Department of Agriculture records its first profit in years

The department has been plagued by operational deficits for years, but this year has posted a profit.

The federal Department of Agriculture, Fisheries and Forestry has recorded its first profit in three years after drastically reigning in its spending on consultancy firms.

The department recorded a $13.9 million surplus in 2023-24, having started the new financial year “in a stronger financial position” than the previous, which it described in its latest annual report as a “period of austerity” by focusing on improving the depth of its employees’ skills so it could wean itself off consultants.

The Department of Agriculture, Fisheries and Forestry’s secretary Adam Fennessy is turning things around.

AusTender, where all federal government contracts are advertised, shows that in 2023-24, DAFF advertised 87 contracts worth a combined $8.1 million, down from the $10 million it spent on consultants in the previous 12 months.

This was significantly less than the $80.5 million spent in 2021-22, which included a six-month contract with PricewaterhouseCoopers for strategic planning services at a cost of $6 million.

The timing of DAFF’s move away from engaging consultants coincided with a scandal that hit the Australian arm of global consultancy firm PwC, which was found to have been sharing confidential government information to the benefit of its clients to avoid tax.

Amid the scandal, it was revealed the federal government had become heavily reliant on PwC and other consultancy firms to complete its work, with $500 million worth of contracts with PwC alone in 2022.

In the 12 months to June 30 this year, DAFF spent $711 million in staff costs for its almost 6000 employees, which was on par with recent years, and received almost $700 million from the government in 2023-24.

This was less than the $767 million received from budget appropriations the previous year.

The cost of providing its services was $685 million, down from the $818 million in 2022-23.

The Department has endured a rocky ride in recent years.

DAFF’s $13.9 million surplus in 2023-24 follows a loss of $51 million the year before and a loss of $101 million in 2021-22. It last recorded a profit in 2020-21, of $52 million, but this was preceded by a $131 million loss in 2019-20.

The situation has turned around recently, in part by raising the fees and charges on importers to achieve full cost-recovery from July 1 last year.

NFF president David Jochinke said the NFF had long advocated for a cost recovery model to help provide sustainable funding to protect Australia from pests and diseases.

“This could not come at a more pertinent time as we face down some very real and serious threats, like variants of avian influenza,” Mr Jochinke said.