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Quality service standards compliance: Snapshot survey

How much does it cost your organisation?
The community services sector knows first hand that assessment and compliance reporting for quality or service standards is a costly exercise and despite everyone’s best efforts the benefits are often overshadowed by the significant drain on resources. For more information on the quality service environment for NGOs … read more
As part of our work developing Standards and Performance Pathways, we undertook a snapshot survey to gather baseline data on the cost of quality standards and compliance reporting to the sector.
This national survey was conducted over a 3 week period in April 2011 with the support of the State and Territory Councils of Social Services and other peak bodies. A total of 133 organisations completed this survey.
The findings have given us a clear a picture of the sector impact of how the current quality standards assessment and compliance reporting requirements impact on government funded NGOs and community based organisations.
What we know is:
·       Nationally, unnecessarily duplicated standards assessment and compliance reporting is costing NGOs in excess of 2.7 million hours, or over $100 million a year. The impact of standards assessment and compliance reporting is felt by almost all organisations, large and small, with over 70% of organisations undertaking multiple assessments against compliance standards.
 
                     Number of Assessments Against Standards
  
·          A significant number of organisations have to complete over 6 sets of standards assessment and compliance reports a year;
and
·          Over 30% of organisations spend more than 40 hours per assessment, with half of all organisations spending more than 25 hours per standard assessment, (not including work required to meet compliance requirements).
 
% of Organisations by Time Taken  

·         Size of organisations responding

o    Micro - Annual income less than $150,000, 11% of respondents:
o    Small - Annual income $150,001-$2,000,000, 60% of respondents
o    Medium - Annual income $2,000,001-$5,000,000, 11% of respondents
o    Large - Annual income $5,000,001-$10,000,000, 8% of respondents
o    Very Large - Annual income more than $10,000,000, 9% of respondents
 
·         What it is costing to meet standards assessment and compliance reporting requirements:
    • Over 70% of small organisations surveyed spend more than $5,000 annually to meet standards assessment and compliance reporting requirements
    • More than half of all small organisations surveyed are spending over $10,000 annually
    • Almost all medium, large and very large organisations spend over $10,000 annually
    • One organisation reported spending one third of its income on meeting standards assessment and compliance reporting
    • Almost two thirds of those spending above $50,000 reported spending well over $100,000 with one organisation advising recent standards assessment and compliance reporting changes had cost the organisation over $400,000
  
 Organisational spend on standards assessment and compliance reporting by size


The above figures of course, only provide part of the picture. In addition to the costs of meeting standards assessment and reporting requirements, organisations are also faced with undertaking implementation work to meet compliance requirements. Conservatively this is estimated to at least double the overall costs to organisations. For organisations that have multiple standards, the above costs of standards assessment and compliance reporting are estimated to represent only a fraction of the total cost.

·         What are the opportunities lost?
In addition to the financial impact of standards assessment and compliance reporting, there is also of course the opportunities lost, the service hours lost due to this over-burdensome system of multiple standards.
    • A third of small organisations are each losing over 280 hours annually
    • Almost two thirds of medium organisations are losing over 280 hours annually
    • One organisation reported spending over 10,000 hours on standards assessment and compliance reporting (the equivalent of more than 5 full time staff).
With a more efficient system, many of these hours could have been redirected into direct service delivery.
If you would like a copy of the full research report, please click here.