A damning review recommends 40 per cent of Athletics Australia's (AA) crucial government funding is withheld until the body shows it is making far-reaching changes.
The One Sport review, chaired by former Australian cricket coach John Buchanan, has called for an overhaul at all levels of athletics.
It wants new board members within the next year and also says there are concerns in the sport about whether chairman David Grace QC is the right person for the role.
The review has recommended an oversight committee meet monthly and assess the progress of the reforms it has proposed.
Buchanan's report said the Australian Sports Commission should only guarantee 60 per cent of its athletics funding for 2015-16 until the committee is satisfied with the progress of change within the sport.
AA's initial response was to welcome the report and say it had already started implementing many of its recommendations.
"I would say they certainly have responded since what happened in Glasgow and are progressing in a number of areas, particularly high performance," said Sports Commission chief executive Simon Hollingsworth.
"That is encouraging ... my conclusion still would be that they have a long way to go."
The review savaged AA over its governance and the fragmented nature of the sport in Australia.
It is the latest report to call for AA and Little Athletics to become one organisation.
The review went right through the sport's structure and did not spare the board or its chairman.
"In the next 12 months, the panel recommends there should be at least two changes to the current board of nine, while retaining the most-recent appointees," it said.
"Any review of board requirements and capability should also consider the role of the chair.
"The panel heard differing views on the current chair.
"There is uncertainty in the athletics community as to whether the current chair has the right skills for the role."
The panel also featured Melinda Gainsford-Taylor, Lynne Williams, Mark Bartels and Matt Favier.
It was commissioned in the wake of AA's troubled Glasgow Commonwealth Games campaign.
The most glaring controversy was head coach Eric Hollingsworth being sent home after he publicly criticised star hurdler Sally Pearson.
That was only mentioned briefly in the Buchanan review, which focused on more deep-seated problems.
Simon Hollingsworth noted this was the latest report to recommend significant changes to the sport.
"We are really determined that this report does not gather dust on the shelf," he said.
"Regardless of government funding and the like, the sport needs to do this for its own sake.
"The report is saying to thrive and compete in the marketplace, the sport hasn't got five years, 10 years to twiddle its thumbs."
AA and the Sports Commission will prepare detailed responses to the review.
The Sports Commission boss stressed preparations for the Rio Olympics were a high priority.
"We will not compromise athletes' performance in the lead-up to Rio," Simon Hollingsworth said.
Buchanan said the report was a golden opportunity for athletics, agreeing it was a sleeping giant in Australian sport.
"Historically, (athletics) has been fragmented. It hasn't brought all its resources and headed in one direction," Buchanan said.
"Here's an opportunity, I think, to change that.
"It will take time to do that, but ... there's a swell of so much support - they just need really good leadership and management to drive that home."
KEY FEATURES OF THE ONE SPORT REVIEW OF ATHLETICS IN AUSTRALIA:
* Review panel chaired by former Australian cricket coach John Buchanan
* Melinda Gainsford-Taylor, Lynne Williams, Mark Bartels and Matt Favier also on the panel
* Commissioned in the wake of the Glasgow Commonwealth Games
* Received 51 submissions and conducted 136 interviews
* 16 recommendations, mainly related to significant governance and high-performance reforms
* Calls for an oversight committee to monitor the progress of reform in Athletics Australia for at least 18 months
* Wants the Australian Sports Commission to only guarantee 60 per cent of its 2015-16 AA funding until the committee is satisfied with progress in the sport
* Other recommendations include:
- A minimum of two board changes and an assessment of current chairman David Grace QC
- An immediate audit of all AA committees
- AA to develop more diverse revenue sources
- A review of AA's high performance plan
- AA and Little Athletics to come together
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