2.1
This chapter summarises the purpose, outcomes and priorities of the Australian Federal Police (AFP), and explores changes to the agency's performance framework, the AFP’s performance against its assessment framework, and its financial performance for the year 2018-19.
Purpose, outcomes and priorities of the AFP
2.2
The purpose of the AFP is to protect 'Australians and Australia’s interests through addressing criminal and national security threats; in essence, policing for a safer Australia'.
2.3
The functions of the AFP are outlined in section 8 of the Australian Federal Police Act 1979 (AFP Act). These include the provision of police services in relation to:
the laws, property and interests of the Commonwealth;
the investigation of state offences which have a federal aspect;
the Australian Capital Territory, the Jervis Bay Territory and Australia’s external territories;
functions conferred by the Proceeds of Crime Act 2002 and the Witness Protection Act 1994 and any complementary laws;
protective and custodial functions directed by the Minister;
assisting an Australian or foreign law enforcement, intelligence, security or government regulatory agency;
establishing peace, stability and security in foreign countries;
assisting an international organisation or a non‑governmental organisation in relation to matters outside Australia;
and anything incidental or conducive to these functions.
2.4
In 2018-19, the AFP had two outcomes stipulated in the Home Affairs Portfolio Budget Statements. The first intended outcome of the AFP's work is 'reduced criminal and security threats to Australia’s collective economic and societal interests through cooperative policing services'. This outcome includes the AFP's Federal Policing and National Security program and its International Police Assistance program.
2.5
The second intended outcome of the AFP's work is 'a safe and secure environment through policing activities on behalf of the ACT Government'. This outcome comprises the ACT Community Policing program.
2.6
The AFP's annual report 2018-19 addresses Outcome 1 while Outcome 2 is canvassed in a separate annual report published by ACT Policing. The committee considers the AFP's performance against its measures for Outcome 1. The AFP's Outcome 2 performance is not considered here.
2.7
The AFP Corporate Plan 2018-19 (covering four years from 2018-19 to 2021-22) states that the organisation’s priorities are influenced by the operational environment as well as government priorities. The plan identifies globalisation, technology, transnational serious and organised crime, child exploitation, terrorism, and regional and global stability as key enablers, threats, and priorities for the four-year period.
2.8
For the short to mid-term future, the AFP intends to develop: a future-ready agency, domestic and international partnerships, culture and organisational health, and agility in its capabilities. To this end, its corporate plan outlines major activities to be commenced or continued in 2018-19 under these four headings. The AFP's annual report 2018-19 demonstrates progress against each of these initiatives, for example:
work towards a future-ready agency was progressed through development of a single-source report that provides an overview of programs driving change across the organisation and a mechanism to register matters which require attention;
domestic and international partnerships were progressed through working groups;
improved culture and organisational health was progressed through implementation of almost all of the Cultural Change Report recommendations; and
the AFP developed further agility in its capabilities by launching its People Strategy 2018–2022.
Changes to the AFP performance framework
2.9
According to the AFP Corporate Plan, the AFP is incrementally reforming its performance framework each year to allow it to 'stay attuned with environmental changes'.
2.10
In 2017-18, the AFP's performance framework grouped 19 performance criteria against its main activities—National Policing, International Operations, Protection and Community Policing. In 2018-19, the AFP’s performance was assessed against 11 performance criteria under two groupings: Public value and impact (3 criteria) and Operational outcomes (8 criteria). The majority of existing performance criteria have been retained but are 'presented more clearly'.
2.11
The AFP changed one criterion which relates to the quality of its investigations. The AFP previously reported the conviction rate of individuals who had been successfully prosecuted of a Commonwealth crime by the Commonwealth Department of Public Prosecution (CDPP). However, as prosecution is outside of the AFP’s control, the agency replaced this rate with the number of prosecution cases that have been accepted by the CDPP (the acceptance rate).
2.12
At the committee’s hearing on 28 May 2020, the committee questioned whether it would not be more useful to report on both prosecution and acceptance rates as both indicate the quality of AFP investigations. AFP Commissioner Reece Kershaw agreed that that there is opportunity for the agency to improve its reporting and that the organisation was considering including additional measures such as caseloads, run times, expenditure and acceptance rates.
2.13
It might be noted that ACT Policing, which is part of the AFP, measures this information in a different way. ACT Policing measures the percentage of briefs it delivered to the Director of Public Prosecutions (DPP) within designated timeframes, as opposed to the number of briefs which have been accepted by the CDPP as in the case of the AFP. In addition to timeliness of briefs, ACT Policing tracks the percentage of cases which are finalised by the offence being proven in court. Further, the ACT Policing report tracks the percentage of cases which were 'otherwise resolved' which aims to measure those matters where defendants were unfit to plead due to mental illness.
2.14
The 2018-19 performance framework also retired two criteria from the previous year: the ‘stakeholder satisfaction’ measurement was removed due to its inability to provide insight into the AFP’s public value or operational outcomes; and the ‘cyber safety awareness’ measurement (which considered the effectiveness of messaging from the AFP's ThinkUKnow program) was removed and captured instead as part of the 'prevention case study analysis' measure. The AFP also introduced two new criteria this year—the 'response case study analysis' and 'enforce case study analysis' (discussed in the following section).
Performance results for 2018-19
2.15
While the AFP has 11 performance criteria, its 'return on investment' criterion has been broken down into three parts and its 'response time' criterion has been broken down into four parts. This means there are 16 measures in total being assessed for results and marked as either 'achieved' or 'not achieved' for the year.
2.16
This section of the committee's report analyses the 16 measures related to Outcome 1, summarises the AFP's notable highlights from the 2018-19 year, and provides an overall committee view for Outcome 1 performance. This is followed by a summary of the AFP's financial performance.
Public value and impact
2.17
The AFP aims to measure its public value and impact by measuring 1) the community's confidence in the AFP's ability to counter threats via an annual phone survey, 2) its return on investment via cost/benefit analysis, and 3) the effectiveness of its external territories work via evaluations of its programs. A single committee view has been provided at the end of this section at paragraph 2.39.
Community confidence
2.18
In order to gauge community confidence in the AFP, the organisation commissioned a phone survey of a random sample of the Australian public asking them to rate their confidence in the AFP out of 10. The target was to have 75 per cent of respondents rating their confidence as 8 or more out of 10; however, only 61 per cent of respondents did so. This result was consistent with the result in the previous reporting period, 2017– 18, when 62 per cent of respondents rated their confidence as 8 or more out of 10.
2.19
Of the AFP's 16 measures, this was the only criterion that the agency did not achieve. The AFP annual report noted that a target of 75 per cent is ambitious for this criterion as the organisation does not have many direct engagement roles with the community (the crimes it addresses affect national and border security), undertakes many joint operations, and some AFP officers do not wear uniforms.
2.20
The annual report indicates that the AFP is aware there is poor public knowledge of the organisation's role. The report states, '[t]he lack of a distinct public image remains an area of concern…as the public frequently do not really know the agency and it is unclear whether it needs to, given the role of the AFP. This will be an area of ongoing consideration as to the best measure for the AFP to use'.
2.21
Most of the information the community has about the AFP has been derived from media (82 per cent of respondents stated this was their main source), yet only one in eight (12 per cent) rated their perceived knowledge about the AFP as 8 or more out of 10. The AFP acknowledged there are issues arising from media being the main source of information for the community about its work, and that it would review this criterion and the survey for 2020 to develop a more realistic approach.
Return on investment – transnational crime
2.22
The transnational crime return on investment (ROI) criterion takes the value of how much harm to the community is avoided in dollar terms when the AFP seizes drugs and investigates fraud, and divides it by how much it cost to operate the AFP teams carrying out the work. The AFP estimates how much, for example, prison, legal and medical services, absenteeism and rehabilitation would have cost the community if it had not prevented crime before it happened. The AFP assesses its transnational crime efforts as having been 'achieved' if it returns a positive figure on its investment. Overall, the AFP’s transnational ROI for 2018-19 was 3.6—that is, it returned $3.60 for every dollar it spent on these activities.
2.23
Breaking this figure down, drug-related investigations finalised in 2018-19 brought $1.2 billion in benefits against a cost of $274 million, while financial crime cases only brought $10 million in benefits against a cost of $59 million. The annual report notes that these figures do not capture all benefits but only those that can be directly measured. Further, only domestic drug seizures are used for the drug harm calculations even though the AFP works collaboratively with international partners. The figures are also only based on investigations that were finalised in the 2018-19 period, even though they may have commenced in previous years and some investigations can take up to 10 years to complete.
2.24
For comparison, the AFP’s ROI was 16.0 in 2017-18. However, as the AFP pointed out, lower figures do not necessarily represent weaker performance. The annual report also noted that a 'changing policing landscape of fraud federally is having an impact on this ROI'.
Return on investment – assets confiscation
2.25
The AFP confiscates criminal assets so that financial benefits from offending cannot be reinvested into criminal activities. Each year, the AFP calculates its ROI by dividing the value of confiscated assets by the cost of running the confiscating and litigating teams. In 2018-19, the AFP had $49.7 million of confiscated assets against $18.4 million of running costs, which provided an ROI of 2.7 against a target of 1.
2.26
The annual report highlighted that cases are frequently complex and involve significant international liaison. Further, the amount confiscated each year is subject to delays in matters being litigated, the time taken to finalise litigation, the time taken to realise confiscated assets, and the value of assets when sold. Investigations are also often commenced in previous years, take several years to complete, and the assets may have been realised over a number of financial periods.
Return on investment—international operations
2.27
The AFP assists international law enforcement services via a range of joint operations which can relate to, for example, child exploitation, illicit drugs, and human trafficking. Due to the nature of the work, the AFP is unable to fully capture the benefits of its contribution in its performance measurement and reporting.
2.28
The AFP calculates its ROI for international operations based on the value of international drug seizures which involved the AFP (that is, the value of the harm that could have been caused to the Australian community had drugs reached it) divided by the cost of the AFP carrying out its international work. The annual report advises that '[t]he true breadth of this contribution cannot be fully measured'.
2.29
Even using this partial capture methodology, the AFP’s ROI for 2018-19 was $22 for every dollar spent against a target of >$1. This is based on $3 billion worth of drugs and precursors that were seized with the assistance of the AFP against running costs of only $133 million. The annual report identified that effective international collaboration in places like northern Myanmar and the Netherlands led to substantial seizures which affected the ROI.
2.30
Last year, the AFP’s ROI was significantly higher at $32 for every dollar invested. The annual report pointed out that the AFP's focus on child exploitation matters in the Asia-Pacific as well as its prevention work (which does not involve seizures) during the year will have impacted calculations, as the methodology captures only AFP work which involved drugs.
Mission and external territories performance evaluation
2.31
The AFP provides community policing in Australia’s external territories, including Christmas Island, Norfolk Island, Cocos (Keeling) Islands, and Jervis Bay. AFP International Operations is responsible for managing community policing and a variety of other functions in these territories including customs, border protection and immigration functions and land and maritime search and rescue operations. The AFP also provides several international police assistance missions which focus on capacity building across the Pacific, Timor-Leste, and the Solomon Islands.
2.32
While the AFP also provides community policing services to the ACT Government, ACT Policing is not included in its 'mission and external territories performance evaluation' measure as ACT Policing provides a separate annual report.
2.33
The aim of this performance criterion is to gauge improvements to, and perceptions of, safety and policing capability in specific international communities through program evaluations. It is separate from the 'community confidence' measure which examines local perceptions and confidence in the AFP.
2.34
The AFP measured international perceptions and potential for improvement through 'systematic and in-depth independent and internal assessments of programs, strategies and objectives that provide evidence to inform learning and decision making'. However, it is unclear from the 2018-19 annual report whether AFP performance in all of its international policing missions as well as external territories policing are evaluated routinely, if a selection is chosen for evaluation each year, or a combination of both of these.
2.35
The AFP Corporate Plan 2018-19 notes that both internal and independent assessments for this performance criterion are optional. The plan forecasts which international policing mission evaluations will take place in 2018-19, 2019-20, 2020-2021, and 2021-2022. However, the corporate plan does not explain or indicate the evaluation framework for the AFP's performance in external territories (for example, Norfolk and Christmas Islands).
2.36
The AFP's previous annual report for 2017-18 provided a table which outlined how each international policing mission had performed overall against effectiveness, efficiency, gender equality, and sustainability targets for the first half of the reporting period (July to December 2017). However, it did not provide any comments on the performance of external territories policing. The 2018-19 report does not provide a similar table but instead discusses the single evaluation that was planned for the year.
2.37
The single evaluation that was planned for 2018-19 was in regard to the Pacific Police Development Program (PPDP). The AFP works with the police across the Pacific to combat transnational crime in an interconnected way, and the AFP undertook a ‘health check’ of its work to identify areas that are working or need improvement. The network was reviewed between April and June 2019; however, as the results were presented outside of the reporting period, the 2018-19 assessment of the criterion was marked ‘pending’ in the annual report.
2.38
Overall, the AFP’s target for its mission and external territories performance evaluation criterion is to have ‘evaluations completed and recommendations addressed’. However, it seems that not all missions and external territories are reported on in this section of the annual report, evaluations may not be completed or made available in same time period, and implementation of recommendations may span several years.
Committee view
2.39
The committee acknowledges the significant contribution of the AFP to the Australian community and acknowledges the difficulty it faces in measuring and assessing its performance on an annual basis. The AFP works within a much larger system, often collaboratively and internationally, and it is impossible to measure all the benefits arising from its work.
2.40
The committee encourages the AFP to continue to seek new ways to measure community confidence and notes that the AFP is reviewing the importance of the role of public knowledge of the organisation.
2.41
The AFP's return on investment (ROI) is impressive considering that much of the benefits from its work have not been captured. With regards to the ROI in transnational crime efforts, the committee appreciates the inclusion of a five-year chart in its annual report which demonstrates the fluctuations in ROI over time. As investigations can sometimes take up to ten years to complete, it may be useful for the AFP to broaden the time range of its chart. Briefly unpacking how the policing landscape of fraud is changing and impacting the AFP's ROI, may also be of benefit.
2.42
Further clarity could be provided in the annual report on the AFP's performance in external territories and international policing missions. The framework for assessing the AFP's work is unclear; for example, the performance framework and results for Norfolk Island do not appear to be reported on in the annual report or publicly available elsewhere. It may also be difficult for the AFP to meet its ‘evaluations completed and recommendations addressed' target annually, due to evaluations spanning reporting periods. The AFP might consider providing greater detail on its external territories and international assistance missions' performance framework and the results of its assessments. The annual report may also benefit from including a table that captures several reporting periods of results of evaluations.
Operational outcomes
2.43
The 'operational' grouping aims to measure the success of the AFP's operational activities in meeting its four goals—prevent, disrupt, respond and enforce—across areas such as combatting terrorism, transnational and organised crime, supporting regional stability, and protecting Australia's interests. This section analyses the AFP's 11 operational measures and results under seven headings.
Prevention case study analysis
2.44
The AFP carries out a diverse range of prevention activities, such as working with vulnerable individuals to prevent crime, targeting underlying causes of crime, and maintaining order. Prevention can include education campaigns, policing control orders, or referring potential risks to other agencies.
2.45
The AFP’s target for this criterion is framed broadly as ‘successfully targeted crime prevention’. The annual report notes that the AFP's prevention work is diverse and that it includes things like vulnerabilities being identified during investigations, control orders, and education campaigns. The report provides two case studies which demonstrate the AFP's work in preventing potential child sexual offences through the operation of its National Child Offender System and restricting the international travel of high-risk offenders. The report also highlights the AFP’s ThinkUKnow online security awareness campaign and National Missing Persons Week campaign.
Committee view
2.46
The committee commends the prevention activities of the AFP and its contribution to protecting not only Australian children but those overseas. The annual report notes that prevention often takes place within other AFP work, such as disruption and enforcement, and the committee appreciates the difficulty with delineating the boundary between coexisting and complementary work for the purposes of reporting and evaluation. In addition to case studies, the AFP might consider providing a summary, for example, of how many people or schools have accessed the National Missing Persons and ThinkUKnow campaigns during the year and any outcomes or trends. It might also review whether there are additional figures that could be included which provide insight into how many cases, services, and campaigns the AFP carries out during a year as part of its prevention work.
2.47
The AFP might consider providing an approximate breakdown of how much prevention work is carried out as a proportion of the AFP’s total prevent, disrupt, enforce, and respond efforts for the year. This would provide the committee with an understanding of the organisation’s current resourcing distribution and any trends over time.
Disruption case study analysis and disruption numbers
2.48
The AFP defines ‘disruption’ as delaying, diverting or complicating the commission of criminal activity where prosecution may not be feasible.
2.49
Again, the AFP’s disruption target for 2018-19 was framed broadly as ‘successfully undertook disruption’ and the annual report provides four case studies which outline some of the AFP’s international and domestic work disrupting drug smuggling operations, forced marriages, and financial fraud.
2.50
The AFP provides the number of disruption activities it carried out during the year in a separate criterion. For 2018-19, the AFP recorded 246 disruptions against a target of 206. In terms of nature, 64 per cent were international disruptions and 36 per cent national disruptions, and the majority related to child exploitation and drugs.
Avoidable incidents
2.51
The AFP provides protection to particular officeholders that have been identified as at risk in both Australia and during international travel. The AFP measures the success of its work through the number of incidents that occurred and caused injury, death or embarrassment which could have been avoided through intelligence and action. For 2018-19 it set a target of less than three avoidable incidents and recorded one incident (which related to a member of the public throwing an egg at the Prime Minister while he attended a Country Women's Association meeting).
Committee view
2.52
The significance and scope of the AFP’s disruption work is well illustrated in the annual report through the inclusion of case studies. Again, the difficulty of setting a quantitative target for disruption is not lost on the committee. In addition to the case studies, the AFP might consider providing brief discussion of how it prioritises disruption activities, the proportion of total resourcing its disruption activities represented for the year, how yearly targets are set, and trends over time.
2.53
With regards to protective services and avoidable incidents, the committee commends the AFP’s work in this area; its results are a testament to its intelligence and response efforts, as no two incidents are the same.
Response case study analysis
2.54
The AFP introduced a new performance measure in 2018-19 which aims to gauge how urgently the AFP responded to time-critical incidents such as drug seizures, vessels in distress, alarms at officeholder and diplomatic premises, international emergencies and aviation incidents. The AFP’s target for this measure was again framed broadly as ‘successfully delivered response’. The annual report provided two case studies which outlined some of its work in responding to threats made via phone and social media in collaboration with other law enforcement services.
Committee view
2.55
The committee acknowledges the response results of the AFP and thanks the agency for providing illuminating case studies which demonstrate the complexity of its work. The committee appreciates the difficulty in setting targets for, and measuring the success of, the AFP's response work when it is broad in scope and each incident is unique from the next. In future annual reports, the AFP might consider including information on how priority levels and expected response times are set, the approximate number and types of incidents that were responded to, and trends over time.
Response to aviation incidents within priority time frames
2.56
The AFP measures its performance at airports through its time taken to respond to incidents. Incidents have priority levels ranging from 1 to 4 (depending on whether they are life threatening or no immediate danger) and their response target times vary. For 2018-19, priority levels 1 and 2 had targets of 90 per cent and priority levels 3 and 4 had targets of 95 per cent. The AFP aims to have 90 per cent of priority 1 incidents responded to within 10 minutes while other jurisdictions' aim to have between 80 and 90 per cent of their priority 1 call-outs responded to within 10 and 15 minutes.
2.57
In 2018-19, the AFP exceeded its targets for all priority levels despite a trend of increasing passenger numbers (14 per cent in Melbourne) which did not match the increase in AFP staffing over the same period (four per cent in Melbourne). Geography, resources, deployment, and clustering of incidents can also impact attainment of targets. In the previous reporting period (2017-18), the AFP attended nearly 600 priority one incidents, while it attended 703 priority one incidents in 2018-19.
Committee view
2.58
The committee acknowledges the excellent response times of the AFP in responding to aviation incidents, despite rising traffic at airports and against a particularly lean target. In future annual reports, the AFP might wish to include some discussion around the quality of its responses, how targets are set, whether and why targets differ from year to year, and any trends in the types of incidents the AFP is responding to at airports (noting that border and travel restrictions imposed as a result of the COVID-19 pandemic will likely make comparison between 2019-20 and previous years challenging).
Enforce case study analysis
2.59
The AFP introduced a new performance assessment criterion in 2018-19 which aims to measure its success in enforcement activities. Enforcement activities can range from investigation of offences, assisting other agencies with their enforcement, and cooperative international activities. The AFP's contribution often forms part of a larger process in which prosecution and sentencing for example, are outside of the AFP's control. The AFP's target for this measure is 'successfully targeted crime prevention'. The annual report provides three case studies across money laundering, illegal trade, and cybercrime to illustrate the complexity of and outcomes from the AFP's enforcement work.
Committee view
2.60
The AFP's enforcement work is commendable and again the committee acknowledges the difficulty of setting a qualitative or quantitative target when the nature of the work is dynamic, unique, and significantly broad in scope.
2.61
In addition to providing case studies, the AFP might include information on how it prioritises its work, the approximate number and types of incidents that were responded to, and any trends over time.
2.62
The AFP might also consider ways in which an approximate breakdown of how much enforcement work is carried out as a proportion of the AFP’s total prevent, disrupt, enforce, and respond efforts for the year could be included in future reports.
Prosecution acceptance rate
2.63
The AFP introduced a new performance assessment criterion in 2018-19 which aims to measure the quality of briefs it submitted to the CDPP using the number of briefs which were accepted for prosecution. The CDPP completed assessment of 417 briefs in the time period; it accepted 95 per cent for prosecution while the remaining five per cent were not proceeded with due to insufficient evidence. In 2018-19, 95 per cent of AFP cases that proceeded to court recorded a conviction.
2.64
The CDPP also assesses AFP investigations, which are complex matters involving multiple offenders, in addition to AFP briefs which are matters referring to an individual offender. The CDPP assessed 228 investigations during 2018-19, of which 49 per cent related to drug crime, 25 per cent to child sexual exploitation, 11 per cent to financial crime, and 15 per cent to other crime types. Four investigations took over 10 years to complete, while the median run-time was two years.
Committee view
2.65
The committee commends the AFP for its high quality and effective brief preparation which is demonstrated through a high prosecution acceptance rate. As mentioned earlier, the AFP previously reported the conviction rate of individuals who had been successfully prosecuted of a Commonwealth crime by the CDPP and the committee is of the view that the AFP should include both of these rates in its annual reporting.
2.66
The committee notes that the annual report states that 'no briefs were refused due to poor quality,' yet five per cent of briefs were not proceeded with due to insufficient evidence. Should a similar situation occur in future, some discussion as to why this occurred might be helpful.
Notable performance outcomes in 2018-19
2.67
In addition to the Outcome 1 performance results discussed above, the AFP undertook a number of significant investigations and operations during the 2018-19 year. These include:
members of the AFP helped the international rescue effort to save a junior soccer team from a northern Thailand cave system;
the largest ever onshore seizure of methamphetamine (ice) took place in collaboration with the Australian Border Force (ABF);
the Australian Centre to Counter Child Exploitation was established in Brisbane;
assistance to Papua New Guinea to deliver a safe Asia-Pacific Economic Cooperation meeting of world leaders after two years of planning;
agreements with Chinese law enforcement to tackle transnational serious and organised crime were extended;
almost 30 000 incidents across nine major airports were responded to;
112 overseas children were rescued from potential sexual abuse and 60 people were charged as a result of child protection investigations.
Committee view - Outcome 1 overall performance
2.68
The committee thanks the AFP for an informative and well-structured annual report and acknowledges the significant efforts of the AFP during 2018-19 in combatting transnational crime, drug smuggling, child exploitation, and money laundering, and in carrying out protective services and aviation security. The AFP's role in operations such as the Thailand cave rescue and the largest ever seizure of ice in collaboration with the ABF, is also to be commended.
2.69
The AFP's overall performance for 2018-19 was positive and the committee notes that the AFP's workload remains relatively stable (it closed 3416 cases in total during the year, 2670 of which were finalised and 746 of which were rejected due to being of low priority or not within AFP jurisdiction).
2.70
The committee appreciates that the AFP operates within a contested environment where there is debate around which approach is best in tackling different forms of crime. It is also inherently difficult to measure the social benefits of policing and much of the AFP's work is unique to each incident, crosses borders and legal jurisdictions, is collaborative, broad in scope and difficult to quantify. The results of AFP investigations can often not be realised for many years, be realised by other agencies, or be subject to variables like litigation processes which are outside of the AFP's control. Many benefits of the AFP's work are only able to be partially captured yet the agency remains vital in protecting the Australian community and its interests.
2.71
It is essential that the AFP has a rigorous and meaningful annual performance framework in place which can demonstrate the effectiveness, quality, and quantity of its work. In many respects, the AFP's 2018-19 annual performance framework meets this goal; however, the organisation's broad targets of 'successfully prevented, disrupted, responded and enforced crime' could potentially be further broken down to facilitate deeper analysis.
2.72
The committee commends the inclusion of case studies to illustrate the AFP's work. These snapshots provide insight into the complexity of its operations, the organisation's significant domestic and transnational contributions, and the difficulty in delineating between and reporting on prevention, disruption, response and enforcement activities which can often stem simultaneously from a single operation.
2.73
The committee hopes that its suggestions are helpful to the AFP, and looks forward to monitoring the AFP's performance and measures in its future annual reports.
Financial performance of the AFP in 2018-19
2.74
The AFP’s departmental operating income for 2018-19 was $1 397 million. This comprised $1 103 million in government appropriation, $166 million from the ACT Government for policing services, and $127 million in other revenue. The AFP further received $59 million in government appropriations for departmental capital expenditure and $71 million in equity injections for specific initiatives. It also administered $14 million in expenses on behalf of the government during the year.
2.75
The AFP reported a departmental comprehensive loss of $109 million for 2018-19. When the impact of unfunded depreciation of $93 million is excluded, the deficit for the year is $16 million. This result was due to 'technical accounting adjustments to employee leave provisions due to movements in the bond rate'.
2.76
The AFP explained the $16 million deficit at the committee's public hearing. Broadly, when the AFP values its long-term employee liabilities, it applies a percentage rate for the time-value of money in accordance with the Department of Finance standard. As the bond rate fluctuates and is not something that the AFP can control, it uses an estimate at the beginning of each year based on the market and makes an adjustment at the end of each year to reflect the actual rate.
2.77
The AFP's annual report noted a number of major variances between the funds allocated in the 2018-19 Portfolio Budget Statements and the final outcome for the year. These included the AFP having higher than budgeted employee benefit expenses, revenue, trade and other receivables, as well as supplier payables while its land and buildings were lower than budgeted due to delays in capital projects, particularly the Perth and Sydney offices.
2.78
The following section considers the AFP's progress in improving mental health and diversity in its workforce, the AFP's strategic and organisational restructure, key reports and findings from external scrutiny agencies which were released during or pertain to the 2018-19 year, and compliance with annual report requirements.