Wages blowout: Dairy Australia’s employee costs up 20 per cent in 12 months

Staff numbers at Dairy Australia rose by seven last financial year, but its employee costs jumped 20 per cent amid a costly deficit.

When asked if they were satisfied Dairy Australia was investing their levies appropriately, farmers gave it a score of 5.5 out of 10, while only 42 per cent felt they were well-informed about how the R & D body invested their levies.

Dairy Australia total employee costs have blown out 20 per cent, with salaries and allowances up 13.2 per cent, as it records a $5 million deficit for 2022-23 and major slump in its performance.

DA’s latest annual report shows the dairy farmer-funded research, development and marketing body’s overall employee costs rose from $18.3m to $21.9m over the 12 months to June 30.

Yet the number of employees only rose from 178 full-time equivalents on June 30, 2022 to 185 FTEs on June 30, 2023.

Based on the reported financials the average DA employees enjoyed a $8044 pay rise, lifting their take-home wages and allowances from $94,325 each in 2021-22 to $102,370 in 2022-23 – up 8.5 per cent.

Extract of Dairy Australia's latest annual report shows employee costs for 2023 versus 2022. The number of staff rose from 178 full-time equivalents on June 30, 2022 to 185 FTEs on June 30, 2023.

But a DA spokeswoman said its “average salary increases were less than 4 per cent and were determined based on industry benchmarking and relative to performance.

“Our headcount varies through the year as vacancies open up and are filled and some fixed term staff finish, therefore the end-of-year comparison has been misinterpreted.”

Meanwhile DA is battling to meet its key performance targets, one of which was to ensure 80 per cent of dairy farmers valued the R & D body “for our ability to be innovative”.

Yet its 2022-23 performance report found just 53 per cent of farmers thought the R & D body was innovative.

When asked if they were “satisfied that Dairy Australia is investing levies appropriately”, farmers gave it a score of 5.5 out of 10, while only 42 per cent felt they were well informed about how Dairy Australia invested their levies.

Even the majority of its employees feel DA is struggling, with just 46 per cent stating “Dairy Australia is decisive and effective in its actions”.

The performance report shows DA has gone backwards on many performance measures.

The research and development corporation reported only 49 per cent of farmers “feel Dairy Australia has an effective relationship management model”, compared to 53 per cent three years ago.

In assessing the effectiveness of its marketing campaigns DA reported the proportion of consumers who “prefer to buy Australian made or locally produced dairy products wherever possible” had also fallen from 83 per cent in 2021-22 to 75 per cent in the 12 months to June 30 this year.

DA’s efforts to promote dairy farming’s environmental credentials have also slumped, finding just 61 per cent of “consumers agree dairy farmers do a good job caring for the environment”, down from 64 per cent three years ago.

It was better news on DA’s efforts to promote the benefits of dairy products, with 91 per cent of consumers hearing “positive health messages about dairy foods from health professionals”, compared to 86 per cent three years ago.

But the proportion of consumers who make an effort to consume dairy every day remains stagnant at 47 per cent.

DA has also struggled to improve the image of dairying’s animal welfare credentials in the face of activists’ campaigns, with just 65 per cent of “the community believes the dairy industry meets their expectations in doing the right thing”, compared to 73 per cent three years ago.

The R & D corporation’s role in promoting dairy farmer adoption of technologies and management practices “to achieve land, water, carbon, nutrient, and energy efficiency” has also taken a hit, falling from 66 per cent of farmers undertaking such work in 2020-21 to 41 per cent in 2022-23.

Research efforts by DA to lift the rate of genetic gain in rye grass by more than 2 per cent annually have also fallen short, with it reporting less than 1 per cent in each of the last three years.

However DA did manage to get 24 per cent of farmers to use its Forage Value Index to select grass pasture varieties sown, compared to just 9 per cent three years ago.

The DA spokeswoman said “overall our performance is steady, on target, or our targets have been achieved.

“Cherry picking measures would be an inaccurate report of our overall performance.

“Dairy Australia performance targets are a mix of ambitious stretch targets and more conservative. This enables us to challenge our teams to deliver above expectations.

“We have undertaken a midterm analysis of our strategy and refined our focus for the second half of the strategy.

“This means we have prioritised areas of most importance to farmers and deprioritised others, and therefore in some instances we are not chasing original targets.”