Country health property maintenance
We have completed a review of regional local health networks (regional LHNs) property assets. We examined whether the arrangements to manage the maintenance of those assets were effective.
Together with their staff, the assets used by regional LHNs are critical to delivering safe and reliable services to the public at the required level.
Regional LHNs manage over $821 million in property assets at 168 different sites across regional South Australia.
Poor maintenance practices result in assets providing deteriorating levels of service, and increase the financial burden and risk of asset failures. It is therefore important that systems and processes are in place, and information available, to effectively manage and maintain these assets. This will ensure asset management and maintenance risks, and their impact on service delivery, are appropriately managed and there is proper use of public money..
We found that processes, practices, systems and arrangements established by the State to manage the maintenance of regional health property assets were not effective. We identified numerous gaps in fundamental areas including:
- clearly defined roles and responsibilities were not established and agreed with DPTI
- foundational strategies, policies and plans for asset management were not established
- fit-for-purpose information systems with complete and reliable asset data were not established
- maintenance budgets were based on the previous year’s budget rather than maintenance needs and priorities
- no effective certification that works by external contractors were completed to an appropriate standard, and that payment was only made for actual work performed and for a reasonable price.
In line with the new governance arrangements, regional LHNs need to take responsibility for their assets and work with the mandated facilities management service provider and DHW to implement remedial strategies and actions. Further, regional LHNs need to:
- consider how the new governance arrangements impact the relationships and responsibilities of all parties involved
- establish effective processes for the six separate regional LHNs to work together to collectively address remedial strategies and actions.