Portable Long Service Authority Annual Report 2023-2024

The Portable Long Service Benefits Authority (the Authority) is an independent statutory body established to oversee the Long Service Benefits Portability Act 2018 (Vic) (the Act). The Act, along with the Long Service Benefits Portability Regulations 2020 (Vic), creates a scheme allowing long service benefits to be transferable for Victorian workers in the community services, contract cleaning, and security industries.

The Portable Long Service Benefits Scheme (the Scheme) was established following an inquiry by the Victorian Parliament’s Economic, Education, Jobs and Skills Committee to allow workers to accrue long service benefits based on their total time in an industry, not with a single employer.

Since 2019, the Scheme has become one of Australia’s largest portable long service leave schemes. The Authority manages employer and worker registrations and oversees investment funds from employer levies for future entitlements.

The Authority is also charged with educating employers on their obligations under the Act. It uses its legislative powers to ensure proper worker registration, especially in the face of under registration, which remains one of the Authority’s key priorities.

Simultaneously, the Authority also educates workers about their rights, empowering them to inquire about their registration for the Scheme and manage their details.

Vision

Our vision is to deliver a quality Scheme to protect the benefits of those who are entitled to them.

Purpose

The Authority administers an effective Scheme through prudent, sustainable investment and supporting all stakeholders – including employers and workers alike – as well as educating and enforcing every stakeholder’s role and interest in the Scheme.

Our shared values

The Authority adheres to the Victorian Public Sector values, which underpin the behaviours that the government and community rightly expect of it. Acting consistently with these values strengthens the Authority’s capacity to operate effectively and achieve its objectives. These values are:

• Responsiveness - We are approachable and provide timely, useful and accurate information.
• Integrity - We have unbiased and honest interactions.
• Impartiality - We are firm and consistent in our application of the law.
• Accountability - We fulfil our objectives in a clear, transparent and responsible manner.
• Respect - We respect our stakeholders, each other and ourselves.
• Leadership - We seek to have a positive influence and to empower others.
• Human rights - We administer the law and deliver decisions, advice and policy that respect and support everyone’s human rights.

Delivering a quality Portable Long Service Benefits Scheme

On behalf of the Governing Board, we are pleased to present the Authority's Annual Report for the financial year ended 30 June 2024.

In five short years since the Scheme's inception in 2019, much has changed for workers and employers alike. The Scheme’s core purpose has been to administer an effective Scheme to ensure that workers in the community services, contract cleaning and security industries can accrue long service benefits even if they change employers within their industry. Workers in these industries frequently move from one short-term position to another. Prior to the establishment of the Scheme this meant that many workers missed out on long service entitlements.

The community services, contract cleaning and security industries are important to the Victorian economy. In the past year alone, an additional 60,000 workers have been registered with the Authority, taking the total number of workers on the Authority’s register to more than 355,000. The number of employers has also grown, with more than 3,400 employers now registered with the Authority. Registration of covered employers is mandatory by law and vital to the growth and continued success of the Scheme.

The 2023-24 financial year saw the Authority continue to focus on identifying employers who have failed to register, as well as employers who have failed to include all eligible workers on their quarterly returns. We are taking new compliance and enforcement actions and enhancing communication with workers and stakeholders to assist in identification of non-compliance. We are also investing in the development and implementation of vital frameworks and infrastructure to support better systems and practices consistent with our 2023-26 Corporate Plan. This will make us more accessible and responsive to registered employers and workers.

A great deal of effort across every business unit within the organisation has contributed to the Scheme’s success in 2023-24. We would like to take this opportunity to thank staff within the Authority who have worked on the various projects consistent with the Governing Board’s outlined strategic priorities.

Our vision for the Scheme is an ambitious one and there is much work to be done as workers begin to reach eligibility for their portable long service leave entitlements.

Julius Roe
Chair, Governing Board

Joseph Yeung
Chief Executive Officer
Registrar

Functions and Independence

Functions

The Authority has several key functions under the Act:

1. Administering the Scheme in the covered industries.
2. Making payments of long service benefits.
3. Keeping registers of employers and workers.
4. Resolving disputes regarding the timing of taking long service leave.
5. Consulting with industries that may be affected by decisions made under the Act.

Independence

The Authority is an independent statutory body with an official seal. Under the Act, the Authority may sue and be sued and acquire, hold and dispose of property. Authority staff are Victorian Public Service (VPS) employees.

Machinery of government changes

On 1 February 2024, a Machinery of government came into effect. This resulted in the Authority’s responsible department transferring from the Department of Premier and Cabinet to the Department of Treasury and Finance. The Authority continues to be accountable to the Minister for Industrial Relations. The Authority has incurred negligible costs associated with the transfer. These costs that have been incurred relate primarily to information technology (IT) systems.

Governance and Organisational Structure

Effective governance is pivotal for the Authority to fulfil its primary objectives for the benefit of all stakeholders.

Governing arrangements

The Authority follows necessary procedures and adheres to monitoring systems to ensure it performs all its duties and functions to the required standard and in accordance with its legal obligations.

Minister

Tim Pallas MP
Minister for Industrial Relations

Board

Chair

Julius Roe

Deputy Chair

Claire Filson

Members

Tim Piper AM

Rachaell Saunders

Elisa Brophy (nee Dickenson)

Julie Warren

Emma King OAM*

Lisa Darmanin**

Member / Registrar

Joseph Yeung

Audit and Risk Committee Members

Chair

Claire Filson

Members

Rachaell Saunders

Elisa Brophy (April to June 2024)

Lisa Darmanin (until February 2024)

Independent Member

Peter Wyatt

* Emma King OAM resigned from the Governing Board on 24 November 2023.
** Lisa Darmanin resigned from the Governing Board and the Audit and Risk Committee on 27 February 2024.

The Authority is overseen by a Governing Board appointed by the Minister for Industrial Relations. This Board includes individuals with a range of expertise, qualifications, and experience, representing employers and workers in the three covered industries – community services, contract cleaning and security.

Board members adhere to the standards of the Code of Conduct for Directors of Victorian Public Entities and the Public Administration Act 2004 (Vic).

As mandated by s38 of the Long Service Benefits Portability Act 2018 (Vic), the Governing Board:

• Sets the levy to be paid by employers and contract workers
• Manages the Authority’s governance, strategic planning, and risk management
• Advises the Minister on agreements for corresponding schemes across Australia
• Performs functions and exercises powers of the Authority as appropriate.

Our Governing Board

Julius Roe, Chair

Julius Roe’s career spans 40 years in industrial relations, including as a Fair Work Commissioner from 2010 to 2017.

He is a member of the Police Registration and Services Board. Since 2017, Julius has been working as a consultant, handling mediation in a diverse range of workplace disputes in the public and private sectors. Julius has been a leader in vocational education and training policy, including various boards at both state and national level. He was National President of the Australian Manufacturing Workers Union from 2000-2010.

Claire Filson, Deputy Chair

Claire Filson has worked extensively in the financial services sector, with more than 20 years’ boardroom experience in superannuation and infrastructure businesses.

Before taking a break to travel in 2010, Claire was a Director on the Board of Emergency Services and State Superannuation, a 150,000-member public sector superannuation fund managing $15 billion.

Claire has a mix of skills spanning law, governance and risk management and is currently a director of Greater Western Water and Redundancy Payment Central Fund Limited and the Indigenous Land and Sea Corporation.

Tim Piper AM, Member

Tim Piper is the Head of the Australian Industry Group’s Victorian branch, advocating for more than 12,000 businesses in Victoria and over 60,000 across Australia.

He has had significant engagement with government at all levels. He chairs the Industry Capability Network, is Deputy Chair of the Rail Industry Advisory Council and sits on several Ministerial Committees and government bodies. During the financial year he was also on the Board and a Director at Global Systems Institute.

A lawyer in private practice in Australia and the UK, Tim was previously Executive Director of the Australian Retailers Association in Victoria. Tim was appointed a Member of the Order of Australia (AM) in the Queen’s Birthday 2020 Honours List for significant service to industry and manufacturing, to skills training and to multicultural youth.

Rachaell Saunders, Member

Rachaell Saunders is founder and CEO of National Protective Services, a leading national security organisation that specialises in both protective services and electronic security. Having founded the organisation in 1988 Rachaell has an extensive career within the security industry.

Rachaell has various qualifications in marketing, international business, risk management, security and business. As CEO of National Protective Services, she sets the strategic direction for the business with a focus on operations, finance, human resources, sales and marketing.

RachaelI has been on the board of the Australian Security Industry Association Limited the peak body for security employers for several years and is currently Vice President.

Elisa Brophy, Member

During this financial year, Elisa Brophy (nee Dickenson) was Senior Industrial Officer of the Health and Community Services Union (Health Services Union, Vic No. 2 Branch) and had been at the union since 2015.

She led the industrial team at the union and represented members working in disability and mental health.

She holds a Bachelor of Arts/Laws degree and has extensive legal and advocacy experience. Prior to working at the union, she was a Senior Criminal Solicitor at the Victorian Aboriginal Legal Service and regularly appeared in the Magistrates’ Court across Victoria.

Subsequent to the end of the 2023-24 financial year, Elisa resigned from the PLSA Governing Board.

Julie Warren, Member

In addition to her work with the Authority, Julie Warren is also on the Board of the Victorian WorkCover Authority (WorkSafe Victoria).

Previously, Julie had worked for more than 20 years with the National Union of Workers and was president of the union’s Victorian branch for 13 years. In that role, she led a number of significant changes in strategic direction for the union.

Additionally, Julie was also a past Senior Vice President of the Victorian Trades Hall Council and as a result has considerable experience and understanding of the issues and concerns that are faced by workers in the relevant covered industries of the Scheme.

Emma King OAM, Member

During this financial year, Emma King was CEO and Company Secretary of the Victorian Council of Social Service. Emma is a strong voice on social justice, has a Masters in Industrial and Employee Relations and has worked as a policy adviser, teacher as well as in a range of other industrial and training roles.

Emma is also a member of the Victorian Skills Authority and the Chair of the Farnham Street Neighbourhood House Learning Centre. Emma received a Medal of the Order of Australia (OAM) in the King’s Birthday 2023 Honours List for services to the community through social welfare organisations.

Lisa Darmanin, Member

During this financial reporting year, Lisa Darmanin was the Secretary of the Australian Services Union (Victorian and Tasmanian Authorities and Services Branch). The union leads advocacy and campaigning across social and community services, local government, and the public sector.

In 2016, Lisa was inducted into the Victorian Honour Roll for Women in recognition of her significant contribution to the Victorian community, specifically in achieving gender equity for women. Lisa has extensive board experience and is currently Chair of Vision Super, Board Director of the Australian Institute of Superannuation Trustees, and the Trust for Nature, as well as a Shareholder Representative of the IFM Shareholder Advisory Board.

Joseph Yeung, Non Voting Member

Joseph Yeung is an experienced government Senior Executive and was previously the Chief Financial Officer at the Department of Premier and Cabinet from 2017 to 2019.

Before joining the Victorian Government, Joseph was an Assistant Secretary in the Civil Justice and Corporate Services Division at the Commonwealth Attorney-General’s Department in Canberra. A chartered accountant and lawyer, Joseph is a Graduate of the Australian Institute of Company Directors and also holds an MBA (Executive).

As Registrar, Joseph is a non-voting member of the Governing Board. As Chief Executive Officer, Joseph is responsible for the day-to-day management of the Authority and its operations.

Table 1: Director attendance at Governing Board meetings

Vale and Retiring Board Members

Vale – Senator Linda White

Victorian Senator Linda White sadly passed away on 29 February 2024 following a health battle.

Ms White was an inaugural member of the Authority’s Governing Board from 2019 before retiring from the Board on 5 April 2022. She was elected as a Victorian Senator to the Commonwealth Parliament for a term commencing on 1 July 2022.

The Authority acknowledges Senator White’s valuable contribution during the establishment of the Authority and all her insights during the Authority’s critical start-up phase.

Retiring Board Members

The Authority would like to acknowledge and thank Lisa Darmanin, Emma King OAM and Elisa Brophy for their contributions to the Authority’s Governing Board.

Emma King OAM resigned from the Board on 24 November 2023. Lisa Darmanin resigned from the Board and the Audit and Risk Committee on 27 February 2024.

Audit and Risk Committee

The Audit and Risk Committee (ARC), established by the Governing Board under the Standing Directions for the Minister for Finance (Vic) (2018) and the Financial Management Act 1994 (Vic), provides individual assurance and advice on the Authority’s financial management, performance, compliance, and risk management.

Comprising four members, the Committee operates under a charter outlining its role and responsibilities in line with the Standing Directions and best practice corporate governance projects.

Audit and Risk Committee membership and roles

• Claire Filson, Deputy Governing Board Chair and ARC Chair
• Rachaell Saunders, Governing Board Member, ARC Member
• Lisa Darmanin (until February 2024) Governing Board Member, ARC Member
• Elisa Brophy (April to June 2024) Governing Board Member, ARC Member
• Peter Wyatt, ARC Independent Member

Peter Wyatt, Independent Member
Audit Risk Committee

The ARC’s independent member, Peter Wyatt, was previously the Chief Financial Officer of Treasury Corporation Victoria (TCV) with responsibility for TCV’s finance, reporting and settlements functions.

Prior to joining TCV in 2006, Peter was the Chief Financial Officer of the State Superannuation Fund, having formerly held senior management roles in life insurance and financial services organisations.

Peter has a Bachelor of Business and a Graduate Diploma of Applied Finance, is a Certified Practising Accountant, and a member of the Australian Institute of Company Directors.

The following table indicates committee member attendance at ARC meetings for the Authority.

Table 2: Attendance at ARC meetings

Conflicts of Interest

The Authority’s Conflict of Interest policies for the Governing Board and employees outlines obligations for managing conflicts of interest. These policies ensure a transparent and accountable process, aiding compliance with section 81 of the Public Administration Act 2004 (Vic) and section 45 of the Long Service Benefits Portability Act 2018 (Vic) regarding pecuniary interests.

Internal Audit

The Authority has appointed AFS Associates as its internal auditors to execute a comprehensive risk-based internal audit plan. Audits undertaken this year focused on information privacy, cyber risk management, stakeholder engagement and compliance with standing directions. All audit results and follow-up actions were reported to the ARC.

Occupational Health and Safety

The Authority is committed to providing and maintaining a healthy and safe working environment for staff and visitors in accordance with the Occupational Health and Safety Act 2004 (Vic) and associated regulations.

Occupational Health and Safety Committee

The Authority’s Occupational Health and Safety Committee, comprising management and health and safety representatives, meets every two months to discuss workplace health, safety, and wellbeing.

Legislation and Operating Environment

Legislative environment

Under the Act, the Authority manages the Scheme for covered employers and workers in Victoria’s community services, contract cleaning, and security industries.

Employers in these sectors must register themselves and their workers with the Authority via our online portal. Each quarter, registered employers must submit a return detailing worker information, including workers’ service with that employer, and pay a levy. This levy funds future long service payments for covered workers.

The Scheme allows workers to accrue long service leave and take it with them if they change employers but stay in the same industry. Registered workers can check their balances or update their details online through the worker portal. After at least seven years of service, workers can apply for their portable long service benefit, which varies slightly across the three sectors.

Overview

The Authority continues to expand its staffing profile to meet the demands of administering a growing Scheme.

Each of our business units – Finance and Claims, Operations, Legal, Governance and Secretariat, Facilities and Information Technology, Communications and Engagement and People and Culture – have worked together collaboratively throughout the 2023-24 financial year.

Finance and Claims

The Finance and Claims business unit is essential to our operations, with the Head of Finance holding specific responsibilities under the Financial Management Act 1994 (Vic). In 2023-24, the business unit was expanded to include a new Claims team responsible for processing and paying future claims (and current reimbursements) from employers and workers.

Through performance monitoring, responsible budgeting and a robust investment strategy, the Finance and Claims business unit ensure the entitlements of registered workers are managed effectively, supporting the overall sustainability of the Scheme.

Operations

The Operations business unit is responsible for the administration of the Scheme. This includes the Authority’s customer service contact centre, maintenance of the Authority’s employer and worker registers and supporting quarterly returns submission, processing and compliance.

Compliance activity was also supported by other business units across the Authority.

Legal, Governance and Secretariat

The Legal, Governance and Secretariat business unit supports the Authority and Governing Board in adhering to its legal, governance and compliance obligations under the Act and the regulatory environment of a statutory authority.

The Secretariat supports the Governing Board and its subcommittees through coordination and facilitation of timely, professional agendas, packs, minutes for meetings to meet the obligations of the Authority.

Facilities and Information Technology

The Facilities and Information Technology (IT) business unit supports the Authority’s operations by providing IT support, security, records management, and managing the external portal for employers and workers. The business unit oversees technology infrastructure, registration systems, and office leases, collaborating with other business units to enhance systems for efficiency and effectiveness.

The Project Management Office (PMO) team also sits within this business unit. The PMO is responsible for partnering with internal stakeholders to implement assigned strategic priorities.

Communications and Engagement

The Communications and Engagement business unit raises the Authority’s profile through our website, advertising and email campaigns, social media, and public relations activities to ensure employers understand their obligations and empower workers.

People and Culture

The People and Culture business unit fosters a safe and welcoming work environment to support staff growth and development. It empowers employees to thrive, driving a positive culture and ensuring a robust performance management framework.

Workforce Data

The Authority’s policies and practices align with the Victorian Commission’s public sector employment standards, adhering to VPS values.

These policies ensure fair treatment, career opportunities and the early resolution of workplace issues. The Authority also offers guidance and training to employees on avoiding conflicts of interest, managing offers of gifts and addressing misconduct.

The following table discloses the head count and full-time equivalent (FTE) of all Authority employees employed in the last full pay period in June 2024.

Table 3: Comparative workforce data

The following table discloses the annualised total salary for senior employees of the Authority, categorised by classification, with salary amounts reported as the full-time annualised salary.

Table 4: Annualised total salary for executives and other senior-non-executive staff*

2023-26 Corporate Plan

The Authority’s 2023-26 Corporate Plan sets out the Authority’s short and medium-term priorities along with key target measures for success. These priorities focus the Authority on ensuring that:

1. Covered employers and workers are registered
2. Service of workers is captured
3. Outstanding levies are paid
4. The Authority has a strong, intelligence-led and risk-based compliance and enforcement program
5. The Authority is claims ready

With key priorities directing the Authority’s actions to June 2026, the specific areas of strategic focus for the Authority as approved by the Governing Board are:

• Better identification of under registered workers and employers.
• Strengthening our compliance and enforcement approaches.
• Improving internal infrastructure to ensure better practices and procedures across the Scheme.

During the 2023-24 financial year, the Authority has successfully executed specific areas of strategic focus, operating in a fiscally responsible manner while maintaining strong governance frameworks. This is reflected in the results detailed below, with the Authority exceeding and remaining on-track for 11 of the 12 targets set out in our 2023-26 Corporate Plan.

Better identification of under registered workers and employers

The Authority continues to support the Scheme's growth through outreach and engagement efforts. The Authority is implementing strategies to ensure we can directly communicate with workers particularly when they change employers. We utilise a range of data bases, collaborative arrangements with other agencies, and engagement with industry stakeholders to improve our capacity to identify likely areas of under-registration.

Notwithstanding a gradual shift in the Authority’s regulatory strategy towards strengthening our compliance and enforcement approaches, the Authority recognises the continued need to engage with employers and workers directly. The Authority is continuing a large program of targeted work on educational activities, which during the current financial year, included a significant project centred around streamlining employer submission of quarterly returns by collaborating with employers following their feedback.

As one of Australia’s largest portable long service benefits schemes, the Authority recognises its leadership role nationally and during the year initiated and hosted the first in-person conference of national portable long service leave authorities to discuss industry trends and operational insights since 2019.

Unfortunately, due to delays with the Authority's website enhancement project, the Authority was unable to complete its full target of publication insights for the 2023-24 financial year. This work has been prioritised for 2024-25 financial year with additional resources and assistance to ensure its success.

National Conference on Portable Long Service Leave hosted in Victoria

In February 2024, leaders from Australia’s nine state and territory-based Portable Long Service Leave Authorities gathered in Bendigo for the first in-person conference since 2019. The event was hosted at the Galkangu Bendigo GovHub building by Victoria’s Portable Long Service Authority.

Over two million workers across industries including construction, community services, contract cleaning and security benefit from these state-administered portable long service schemes.

The two-day conference offered a valuable platform for knowledge-sharing and discussions around challenges in administering and growing portable long service leave schemes.

Key themes included enhancing IT systems, strengthening compliance and enforcement, and ensuring the sustainability of long service leave schemes. Online sessions allowed senior staff from finance, legal, compliance and IT to collaborate in key issues, sparking new ideas and solutions.

Authorities participating in the conference represented all regions of Australia, reflecting the national commitment to portable long service leave across diverse industries.

• LeavePlus - Victoria’s construction industry
• Long Service Corporation NSW - New South Wales construction and contract cleaning industries
• ACT Leave - Australian Capital Territory’s construction, contract cleaning, community and security industries
• MyLeave WA - Western Australia’s construction industry
• Portable Long Service Leave - South Australia’s construction industry
• NTBuild - Northern Territory’s construction industry
• QLeave - Queensland’s construction, contract cleaning and community services industries
• TasBuild - Tasmania’s construction industry

Improving employer collaboration: Payroll to quarterly return project

The Authority is committed to streamlining its processes for the benefit of both employers and workers.

A recent initiative in this effort is the ‘Payroll to Quarterly Return’ project, which simplifies employers submitting their quarterly returns.

The Authority sought feedback from employers to gain a better understanding of their experiences with the quarterly returns process. This feedback has been invaluable, revealing several opportunities to refine and improve processes.

The Authority is now using this feedback to review the submission of the quarterly returns process. These insights will help shape future enhancements to ensure a more efficient and smoother experience for all stakeholders.

Transition to digital project: SMS campaign to streamline communication with workers

The Authority has previously relied on written correspondence through direct email and newsletters to communicate with workers about the Scheme and their entitlements. This meant that if workers changed their employer or contact details, delays could result.

To increase engagement, the Authority launched a pilot project in May 2024 to send SMS messages encouraging workers to log into the worker portal to update their personal details and avoid delays in processing requests.

The campaign included posting information about the new initiative through digital and traditional communication channels. An additional advertising campaign targeting workers is planned in the coming 12 months to expand on these initial positive results.

Strengthening our compliance and enforcement approaches

* Based on the last quarter
**Progress is discussed below

As of the last quarter of the Authority's operations, the regulatory posture of the Authority focused on educating and supporting employers and workers.

Specifically, the Authority worked closely with employers to ensure that they understood the Scheme and their obligations as an employer. This approach has been successful, with the Authority exceeding its registration targets and most employers complying with their legal obligations.

However, some employers remain non-compliant with the Act. To address this, the Authority has continued to sharpen its focus in 2023-24 on evolving its compliance and enforcement activities to target the following four key areas of regulatory non-compliance:

1. Registering non-compliant employers;
2. Ensuring timely submission of quarterly returns;
3. Investigating inaccurate quarterly returns and under registration of workers and/or their recorded service; and
4. Ensuring prompt or complete payment of levies.

The Authority is on track to strengthen its effort in these areas to protect workers’ rights and hold non-compliant employers accountable.

During the 2023-24 financial year, the Authority commenced a number of compliance investigations, including field work and other compliance activities. These activities were a combination of field investigations as well as strategically planned desktop investigations.

Specifically, during the financial year, the Authority:

• investigated over 300 tip-offs of unregistered employers;
• issued 45 letters of demand to employers who failed to pay invoices for levies resulting in the recovery of over $300,000 in unpaid levies;
• undertook a range of other targeted compliance activities in relation to overdue quarterly returns; and
• published a refreshed regulatory approach on the Authority’s website informing employers and the public of the Authority’s evolution from an education-based and intelligence-led stronger compliance approach.

As the Authority’s compliance and enforcement framework matures, the sophistication of current investigations will increase further. This will allow the Authority to more accurately define formal and informal compliance investigations and activities for reporting in future reporting years.

Finally, the Authority is on track to continue to reduce the number of days to issue invoices towards the 60 day target by 2026. Also, further refinement of the Authority’s current policies for payment extensions and payment plans need to be undertaken in 2024-25. The Authority is aware of the impact arising from changes to these policies on smaller business operators who are more sensitive to changes in broader macro-economic conditions.

Refreshing our Regulatory Strategy

We refreshed our Regulatory Strategy following extensive planning and internal collaboration and consultation across the Authority’s business units and staff, drawing on the learnings and insights over the Authority’s five years in operation.

In June 2024, our Regulatory Strategy was published to ensure employers and the public understand the Authority’s approach to its compliance and enforcement activities.

The strategy ensures decisions are risk-based, intelligence-led, and align with the Authority’s Compliance and Enforcement Policy and Corporate Plan 2023-26. It focuses on four key areas:

1. Registering non-compliant employers;
2. Ensuring timely submission of quarterly returns;
3. Investigating inaccurate quarterly returns and under registration of workers and/or their recorded service; and
4. Ensuring prompt or complete payment of levies.

Strengthening Compliance Action

Registered employers are required to pay levies for their workers promptly each quarter. Successful recovery of these levies is vital to the long-term sustainability of the Scheme for workers in the three covered sectors.

As part of growing the Authority’s civil enforcement process, the Authority has strengthened its compliance steps to recover unpaid levies from employers. This graduated approach has included the Authority issuing 45 employers with letters of demand for payment.

One employer with longstanding arrears in excess of $24,000 had failed to make payment or engage with the Authority’s calls and was issued a letter of demand. As a result, this employer made payment in full and has continued to remain fully compliant with its obligations.

At the same time and in the face of the cost-of-living crisis, the Authority is conscious of balancing the recovery of unpaid levies with supporting struggling small businesses. Rising inflation, energy costs and wage challenges have put significant pressure on small businesses, making it difficult for some to meet their legal obligations.

One small business employer in the cleaning sector who was issued a letter of demand advised the Authority that they had difficulty in making the large payment. The Authority engaged with the employer and supported them to enter into a payment arrangement. This enabled the employer to comply with their obligations, whilst reducing the financial burden associated with large arrears.

Improving internal infrastructure to ensure better practices and procedures across the Scheme

The growth in the Scheme has also seen a continued increase in the demands on the Authority's workforce. During the 2023-24 financial year, there were 20,663 total calls through the Customer Services contact centre (split between 7,560 inbound calls and 13,103 outbound calls) with an average wait time to answer calls of 42 seconds.

The Authority processed and collected invoices totalling over $165 million during the 2023-24 financial year, a 32% growth on the previous financial year predominately due to increased number of registered employers and workers. Total collections have been invested in accordance with the Authority’s investment strategy as set out by the Governing Board. This ensures that entitlements of registered workers are managed prudently while the sustainability of the Scheme has also been reviewed by the Authority’s appointed independent actuary in the current year. This review has also resulted in the recommendation to the Governing Board to maintain the current levy rate settings.

In relation to investment performance of collected funds, the Authority has continued to exceed its investment return objective of CPI + 3.0% p.a. with a return of 9.4% for the 2023-24 financial year. This has increased the funding ratio (for all 3 schemes in total) to 107.8%, which remains on-track to surpass the target of 110% by 2026.

To achieve the Authority’s objectives, investment in the Authority’s staff was also identified as a key priority across the next three years noting that our staff are integral to the successful implementation of the above outlined strategic priorities.

With a majority of staff based in regional Victoria within the Victorian Government’s newly built Galkangu Bendigo GovHub premises, areas of key focus for the Authority's leadership include:-

• the need for dedicated investment in time and focus on work place culture (especially in a hybrid working environment)
• ensuring clarity of role alignment to organisational objectives
• educating staff on the values and expectations of the VPS
• empowering staff to be accountable in their roles.

As a result of this work, the Authority is pleased to report that it was able to exceed the VPS People Matter Survey target participation rate for the 2023-24 financial year of 85% by recording a participation rate of 94%. Positive improvements were recorded across the board, including 92% of our staff understanding their personal contribution towards achieving our organisational goals and getting a sense of accomplishment through their work. Consistent with other VPS entities, the results of the Authority People Matter Survey are available publicly through the Victorian Public Sector Commission’s information databases.

Finally, work continues to progress within the Authority in readiness for the first portable long service benefit payments for workers should they wish to take the benefit from the first day of eligibility. This includes not just efficient processes and strong controls but also a skilled workforce with an acute awareness of cybersecurity risks in the digital age.

With management of over $500 million in financial assets, the need to protect digital systems, networks and data from unauthorised access and hostile assaults is central to the work being done by the Authority to prepare for claims readiness. While this remains on-track, the Authority is ever vigilant of the dynamic changes and quick shift in risk profiles of the cybersecurity landscape.

Implementing Multi-Factor Authentication (MFA) for Enhanced Security

In late 2023, the Authority took decisive steps to enhance the security of its digital platform. The Authority worked with the technology provider Formation CRM to develop Multi-Factor Authentication (MFA) for both the Employer and Worker Portals. The goal was to provide a more robust layer of protection against unauthorised access and safeguard sensitive information across the platform.

Phase 1: MFA Rollout for Employer Portal

In October 2023, the first phase of the MFA implementation focused on employers registered with the Authority. As part of the new security initiative, employers received emails outlining the steps to authenticate their accounts when accessing the portal. This helps minimise the risk of unauthorised access to sensitive data.

Phase 2: Extending MFA to Worker Portal

The Authority has developed and will extend MFA to be mandatory for the Worker Portal in 2024. The Authority, through the worker SMS campaign and employers maintaining mobile contact details.

For workers, the two-step verification process will verify their identity beyond just a simple password process. This method of ‘double-checking’ will reduce the risk of data breaches by confirming the authenticity of the person attempting to access the account.

Supporting career growth in Regional Victoria

Leon Harper’s journey with the Authority exemplifies the opportunities available in regional Victoria for staff in the VPS. Originally recruited as a Lawyer while working in Melbourne, Leon is now Senior Lawyer within the Authority’s legal team based in Bendigo.

Initially splitting his time between the Melbourne and Bendigo offices, Leon developed an affinity with the Bendigo area. Recently, he made the decision to relocate his family to Bendigo, drawn by the lifestyle, flexibility and the ease of commuting.

The Authority’s commitment to creating specialist opportunities in regional Victoria has been a key factor in Leon’s career growth. As an employer, the Authority is eager to promote professional development and career progression, especially in regional areas in need of talent and specialist skills.

Leon now enjoys working in the Galkangu Bendigo GovHub’s state-of-the-art facilities, which foster collaboration across departments and provide the resources for individual and team success.

Financial Performance

Five-year financial summary

The Authority commenced operations on 18 March 2019. Five full years of comparative financial information is shown below.

Authority five-year financial summary

Current year financial summary

The Authority administers three schemes that provide portability of long service leave benefits for registered workers in the community services, contract cleaning and security industries in Victoria.

The Authority levies registered employers for workers in the covered sectors and industries in accordance with the Long Service Benefits Portability Act 2018 (Vic) and the Long Service Benefits Portability Regulations 2020 (Vic) and makes payments for benefits taken.

In the 2023-24 financial year, the Authority’s net result was $26.6 million compared to $17.5 million in 2022-23. The major performance drivers in the current year’s net result were levy contributions of $165.8 million from employers (2022-23: $125.1 million) and total returns from investments held by the Authority of $36.4 million (2022-23: $21.0 million), offset by an increase in the portable long service benefits liability of $166.1 million (2022-23: $120.8 million). The increase in the portable long service benefits liability is consistent with the growth of the Scheme and reflects the increased expectation as measured by the Authority’s appointed Scheme Actuary that more workers will now be eligible for future portable long service leave entitlements.

Levy contributions from employers and contractors are based on levy rates set by the Governing Board and this was the largest source of income from transactions. Levy contributions increased by $40.7 million in the current financial year due to increase in registered workers. There are now over 350,000 workers registered in schemes across the three covered sectors and industries.

During the financial year, the Authority transferred $143.8 million to the VFMC Balanced Fund, Victorian Funds Management Corporation (VFMC) increasing total investments held with VFMC to $473.9 million.

The portable long service benefit expense for 2023-24 is $166.1 million, representing an increase in the benefits liability for workers of $45.4 million ($120.8 million 2022-23).

Administration costs totalled $10.5 million with $6.8 million relating to employee benefits expense of the Authority and its regulatory operations and $3.7 million for information technology costs, office expenses, professional services, promotion costs along with internal and external audit fees.

Financial position balance sheet

The Authority’s net asset position at 30 June 2024 was $57.7 million and the funding ratio of all 3 portable long service leave schemes was 107.8%.

Cash at bank totalled $29.2 million, which includes mainly Scheme funds collected and not transferred to VFMC investments as at 30 June 2024.

The Authority increased its investments with the VFMC to $473.9 million and accrued $22.0 million representing an investment distribution due from the VFMC that was paid in July 2024.

Operating cash flows

Net cash flow from operating activities was positive for the year totalling $145.9 million, which included $162.7 million of receipts from employers for their worker levy contributions.

The Authority transferred $143.8 million to the VFMC Balanced Fund and received $10.2 million of investment distributions during the financial year.

Investment performance

The Governing Board has approved an investment strategy based on an analysis of desired investment returns against investment risk appetite.

The investment objectives of the Authority at 30 June 2024 are:

• Return: To achieve an average return objective of at least CPI + 3.0% p.a. with greater than 60% probability over a rolling 10-year period; and
• Risk: To limit the likelihood of a negative annual return to no more than one year in every five years, and when negative returns occur not to exceed a 10% loss of capital.

The Authority exceeded its investment return objective of CPI + 3.0% p.a. with a return of 9.37% for the 2023-24 financial year.

Current year investment performance

Under the Act, the Authority is permitted to invest Scheme assets for the benefit of the schemes.

The Authority has appointed VFMC as its investment manager and VFMC has determined the following balanced asset allocation of investments for the Authority’s portfolio:

For the 12 months from 1 July 2023 - 30 June 2024, the Authority recorded a gain on fair value of investments of $9.4 million against total Scheme funds of $473.9 million at 30 June 2024. The Authority received $10.2 million of investment distribution during the year.

Outlook

The Authority is continually working with its investment manager to adjust portfolio positioning in response to market movements and changes to economic conditions and policy outlook of governments, which may affect key investment asset classes.

Local jobs first

The Local Jobs First Act 2003 (Vic), amended in August 2018, brings together the Victorian Industry Participation Policy and Major Project Skills Guarantee, which were previously administered separately.

The Authority is required to apply the Local Jobs First policy to all metropolitan Melbourne or state-wide projects valued at $3 million or more, or any regional Victoria projects valued at $1 million or more.

The Authority undertook no projects subject to the Act during the 2023-24 reporting period.

Government advertising expenditure

In 2023-24 there were no government advertising campaigns of $100,000 or greater (exclusive of GST).

Consultancy expenditure

Details of consultancies (valued at $10,000 or greater)

In 2023-24, there were four consultancies where the total fees payable to the consultants were $10,000 or greater. The total expenditure incurred during 2023-24 in relation to these consultancies is $0.13 million (excluding GST). Details of individual consultancies are outlined below.

Details of consultancies under $10,000

In 2023-24 there was no consultancy engaged during the year, where the total fees payable to the individual consultancy was less than $10,000 (exclusive of GST).

Review and studies expenditure

Details of reviews and studies

During 2023-24 one review was undertaken with the total cost of $0.23 million. Details of the review is outlined below.

Information and communication technology expenditure

For the 2023-24 reporting period, the Authority had a total information and communication technology (ICT) expenditure of $1.06 million, with details shown below.

ICT expenditure refers to the Authority’s costs in providing business enabling ICT services within the current reporting period. It comprises Business as Usual (BAU) ICT expenditure and Non-Business as Usual (Non-BAU) ICT expenditure. Non-BAU ICT expenditure relates to extending or enhancing the Authority’s current ICT capabilities. BAU ICT expenditure is all remaining ICT expenditure that primarily relates to ongoing activities to operate and maintain the current ICT capability.

Disclosure of major contracts

The Authority did not award any major contracts valued above $10 million or more during 2023-24.

Freedom of Information

The Freedom of Information Act 1982 (Vic) (the FOI Act) allows the public a right of access to documents held by the Authority.

Information about the type of material produced by the Authority is available on its website under the Part II Information Statement.

During the 2023-24 financial year, the Authority received no Freedom of Information requests.

During the 2023-24 financial year, no requests were subject to a complaint/internal review by Office of the Victorian Information Commissioner or were progressed to the Victorian Civil and Administrative Tribunal.

Making a request

Access to documents can be made by a written request to the Authority’s Freedom of Information Officer as detailed in section 17 of the FOI Act. The 2023-24 application fee was $31.80.

When making a Freedom of Information request, applicants should ensure requests are in writing and clearly identify the documents being sought.

Requests for documents in possession of the Authority can be made via email to foi@plsa.vic.gov.au(opens in a new window) or by mail to:

Attention: Freedom of Information Officer
Portable Long Service Authority
PO Box 443
Bendigo VIC 3552

Further Information

Access charges may also apply once documents have been processed and a decision on access is made, such as but not limited to photocopying, search and retrieval charges. Further information regarding Freedom of Information can be found at ovic.vic.gov.au/freedom-of-information/(opens in a new window).

Compliance with the Building Act 1993 (Vic)

The Authority does not own or control any government buildings and consequently is exempt from notifying its compliance with the building and maintenance provisions of the Building Act 1993 (Vic).

The Authority met all relevant compliance provisions of the Building Act 1993 (Vic) in our building and maintenance activities during the year.

Competitive neutrality policy

The Authority does not provide services that compete with the private sector and is therefore not subject to the requirements of the National Competitive Policy (NCP) including compliance with the requirements of the Neutrality Policy Victoria or any subsequent reforms.

Public Interest Disclosures

The Public Interest Disclosures Act 2012 (Vic) (the PID Act) encourages and assists people in making disclosures of improper conduct by public officers and public bodies. The PID Act provides protection to people who make disclosures in accordance with the PID and establishes a system for the matters disclosed to be investigated.

The Authority encourages its officers and members of the public to report known or suspected incidences of improper conduct and detrimental action.

Disclosures of improper conduct or detrimental action by the Authority or any of its employees and/or officers must be made directly to the Independent Broad-based Anti-corruption Commission:

Level 1, North Tower, 459 Collins Street
Melbourne, VIC 3000
Phone: 1300 735 135
www.ibac.vic.gov.au

Disclosures under the Public Interest Disclosures Act 2012 (Vic)

Compliance with the Carers Recognition Act 2012 (Vic)

To the extent applicable, the Authority has taken all practical measures to comply with obligations under the Carers Recognition Act 2012 (Vic) (the CR Act). These include:

• ensuring our staff have an awareness and understanding of the care relationship principles set out in the CR Act.
• considering the care relationships principles set out in the CR Act when setting policies and providing services.
• promoting the availability of flexible work arrangements and providing resources to effectively support this.
• providing support to all staff through the Employee Assistance Program.

Compliance with the Disability Act 2006 (Vic)

The Authority acknowledges the importance of strengthening the rights of people with a disability. We are committed to creating and maintaining an accessible and inclusive environment for all people with a disability who come into contact with the Authority, whether as employees, stakeholders or members of the public more generally.

The Department of Premier and Cabinet developed a comprehensive Disability Access and Inclusion Plan 2021-25 which informs the Authority’s policies ensuring we remain responsive to the needs of people with a disability.

Procurement complaints

Under the Governance Policy of the Victorian Government Purchasing Board, the Authority must disclose any formal complaints relating to the procurement of goods and services received through its procurement complaints management system.

The Authority received no formal complaints through its procurement complaints management system in 2023-24.

Transportation

The Authority’s fleet is comprised of 2 passenger vehicles. These vehicles are essential to the operation of the Authority, for example, travel relating to the Authority’s compliance and enforcement activities.

Sustainable buildings and infrastructure

The Authority’s two offices, in Bendigo and Melbourne, maximise natural light, with electronics, lighting, heating and cooling switched off each evening.

The Galkangu Bendigo GovHub is Victoria's largest timber frame office. Its environmentally sustainable design contains efficient indoor air quality systems, solar panels, water and energy monitoring systems.

The Victorian Government’s Digital First principles are applied with staff encouraged to avoid printing where possible. Senior staff members have been provided with portable devices to assist with this initiative. In addition, the Authority utilises “Follow Me” printing which enables usage reporting, application of print policies organisation-wide and mobile printing solutions to reduce waste, saving on average 30% of wasted print jobs sent in error.

All office waste systems across our two locations are segregated, reducing the amount of recyclable material directed to landfill. Authority staff are strongly encouraged to adopt “green commuting” through active or public transport when undertaking business activities, particularly when travelling between our Bendigo and Melbourne locations. Meetings are also conducted via video conferencing where possible to reduce unnecessary or excessive travel.

The Authority has phased out single-use plastics in its offices. This is in line with the Authority’s recognition of the importance of reducing our environmental footprint.

Agency Specific Legislative Disclosures

Subsequent events

There are no post balance date events that materially affect the Authority’s 2023-24 financial statements.

Additional information

The Authority’s published reports and documents are available online at plsa.vic.gov.au.

Any relevant information in relation to the financial year is retained by the Accountable Officer and is available on request subject to the provisions of the FOI Act.

What’s next?

As we turn our attention to next year, our focus will also shift to include additional milestones and priorities:

• Awareness and education campaigns including worker engagement
• Strategic and risk-based compliance and enforcement activity
• Continue to refine better practice systems and processes

Portable Long Service Benefits Authority Financial Management Compliance Attestation Statement

I, Julius Roe, on behalf of the Responsible Body, certify that the Portable Long Service Benefits Authority has no Material Compliance Deficiency with respect to the applicable Standing Directions under the Financial Management Act 1994 (Vic) and Instructions.

Asset Management Accountability Framework maturity assessment

The following sections summarise the Authority’s assessment of maturity against the requirements of the Asset Management Accountability Framework (AMAF). The AMAF is a non-prescriptive, devolved accountability model of asset management that requires compliance with 41 mandatory requirements. These requirements can be found on the Department of Treasury and Finance website (dtf.vic.gov.au)(opens in a new window).

The Authority’s target maturity rating is ‘competence’, meaning systems and processes are fully in place, consistently applied and systematically meet the AMAF requirement, including a continuous improvement process to expand system performance above AMAF minimum requirements.

The Authority has assessed requirements 3 and 10 as not applicable.

Leadership and Accountability (requirements 1-19)

The Authority has met its target maturity level in this category.

Planning (requirements 20-23)

The Authority has met its target maturity level in this category.

Acquisition (requirements 24 and 25)

The Authority has met its target maturity level in this category.

Operation (requirements 26-40)

The Authority has met its target maturity level in this category.

Disposal (requirement 41)

The Authority has met its target maturity level in this category.

Understanding the financial statements

Comprehensive Operating Statement

The Comprehensive Operating Statement measures our performance over the year and shows if a surplus or deficit has been made in delivering our services. The statement includes all sources of income less all expenses incurred in earning that income.

For the financial year ending 30 June 2024, the net gain of the Authority was $26.6 million.

Balance Sheet

The Balance Sheet sets out our net accumulated financial worth at the end of the financial year. It shows the assets we own as well as liabilities or claims against those assets.

Both assets and liabilities are expressed as current or non-current. Current assets or current liabilities are expected to be converted to cash receipts or outlays within the next twelve months. Non-current assets or liabilities are longer-term.

Equity is our reserves and accumulated surplus that have been reinvested in the Authority over the year.

For the year ending 30 June 2024, the Authority had net assets of $57.7 million.

Cash Flow Statement

The Cash Flow Statement summarises our cash receipts and payments for the financial year and the net cash position at the end of the year. It differs from the Comprehensive Operating Statement in that it excludes non-cash expenses such as the accruals taken into account in the Comprehensive Operating Statement.

For the year ending 30 June 2024, the Authority had net cash flow from operating activities of $145.9 million.

Statement of Changes in Equity

The Statement of Changes in Equity shows the changes in equity from last year to this year.

The total overall change in equity during a financial year comprises the net result for the year.

Notes to the Accounts

The Notes to the Accounts provide further information about how the financial statements are prepared as well as additional information and detail about specific items within them.

The Notes to the Accounts also describe any changes to accounting standards, policy or legislation that may affect the way the statements are prepared. Information in the Notes is particularly helpful if there has been a significant change from the previous year’s comparative figures.

Statutory Certificate and Auditor General’s Report

These provide the reader with a written undertaking that the financial statements fairly represent the Authority’s financial position and performance for 2023-24. The Report from the Independent Auditor provides an independent view and outlines any issues of concern.

Statutory Certification

The attached financial statements for the Portable Long Service Benefits Authority have been prepared in accordance with Direction 5.2 of the Standing Directions of the Assistant Treasurer under the Financial Management Act 1994 (Vic), applicable Financial Reporting Directions, Australian Accounting Standards including interpretations, and other mandatory professional reporting requirements.

We further state that, in our opinion, the information set out in the Comprehensive Operating Statement, Balance Sheet, Cash Flow Statement, Statement of Changes in Equity and the accompanying notes, presents fairly the financial transactions during the financial year ended 30 June 2024 and the financial position of the Authority as at 30 June 2024.

At the date of signing, we are not aware of any circumstance which would render any particulars included in the financial statements to be misleading or inaccurate.

We authorise the attached financial statements for issue on 03 September 2024.

Comprehensive operating statement

For the financial year ended 30 June 2024

The accompanying notes form part of these financial statements.

Balance sheet

As at 30 June 2024

The accompanying notes form part of these financial statements.

Cash flow statement

For the financial year ended 30 June 2024

The accompanying notes form part of these financial statements.

Statement of changes in equity

For the financial year ended 30 June 2024

The accompanying notes form part of these financial statements.