Underperforming RTA blows budget...again

RTA blows budget by $530 million, capping off three years of over spending

By Brad Gardner | November 5, 2010

The NSW Roads and Traffic Authority blew its budget by more than $500 million and failed to meet key initiatives last financial year.

A recent financial audit released by NSW Auditor-General Peter Achterstraat reveals the RTA exceeded budget by $530 million – a $258 million increase over the previous year.

According to the report, the RTA overspent by $272 million in the 2009 financial year and $269 million in 2008, leading Achterstraat to say there has been "significant and consistent overruns in budgeted expenditure" within the department.

The report cites transfers of roads to local councils ($401 million) as the main cause of the $530 million blowout, while Sydney Harbour Tunnel expenses ($55 million) and additional road maintenance due to storm damage ($70 million) also contributed.

Achterstraat cites the RTA for failing to implement a $234 million road safety program that included speed zone management and education campaigns. The installation of safety cameras was delayed due to problems with approval, procurement and construction.

It was a similar situation for point-to-point cameras in the 2010 financial year, with the report saying there was a "Deferral of [the] installation program predominantly due to a steel storage".

Despite the RTA spending more than budgeted, the extra cash didn’t equate to more rest areas in some instances.

According to the report, rest area projects on the Pacific Highway, Nambucca Heads and Boggy Creek were scrapped due to property constraints.

A number of road projects on key routes such as the M5, Newell Highway and F3 were delayed due mainly to poor weather. Community consultation, environmental issues, property acquisitions and project approvals also played a role in some cases.

Following the release of the report, Achterstraat called on the public service to improve the quality and timeliness of financial reporting.

"Seven of the 24 largest agencies’ financial statements submitted for audit contained 24 errors, each exceeding $20 million," he says.

"This delayed and increased the costs of preparing and auditing these financial reports."

Achterstraat used the report to urge the NSW Government to improve financial reporting.

He wants all agencies to prepare a full set of accounts by March 31 each year and for minimum qualifications for chief financial officers.

He says limited progress has been made on implementing common financial reporting systems in some of the super departments.

The Auditor-General is also pushing for CEOs to be held accountable for accurate and timely financial reporting.

Achterstraat’s report records a government surplus of $994 million for the 2009-2010 Budget due to federal stimulus funding.

Had the money been excluded, Achterstraat says NSW would have being looking at a deficit of $861 million.

He says employee costs excluding superannuation increased by 3.5 percent compared to 7.5 percent the previous year.

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