Service agreement

A service agreement is a legal contract between a government department and a funded organisation for delivery of services in the community on behalf of the Department of Health and Human Services.

The service agreement defines the contractual arrangements between organisations funded to deliver services in the community and the Department of Health and Human Services (the department) who provides funding for this. 

The service agreement was developed through extensive consultation with the sector through the Service Agreement Working Group which comprises sector and departmental representatives. The sector consultation was led by the Victorian Council of Social Service.

The service agreement runs for the term 1 January 2020 to 30 June 2024. 

The service agreement provides the details about the parameters of the contract between the funded organisation and the department including:

  • Details of the parties to the service agreement
  • Services being delivered including the individual activities and relevant activity descriptions
  • Applicable departmental policies including the Service Agreement Requirements and program requirements
  • Funding summary and payment schedule
  • Agreement level information.

Sample service sgreements for 2020-2024 which include the new terms and conditions are available under ‘Sample service agreements.’  

  • Sample service agreements

    Sample service agreements for individual departments for 2020-2024 including the relevant new terms and conditions are available as follows:

  • Service Agreement Requirements

    The Service Agreement Requirements is a contractual document and outlines the departmental responsibilities and the policies and obligations that all funded organisations must comply with. 

    The Service Agreement Requirements document is available at Service Agreement Requirements

  • Activity descriptions

    Activity descriptions specify the requirements for the delivery of services or programs being provided by organisations on behalf of the Department of Health and Human Services. They form part of the contract between the organisation and the department. 

    Activity descriptions contain detailed information that funded organisations must adhere to in order to receive funding from the Victorian Government. Health and human services activity descriptions ensure the delivery of safe, high-quality services and responsible financial management. They include: service objective, description of the service, client group, program requirements and other policy guidelines, performance measures and data collection.

    They are available on Health and human services activity search and provides access to detailed information for each health and human services activity funded by a service agreement.

    To assist with your search, an index of the Health and Human Services activity descriptions is available, containing activity codes and activity names by output group.    

  • Funding

    The department will fund an organisation if it meets its obligations under the service agreement and delivers the services as described in the Schedules to the service agreement. The funding to be paid to an organisation is set out in schedule 4 Funding summary and payment schedule.

    The organisation is to use the funding provided by the department only for the delivery of services specified under the service agreement. The funding will include direct service costs and the cost of overheads that the department considers inherent in the delivery of the services.

    The department will increase the funding payable each year of the service agreement by the rate of indexation approved by the Victorian Government. For financial years 2020-2024 the Victorian Government has approved the 2019-2020 price indexation for funded organisations as detailed on the Funded Agency Channel. 

  • Assets and financial

    Organisations need to attach relevant financial data and/or URLs via the service agreement module of the Funded Agency Channel. This includes the information of the location of the organisation’s Annual Report, a Financial Indicator Statement (FIS) or a Cash Indicator Statement (CIS).

    Where an organisation receives funding from more than one department, only one Financial Accountability Requirement (FAR) is required which will cover the requirements for Department Health and Human Services and Department Education and Training.

    FAR reporting assists the funding department(s) to ensure that there is a financially sustainable service system. Finance staff from the department(s) analyse the financial position of each funded organisation and monitor financial position trends over time.

    Organisations should ensure that the applicable reporting period is inserted (for example 1 Jul 2017 to 30 Jun 2018) as well as details of the organisation.

    The following reporting templates are available:

    If you are still unsure about your FAR reporting requirements please contact your service agreement contact or payment contact.

  • Service agreement compliance certification (SACC)

    Most organisations funded through a Service agreement will be required to submit an annual Service agreement compliance certification (SACC). 

    The SACC contains questions relating to:

    • Financial Management, that the organisation has used funding as outlined in their service agreement, is financially viable, has prepared its financial reports and any audit reports and maintains an asset register.
    • Risk Management, that risks are managed in accordance with the Australian/New Zealand Risk Management Standard.
    • Staff safety screening, referee checks, police checks, and if relevant Working with Children Checks have been completed.
    • Privacy and Data Protection, that the organisation’s practices and systems that do not contravene the Privacy and Data Protection Act 2014 and the Health Records Act 2001 and the Privacy Act (Cth), to protect personal and health information. 
    • Occupational Health and Safety, that the health and welfare of the staff employed are protected by organisation’s policies and practices in accordance with OHS requirements.

    The SACC must be submitted to the department three months after the organisation’s reporting period, or seven days after the organisation’s Annual General Meeting.

    2019-2020 financial year – use existing SACC

    The 2019-2020 financial year will use the existing SACC relating to financial management, risk management, staff safety screening and privacy and data protection.

    2020-2021 financial year - use a new SACC with an OH&S question

    The 2020-2021 financial year will use a SACC with an additional question on Occupational Health and Safety and the Privacy and Data Protection questions will also reference the Privacy Act (Cth).