Government spending on law firms and barristers ballooned by almost 50 per cent over two years before the Attorney-General’s Department sidelined expensive top-tier corporate law firms, demanded discounts and overhauled its preferred suppliers, new figures show.

The figures, released on Tuesday as part of the Attorney-General’s Department’s legal services expenditure report, show spending on external law firms hit $448 million in 2022-23, driven by blowouts at the Department of Defence and Services Australia and a rise in court action by regulators. The figure jumped from $381 million in 2021-22 and $301 million in 2020-21.