SECTION 2 - OUTCOMES AND OUTPUTS INFORMATION

OUTCOME AND OUTPUT GROUPS

The map on the following page shows the relationship between the Government’s outcome and the contributing outputs for AusAID, presented here as output groups. Financial detail for Outcome 1 by outputs and output groups appears in Table 2.2 while non-financial information for Outcome 1 appears in Table 2.3

Chart 2.1 - AusAID Outcome and Output Groups

Note: Revenue from Government through appropriations contributes 98.5 to the total departmental output price for this outcome for 1999-2000.

OUTCOME 1

Table 2.1

PROGRAM MANAGEMENT BUDGETING	ACCRUAL BUDGETING
Program 6 Development Cooperation	Outcome 1 Australia’s national interest advanced by assistance to developing countries to reduce poverty and achieve sustainable development
Sub-programs Sub-program 6.1: Country Programs Sub-program 6.2: Global Programs Sub-program 6.3: Corporate Services	Output Groups Output 1: Policy Output 2: Program Management
Appropriations for Program 6 Sub-program 6.1 Appropriation Bill 1 Division 317.1 - Running Costs Division 317.2 - Country Programs Sub-program 6.2 Special Appropriations Asian Development Fund Act 1987 International Development Association Act 1987 International Development Association (Further Payment) Act 1990 International Development Association (Further Payment) Act 1993 Appropriations Bill 1 Division 317.1 Running Costs Division 317.3 Multilateral, community and humanitarian relief programs Sub-program 6.3 Appropriations Bill 1 Division 317.1 – Running Costs	Appropriations for Outcome 1 Output 1.1; Output 1.2 Appropriation Bill 1: Departmental outputs Appropriation Bill 2: Departmental capital injection relating to carry over, and equity injection for new budget measure (see Table 1.1 and page 112 explanation of capital injections) OUTCOME 1 Appropriation Bill 1: Administered expenses Appropriation Bill 2: Administered capital injection to extinguish existing multi-year liabilities (see Table 1.1 and page 112 explanation of capital injections) Special Appropriations Asian Development Fund Act 1987 International Development Association Act 1987 International Development Association (Further Payment) Act 1990 International Development Association (Further Payment) Act 1993

OUTCOME 1

Australia’s national interest advanced by assistance to developing countries to reduce poverty and achieve sustainable development

Promotion of sustainable development and poverty reduction in developing countries, particularly in the Asia Pacific region, is a key objective of Government. The core business of AusAID is to manage programs that assist developing countries to reduce poverty and achieve sustainable development. The Agency also provides advice and analysis to the Government across all aspects of international development policy.

In 1999-2000 resources for development programs have been maintained in real terms. Resources allocated to the management of development programs and provision of policy have been increased to prepare for an expanded program of assistance to East Timor.

1999-2000 BUDGET MEASURES AFFECTING OUTCOME 1

Budget Measure Purpose: To provide additional resources to fund the establishment of an AusAID office as part of a new Australian Consulate-General in Dili.

Impact of the Measure: The AusAID office in the Consulate-General will help decide the most appropriate Australian aid response to developments in East Timor. It will support the implementation of an expanded aid program to assist East Timor.

The financial implications of the budget measure are detailed in Table 1.2 .

The Government has made clear that Australia will provide substantial assistance to an autonomous or independent East Timor. Decisions on the level and nature of that assistance will be taken once the situation is clearer. In the meantime, Australia’s aid to East Timor will continue to be delivered as part of our overall aid program to Indonesia. Australia is the largest bilateral donor to East Timor, providing $7 million in 1998-99. Australia has also pledged $20 million to assist the United Nations consultation process planned for August 1999.

RESOURCES FOR OUTCOME 1

Table 2.2 shows how the 1998-99 appropriation and program structure translate to total resourcing for planned Outcome 1, including total administered expenses, revenue from Government (Appropriations) for outputs, and the total price of outputs. Cell references D1, E1 and I1 show the links back to Table 1.1, the Appropriations Table. Table 2.2 also compares cash with accrual figures for 1998-99.

Table 2.2 - Total Resources for Outcome 1

Outcome 1: Australia's national interest advanced by assistance to developing countries to reduce poverty and achieve sustainable development.

2. Allocation of 1999-2000 expenses against 1998-1999 appropriations is only notional and for information
3. Differs from 1998-1999 PBS figures due to the inclusion in departmental items of $1m from this appropriation
4. See Note 1 to Financial Statements- Explanation of decrease in expenses from 1998-1999 to 1999-2000.
5. Does not include AusAID's unfunded expenses ie operating loss. See Note 2 to Financial Statements
6. Includes SES and non-SES officers funded from running costs

CONTRIBUTION OF OUTPUTS TO PLANNED OUTCOME 1

AusAID’s outputs of policy and program management reflect the Government’s decision to provide effective assistance in partnership with developing countries to reduce poverty and achieve sustainable development. AusAID manages, monitors and advises on the types of programs that are implemented and the impact these programs have on development.

Justification for the choice of the outputs to achieve planned Outcome 1 is described in Table 2.3. That table provides information on the strategies chosen to deliver Outcome 1, and shows the links between outputs and the outcome.

PERFORMANCE INFORMATION FOR OUTCOME 1

Table 2.3: Performance Information and Planned Level of Achievement, 1999-2000

Effectiveness – Overall Achievement of the Outcome – (Measures, indicators and targets used as appropriate)

AusAID’s administered expenses will be allocated to activities aimed at reducing poverty and achieving sustainable development. Activities will be concentrated in the following key result areas: improve agriculture and rural development increase access and quality of education promote effective governance in developing countries improve health provide essential infrastructure deliver humanitarian and emergency assistance promote environmental sustainability promote equal opportunities for men and women as participants and beneficiaries in development A target of 75 per cent of these activities receiving a quality rating of satisfactory overall or higher will be adopted (A 'quality rating' is a measure of the quality of individual projects or activities expressed as a score or a standard. A five-point scale is used as follows: 5 = best practice; 4 = fully satisfactory; 3 = satisfactory overall; 2 = marginally satisfactory; 1 = weak. The rating is determined by AusAID project managers (Posted officers and Canberra-based officers) by assessing performance against whether the activity has appropriate objectives and design; is managed in a professional manner; achieves its objectives; and has sustainable outcomes.) Assistance will be provided to countries directly, and through international and regional and non-government organisations.

Performance Information for Administered Items (including third party outputs)
Country and Regional Programs	75% of activities in the key result areas receive a quality rating of satisfactory overall or higher 75% or organisations receive a rating of satisfactory overall or higher in terms of efficiency, effectiveness and relevance to Australian Government priorities significant activity outputs in key result areas
Multilateral Organisation Programs	75% of organisations receive a rating of satisfactory overall or higher in terms of efficiency, effectiveness and relevance to Australian Government priorities significant activity outputs in key result areas
Emergency and Humanitarian Programs	75% of humanitarian activities receive a quality rating of satisfactory overall or higher 75% of emergency activities receive a rating of satisfactory overall or higher in terms of the timeliness and appropriateness of Australia’s response 75% or humanitarian organisations receive a rating of satisfactory overall or higher in terms of efficiency, effectiveness and relevance to Australian Government priorities significant activity outputs in key result areas
NGO and Volunteer Programs	75% of activities in the key result areas receive a quality rating of satisfactory overall or higher significant activity outputs in key result areas
Information, Education and Communication Programs	75% of activities in the key result areas receive a quality rating of satisfactory overall or higher significant activity outputs in key result areas No. of teachers participating in development education training No. of currriculum documents purchased by target group Average monthly number of hits on the internet sites Community support for development increasing
Outputs
Output 1: Policy	Quality: Ministerial/Parliamentary Secretary satisfaction Quantity: No. of submissions, briefs, questions on notice, PPQs, submission to Parliamentary Committees, correspondence, press releases, speeches, correspondence Price: $9.900m
Output 2: Program Management	Quality: 75% of activities rated satisfactory overall or higher Quality: All major programs carried out in partnership Quality: tools and process implemented to ensure management of a high quality program that reflects Government priorities. Quality: feedback on quality of tender information; decreasing number of late gazettals; number of contracts terminated or subject to litigation or serious disputation. Quantity: number of programs; number of activities, number of new contracts signed and ongoing contracts managed Price: $53.743m; Output price equals 4% of administered cash used

EVALUATIONS

Evaluations undertaken by AusAID in 1999-2000 will involve analysis of project performance and design quality at different stages of the project cycle and incorporate feed back of lessons and guidance of best practice. In 1999-2000, dependent on the agreed scope of the activities and the availability of sufficient resources, it is proposed the following activities will be undertaken:

Sectoral Evaluations

• Land Management and Regional Planning: Philippines
• Health sector: community participation and primary health care projects
• Rural development: integrated rural development (China and possibly Papua New Guinea)
• Agriculture: targeting poverty and income generation and dryland farming
• Education: curriculum development, distance education and education financing

Strategic evaluations

• Effectiveness of the aid program on alleviating poverty
• Institutional strengthening and capacity building study (South Africa and other country programs)
• Effectiveness of mainstreaming gender considerations in the aid program
• Microfinance: impact assessment (with International Fund for Agricultural Development)
• Organisation review: Pacific Community
• Effectiveness of food aid activities (with World Food Programme)

Sectoral and Program reviews:

• NGO programs: Africa
• Review of Australian co-financing with multilateral development banks
• Environment reviews: infrastructure, water and sanitation and urban development
• Review of the training program: performance and links to country and regional strategies

Review of systems and mechanisms

• Review of Project Completion Reports
• Guidelines on the Management of Program Aid
• Revision of the lessons learned data base

COMPETITIVE TENDERING AND CONTRACTING

Actual delivery of the aid program is entirely outsourced. AusAID’s role is to provide policy advice to Government on development issues and manage the programs implemented by contractors, non-government organisations and international and regional organisations. As a result, contracting out program delivery has been an integral part of the aid program for more than twenty years, and AusAID currently manages some 1,800 contracts on behalf of the Commonwealth.

Since the Government’s competitive tendering and contracting initiative, AusAID has aimed for qualitative improvements in our contracting procedures. This is being done through an emphasis on quality on entry, improvements in project and program effectiveness, and ensuring flexible program approaches. Changes to contracting arrangements have recently been approved by the Minister for Foreign Affairs, the Hon. Alexander Downer MP. All these measures are directed at ensuring we get the best contractor to do a quality job, resulting in better value for money outcomes.

In 1998-99, AusAID reviewed all of its internal functions to determine consistency with Government objectives, cost effectiveness and performance improvement strategies, including market based testing and competitive tendering and contracting. In 1999-2000 AusAID will seek independent, expert advice on the implementation of these performance improvement strategies, including benchmarking and competitive tendering and contracting, in particular in relation to corporate support and management functions.