Annual reports of agencies
2.1
The committee selected the annual reports of the following entities for closer examination:
Agriculture portfolio
Department of Agriculture, Water and the Environment; and the
Murray-Darling Basin Authority.
Infrastructure portfolio
Department of Infrastructure, Transport, Regional Development and Communications; and the
Civil Aviation Safety Authority.
Department of Agriculture, Water and the Environment
2.2
The 2020–21 Annual Report of the Department of Agriculture, Water and the Environment (DAWE) was tabled in the Senate on 20 October 2021. The report provides an overview of the activities and achievements of DAWE over the previous year.
Secretary’s review
2.3
The Secretary, Mr Andrew Metcalfe AO, gave a review of DAWE’s key activities, successes, and challenges for the year including:
support for wildlife and habitat recovery and for those whose livelihoods were affected by the 2019–20 bushfires;
the need, due to the COVID pandemic, to adopt and use new technologies, such as QR codes to validate exports and remote animal welfare monitoring;
a record gross value of $68 billion for agricultural production. This figure rises to $73 billion when including the fisheries and forestry sectors; and
the discovery of African swine fever and foot and mouth disease viruses in pork products seized at the border.
Purpose and objectives
2.4
DAWE identifies its purpose as ‘partnering and regulating to enhance Australia’s agriculture, unique environment and heritage, and water resources.’ The department lists five objectives to achieve this purpose relating to: environment and heritage; Antarctic; agriculture; biosecurity; and water resources. In its summary of performance results, DAWE reported that 25 performance measures were achieved, 21 were partially or substantially achieved, and three were not achieved. The three measures that were not achieved were:
average annual productivity growth for the past ten years is equal to or exceeds average annual market sector productivity growth over the same period. During the ten years prior to the reporting period, the average annual productivity growth for agriculture, forestry and fishing was −1.4 per cent. This was lower than annual market sector productivity growth, which averaged 0.25 per cent over the same period;
100 per cent of World Heritage listed properties being managed under management plans that are consistent with the management principles in the Environment Protection and Biodiversity Conservation (EPBC) Regulations. DAWE reported that of 20 World Heritage properties, 16 have management plans consistent with the World Heritage management principles, one has a management plan in development, and three are due for review; and
a reduction against the baseline of non-compliant projects causing environmental harm. Compared to the previous reporting period, there was a 15 per cent increase in the identification of non-compliant projects causing environmental harm.
Key activities
2.5
This section examines aspects of the agriculture, water resources, and biosecurity objectives of DAWE, as these are the areas under the purview of the committee.
Agriculture
2.6
DAWE highlighted its continued implementation of the Australian Government’s Drought Response, Resilience and Preparedness Plan, and reported that the Future Drought Fund was used to fund eight drought resilience adoption and innovation hubs, with co-contributions from partner organisations, to connect farmers and communities with drought resilience expertise for their region.
2.7
DAWE also reported on the Rural Financial Counselling Service’s (RFCS) provision of free counselling to primary producers and
agriculture-related small businesses who may be at risk of financial hardship. The department implemented the recommendations from a review conducted in 2019-20 to improve the RFCS before transferring responsibility for the service to the National Recovery and Resilience Agency from 1 July 2021. DAWE reported further support for farmers through the pilot Drought Communities Small Business Support Program. The program employed 44 financial counsellors and reportedly supported more than 1000 small businesses during the reporting period.
2.8
Other activities reported under the agriculture portfolio include:
increased funding to drive competitiveness and growth of Australia’s agricultural sector, including $96.7 million to support exporters and market diversification, $400 million to combat pests and diseases, and $246 million to support agriculture stewardship;
resumption of the Seasonal Worker Programme and the Pacific Labour Scheme to address agricultural worker shortages;
increased trade with Indonesia following the reduction of tariffs negotiated in the Indonesia–Australia Comprehensive Economic Partnership Agreement;
negotiated tariff-free quotas for commodities such as beef, sheep meat, dairy, and sugar in free trade agreements with the United Kingdom and the European Union; and
prohibiting the export of sheep to the Middle East during the Northern Hemisphere summer to reduce heat stress and mortality rates.
Water resources
2.9
A new Murray–Darling Communities Investment Package was announced in September 2020, which includes 11 measures to end water buybacks and instead focus water recovery on off-farm water efficiencies. DAWE reported that it will be working with Basin governments to plan and deliver the measures. The Australian Competition and Consumer Commission (ACCC) also released the final report of its Murray–Darling Basin water markets inquiry and made recommendations to improve the way water markets operate. The department reports that $3.5 million has been made available to establish an independent panel to work with Basin governments and other stakeholders to develop a roadmap for water market reform.
2.10
Other reported water resource activities and achievements included:
the contribution of more than 100GL of Commonwealth environmental water to natural flows on the back of good rainfall;
celebration of the 50th anniversary of the Ramsar Convention on Wetlands;
commitment of an additional $50 million to the On-farm Emergency Water Infrastructure Rebate Scheme. The commitment will be matched by state and territory governments; and
commencement of the review of the Water Efficiency Labelling and Standards scheme (the review was due to be delivered in early 2021–22).
Biosecurity
2.11
In May 2021, the Government released its Commonwealth Biosecurity 2030 plan, which aims to build a stronger biosecurity system and comes with a financial commitment of $400 million. As part of the five-year roadmap, DAWE reported that it has launched its biosecurity innovation hub, The Seed. The department also reported the funding of 24 projects under the Biosecurity Innovation Program including diagnostic tests for plant viruses, projects modelling the spread and control of African swine fever, and development of environmental DNA technology to improve the identification of ornamental fish.
2.12
DAWE reported on numerous grants awarded to strengthen biosecurity. Grants included $13 million towards Advancing Pest Animal and Weed Control Solutions, $3.74 million under the Plant Biosecurity and Response Reform program and the Priority Pest and Disease Planning and Response program, and $1.78 million in third-party procurement to enhance Indigenous ranger capability and deliver equipment and services to First Nations ranger groups.
2.13
Other key biosecurity activities reported by DAWE include:
continued vigilance in monitoring the global spread of African swine fever;
support following an outbreak of avian influenza in Victoria;
management of pests including the khapra beetle, brown marmorated stink bug, and fall armyworm; and
implementation of legislation and regulatory changes to increase compliance with biosecurity requirements, including the Biosecurity Amendment (Traveller Declarations and Other Measures) Act 2020 and the Biosecurity Amendment (Strengthening Penalties) Act 2021.
Staffing and financial information
2.14
DAWE reportedly employed a total of 7107 people during the reporting period, of which 6341 were ongoing and 766 were
non-ongoing.
2.15
DAWE reported a comprehensive income of $191.13 million in
2020–21 against a budgeted loss of $111.39 million. The discrepancy has been attributed primarily to changes in asset revaluation reserves of
$139.11 million.
2.16
Other key financial details include:
total expenses—$1,409.72 million;
total own-source income—$495.67 million; and
revenue from the Australian government — $966.06 million.
Committee comment
2.17
For the purposes of its report to the Senate, the committee considers the DAWE annual report to be compliant with reporting requirements and to be ‘apparently satisfactory’.
Murray-Darling Basin Authority
2.18
The 2020–21 Annual Report of the Murray-Darling Basin Authority (MDBA) presented information on the operations and performance of the agency over the reporting period. The report was tabled in the Senate on 22 October 2021.
Chief Executive's review
2.19
The Acting Chief Executive of the MDBA, Mr Andrew Reynolds, reported that progress was made on all agency priorities, although some timeframes had been extended to the following year. Points of interest included:
work undertaken with Basin governments to assess water resource plans, including the transition to sustainable diversion limit accounting;
publication of ‘The Basin Plan 2020 Evaluation’ identifying what parts of the plan were working and identifying what needed resetting;
drier than expected conditions resulting in less water for the environment being made available; and
continued regionalisation of the agency’s workforce to strengthen its presence in Basin regions.
Purpose and objectives
2.20
The purpose of the MDBA is achievement of ‘a healthy working Basin through the integrated management of water resources for the long-term benefit of the Australian community.’ The agency measures its performance against a single outcome:
Equitable and sustainable use of the Murray–Darling Basin by governments and the community including through development and implementation of a Basin Plan, operation of the River Murray system, shared natural resource management programs, research information and advice.
2.21
The MDBA measures its achievements against five main goals, containing eight key performance indicators (KPIs). Of these KPIs, three were met, three were substantially met, and two were partially met. The following section examines the MDBA’s key activities against its five goals.
Goal 1: Drive the successful implementation of the Basin Plan
2.22
The MDBA’s reported role under this goal is to lead the implementation of the Basin Plan in collaboration with Basin state and territory governments and other agencies. The role includes the accreditation of water resource plans (WRPs), ensuring WRPs can continue to adapt and evolve as new information becomes available, improved water accounting and reporting on water resources, and efficient delivery of environmental water.
2.23
The MDBA reported that the agency fell short of its target of assessing 100 per cent of WRPs for accreditation. The agency reported that 13 WRPs, representing 39 per cent of the total, were assessed. The remaining 20 that went unassessed were all from NSW and required amendments before they could be accredited. COVID-19 restrictions were the primary cause of delays in meetings with community groups and engagement with First Nations people in the WRP areas. In lieu of accredited WRPs, the MDBA and the NSW Government signed a new bilateral agreement to safeguard Basin Plan commitments.
Goal 2: Strengthen the culture of compliance in the Murray–Darling Basin
2.24
Under this goal, the MDBA’s reported role is to implement a strategic approach to compliance and enforcement of the Basin Plan and WRPs. The MDBA aims to make its compliance and enforcement information available and transparent; undertake assurance of Basin state compliance and enforcement systems; and increase the coverage and quality of water measurement in the Basin.
2.25
The MDBA reports that it aims to achieve 100 per cent of its compliance priorities. During the reporting period this was partially met. In 2020–21 the MDBA had five compliance‑related priorities:
protection of environmental water and first flush flows;
Sustainable Diversion Limit (SDL) accounting; and
2.26
To address the five priorities, the MDBA planned 12 activities. During the reporting period four activities were completed and five activities commenced. Three were deferred until 2021–22 due to resourcing constraints. All outstanding activities were expected to be completed during the next reporting period.
Goal 3: Efficiently and effectively operate the River Murray System for partner governments
2.27
In partnership with Basin governments, the MDBA promotes and coordinates the planning, management, and sharing of water and other resources of the Basin. The MDBA reports that some of its aims under this goal are the efficient and effective delivery of water that is fit for purpose, improved environmental outcomes in the southern connected system, and the coordinated delivery of all water for the environment in the southern basin.
2.28
According to the MDBA, one measure under this goal was not met. The target for Measure 5.1 in the report was to maintain or improve environmental health for at least five of seven key sites of the River Murray system. The MDBA reports that one site improved its condition, two sites maintained a ‘good’ condition, whilst the remaining four sites were classified as declining. The MDBA attributed this result to a third year of hot and dry conditions across the south of the Basin, which placed stress on the sites and resulted in less water being available for the environment.
Goal 4: Improve transparency and confidence in the Basin Plan
2.29
The MDBA aims to improve transparency and confidence in the Basin Plan through the development and implementation of education and engagement activities with Basin stakeholders. The agency reports that maintaining and expanding its regional presence and engagement is key to achieving this goal.
2.30
Measures underpinning this goal were reported as substantially met. The measures included:
awareness and understanding of the Basin Plan and River Murray operations based on the MDBA stakeholder survey (every three years);
awareness and understanding of the MDBA’s role based on the MDBA stakeholder survey; and
delivery of stakeholder engagement activities that improve awareness and understanding of the Basin Plan, River Murray operations, and MDBA’s role.
2.31
The agency reported that 67 per cent of respondents had an awareness and understanding of the Basin Plan, compared to 56 per cent in 2018. Awareness and understanding of the role of the MDBA also increased, rising from 57 per cent in 2018 to 73 per cent in the most recent survey. However, the agency noted that awareness around River Murray operations and water management was lower. Only 66 per cent of surveyed community members were aware that water in the Basin is managed in partnership between the Australian, state and territory and local governments. The MDBA reported that it aims to improve this response by being more proactive in engaging with groups that are otherwise inactive in seeking information about Basin management.
Goal 5: Apply the best available science and knowledge to the management of the Murray–Darling Basin
2.32
The MDBA reports that its aims to meeting this goal include collecting and collating the best available data and analysis to inform its decision-making and using this information to guide the implementation of the Basin Plan. The MDBA aims for a deep understanding of the social, economic, cultural, hydrological, and ecological conditions of the Murray–Darling Basin and collaborates with partners to generate data and knowledge.
2.33
The agency reports that all measures to achieve this goal were met or substantially met during the reporting period.
Staffing and financial information
2.34
The MDBA reported 300 employees during the 2020-21 financial year. The majority of these were in the ACT with representation in WA, QLD, VIC, NSW and SA.
2.35
The agency reported total comprehensive income of $9.24 million during the reporting period. Key financial details include:
total expenditure – $171.09 million;
total own-source income – $117.92 million;
revenue from government – $62.01 million; and
changes in asset revaluation reserve – $409,000.
Committee comment
2.36
For the purposes of its report to the Senate, the committee considers the MDBA annual report to be compliant with reporting requirements and to be ‘apparently satisfactory’.
Department of Infrastructure, Transport, Regional Development and Communications
2.37
The 2020–21 Annual Report of the Department of Infrastructure, Transport, Regional Development and Communications (DITRDC) details the department’s activities and achievements during the reporting period. The report was presented to the Senate on 22 November 2021.
Secretary’s review
2.38
The Secretary, Mr Simon Atkinson, highlighted the ways in which the department was meeting its five main purposes while responding to challenges posed by the COVID pandemic. Mr Atkinson emphasised DITRDC commitment to reliable transport and communications sectors, supporting liveable cities and regions, and maximising growth and economic opportunities across regional Australia.
Purposes and performance
2.39
The department has structured the annual report to provide a snapshot of its performance against each of its five purposes. The five purposes are as follows:
transport connectivity – supporting an efficient, sustainable, safe, and accessible transport system;
regional development – improving living standards and facilitating growth in cities and regions across Australia;
territories – providing governance frameworks and services in the territories;
communications connectivity – enabling all Australians to connect to effective communications services and technologies, for inclusiveness and sustainable economic growth; and
creativity and culture – supporting sustainable and inclusive creative and cultural sectors and protecting and promoting Australian content and culture.
2.40
This section will examine aspects of the transport connectivity, regional development, and territories objectives of DITRDC, as these are the areas under the purview of the committee.
Transport connectivity
2.41
DITRDC measures its transport connectivity performance against 25 targets. Of these, 11 targets were met, one was partially met, three were not met, and ten had no target. The ‘no target’ designation was given in circumstances where performance was deemed to have been heavily impacted by the COVID pandemic and where highly unusual results may have ensued because of the pandemic. DITRDC therefore omitted those targets for this cycle. Other reasons provided by DITRDC for a ‘no target’ designation included some targets being demand driven, with others outside of the department’s control.
2.42
Of the three targets that were not met, two related to the introduction of a new Reporting and Program Management System. DITRDC reported that while it continues to make improvements to its business and reporting processes, the new system was not implemented during the reporting period. The system was expected to be in place in 2021–22. The third unmet target was the reduction of rail fatalities compared to average annual numbers from 2017 to 2019, with nine fatalities during the reporting period—an increase of four per cent over the three-year average.
2.43
In its analysis, the department gave an overview of the support provided during the COVID-19 pandemic. The department reported that it supported the development and implementation of the Freight Movement Code to exempt freight movements from border closures and allow the delivery of essential ongoing services. DITRDC also reported the delivery of $4.5 billion in support for the aviation sector to enable critical air freight.
Regional development
2.44
DITRDC measures its regional development performance against 13 targets. Of these, ten targets were met and three were partially met.
2.45
The first target that was partially met was the improved liveability, productivity growth, access to jobs and reduced congestion in City Deal locations. While some locations met targets in some areas, others fell short. DITRDC reported that median dwelling price to median income ratios to the end of 2020 were stable, with Darwin reporting the largest increase and Adelaide recording a slight decrease. Productivity growth was good, with the five-year average employment growth rate reported to be positive for all cities except for Darwin. There was reduced congestion in Hobart, Perth and Adelaide. However, there was a reduction in the number of jobs accessible within 30 minutes across all City Deal locations.
2.46
The second partially met target was the delivery of projects to meet agreed timeframes, within the Regional Growth Fund. At the end of the reporting period, DITRDC reported that all 17 Regional Growth Fund projects were contracted, but just two were completed. The delay was mainly attributable to issues caused by COVID-19 restrictions, and all payments have been moved to the 2021‑22 financial year. Similarly, the final partially met target was the delivery of projects funded through the National Water Grid Fund and Science Program within agreed milestones and budgets. Of the projects under this program, 93 per cent of project milestones were met against a target of 100 per cent.
2.47
In its analysis, DITRDC reported that 2020 saw the largest internal migration to regional areas on record with over 43 000 people moving from capital cities—an existing trend that was hastened by COVID-19 and was predominantly families with children. However, this migration, along with natural disasters and border closures, has also reportedly contributed to housing pressures in some areas.
Territories
2.48
DITRDC measures its territories performance against two targets, both of which were met—but the department reported that Australia’s external territories were heavily affected by the COVID‑19 pandemic.
2.49
Travel restrictions instituted to protect vulnerable and isolated communities had the effect of negatively impacting tourism, freight services, and delivery of materials for capital works and other projects. DITRDC reported the delivery of 22 projects throughout the reporting period to support external territories, including the Norfolk Island Water Resources Assessment project and an independent Review of Norfolk Island’s emergency management governance arrangements. The department also reported the provision of $13.5 million of extra funding to external territories to support community infrastructure and promote tourism.
Staffing and financial information
2.50
DITRDC reported a total of 1650 staff at the conclusion of the reporting period. Staff members were based in all states and territories, including Norfolk Island, while a further four were based internationally.
2.51
DITRDC reported an operating surplus of $6.5 million in 2020-21. The surplus can mainly be attributed to lower than budgeted employee expenses and the effect of changes in the 10-year government bond rate on the long service leave provision balance. Other details of the department’s finances included:
expenses totalling $376.8 million;
income totalling $383.3 million; and
net assets totalling $177.9 million.
Committee comment
2.52
For the purposes of its report to the Senate, the committee considers the DITRDC annual report to be compliant with reporting requirements and to be ‘apparently satisfactory’.
Civil Aviation Safety Authority
2.53
The 2020–21 Annual Report of the Civil Aviation Safety Authority (CASA) was tabled in the Senate on 22 November 2021. The report details the activities of the Authority over the previous year.
Chief Executive Officer and Director of Aviation Safety's review
2.54
The Chief Executive Officer and Director of Aviation Safety, Ms Pip Spence PSM, highlighted several of CASA's activities and achievements over the reporting period including:
progress on regulatory reform including the publication of critical guidance materials for the flight operations regulations;
finalisation of the Regulatory Services and Surveillance Transformation Program to take a nationally managed approach to regulatory oversight;
the publication of three ‘plain English’ guides to simplify compliance with general operating and flight rules and fatigue management; and
introduction of six aircraft maintenance engineer scholarships.
2.55
Ms Spence also detailed some of the planned outcomes that suffered delays during the reporting period:
planned workshops on regulatory philosophy that had been planned would now be held in a virtual and hybrid format in the new year;
amendments to the CASR Part 61 flight crew licensing scheme which were expected to commence in 2020-21 were not progressed. CASA was focussed on furthering these amendments in 2021-22; and
the delay in development of the regulatory roadmap for remotely piloted aircraft systems. The delay was deliberate to enable alignment with the Australian Government’s National Emerging Aviation Technologies Policy Statement, which was released on 6 May 2021. The draft roadmap was now intended to be completed in 2021-22.
Performance
2.56
CASA structured the performance statement in its annual report to reflect the targets set out in the Portfolio Budget Statements (PBS) and the agency’s Corporate Plan. Each target was assessed as either ‘on track’ or ‘impact on deliverable’ (which included possible delays).
Portfolio Budget Statement targets
2.57
CASA reported that its PBS targets are measured against eight performance criteria:
number of accidents per hours flown by industry sector;
number of incidents per hours flown by industry sector;
maintenance of the Effective Implementation Score determined by ICAO Universal Safety Oversight Audit Program;
regulatory implementation delivered in accordance with planned and reviewed targets;
surveillance determined via a National Oversight Plan consisting of scheduled and response events informed by risk;
delivery of a program of aviation safety education seminars to industry participants;
clear, open and transparent engagement with the industry to support the continuous improvement of an efficient and effective aviation safety regulatory framework; and
regulatory service applications are decided within published service delivery timeframes.
2.58
CASA reported that nine of 11 of its PBS targets were on track. The remaining two targets were impacted by other variables, as discussed below.
2.59
The first target that fell short was the delivery of 90 per cent of aviation safety seminars, with an overall satisfaction rate for effectiveness of
80 per cent. The agency reported the delivery of 88 per cent of seminars,
2 per cent below the target, with the remainder deferred or cancelled due to COVID-19 restrictions. Following a study commissioned in April 2021, CASA reported that of pilots who had attended a seminar 88 per cent agreed that they had learnt something, 89 per cent felt that attending had been worthwhile, and 78 per cent felt that participation had made them a better pilot. In all, CASA reported that the agency had reached 5256 members of the aviation industry via 175 seminars and 578 onsite visits.
2.60
The second target that was reportedly impacted related to the application of a service delivery timeframe to all regulatory service activities. CASA reported that during 2020-21 demand for regulatory services remained at pre‑pandemic levels. However, the complexity of applications was higher. CASA transitioned regulatory service applications to a new system – the European Aviation Processing system – as part of a wider change to regulatory oversight. The transition to the new system reportedly resulted in delays to development of service delivery timeframes. CASA reported that updated service delivery timeframes based on the new system will be developed in
late 2021.
Corporate Plan targets
2.61
CASA reported that its Corporate Plan targets are measured against three goals with nine key performance areas, as follows:
Develop the regulatory framework;
Strengthen international compliance;
Entry control (airworthiness assurance);
Compliance assurance – Surveillance;
Address non-compliance – Enforcement;
Engagement (with key stakeholders);
Promote safety and education;
Robust structures, systems and processes supporting good governance; and
Continually develop its capability and capacity.
2.62
CASA reported that 32 of 34 of its Corporate Plan targets were on track. The remaining two targets were impacted by other variables.
2.63
The target to promote CASA’s regulatory philosophy through workshops for industry members was delayed due to COVID-19 constraints. The agency reported that this work would proceed in 2021-22 through virtual and hybrid presentations. The workshops set out the principles supporting the way the agency performs its functions, exercises its powers, and engages with the aviation community.
2.64
CASA aims to notify industry participants of surveillance safety findings within timelines defined in the surveillance manual. The agency also requires industry participants to undertake corrective actions to respond to compliance issues within those timelines. During 2020-21, CASA reported that it provided 899 of 901 safety findings within the required timeframe. Of those 901 safety findings, just 564 were successfully closed within the defined timeframe. CASA found that numerous factors affected the timely closing of safety findings including:
reduced staff due to COVID-19 restrictions;
inability of the agency to complete onsite validation of findings due to state border closures;
suspension of certificates with open safety findings; and
implementation of Civil Aviation Safety Regulations Part 139, which required that all open safety findings for aerodromes be reissued under a new regulatory reference.
Staffing and financial information
2.65
CASA reported a total of 857 employees across the agency as at
30 June 2021. Staff are located in all Australian states and territories with the majority residing in QLD and the ACT.
2.66
CASA reported an operating surplus of $16.2 million during the reporting period, up from a deficit of $12.4 million in 2019–20. The difference of
$28.6 million can be attributed to additional funding from government appropriations as part of the Australian Airline Financial Relief Package and a decrease in expenses related to employees and suppliers. The agency also reported that reduced spending on consultancies and service contracts also contributed to the decrease in expenditure.
Committee comment
2.67
For the purposes of its report to the Senate, the committee considers the CASA annual report to be compliant with reporting requirements and to be ‘apparently satisfactory’.
Senator Glenn Sterle
Chair