when you impose solutions instead of working with communities. Labor wants a bipartisan approach to improving the lives of Aboriginal and Torres Strait Islander Australians, but we cannot ignore or excuse these failings.”