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Chapter Seven: Aid Administration and Management
The Australian Agency for International Development (AusAID) is an autonomous agency within the Foreign Affairs and Trade portfolio. It has prime responsibility for management and administration of the Government's overseas aid program.
The Director General has final responsibility for the Agency and reports directly to the Minister for Foreign Affairs on all aspects of aid policy and operations. The Director General is responsible to the Secretary of the Department of Foreign Affairs and Trade for the administration of the Agency and is a member of the Department's Executive.
AusAID has a central office in Canberra and representation in Sydney, Brisbane, Melbourne, Adelaide and Perth. AusAID is also represented at 23 diplomatic missions overseas.
AusAID Outputs
AusAID's core business is to serve the Government by advising on development issues and delivering Australia's development cooperation program with excellence. AusAID has a single outcome: Australia's national interest advanced by assistance to developing countries to reduce poverty and achieve sustainable development. Two agency `outputs' contribute to this outcome: policy and program management. The Government purchases these two outputs from AusAID at an agreed price of $10.5 million and $57.4 million respectively in 2000-01.
Policy
AusAID provides advice and analysis to Portfolio Ministers and the Parliamentary Secretary to the Minister for Foreign Affairs on aid policy, program directions and international development issues. The provision of timely, comprehensive and accurate policy advice and analysis enables Ministers to make informed decisions in the national interest.
The Agency also supports Government communication with the Australian community and Parliament through the provision of briefings, speeches, correspondence, press releases, replies to questions from Parliament and publications. This helps build community understanding of development issues and ensures the aid program remains accountable to the Australian public and Parliament.
Program Management
The Agency manages Australia's overseas aid program on behalf of the Government. Actual delivery of the aid program is entirely outsourced. AusAID's program management comprises:
- ensuring programs and projects correspond with Government priorities and are determined in partnership with the people and governments of developing countries
- ensuring high quality projects and programs through effective identification and design, regular monitoring, evaluation, establishment of lessons-learned data bases, and accessing technical expertise and external advice as appropriate
- establishing and managing contracts with delivery agents including the private sector, public sector providers, international and regional development organisations and non government organisations.
Indicators of the quality of AusAID's program management output include:
- 75 per cent of activities within the program are rated satisfactory overall or higher
- major programs are carried out in partnership with recipients and other donors
- agreed procedures are in place to ensure management of a high quality program that reflects Government priorities
- feedback on tender information, the number of late gazettals, and the percentage of contracts terminated or subject to serious disputation.
Supporting Services
In order to effectively deliver AusAID's two key outputs - policy and program management - a wide range of support activities are undertaken and managed within the Agency.
Contract Services
AusAID contracts firms and individuals to deliver activities at all stages of the project management cycle: feasibility, design, implementation, review and evaluation. Following approval by the Minister for Foreign Affairs in early 1999, a number of reforms to AusAID's contractor selection procedures were implemented in 1999-2000. These reforms have improved project quality and selection outcomes.
Enhancements to project quality were also made through the introduction of a new contractor performance reporting system early in 2000. The new system allows contractor performance information to be considered in the assessment of tenders. The introduction of a new suite of standard services contract and tender documentation will also produce real benefits to contract activity quality. The appointment of a commercial contracts adviser to the Contracts Services Group will enhance efforts to improve the quality of contracted activities, contractor performance and the further development of best practice approaches in contracting.
Quality assurance
In line with the Government's shift to results based management, AusAID adopted an outcomes approach to the planning and management of the aid program, incorporating a greater emphasis on enhancing quality and reporting results against performance targets.
A review of Australia's aid program in 1999 by the Development Assistance Committee (DAC) found that AusAID's strengthened approach to quality assurance placed it in the vanguard of DAC members' aid management practices.
In the year ahead, priority will be given to upgrading systems and guidelines for the collection and reporting of performance information on individual activities across the program. Quality assurance will also be further strengthened through revisions to comprehensive guidelines on management of projects, AusGUIDE. These guidelines are available to AusAID staff, contractors and NGOs involved in the delivery of the aid program, through AusAID's Intranet and external Web page (www.ausaid.gov.au).
Evaluation
Performance information is complemented by evaluations in which the focus is on impact and sustainability of outcomes. In 1999-2000 AusAID's evaluation program included a number of project reviews (health, microfinance, rural development, water supply and sanitation and rural poverty), sectoral analyses (land management, environment and gender) and strategic studies (NGO programs in Viet Nam and Africa and a Pacific regional organisation). In 2000-01 there will be a greater focus on thematic evaluations (institutional strengthening and capacity building, poverty reduction and co-financing). Evaluation and review reports are available through the AusAID Internet site. An improved system of lessons feedback and dissemination from evaluations is under development to help improve the design and implementation of new projects and programs.
Quality Assurance Group
The Quality Assurance Group (QAG) will continue its work to improve the quality of the aid program through reviews of bilateral and regional projects during preparation and implementation. These assessments have confirmed that the key factors for improving quality are the improvement of management systems and strengthening the approach to monitoring and reporting. In 2000-01 these will be the priority issues for the QAG. This will be supported through assessments of project quality, preparation of guidelines and dissemination of best practice approaches for AusAID staff and other stakeholders.
Improving statistical information
Provision of accurate, comprehensive statistics on the aid program is fundamental to enhancing the quality of the aid program. In 2000-01 the quality of statistical information used in the development of policy advice and ongoing program management will be enhanced through the implementation of a new statistics package, Datamart. This will enable consistent and comprehensive statistical reporting to a range of interested users both within and outside AusAID.
Improving management systems
AusAID's computer based activity management system is designed to collect financial and performance management information to support monitoring, analysis and reporting on all aspects of aid projects. In 1999-2000 links between this system and most of Australia's overseas missions dealing with the aid program were strengthened. The direct entry of performance information by staff working in these missions, particularly from project monitoring reports, has substantially improved program management.
Further program performance will be achieved through the establishment in 2000-01 of a computerised system to support the contracting out of the management of overseas students to tertiary institutions throughout Australia. This new system will improve student placement and support processes as well as monitoring and reporting students' academic performance.
Accountability and risk management
The internal audit program plays an important role in improving the quality of the aid program. The Agency's fourth Fraud Prevention Plan was prepared during the year and endorsed by the Attorney-General's Department as meeting the requirements of the Fraud Control Policy of the Commonwealth. A revised risk management policy will help to improve decision-making and accountability. Audits of commercial contractors and NGOs involved in the delivery of aid will continue. This approach will be broadened through a progressive shift to risk-based auditing of key Agency programs and functions.
Sectoral advice
AusAID has a number of groups established to focus on sectoral priorities. These groups cover health, education and gender, environment, resources and infrastructure, governance and program development. Their role is to ensure the delivery of high quality technical advice and sectoral analysis to support programs. The groups gather, analyse and disseminate sectoral information between country, regional and multilateral programs. A program development group works to develop new ways to incorporate lessons learned into the design of activities.
People management
AusAID maintains a high commitment to enhancing staff effectiveness and satisfaction through the provision of targeted training and development activities.
During 2000-01, AusAID will continue to implement its comprehensive People Management Strategy, designed to ensure AusAID is well placed to attract, recruit and retain the best staff to meet the Government's aid program objectives.
Information and financial management
Program management is supported through effective and efficient financial management systems. These systems are progressively developed to meet the changing needs of Government reporting. They have recently been upgraded to take account of the new requirements for accrual budgeting.
AusAID has completed the development of an Information Technology Management Strategic Plan and is now working through the implementation of the strategies identified.