Part Four:


1. Guiding CDEP Organisations to secure Sales Tax Exemption

Sales Tax adds, typically, an extra 22%, onto the price of many items to be purchased. This means that an organisation which has been granted Sales Tax exemption has significantly more Recurrent and Capital funds at its disposal with which to drive the CDEP. This could add more than 15% to the purchasing power of the Capital and Recurrent grants. This extra funding would exceed $400 per participant, or over $40,000 for the average 100 participant CDEP. New CDEPs starting up could have at their disposal, an extra $20,000 establishment funds. ATO allows three years back claims for sales tax exemption. A CDEP recovering tales tax over this period could receive a windfall of $100,000.

Sales Tax exemption has never been automatically granted to Aboriginal CDEP Organisations, and up until now, each CDEP organisation, if it has not had prior granting of tax exemption, must after making its own individual application, pursue tax exemption without guidance or assistance. The ATO have never been known to be particularly helpful in an organisation’s pursuit of Sales Tax Exemption, which can be a long and arduous process, especially for an Aboriginal person without strong administrative skills, Some have been known to give up the struggle as too difficult and unfruitful, while other CDEPs have been rejected outright, and are required to pay sales tax. There has never been a consistent pattern to ATO findings.

When one Aboriginal Corporation applied for Tax exemption in 1996, the ATO made them a test case to examine the whole issue of tax exemption to CDEPs throughout Australia. The ATO concluded that henceforth any CDEP would qualify for Sales Tax Exemption provided that the Objects in their Rules met ATO criteria. This is a significant improvement for CDEPs wishing to be granted tax exemption.

This is an area that ATSIC, and in particular the Registrar of Aboriginal Corporations, could be of much assistance to organisations, by presenting to them examples of model objects that are consistent with the aims of CDEP and are phrased to pass the ATO criteria for Sales Tax Exemption eligibility. Objects were re-written and cleared by the ATO before being incorporated into their rules. They are reprinted here as a guide for any organisation that has yet to be granted Tax Exemption.

Model CDEP Objects that have passed ATO scrutiny for Tax Exemption.

  1. To establish and operate a Community Development Employment Project;
  2. To create employment opportunities for CDEP participants;
  3. To train CDEP participants in work related skills;
  4. To promote the employment of Aboriginal persons in mainstream society;
  5. To assist the establishment of Aboriginal owned and operated enterprises;
  6. To increase the amount of rental housing for Aboriginal persons in the area via the establishment of a housing cooperative to purchase and /or build houses.
  1. To promote or undertake activities that improve the physical, emotional, mental and spiritual well-being of Aboriginal persons, their families and communities;
  1. To seek funding to assist any or all of the above activities;
  2. To assist the alleviation of poverty in Aboriginal families by all of the above activities.

Recommendation 19:

That ATSIC assist CDEPs to achieve Tax Exemption status. Existing CDEPs should be surveyed  to ascertain which CDEPs do not already have Tax Exempt status. Guidance for new CDEPs should be initiated as soon as an organisation receives notification that the application for CDEP has been approved.

2. Guiding CDEP Organisations to Secure Govt. Contract Supply Purchasing Rights

Even  greater savings can be made if an organisation is able to purchase equipment at Govt contract supply prices. In general, if an organisation is wholly Govt funded they are likely to qualify to benefit from such discounts. This can apply, even to an organisation that does not have tax exemption status.

One company that supplies landscaping and garden machinery, offers a 60% discount for tax-exempt, Govt supply prices. For non tax-exempt organisations that have Govt purchase eligibility, they add 22% back. This still leaves a substantial discount from the original retail price.

One organisation wished to purchase a skid steer to enable themselves to undertake a housing contract. The supplier even assisted them with calculations to show that with the funds saved, through purchase at tax exempt Govt contract price, the equipment would essentially pay for itself over the duration of the contract, leaving them with the capital equipment to undertake similar projects, and to generate income through hiring their equipment and drivers out after the contract was complete. Unfortunately, through lack of knowledge, they were unable to go through the ramifications necessary to secure Govt contract purchasing rights, and were therefore unable to afford to purchase the equipment. The outcome was the hiring of the equipment, with drivers, which left the organisation, at the end of the contract without any increase in their capital asset base.

Recommendation 20:

That ATSIC assist CDEPs to achieve Govt Supply Contract status. Existing CDEPs should be surveyed  to ascertain which CDEPs do not already have purchasing status.

3.   Re-ordering of Dates and Spread of Reporting Deadlines

Major CDEP reporting deadlines occur together or on following days, causing large peak administrative workloads. For example, November 30 is the deadline for 1st Qtr financial statements, while December 1 is the deadline for Participant Schedules, and CDEP and other grant applications. Meeting these deadlines is crucial to the survival of the CDEP, as failure will result in the organisation being put into breach and having quarterly funding discontinued, or not have grant applications for following year accepted. A continuation of breaches can place an organisation in jeopardy, and lead to the temporary, or even permanent, suspension of the CDEP.

November 30/December 1 reporting deadlines are particularly burdensome. At this juncture CDEP organisations must submit:

  • 1st Qtr financial returns,
  • 3rd Qtr participant schedules,
  • CDEP grant applications, including work plans and budgets,
  • Any other grant applications.

Recommendation 21:

That ATSIC revise CDEP reporting timetable to more evenly spread workload and avoid reporting bottlenecks.

4.  Re-issuing CDEP Reporting Timetable/Planner/Calendar

Up until 1994/95, ATSIC had produced an annual planner/calendar highlighting dates of important events, such as deadlines for submission of quarterly returns, participant schedules, etc. The meeting of some of these deadlines are crucial for the ongoing well being of the organisation, as late quarterly returns will place an organisation in breach. This means that funding will cease until that organisation has been found to have complied with the requirements.

Recommendation 22:

That ATSIC issue a suitable annual planning calendar, that shows all relevant dates and deadlines of important events.

5.  Release of Relevant CDEP Guide Publications

In June 1993 a very good publication Guide For CDEP Organisations was issued but by 1995 was considered too obsolete to be used any longer. In 1997, a new shorter version was released. In 1995, an excellent ATSIC in-house CDEP Training Manual was published but not made available to CDEPs. For about the last two years, rumours have been circulating about the immanent release of a CD Rom Guide or Training Manual which has yet to see the light of day.

Some Regional Offices have released copies of the ATSIC Grant Procedures Funding Manual to their CDEPs, but other Regional Offices have seen no need to. This is the Project Officer’s Bible on what is or is not permissible, and what is or is not compulsory, and as such should be issued to every CDEP organisation.

Recommendation 23:

That ATSIC give high priority to compiling and issuing an updatable guide for all CDEPs, whether on magnetic disk, CD Rom or hard copy.

Recommendation 24:

That ATSIC issue to all CDEPs a copy of the ATSIC Grant Procedures Funding Manual, including annual revisions.

6.  Re-Allocating Grant Funding and Participant Numbers

CDEP is ATSIC’s most highly funded, and most difficult to implement program. In many cases, the reducing funding  has not resulted in a leaner, better managed project, but has instead contributed to the general malaise, through withdrawing of funds from areas of greatest need, as in the case of axing any form of coordination funding.

Across-the-board counter-measures to address under-performing or badly administered CDEPs has very often had the effect of constraining and penalising many better performing CDEPs.

To free those CDEPs who wish to expand and grow, ATSIC needs to apply and distribute constraints or funding cuts intelligently and creatively. If ATSIC would distinguish between the under-performing and better-performing CDEPs, they could then devise ways to assist the better-performing CDEPs to further improve themselves, while applying whatever constraints are deemed necessary to improve the underperforming CDEPs. For example, under-employing CDEPs could be scaled down to a manageable participant workforce size, and savings in funds and participant numbers could be shifted to where they are most needed, and can be responsibly and creatively used.

Recommendation 25:

That ATSIC adopt the principle of supporting, and not punishing the better performing CDEPs, so that they are not penalised by policies that are designed to curb excesses or improve performance of less well performing CDEPs.

Recommendation 26:

That ATSIC redistribute participant numbers away from CDEPs with persistent sit-down, and towards those CDEPs who can offer full employment.

7.  Adapting Work Schemes for use by CDEP Organisations

CDEP participants are prevented by policy from embracing and using many useful workplace schemes for the unemployed or low-income recipients, unless they leave the CDEP scheme. Recent examples of this are Jobskills and New Work Opportunities (both since disbanded).  Many of these schemes could be very helpful and useful if they were adapted for use by CDEPs or participants.

One scheme that could be very useful if adapted for CDEPs is the DEETYA SES Brokerage Placement Scheme. This is a new creation by the Coalition Govt., and in summary funds an organisation to place unemployed persons into a 100% subsidised, 20 week training program in companies that undertake to provide them with full employment thereafter. Candidates to this scheme would be DEET selected.

This scheme could be easily adapted for use in Urban CDEPs to suit those participants seeking mainstream employment in the following way:

  • Instead of nominating a target number of DEET selected candidates to place in companies, the scheme could be freed up for CDEPs by allowing them to place their own CDEP participants, without specific targets to be met.
  • This would enable CDEPs to place those participants interested in mainstream employment, through being able to offer the same incentive training package as can be offered to assist unemployed people.
  • In practice, participants seeking mainstream employment could place themselves, being able to offer the additional incentive that they are already actively working.
  • To help overcome the extra hurdle of Aboriginality, participants can offer their working experience, gained whilst on the CDEP scheme, which may even in the same field as the prospective position,
  • That they are not reluctant candidates, but are voluntarily seeking to improve themselves is always of interest to prospective employers, who value enthusiasm, commitment and drive.

Such a scheme would work best if it were ‘free floating’ as to placement numbers and be driven by the interested participants themselves, in seeking out positions and fronting up with the package of 20 weeks funded on site work/training.

CDEPs should not be given targets to divest themselves of what may be their best workers, some of whom may be crucial to the success of the CDEP activity or enterprise they are already working in. CDEP participants are voluntary workers, are already usefully occupied and are now expected to move towards income generation within the scheme. Some may be seeking to move towards self-employment.

Recommendation 27:

That ATSIC seek to adapt employment schemes, such as DEETYA SES Brokerage Placement Scheme, to be useable by urban CDEPs.

8.  Promotion of User Friendly Software

(See Part 3 Section 3 on page 21: Improving Financial Accountability)

Recommendation 8:

That ATSIC trial and evaluate potentially suitable accounting packages, and make available to Aboriginal organisations a list of trialed and recommended computer accounting packages, along with review findings. Evaluation criteria to include ease-of-learning, ease-of-use, cost, support etc. Accounting packages to be evaluated should include Quicken, Quickbooks, MYOB, as well as other known, potentially suitable packages.

9. Consulting with Regional Councils and  CDEPs

The decision to abolish funding for coordination and administrative training to CDEPs has serious, potentially disastrous implications for CDEPs throughout Australia. The idea of abolishing programs crucial to the survival and future wellbeing of CDEPs should have had considerable widespread canvassing for ideas and possible alternative solutions, and not be presented as a fait accompli.

ATSIC decision and policy making on CDEP matters usually comes about through Commissioners voting on proposals drafted by the Administration wing, without being given the opportunity to consult with either Regional Councils or CDEP organisations. The pressure to make quick decisions pushes Commissioners towards rubber stamping proposed policies on matters vital to the success of CDEPs. which too often, has not produced the result that was intended.

Failure to consult has already led to a shortage of good ideas. Many, much needed CDEP policies have never been formulated, while some formulated policies have seriously impeded the furtherance of able CDEPs, while not effecting sufficient improvement in underperforming CDEPs. The decision to abolish coordination and training support may lead to the collapse of many CDEPs that have never enjoyed the benefits of good coordination, or proper training of assistants.

A fairer and more reasonable approach to the coordination issue would be to give Regional Councils a number of options that they may prioritise, or allow and encourage Councils to add their own suggestions. Regional Councils could then choose how their funding split would best reflect the needs of their region, and pass this on to Commissioners. They would then also have the option of consulting projects in their region, either individually or collectively. Individual Regions could even be permitted their own unique funding mix, tailored to their needs.

Top-down approaches to decision making has been regarded as outmoded by management theorists since the 1950s, after they discovered that consulting  resulted in wiser decisions and gave a feeling of ownership that brought with it a heightened sense of motivation, responsibility and commitment.

A consultative approach is always open to the best ideas, which may then be developed to their optimal potential. Nothing less than this should be acceptable. A consultative approach would ensure that the likely consequences of any decision would be well considered, It would also ensure that matters crucial to the betterment of CDEP would get a hearing.

This ‘democratic’ approach to decision-making need not be overly cumbersome or burdensome. We now live in an age of networking, and it is widely accepted today that the power of networking is the next leap ahead. Much creativity is unleashed when ideas are shared and discussed for positive enhancements and optimum solutions.

There could develop a very strong consultative network, that would also serve to inform all CDEPs of ideas and developments, and also be very helpful to the less developed CDEPs, which would get exposure to practices that other CDEPs find most helpful. This would enable all CDEPs to be at the cutting edge, and save individual CDEPs the necessity of ‘reinventing the wheel’, which is the current expectation.

The networking model of communications would enable smart policy to be drafted months ahead of requirements, with much of the pressure work being conducted in a relaxed, unhurried manner. It would very quickly relieve ATSIC of the pressure of being in ongoing crises mode.

Recommendation 28:

That surveys be conducted of Regional Councils, and of CDEPs, to acertain whether they consider the abolition of all forms of coordination and training funding, and the failure to create a proper coordination program, represents the best way to pass on the 10% funding cut imposed on ATSIC by the Dept of Finance.

Recommendation 29:

That ATSIC consult with Regional Councils about funding the coordination of CDEPs and the training of Administration staff in 1997/98 and thereafter.

Recommendation 30:

That ATSIC Regional Councils be required to consult with CDEPs on all matters that significantly affect funding or policy.

Recommendation 31:

That Regional Councils form a network, whether private bulletin board or internet, where ideas are exchanged, and views and opinions sought.

Recommendation 32:

That ATSIC ensure that Regional Council views are sought on all policy matters that may adversely affect Regional Plans.

10. Consulting with CDEPs

Many CDEPs are all too aware of imposed policies and structures that do not help, and have many ideas of what could be helpful. Those at the coal face, whose daily task is to ensure the CDEP can work to its optimum potential, need to be consulted, if the best results are to manifest. Instead, all CDEPs are treated as if they are not worth consulting with. Policies that are unhelpful are never acknowledged as such, and consequently, are rarely improved. CDEPs are always regarded as failing for reasons of their own, even when they are adversely affected by such policies.

Projects should be canvassed for good ideas, and consulted about proposed changes. This could be coordinated by either the Regional Office or Regional Council, or both, and should probably usually be accompanied by conference consultations. Ordinary phones are now capable of making or receiving conference calls, through paying a small monthly premium to the telephone company.

Recommendation 33:

That ATSIC adopt a policy of widespread ongoing consultation with projects primarily for ideas that will improve the running of CDEPs; and to sound out intended policies for rigour and practicality, and to see whether improvements could made before full implementation.

11. Encouraging Ownership by Participants

The CDEP Enhancement Program, otherwise known as the Three Year Plan, recognises and openly states over and over the need for participant involvement in planning and decision making. This is to give ownership to participants of the project. It is, after all, participants who the program is designed and funded for.

This ‘industrial democracy’ orientation is vitally necessary for the development, motivation and empowerment of individual participants, and to increase their sense of responsibility and ownership. This is how maturity is fostered and real improvements are actually made.

Some CDEPs, perhaps through lack of exposure to the best work practices, do not recognise such an approach, and run the project in a top-down, imposed manner, without consulting participants. This is unfortunate, for if a participant works for dole level wages, and without any significant involvement in decision making, it is degrading and more akin to slave labour. Again, the coal face is not consulted for the best ideas.

Recommendation 34:

That ATSIC Regional Offices encourage participant involvement in workplace decision making.

This could possibly be initiated through an information paper, explaining the purpose of CDEPs as being set up for participants, and the benefits of involving participants in decision making etc, followed by Project Officer attendance at participant meetings to explain to them ways it could take place.

12. Promoting Regional Forums

One NSW Region has formed a forum of CDEP Coordinators. This is a fairly high powered discussion and decision making group that explore issues needing resolving. It is recommended that CDEPs in other regions form their own forum. If this were done, networking between forums could be a relatively simple task, enabling Australian-wide consultations to take place for the improvement of the CDEP program.

Recommendation 35:

That ATSIC Regional Offices encourage the setting up of Regional Forums made up of CDEP Coordinators.

Recommendation 36:

That Regional Forums form their own network or share the Regional Council’s.

13. Encouraging a Process Approach to Planning

CDEP funding is based on advanced, forward planning. This is useful to get projects to think ahead, and enables ATSIC’s to have a measure of predictability over their own budgeting requirements.

In actual life, a CDEP may need to continually review its plans if it is to take into account the ever changing reality, which may be either problematic or opportunistic. This includes the unpredictability of ATSIC funding, and hastily formed policy, all of which has been far more problematic than opportunistic in recent years. The important thing is that, if a CDEP is to optimise its potential, it must turn adverse situations into positive and creative opportunities, so that despite setbacks, CDEP activities and objectives continue to move ahead in a positive direction. This is what is meant by being pro-active.

What, then is most important, is the process whereby a CDEP continually reviews its situation, rather than making static plans once a year, and sticking to them even if they cease to be appropriate. This is demanding and difficult, and requires commitment, especially in the most times. Decision makers may find themselves too close to their situation and be lacking in detachment and objectivity. And this is where ATSIC Project Officers may be of much value to the CDEP. By adopting a consultative, non condemnatory approach, a PO may enable CDEP decision makers to gain insight into their more difficult situations, and thus facilitate the CDEP overcoming its difficulties and reaching greater heights than they otherwise found possible.

Recommendation 37:

That ATSIC Project Officers be given basic training in facilitation and consultative techniques.

14. More Constructive Funding and Expenditure Periods

CDEPs are funded by and for the financial year – from July 1 to June 30. CDEPs are also required to acquit all grants during that same period. This gives rise to a number of difficulties:

It prevents any kind of serious longer term planning, despite the Three Year Planning program, as expenditure must be made in annual chunks, with no assurances of funding for the following years. Even the Three Year Planning program itself, which was to be funded as a rolling program over four years, was axed during the first year, and only that first year’s funding was ever granted.

CDEP is a labour intensive program, with minimal capital and recurrent funding. This means that there is often a need to undertake specific objectives in ways that save capital or recurrent expenditure, and use more labour instead. If such an approach results in a more skilled workforce as an outcome, it is to be encouraged. It is likely, however, to necessitate a relatively longer period of time for an objective to reach completion, than if unlimited funds were there to expend. Taking more that the financial year to expend funds through adopting a prudent approach should not automatically be seen as a sign of failure.

Last year, any CDEP which expended as required and acquitted all grants by the end of the financial year found themselves in deep trouble because of ATSIC funding delays at the beginning of this financial year.

A more practical approach would be to require acquittal of grants at the end of the calendar year, or thereabouts, so that, for example, funding during 1996/97 would have to be acquitted by, say, December 31 1997. This would enable ATSIC and CDEPs to avoid funding crises at the beginning of each financial year.

Recommendation 38:

That CDEP expenditure periods be extended to calendar year modules to enable smooth, non-disruptive activities through the financial year transitions.

15. Ensuring Fairness in Governing Committee Elections

One Urban CDEP did not publish a public announcement, nor notified members of an upcoming AGM, which was attended mainly by those who had been personally informed, which was, by and large, the existing committee. Meeting attendees numbered less than a quorum, but the proceeded anyway, with attendees electing each other onto the board. Participants learned of the meeting the next day, and felt disempowered. Many became half hearted about their project they felt they no longer owned. Performance decreased noticeably, and the project lost the espirit de corps that it had previously been noted for.

Recommendation 39:

That ATSIC Regional Offices ensure that all organisation members are aware of their rights, and all AGM’s and elections are held in accordance with constitutional requirements, by requiring evidence of adequate notification, and copies of election minutes. This could be assisted by the attendance at AGM’s of an independent Regional Councillor.

16. Responding to Conference/Workshop Recommendations

A State-wide CDEP conference, attended by CDEP organisation representatives, was held during 1996, at which recommendations were put forward for improving ATSIC assistance to CDEPs. A year later no information on the recommendations has been forthcoming, giving rise to speculation that it may have been only a window-dressing exercise.

A forum of CDEP Coordinators of one region forwarded to the central office, proposals to assist dealing with the axing of CTP and CYS programs, but received no reply after six months.

Recommendation 40:

That ATSIC Central Office ensures that relevant concerns and recommendations put forward for the improved running of CDEPs are promptly responded to.

17. Employment Policies for Funded Positions

One urban CDEP employed a local relative of committee members, who lacked office experience, and accounting, computer and administrative skills crucial to the coordinator’s position. When it was found that the regional office offered no objections, other positions, including that of bookkeeper, were filled with other similarly incapable family members. The CDEP went into multiple breach and severe decline, leading to suspension of the CDEP. The Regional Council were sufficiently dismayed to pass a policy requiring certain minimal requirements for all ATSIC funded positions. The ATSIC Regional Office tried unsuccessfully on many occasions over several months to have central office scrutinise the proposed document for legal correctness, without success. Policy remained unendorsed and unenforced, enabling other organisations in the area to follow suit.

Recommendation 41:

That ATSIC Administration, whether in Central or State Offices create a recommended Employment Policy document and distribute to Regional Councils for possible use.

NOTE: The abolition of funded coordination positions through the axing of CTP and CYS programs, may render this much needed control obsolete. This may make the probability of securing competent coordination positions less likely.

18. Setting up of Service Organisations

Currently, as a result of axing CTP and CYS programs, there has been an emphasis on encouraging smaller neighbouring CDEPs to pool their administrative functions. This may enable financial savings, especially salaries, and ensure that books of account maintain a minimum standard, and that reporting requirements are met.

The forming of service organisations to assist CDEPs has a history of notable successes and failures. Ngattatjarra Services has been a huge success. Originally set up in Alice Springs to provide administration services to desert communities in WA, close to the NT border, it now successfully services many NT organisations as well. It now also owns and runs an airline which does a ‘milk run’ between Alice Springs and Kalgoorlie, servicing remote communities in between. for passengers, mail and freight. It also owns and operates a major bulk-purchasing company in Perth, and distributes food and freight orders in semi-trailers to communities. In addition, Ngattatjarra Services manages medical services to the Western Desert communities.

Failures have been dramatic:

One service organisation was set up to assist development of infrastructure for a group of desert communities, including servicing desert wells. It owned and operated the only store that these desert communities could purchase from, and charged exorbitant prices to assist funding itself. After a number of Aboriginals died from dehydration after breaking down in the desert and finding themselves surrounded by wells all of which had broken, unserviced hand pumps, it was felt that the organisation had provided inadequate service.

One service organisation had been funded around $250,000 per year to provide a bookkeeping service to needy Aboriginal organisations, but had failed to provide the service for a number of years, spending its entire budget running its own office. During this time, a number of client organisations fell into breach, and were placed under grant control at the client organisations expense. The service organisation itself fell into breach after the auditor was unable to a audit of its books because of such confused records.

After the number of Aboriginal organisations placed under grant control grew at an accelerating trend, the Regional Council passed a motion to raise the performance indicators of the service organisation to ensure compliance with funded purposes. The Regional Manager declined to require this of the organisation because it was felt that the organisation could not easily comply. Organisations under grant control continued to increase.

Recommendation 42:

That ATSIC State Offices maintain a watching brief over ATSIC funded service organisations, where performance failures are likely to flow on adversely affecting performance or accountability of other funded organisations.

19. Development of Governing Committee and Coordination Protocols

Many Committees of CDEP organisations are not completely aware of what their responsibilities are, and where those responsibilities end. This can result in severe interference in the coordinator’s function of conducting the day-to-day business of the operation in a responsible and competent manner to optimise the good working of the CDEP.

One coordinator of a desert CDEP had a substantial falling out with the Chairperson after refusing to purchase an iridescent red, white-walled Falcon, for his personal use, because he felt it was inappropriate as there were no sealed roads within 100 klm of the community and 2WD vehicles were prone to getting bogged during or following rains. The upshot was that the coordinator was then subject to almost complete loss of cooperation from the committee. After the coordinator eventually departed, the vehicle was  purchased, and was wrecked with three months after it had been used to chase kangaroos.

One CDEP manger of a town-based CDEP purchased, under threat of dismissal, an excessive number of 4WD vehicles, at the expense of other much needed capital equipment, including a tipper truck. The CDEP encountered no off-road or dirt road usage that would normally  justify the extra outlay. The CDEP was given only minimal usage of the vehicles which were placed in the care of committee members, and used in the main for personal use.

One Governing committee of one urban CDEP attempted to prevent the coordinator/trainer having any direct contact with participants, during the setting up stage of the project. When the coordinator declined to accept this imposition, the committee demonstrated its power over the work scheme by closing down the most lucrative enterprise.

Recommendation 43:

That a set of basic protocols, defining the nature of the working relationship between coordinators and Governing committees be developed to layout as basic structure that would encourage and foster a constructive and effective working relationship that would enhance the overall workings of the CDEP.

It is not enough to dismiss this recommendation with the suggestion of coordinators working this out for themselves.  Many are required to sign workplace agreements before starting work, that do not spell out the relationship. Given the economic climate, where  “beggars can’t be choosers”, they may not be in a position to negotiate.

20. Encouraging Sound Capital/Recurrent Expenditure  Ratios

Treating Capital and Recurrent funds as a combined figure allowed each CDEP to optimise its expenditure so as to serve the individual organisation’s best short and long term interests, given present circumstances, and as conceived in the three year plan.

Unfortunately, this was not always what ensued. In general, Capital funds migrated to the Recurrent category. In some CDEPs the increase in Recurrent expenditure, and corresponding decrease in Capital expenditure was dramatic. All too often, the reason was found to be increases in salary expenditures, due to an organisation employing more full-time staff, which in some instances meant that local personelle were being payed for jobs that were not necessarily crucial and which they were not necessarily qualified to do. This had two dramatic effects:

  1. Increased Recurrent expenditure meant a corresponding decrease in Capital expenditure. The Dept of Finance chose to interpret any reductions in Capital expenditure as signifying Capital funding in excess of the CDEPs needs and reduced Capital funding to CDEPs of over 150 participants by 12%, without redistributing the proceeds.
  1. Demarcation was reimposed. Some leeway was given, by requiring that 70% of the Capital fund had to be expended on Capital Items. The remaining 30% could be expended on Recurrent items.

Whilst this might be a reasonable way to constrain badly managed CDEPs from irresponsible spending, it does not necessarily assist the better and more responsibly managed CDEPs to optimise their purchasing requirements, nor to manage their overall financial affairs to the best of their abilities. Some examples where the imposition is inappropriate are as follows:

  1. 1. Well-established CDEPs may already have a sufficiently built up asset base and not need such large capital outlays. But it does not always follow that their Recurrent needs are similarly well served.

  1. 2. Smaller CDEPs, in particular, have disproportionately large overheads and other Recurrent needs and may require even more that the extra 30% of Capital.

  1. 3. Many Capital Items, once purchased, needs substantial Recurrent funds to maintain them. For Example new vehicles have registration, insurance, maintenance and fuel costs, and depreciation if accrual based accounting is used.

  1. 4. The elimination of CTP and CYS placed far greater demands on Recurrent expenditure to maintain Coordination expenditure.

  1. 5. The first call on Recurrent is compulsory, non-productive expenditure such as Worker’s Compensation, Superannuation, and Insurance. The Second call on Recurrent funds is office overheads, coordination salaries, vehicle running costs, etc. Only what is left over from these priority demands can be spent on activities, which is, in fact the point of the whole scheme.

  1. 6. CDEP is, of necessity, a Labour-intensive program. For it to be otherwise would require huge capital injections, well beyond the scope of the scheme. This may put additional pressure on Recurrent funds for the materials needed to manage a labour intensive scheme.

What is required in this situation is responsible expenditure by individual CDEPs. A blanket policy forcing all CDEPs to maintain certain proportions of Capital and Recurrent expenditure will not, in all circumstances, ensure such responsible expenditure and may even prevent a CDEP from optimising their expenditure. Again this comes down to responsible, professional coordination.

An “escape clause”, Allowing CDEPs to apply directly to the Head of the economic Section for an exemption to the 70% imposition, may or may nor be a reasonable solution, depending on whether it is a genuine offer that will guarantee sufficient time and attention can be given to each applicant’s case, and then whether the applicant can present their case sufficiently well to convince the powers that be of the merits of their application.

Recommendation 44 :

That delegation to recommend altering the 70% compulsory capital expenditure, be decentralised down to a level whereby site visits can be made to investigate the merits of such a case, and whether it is consistent with genuine needs and three year plan.

In practical terms, this would probably require assessment and recommendation by the Project Officer  

21. Survey of CDEPs Greatest Needs from ATSIC

Recommendation 45:

That ATSIC State and Regional Offices carry out surveys of each CDEP in their area to determine what assistance is most needed from ATSIC, that is not already being provided, in order to fulfil their reporting requirements and function as a successful, enterprising CDEP

Recommendation 46:

That ATSIC State Offices seek submissions and recommendations from CDEPs and other interested bodies who feel they may have something to contribute to the better running of the CDEP program.

Recommendation 47:

That each ATSIC State Office assign a working committee of relevant persons to examine, consider and discuss submissions and recommendations with a view to compiling a comprehensive, coherent report of improvements that could be implemented or trialed.

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