DMS Reallocation Outcomes

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1 DMS Reallocation Outcomes Contents Introduction... 2 Outcomes... 2 Insufficient data contracts... 3 One star contracts... 3 Two star contracts... 3 Exiting contracts... 3 New contracts... 3 Retained contracts... 4 Specialist mental health and psychiatric disability contracts... 4 Spreadsheet... 4 Tables and Figures... 5 Figure 1 Count of DES-DMS Contracts before and after Reallocation by Contract Type... 5 Figure 2 Count of Exiting DES-DMS Contracts by Provider... 6 Figure 3 Count of New DES-DMS Contracts by Provider... 7 Figure 4 Count of DES-DMS Contracts in Scope but Retained by Provider... 8 Figure 5 Count of New DES-DMS Contracts by Contract Type and Provider... 9 Figure 6 Count of Exiting DES-DMS Contracts by Contract Type and Provider Table 1 DES-DMS Reallocation Outcomes by in Scope Contracts Page 1 of 15

2 Introduction Based on the September 2013 star ratings release, DES-DMS contracts with insufficient data for a star rating and those contracts rated at one or two stars were in scope for reallocation. The 2010 DES performance framework was used. A total of 88 contracts were in scope, of those 3 (3.4%) had insufficient data, 21 (23.86%) were one star and 64 were two stars (72.73%). The business review and reallocation decisions were based on Commonwealth Procurement Rules (CPRs) under the Financial and Accountability Act 1997, which identifies value for money as the overriding principle underpinning procurement. The Industry Information Paper for the reallocation defined value for money as the optimum combination of factors that: Provide participants, including those most disadvantaged in the labour market, and employers with access to high performing DES-DMS services Provide geographic coverage to ensure participants are able to access providers sites Meet the needs of specific participant groups and local labour markets Where appropriate, deliver participant choice and a diversity of providers, including through a mix of small, medium and large organisations Maintain provider s financial and organisational capacity to deliver optimal services to participants after any expansion, and Appropriately manage risks for the Australian Government Outcomes Of the 88 contracts in scope for reallocation, 41 (46.59%) are exiting and 47 have been retained (53.41%). 34 new contracts have been offered, with the remainder of business being allocated to existing higher-performing contracts. Prior to reallocation, a total of 385 DES-DMS contracts and 58 providers delivered DES-DMS services. Following reallocation, a total of 55 providers will deliver DES-DMS across 378 contracts. Overall, there is a reduction of 7 contracts and 3 providers. The three providers ceasing to deliver DES-DMS following reallocation are: The Salvation Army Employment Plus (member, 2 contracts exiting, remains in DES with 2 DES-ESS contracts) PVS Workfind (member, 2 contracts exiting, no longer a DES provider with 0 DES-ESS contracts) Skill Hire WA Pty Ltd (non-member, 1 contract exiting, no longer a DES provider with 0 DES-ESS contracts) Compared to contracting arrangements prior to reallocation, we observe a reduction of 7 generalist (all client types) contracts and 1 ex-offender specialist contract, with an increase of 1 psychiatric disability specialist contract, see Figure 1 and Figure 6. The reallocation observes an increase in the number of providers delivering specialist services, notably for the mental health and psychiatric disability cohorts. Prior to reallocation, a total of 18 providers had at least one specialist contract, with 25 providers with at least one specialist contract following. Page 2 of 15

3 In addition to the information and analysis provided here, the Department has made the following announcements regarding the DMS reallocation outcomes: 1 At the national level, 19 providers will increase their overall business share, while 13 providers will reduce their overall business share Approximately 11 per cent of participants will transition to higher performing providers As at 23 January 7,906 DES-DMS participants are required to move to a new provider Insufficient data contracts All 3 (100%) contracts in scope due to insufficient data have been retained. Two of these contracts specialise in hearing impaired and deaf job seekers, 1 provides services to all client types, see Table 1. Given the life of the DES-DMS deed, it is likely that these contracts were very close to being in scope and/or had high performance levels. One star contracts Of the 21 contracts rated one star, only 1 (4.77%) was retained, the vast majority are exiting (95.23%). The contract retained specialises in psychiatric disability, see Table 1. It is clear that contracts assessed as one star are extremely likely to exit following a reallocation process. Two star contracts Of the 64 contracts rated two stars, 43 (67.19%) were retained and 21 (32.81%) are exiting. Of the remaining contracts, 33 service all client types, 1 specialises in servicing Aboriginal or Torres Strait Islanders, with the remaining 9 specialising in mental health or psychiatric disability, see Table 1. In comparison to JSA business reallocations, a large number of contracts assessed at two stars has been retained, although we can assume these contracts have a reduced market share and likely involved the closure of lower-performing sites in the ESA. Exiting contracts Of the 41 contracts exiting, 23 (56.09%) service all client types, 1 (2.44%) ex-offenders with the remaining 17 (41.46%) specialising in mental health or psychiatric disability. The majority of exiting contracts belong to Ostara Australia (21.95%), CRS Australia (17.07%) and Break Thru People Solutions (14.63%), see Figure 2 and Figure 6. New contracts Of the 34 new contracts, 16 (47.06%) service all client types with the remaining 18 (52.94%) specialising in mental health or psychiatric disability. The majority of new contracts were awarded to MAX Employment (35.29%) and (20.59%), see Figure 3 and Figure Page 3 of 15

4 Retained contracts A total of 47 contracts were in scope but were retained in an ESA. The majority of these contracts belong to CRS Australia (34.04%), see Figure 4. In most cases, we can assume any contract in scope for reallocation that was retained now has a reduced market share, however this may not be the case for the three contracts with insufficient data. Specialist mental health and psychiatric disability contracts Prior to reallocation, Disability Employment Australia raised concerns with the Department over the handling of mental health and psychiatric disability contracts under the performance framework. 2 Specifically, we raised concerns that these contract types were twice as likely as generalists to be in scope for reallocation. We made strong representations to ensure the reallocation outcomes did not erode social infrastructure through a reduction of specialist services, a reduction we have observed through previous procurement experiences. Prior to reallocation, a total of 12 providers had at least one mental health or psychiatric disability contract, with a total of 19 providers following. The 7 providers newly delivering specialist services are (5 contracts), Campbell Page (1 contract), Hume Employment Service Ltd (1 contract), Job Centre Australia (1 contract), MatchWorks (1 contract), MAX Employment (6 contracts) and the ORS Group (1 contract). Overall, there was an increase of 1 contract specialising in psychiatric disability, see Figure 1. We remain concerned that the performance framework does not adequately recognise the difficulty involved for this cohort and will continue to analyse results moving forward. Members with these specialist contracts are encouraged to read our issues paper DMS Reallocation and Specialist Mental Health and Psychiatric Disability Contracts. Spreadsheet Disability Employment Australia has prepared a user-friendly Excel spreadsheet to allow members to easily filter outcome results by Provider, ESA, LMR, September Star Rating, State and Specialisation. The spreadsheet is available for download here and allows members to analyse before and after reallocation outcomes. It also provides some insight into which providers might have gained or lost market share in an ESA, however we have no visibility over this so caution should be exercised. 2 Page 4 of 15

5 Tables and Figures Figure 1 Count of DES-DMS Contracts before and after Reallocation by Contract Type Page 5 of 15

6 Figure 2 Count of Exiting DES-DMS Contracts by Provider Page 6 of 15

7 Figure 3 Count of New DES-DMS Contracts by Provider Page 7 of 15

8 Figure 4 Count of DES-DMS Contracts in Scope but Retained by Provider Page 8 of 15

9 Figure 5 Count of New DES-DMS Contracts by Contract Type and Provider Page 9 of 15

10 Figure 6 Count of Exiting DES-DMS Contracts by Contract Type and Provider Page 10 of 15

11 Table 1 DES-DMS Reallocation Outcomes by in Scope Contracts Org Name ESA Name State Speciality Description September 13 - Star Reallocation Outcome Rating CRS Australia Bendigo VIC VIC All Client Types 2 Retained Western District Employment Bendigo VIC VIC All Client Types New Access CRS Australia Bundaberg QLD QLD All Client Types 2 Retained CRS Australia CairnsQLD QLD All Client Types 2 Retained CRS Australia Calder VIC VIC All Client Types 1 Exit MAX Employment Calder VIC VIC All Client Types New Break Thru People Solutions Canterbury/Bankstown NSW All Client Types 1 Exit Break Thru People Solutions Canterbury/Bankstown NSW Psychiatric Disability 2 Retained Ostara Australia Canterbury/Bankstown NSW Mental Health 1 Exit MAX Employment Canterbury/Bankstown NSW Mental Health New Job Futures Ltd Capricornia QLD QLD All Client Types 1 Exit Break Thru People Solutions Central Coast NSW NSW Psychiatric Disability 2 Exit Job Centre Australia Central Coast NSW NSW Psychiatric Disability New CRS Australia East Gippsland VIC VIC All Client Types 2 Retained Ostara Australia East Gippsland VIC VIC Mental Health 1 Exit East Gippsland VIC VIC Mental Health New Peedac East Metro WA WA Aboriginal or Torres Strait 2 Retained Islander Job Futures Ltd Eureka VIC VIC Mental Health 2 Exit Eureka VIC VIC Mental Health New Workskills/Workability Eurobodalla NSW NSW All Client Types 2 Retained CRS Australia Fleurieu/Kangaroo Is SA All Client Types 1 Exit Job Futures Ltd Fraser Coast QLD QLD All Client Types 2 Retained CRS Australia Gawler SA SA All Client Types 2 Exit Page 11 of 15

12 Personnel Placement Gawler SA SA All Client Types New Consultancies Pty Ltd CRS Australia Geelong VIC VIC All Client Types 2 Retained On-Q Human Resources Gold Coast QLD QLD All Client Types 2 Retained MAX Employment Gold Coast QLD QLD All Client Types New Ostara Australia Goldfields/Esperance WA All Client Types 1 Exit Forrest Personnel Incorporated Goldfields/Esperance WA All Client Types New Goulburn Valley VIC VIC All Client Types 2 Exit Western District Employment Goulburn Valley VIC VIC All Client Types New Access CRS Australia Goulburn Valley VIC VIC All Client Types 2 Retained CRS Australia Grampians VIC VIC All Client Types 2 Retained WISE Employment Ltd Hobart TAS TAS All Client Types 2 Retained Ostara Australia Inner Sydney NSW NSW Mental Health 2 Retained The Salvation Army Inner Sydney NSW NSW All Client Types 1 Exit Employment Plus MAX Employment Inner Sydney NSW NSW All Client Types New Ostara Australia Inner Western Sydney NSW Mental Health 2 Retained CRS Australia Latrobe Valley VIC VIC All Client Types 2 Retained Ostara Australia Latrobe Valley VIC VIC Mental Health 2 Exit MAX Employment Latrobe Valley VIC VIC Mental Health New Work Solutions Gippsland Pty Latrobe Valley VIC VIC Ex-Offenders 2 Exit Ltd MAX Employment Latrobe Valley VIC VIC All Client Types New Anglicare Tasmania Inc Launceston TAS TAS Psychiatric Disability 1 Retained WISE Employment Ltd Launceston TAS TAS All Client Types 2 Retained Liverpool NSW NSW All Client Types 2 Retained Break Thru People Solutions Liverpool NSW NSW Psychiatric Disability 2 Exit Ostara Australia Liverpool NSW NSW Psychiatric Disability New Campbell Page Logan QLD QLD All Client Types 2 Exit Page 12 of 15

13 Break Thru People Solutions Lower Hunter NSW NSW All Client Types 2 Retained Break Thru People Solutions Lower Hunter NSW NSW Psychiatric Disability 2 Retained Workskills/Workability Lower South Coast NSW All Client Types 1 Exit MAX Employment Lower South Coast NSW All Client Types New Ostara Australia Macarthur NSW NSW Mental Health 2 Exit Macarthur NSW NSW Mental Health New Break Thru People Solutions Manning NSW NSW All Client Types 2 Exit Castle Personnel Services Ltd Manning NSW NSW All Client Types New Wesley Uniting Employment Manning NSW NSW All Client Types 2 Retained CRS Australia Mid Murray VIC VIC All Client Types 2 Retained Skill Hire WA Pty Ltd Mid West/Gascoyne WA All Client Types 2 Exit Sarina Russo Job Access Monash VIC VIC All Client Types 2 Retained WISE Employment Ltd Monash VIC VIC Mental Health 2 Exit MAX Employment Monash VIC VIC Mental Health New CRS Australia Mt Isa QLD QLD All Client Types 2 Retained CRS Australia Murray Darling NSW NSW All Client Types 2 Retained OCTEC Murray Darling NSW NSW All Client Types Insufficient Retained Data Break Thru People Solutions Nepean NSW NSW Psychiatric Disability 1 Exit MAX Employment Nepean NSW NSW Psychiatric Disability New Job Futures Ltd North Coast NSW NSW Psychiatric Disability 1 Exit North Coast NSW NSW Psychiatric Disability New On-Q Human Resources North Coast NSW NSW All Client Types 1 Exit North Coast NSW NSW All Client Types New PVS Workfind North Metro WA WA All Client Types 2 Exit Northern Adelaide SA SA All Client Types 2 Retained PVS Workfind Northern Adelaide SA SA All Client Types 1 Exit Status Employment Services Northern Adelaide SA SA All Client Types New Page 13 of 15

14 UnitingCare Wesley Port Northern Adelaide SA SA Psychiatric Disability 2 Retained Adelaide Inc Northern Sydney NSW NSW All Client Types 2 Retained Ostara Australia Northern Sydney NSW NSW Mental Health 1 Exit MAX Employment Northern Sydney NSW NSW Mental Health New Epic Employment Service Inc Outer North Brisbane QLD All Client Types 2 Retained Interact People Solutions Patterson NSW NSW All Client Types 2 Retained CRS Australia Peninsula VIC VIC All Client Types 2 Retained Ostara Australia Peninsula VIC VIC Mental Health 1 Exit The ORS Group Peninsula VIC VIC Mental Health New Break Thru People Solutions Plenty VIC VIC Psychiatric Disability 2 Exit MatchWorks Plenty VIC VIC Psychiatric Disability New Job Futures Ltd Richmond NSW NSW Psychiatric Disability 2 Retained CRS Australia Riverland SA SA All Client Types 2 Retained CRS Australia South Brisbane QLD QLD All Client Types 2 Retained Ostara Australia South Brisbane QLD QLD Mental Health 2 Retained CRS Australia South Eastern NSW NSW All Client Types 1 Exit Ostara Australia South Eastern NSW NSW Mental Health 2 Retained Hume Employment Service South Eastern NSW NSW Mental Health New Limited Southern Adelaide SA SA All Client Types 2 Retained Campbell Page Southern Adelaide SA SA All Client Types 2 Exit Ostara Australia Southern Ranges NSW NSW Mental Health 1 Exit CRS Australia Southern WA WA All Client Types 2 Retained Ostara Australia St George-Sutherland NSW Mental Health 2 Retained Australian Red Cross Sunshine Coast QLD QLD All Client Types 2 Retained NQ Competitive Employment Townsville QLD QLD Hearing impaired and deaf job Insufficient Retained Service seekers Data The Salvation Army Employment Plus Tweed NSW NSW All Client Types 1 Exit Page 14 of 15

15 WISE Employment Ltd West and North West TAS All Client Types 2 Exit CRS Australia Western Adelaide SA SA All Client Types 2 Retained UnitingCare Wesley Port Western Adelaide SA SA Psychiatric Disability 2 Exit Adelaide Inc Status Employment Services Western Adelaide SA SA Psychiatric Disability New CRS Australia Western District VIC VIC All Client Types 2 Exit Interwork Limited Western District VIC VIC All Client Types New CRS Australia Westgate VIC VIC All Client Types 2 Exit Campbell Page Westgate VIC VIC All Client Types New Westgate VIC VIC All Client Types New EACH Employment Westgate VIC VIC Psychiatric Disability 2 Exit Campbell Page Westgate VIC VIC Psychiatric Disability New Westgate VIC VIC Psychiatric Disability New Interact People Solutions Windamere NSW NSW All Client Types 2 Retained Campbell Page Wollongong NSW NSW All Client Types 2 Exit CRS Australia Yarra VIC VIC All Client Types 1 Exit MAX Employment Yarra VIC VIC All Client Types New Ostara Australia Yarra VIC VIC Mental Health 1 Exit MAX Employment Yarra VIC VIC Mental Health New Sarina Russo Job Access Yarra VIC VIC All Client Types 2 Retained SensWide Services Yarra VIC VIC Hearing impaired and deaf job seekers Insufficient Data Retained Page 15 of 15

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