AUDITOR-GENERAL’S REPORT FINANCIAL AUDITS Volume Seven 2010 _part1 pot

AUDITOR-GENERAL’S REPORT FINANCIAL AUDITS Volume Seven 2010 The Legislative Assembly Parliament House Sydney NSW 2000 The Legislative Council Parliament House Sydney NSW 2000 Pursuant to the Public Finance and Audit Act 1983, I present Volume Seven of my 2010 Report Peter Achterstraat Auditor-General Sydney November 2010 This is trial version www.adultpdf.com This is trial version www.adultpdf.com Contents Significant Items iii Recommendations v SECTION ONE – Overview Environment and Water Overviews SECTION TWO - Commentary on Government Agencies Minister for Climate Change and the Environment 25 Department of Environment, Climate Change and Water 27 Environment Protection Authority 37 Environmental Trust 39 Royal Botanic Gardens and Domain Trust 42 Taronga Conservation Society Australia 45 Minister for Water 49 Cobar Water Board 51 Hunter Water Corporation 52 State Water Corporation 60 Sydney Catchment Authority 67 Sydney Water Corporation 76 Wyong Water Supply Authority 93 APPENDIX Appendix – Agencies not reported elsewhere in this Volume 99 INDEX 101 This is trial version www.adultpdf.com i This is trial version www.adultpdf.com Significant Items Environment and Water Overviews Page In 2009-10, poor air quality days increased to 64 from 47 in 2008-09 and 23 in 2007-08 and is attributed to photochemical smog during the summer, dust storms and bushfires At 30 June 2009, there were 272 contaminated sites across New South Wales of which 114 have been successfully remediated The Department spent $214 million of the Climate Change Fund to help households, businesses and government save energy and water and to reduce greenhouse gas emissions 12 The New South Wales Home Saver Rebate Program, part of the Climate Change Fund, has paid more than 263,000 rebates to residents since its commencement The Department estimates related savings of 310,000 tonnes of greenhouse gas and 3.6 billion litres of potable water each year 13 In the period October 2007 to June 2010, the Department paid 118,848 rebates to residents for hot water systems The related payments from the Climate Change Fund totalled $64.6 million in 2009-10 ($20.8 million) 13 The Department contributed $25.0 million to the Australian Government’s $500 million National Clean Coal initiative The New South Wales Government has committed $100 million over four years to the Fund, which will be mainly used to fund research into, and development of, clean coal technologies 13 In 2009-10, the NSW Office of Water finalised 246 compliance investigations under the Water Act 1912 and Water Management Act 2000 resulting in two license suspensions and the issuance of 40 penalty notices 15 The Central Coast Water Corporation Act 2006 is expected to commence late 2010 17 Water utilities contributed $379 million to government during the year ended 30 June 2010 18 Hunter Water Corporation reported average number of unplanned interruptions per 1,000 properties of 255.5 19 The NSW Office of Water’s information systems not meet the information needs of the Independent Pricing and Regulatory Tribunal of New South Wales 20 Department of Environment, Climate Change and Water The total number of prosecutions commenced during the year for environmental protection offences was the highest number since 2006 Of the 134 cases completed in 2009-10, 94 per cent resulted in successful prosecutions 27 Surveyed unregulated water invoices for 2007 were issued in September 2010 28 Purchases of water entitlements fell from 145,122 megalitres in 2008-09 to 40,122 megalitres in 2009-10 Purchases over the last four years totalled 252,694 megalitres 28 This is trial version www.adultpdf.com iii Taronga Conservation Society Australia Paid attendance at Taronga Zoo increased by 15 per cent in 2009-10 The months of July 2009 and April 2010 recorded higher than expected visitors following the successful birth of two Asian elephant calves 46 Hunter Water Corporation A final decision on the Tillegra Dam remains outstanding 52 Hunter Water is planning to complete its major projects in line with original service delivery dates 54 At 30 June 2010, 132 employees (20.9 per cent of all employees) had accrued more than 40 days of annual leave entitlements Twenty two employees had more than 80 days accrued annual leave 55 State Water Corporation The volume of water sales during 2009-10 continued to remain at historically low levels 60 The Corporation’s performance against its Operating Licence declined slightly from 2007-08 61 The Corporation spent $58.0 million on the first phase of its dam safety compliance project during the year 62 Sydney Catchment Authority Over 31 per cent of the Authority’s employees had leave balances in excess of 40 days 72 The Authority has established a working group to address overtime costs of $1.2 million, representing 5.7 per cent of total employees’ base pay 72 Sydney Water Corporation The Minister for Water granted Sydney Desalination a network operating licence and a retail supplier’s licence 76 The cost of constructing the desalination plant was approximately $90.0 million less than budget 76 The Maximo project, an Information Technology solution to assist with asset management, has been delayed further at additional cost 77 Water customers have retained water saving behaviours developed during the drought, keeping consumption in 2009-10 below the ceiling specified in the Corporation’s Operating Licence 78 Total recycled water from all sources was 35.8 gigalitres in 2009-10 80 Water loss from breaks and leaks has nearly halved from 68,620 megalitres in 2002-03 to 35,323 megalitres in 2009-10 Water loss represented seven per cent of water supplied 81 Some employees received overtime payments higher than their base salary 87 iv This is trial version www.adultpdf.com Recommendations Environment and Water Overviews Page I recommend:    DECCW finalise the implementation of the revised Funding Agreement for grant recipients 14 DECCW report on compliance with National Australian Built Environment Rating System ratings on its website and in its annual report 15 the NSW Office of Water establish systems to meet the information needs of the Independent Pricing and Regulatory Tribunal of New South Wales 20 Department of Environment, Climate Change and Water I recommend the Department:   continue to implement its policy requiring all staff with excessive leave balances to have a leave management plan in place in order to further reduce leave balances within an acceptable timeframe further review the roles and responsibilities of all contract employees to ensure:      30 reliance on contractors is not excessive use of contract employees instead of permanent employees is appropriate contractors not become de facto employees by virtue of being employed for an extended period of time the use of contract employees continues to represent value for money ensure its systems are able to provide accurate data to enable it to prepare specific project based submissions to The Treasury which address its maintenance requirements 30 31 Hunter Water Corporation I recommend the Corporation:  the Corporation prepare a sound and comprehensive business case before any decision is made to proceed with the Tillegra Dam This is trial version www.adultpdf.com 52 v Hunter Water Corporation (continued) I recommend the Corporation:  create and maintain a single register for contracted employees  using this register, review the effectiveness of its existing policies for employment of contract employees to ensure: reliance on contractors is not excessive use of contract employees instead of permanent employees is appropriate contractors not become de facto employees by virtue of being with the Corporation for an extended period of time use of contract employees continues to represent value for money 56 review the effectiveness of its existing policies for managing the use of overtime 57      State Water Corporation I recommend the Corporation:  review the effectiveness of its existing policies for managing overtime work and analyse the underlying reasons for overtime payments that are significantly more than base pay  create and maintain a single record of all contractors engaged by it  62 using this record, periodically review the roles and responsibilities of all its contractors to ensure:     its reliance on contractors is not excessive use of contract employees instead of permanent employees is appropriate contractors not become de facto employees by virtue of being with the Corporation for an extended period of time use of a contractor continues to represent good value for money 64 Sydney Catchment Authority I recommend the Authority:  create and maintain a single record of all contractors engaged by it  using this record, periodically review the roles and responsibilities of all its contractors to help ensure: its reliance on contractors is not excessive use of contract employees instead of permanent employees is appropriate contractors not become de facto employees by virtue of being with the Authority for an extended period of time use of a contractor continues to represent good value for money 70 continue its efforts to help ensure accumulated flex leave is taken rather than forfeited 73      vi This is trial version www.adultpdf.com Sydney Water Corporation I recommend the Corporation:  review the effectiveness of its existing policies for managing overtime 87  continue to implement and monitor its existing Workforce Planning policies for managing its ageing workforce 87  create and maintain a single register for contracted employees  using this register, review the effectiveness of its existing policies for employment of contract employees to ensure:     reliance on contractors is not excessive use of contract employees instead of permanent employees is appropriate contractors not become de facto employees by virtue of being with the Corporation for an extended period of time use of contract employees continues to represent value for money 89 This is trial version www.adultpdf.com vii This is trial version www.adultpdf.com Section One Environment and Water Overviews This is trial version www.adultpdf.com This is trial version www.adultpdf.com ... 2006 is expected to commence late 2010 17 Water utilities contributed $379 million to government during the year ended 30 June 2010 18 Hunter Water Corporation reported average number of unplanned... savings of 310,000 tonnes of greenhouse gas and 3.6 billion litres of potable water each year 13 In the period October 2007 to June 2010, the Department paid 118,848 rebates to residents for hot water... 76 Wyong Water Supply Authority 93 APPENDIX Appendix – Agencies not reported elsewhere in this Volume 99 INDEX 101 This is trial version www.adultpdf.com i This