Value for Money VfM

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4.1.4 Monitoring and Evaluation of ISP Operational Systems

The ME of operational systems is conducted by the country team and by Coffey. The Coffey Adelaide team undertakes a quarterly Project Health Check which reviews management, policy adherence, team performance and milestone quality. The ISP team undertakes six monthly audits of the sub-national offices led by the finance manager and the Coffey finance team. The ISP Finance Manager also has fortnightly telephone links with the subnational finance team to provide regular operational support for finances. In addition the ISP conducts monthly operations meetings to review activities under procurement, HR, finance, administration and HR. For large and complex activities, the ISP operations team have monthly meetings to specifically monitor planning, implementation progress, and identify and manage operational risks. This has been the case for activities such as PJJ, NHA and ADINKES in the new Work Plan. The latest Quality and Finance Audits were conducted in March 2015. The audit revealed irregularities related to an activity conducted in January 2014 for training on the hospital provider payment system to all public hospitals in Indonesia for the establishment of the national health insurance system. The audit findings showed that there was potential mark-up and falsification of receipts related to a photocopy vendor based in the MoH. Coffey took immediate action by providing DFAT with the suspected fraud report. DFAT instructed Coffey to provide them with an approach to managing the case which has been approved and currently being applied by the ISP team leader. Following the audit the ISP will be undertaking the following actions as part of its continuous improvement approach:  Coffey Jakarta finance team to conduct internal reviews of AIPHSS on a quarterly basis to review supporting documentation for potential fraud or gaps in the acquittal review process.  Providing more training for the finance team on the importance of the acquittal review process and on areas to look for when conducting the review.  Conducting additional or refresher fraud training sessions with the team and to partner agencies.  Updating the Security Manual.  Reviewing the Operations Manual Program Implementation Manual for consistency.  Ensuring mandatory inductions and training on DFAT policies are provided for new advisors and locally employed staff.

4.1.5 Value for Money VfM

The ISP has clearly defined processes and procedures in the Program Implementation Manual PIM that have been refined over time to provide value for money. The finance teams have been trained on these processes following the restructure in November 2014. The ISP has continued to improve procurement, management and financial oversight in the delivery of technical services to ensure the program as a whole delivers value for money. Delivering within budget Activity budgets are developed with support from the ISP and the final budgets are scrutinised by the finance team to ensure they comply with the GoI costing system and activities can be implemented within budget. For procurement of consulting services, the GoI consultant market rate guide is used to determine appropriate rates for advisers recruited to support GoI activities. This is used in collaboration with the Coffey salary guide which ensures that salaries are categorised in accordance with the technical focus, in a similar way to how the Adviser Remuneration Framework ARF is used for international positions. Ensuring cost-effective options The ISP uses the government standard rates as the principle for scrutinising costs within the IU activity budgets. For procurement of any goods, the ISP either seeks three quotes or uses a competitive tender as required. 27 Planning of activities and budgets is undertaken by the implementing partners and reviewed by the planning budgeting officer who reviews how budgets are allocated across the program, if serious issues are detected in proportionality, or activities are clearly not cost effective, then these are raised with the senior management and the implementing partner to make the necessary changes to the work plan and allocation of resources. Robust systems and procedures in place to monitor and manage VfM during implementation The ISP applies the Commonwealth Procurement Rules to ensure we encourage competition in the procurement of goods and services to deliver VfM. During implementation of major high value, complex activities, the ISP holds regular management and progress meetings with partners or contractors to review budgets, activity progress, and manage risks which threaten VfM. These meetings are aligned with technical reviews, which are managed by the PTS, TD or technical advisors. The combination of these management and technical reviews provides a systematic approach to managing VfM during implementation. Furthermore, the ME team conduct regular monitoring of activity progress to gather data on implementation. The AIPHSS program is a modality, which for relatively small scale funding and the provision of technical assistance is providing support for high level policy development and the development of tools and guidelines that are adopted and applied at a national level. This approach is demonstrating a high level of sustainability because all activities are part of large scale reforms and systemic change that government is leading but cannot implement quickly due to system bottlenecks. The catalytic effect of AIPHSS by targeting system bottlenecks is emerging as a key strength of the implementation model.

4.1.6 Risk Management