Revealed: VFF drain Grains Group into deficit

The Grains Group’s previous $675,000 surplus has been wiped out by the VFF’s hiked service fees and $230,000-plus in legal costs. See all the details.

The VFF board and management lifted the service fee they charge Grains Group to $1.8 million in 2023.

The Victorian Farmers Federation has drowned its Grains Group in debt, according to finances recently released to members for the first time.

Financials disclosed by VFF chief executive Brendan Tatham reveal the organisation has loaded Grains Group members with a service fee equal to $2100 per member, three times the $700 a member The Weekly Times understands it charges other commodity groups – livestock and dairy. It comes after the VFF last year cashed out the Grains Group’s $9.8 million deed poll to pay off the bulk of its $8 million debt.

The financials, revealed on a recent Zoom meeting with members and seen by The Weekly Times, show VFF board and management lifted the service fee they charge Grains Group members from $674,002 in 2021 to $887,420 in 2022 and then $1.8 million in 2023.

Given the Grains Group has 850 members, the service fee equates to them contributing $2100 each to the running of the VFF.

VFF Grains Group 2021 finances, showing VFF charged a service fee of $674,002.

Grains Group 2023 finances, showing VFF charged a service fee of $1.79 million.

Former Grains Group president Andrew Weidemann said the VFF had also charged the group $237,024 in legal costs this year, which the board incurred fighting grain growers’ federal court bid to oust VFF president Emma Germano and vice-president Danyel Cucinotta.

According to the financials, the hike in service fees has wiped out the Grains Group’s 2021 surplus of $676,510, leaving it with a deficit that reached $552,626 by February this year and could blow out even further.

VFF Grains Group 2024 finances (Oct 1 to Feb 2024), showing deficit of $552,626.

The move comes despite grains group’s revenue, according to the financials, remaining fairly steady at about $1 million a year and its staff, communications and promotions costs being cut to zero.

Grains group vice-president Ryan Milgate asked: “How can the VFF charge us $2100 a member, when we don’t have any dedicated staff and the group gets a budget of $10,000 a year?”.

The VFF board and management responded by stating the Grains Group financials were “internal management data and remains the property of the VFF”.

“Any publication of management data may constitute a breach of copyright. Current financial year management data is subject to review,” it said.

“There has been no change in the internal financial management of the VFF for more than 10 years. All service fees to commodity groups are equal and based on a per member cost of running the VFF. This cost changes annually.

“Information portrayed by the Herald and Weekly Times about the finances of the VFF is inaccurate, divisive and defamatory. The premise of the questions raised by the publication and that of farmers seeking to benefit with a claim of entitlement is rejected.”