Annual performance statements

Introductory Statement

I, Nigel Hadgkiss, as the accountable authority of the Office of the Fair Work Building Industry Inspectorate, present the 2015–16 annual performance statements of the Office of the Fair Work Building Industry Inspectorate, as required under paragraph 39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). In my opinion, these annual performance statements are based on properly maintained records, accurately reflect the performance of the entity, and comply with subsection 39(2) of the PGPA Act.

Entity Purpose

The purpose of the Office of the Fair Work Building Industry Inspectorate (Fair Work Building and Construction) is to enforce workplace laws in the building and construction industry through the provision of education, assistance and advice and, where necessary, civil penalty litigation in the courts. In addition, Fair Work Building and Construction (FWBC) ensures compliance with the Building Code.

Results

Objective 1: Enforcement and compliance

Performance criterion

Criterion source

Results against performance criterion

A target of 75% of legal proceedings in court within 12 months of the complaint being lodged.

2015–16 Corporate Plan KPI 1.1

  • Program 1.1, 2015–16 Portfolio Budget Statements, p. 192

Of the 34 legal proceedings that FWBC commenced during 2015–16, 35% were commenced within 12 months of the complaint being lodged. The reporting period of 2015–16 was a transition year under this criterion and saw the 18 months performance measure decrease to 12 months.

In the 2014–15 year, FWBC had exceeded the previous performance criterion with 94% of matters filed in court within 18 months of the complaint being lodged.

FWBC did not expect to meet the 2015–16 criterion with the transition to the 12-month timeframe, because of the number of ongoing legacy investigations at the start of the year. Many of the matters filed in 2015–16 were complex, and there is expected to be an increase in the complexity of these investigations.

A target of 75% of clients ‘satisfied' or ‘highly satisfied' with the quality and timeliness of advice and assistance provided.

2015–16 Corporate Plan KPI 1.2

  • Program 1.1, 2015–16 Portfolio Budget Statements, p. 192

Of the FWBC clients who were independently surveyed about the quality and timeliness of advice and assistance provided by FWBC, 83% reported being ‘satisfied' or ‘highly satisfied'.

A target of 300 compliance activities to improve compliance with the Building Code 2013.

2015–16 Corporate Plan KPI 1.3

FWBC had a renewed focus on Building Code 2013 compliance following the establishment of a Senior Executive Level National Manager, Building Code in June 2015. During 2015–16, the FWBC undertook 489 activities to improve compliance with the Building Code 2013, achieving 163% of the performance target.

Objective 2: People

Performance criterion

Criterion source

Results against performance criterion

A target of 95% of staff meeting or exceeding performance targets.

2015–16 Corporate Plan KPI 2.1

For the 2015–16 year, 98% of FWBC staff were assessed as meeting the performance targets outlined in their performance agreements. In October 2015, the rating scale was changed from a five-point scale to a two-point scale (meets expectations/does not meet expectations), and therefore no staff were assessed as exceeding their performance targets. There was a continued focus on regular individual feedback to staff on performance.

The development of a new workforce plan by 30 June 2016.

2015–16 Corporate Plan KPI 2.2

FWBC's draft workforce plan was developed by 30 June 2016.

Objective 3: Information and analysis

Performance criterion

Criterion source

Results against performance criterion

A target of the FWBC investigations and legal management system, AIMS, being operational for 95% of business days.

2015–16 Corporate Plan KPI 3.1

For the 2015–16 year, AIMS was operational for 100% of the time on business days.

A target of 100% of updates made to case records following the quality assurance program.

2015–16 Corporate Plan KPI 3.2

For the 2015–16 year, 100% of case records were updated, following identification, as part of the quality assurance program auditing.

Objective 4: Stakeholders

Performance criterion

Criterion source

Results against performance criterion

A target of 125 formal presentations delivered to stakeholders during the 2015–16 year.

2015–16 Corporate Plan KPI 4.1

For the 2015–16 year, 187 formal presentations were delivered to stakeholders. These presentations were delivered to a total of 2,984 attendees. This exceeds the number both of presentations delivered and of stakeholders attending during 2014–15 and 2013–14.

A target of 75% of surveyed industry participants reporting that they are either ‘satisfied' or ‘highly satisfied' with contact by FWBC aimed at promoting appropriate standards of conduct.

2015–16 Corporate Plan KPI 4.2

  • Program 1.1, 2015–16 Portfolio Budget Statements, p. 192

For the 2015–16 year, 100% of industry participants who were surveyed (at 178 presentation sessions) were either satisfied or highly satisfied with the contact by FWBC.

Objective 5: Finance

Performance criterion

Criterion source

Results against performance criterion

A target of +/- 10% expenditure matched to budget (year to date).

2015–16 Corporate Plan KPI 5.1

FWBC expenditure matched to budget for the year was 0.7% over budget. This slight increase was predominantly due to more complex litigation throughout the year.

A target of +/- 5% total revenue matched to budget (year to date).

2015–16 Corporate Plan KPI 5.2

FWBC revenue matched to budget for the year was $0.533 million, or 1,134% over budget. The increase was due to operating lease rental revenue of $0.185 million, which was not included in the original budget, and court-awarded costs exceeding budget by $0.348 million.

Objective 6: Governance

Performance criterion

Criterion source

Results against performance criterion

Annual Performance Statement to be submitted to the Minister by 31 October 2016.

2015–16 Corporate Plan KPI 6.1

The annual performance statements were submitted to the Minister for Employment in September 2016. This is prior to the 15 October requirement outlined in section 46 of the PGPA Act.

Risk Management Framework in place and Enterprise Risk Register reviewed by 30 June 2016.

2015–16 Corporate Plan KPI 6.2

The Enterprise Risk Register was completely revised in April 2016. A new FWBC Risk Management Framework was developed and is expected to be endorsed by the FWBC Executive in August 2016.

Analysis of performance against the purpose

In the 2015–16 year, FWBC filed 34 matters, compared to 36 in 2014–15, including a number of complex matters that had been subject to lengthy investigations. An increase in complexity in the type of conduct being investigated by FWBC is expected to continue in the current operating environment. In addition to the investigatory work of the agency, FWBC continued to provide a high volume of high-level advice and assistance to industry. The number of industry participants contacting FWBC for information through the hotline, online options or direct contact continued to grow.

The quality of the advice provided by FWBC did not diminish: 83% of FWBC clients were either ‘satisfied' or ‘highly satisfied' with the quality and timeliness of the advice and assistance provided. This is noteworthy, as during the year there were several significant changes to the scope of the work undertaken by FWBC, including new drug and alcohol requirements for contractors, and the transfer, from the Department of Employment to FWBC, of the role of assessing enterprise agreements for compliance with the Building Code 2013. That the satisfaction of FWBC clients remained high despite the changing scope of FWBC's responsibilities demonstrates that the changes were well communicated both internally and externally and that FWBC staff were able to respond effectively.

The renewed focus of the agency on the Building Code was reflected in the number of Building Code audits that were conducted during the 2015–16 reporting year. FWBC also enhanced its organisational capacity with an increase in the number of investigators who are trained to undertake Building Code activities. The increase reflected a broader focus on building capability within the agency to achieve a culture of high performance. This focus was underpinned by a revised FWBC Workforce Plan centred on the multiskilling of staff to ensure that FWBC is an agile agency with the capability to readily respond to future challenges in its operating environment.

During 2015–16, FWBC made changes to its performance management by adopting a simpler rating categorisation. The five-point categorisation scale was replaced with a simpler ‘meets expectations/does not meet expectations' categorisation, consistent with recommendation 22.5 of The Independent Review of Whole-of-Government Internal Regulation (Belcher Red Tape Review). These changes were reflected in the FWBC Performance and Development Framework, which continues to emphasise the importance of regular performance feedback.

Throughout the 2015–16 year, FWBC continued to develop and refine systems to plan and monitor agency performance. FWBC has a robust quality assurance program that allows it to learn from experiences and ensures a focus on continuous improvement. An analysis of future needs was undertaken in the reporting year to inform a tender for a new case management system that is expected to be implemented across the agency in 2016–17.

Engagement with stakeholders continued to be a core part of FWBC activities, with an increased focus on targeted and information-driven engagement during the 2015–16 year. The significant changes to Building Code obligations led to increased engagement with stakeholders on Building Code related matters. Further, reflective of the multiskilled and agile nature of the workforce, FWBC operational staff exceeded the target for formal presentations delivered to stakeholders: 100% of those stakeholders were either ‘satisfied' or ‘highly satisfied' with their interactions with FWBC.

FWBC delivered against the corporate KPI targets while ensuring prudent financial management. FWBC net cost of services for the 2015–16 reporting period was marginally better than budget. Agency expenditure continued to be focused in areas that ensured the delivery of high-quality advice and the achievement of planned outcomes. This better-than-budget result was assisted throughout the year by a renewed focus on efficiency and, in particular, cost reductions in the agency's leased premises. In the second half of the reporting year, FWBC began to recruit in line with the 2016–19 FWBC Workforce Plan and will continue to do so in 2016–17. Revenue exceeded the target range when matched to budget, driven largely by court-awarded costs and operating lease revenue.

The revision of the FWBC Risk Management Framework complemented the strategic planning of the agency and will continue to inform the Director's and Executive's decision-making. It is intended that this will develop into a more widespread use of risk management approaches through all levels of the agency. Our improvement is measured through overall increased maturity levels, as assessed in the annual Comcover Risk Management Benchmarking Survey.