AES SEMINAR 2018 – NSW GOVERNMENT MOVE TO OUTCOME BUDGETING

WESTIR Limited attended the Australasian Evaluation Society’s (AES) seminar called NSW Government Move to Outcome Budgeting – Opportunities and Challenges for Evidence-Based Policyat the Australian Human Rights Commission in October 2018.

The first speaker, Josh Greenwood (Director of Outcome Budgeting, NSW Treasury) provided an overview of outcome budgeting used by the NSW Government. Outcome budgeting was announced in the NSW Government 2017/18 Budget and commenced in the 2018/19 budget. Josh outlined the characteristics of outcome budgeting, which included:

• The development of 46 state outcomes
• Outcome indicators
• Agency structures; and
• A strong emphasis on sector collaboration and co-design.

It also included changes to legislation, a new IT system and new budget processes. Some challenges they have encountered so far includes:

• Developing a framework based on principles rather than prescription
• Navigating political cycles
• The varying capacities of clusters and sectors; and
• The availability of quality evidence.

The next speaker, Ophelia Cowell (Director, Economic Analysis and Evaluation, NSW Treasury) spoke about evidence-based policy and evaluation in NSW. A number of NSW auditing reporting processes have highlighted the lack of evidence showing that the NSW Government is achieving its goals. Her department’s aim has been to develop an annual evaluation schedule with a holistic approach. She spoke about the importance of systematically collecting evidence to make better decisions about investments and the use of tools such as cost benefit analysis (CBA). She stressed that CBA is not a financial analysis but simply a tool that places a relative value on program or social outcomes.

The final speaker was Michael Di Francesco (formerly from ANZSOG), who responded to the two presentations. Some of his observations included:

• Using data as an analytical tool versus a decision-making tool – the need to first use data as an analytical tool and then develop decision-making tools as a flow on.
• The issue of information overload – understanding what are the most important decisions to be made.
• Understanding that outcome budgeting is just as much an organisational issue as it is a technical issue – there needs to be behaviour change across government so that using data and evaluation becomes routine.
• Understanding the value of outcome budgeting as constructive – there is no such thing as totally objective metrics, so it needs to be used as an aid for judgement.
• Outcome budgeting needs to be used as a building block for change – frameworks need to make sense to those that are implementing it so that it becomes operational.

The session concluded with a Q&A session with all the speakers. Some useful links mentioned throughout the session are below:

• NSW Outcome Budgeting Overview
• Latest NSW Government Budget Papers
• Implementation of NSW Government’s Program Evaluation Initiative