Chapter 2

Annual reports of agencies

2.1      The committee selected the annual reports of the following bodies for closer examination:

Agriculture and Water Resources portfolio

Infrastructure and Regional Development portfolio

2.2      The committee also examined the National Heavy Vehicle Regulator Annual Report 2016–17. The committee found the report to be in compliance with reporting requirements but did not examine the report in detail.

Agriculture and Water Resources Portfolio

Fisheries Research and Development Corporation

2.3      The 2016–17 Annual Report of the Fisheries Research and Development Corporation (FRDC) was tabled in the Senate on 4 December 2017. The report provides an overview of the activities and achievements of the agency over the previous year.

Directors' review

2.4      The Director's review of operations and future prospects outlined the FRDC's key activities over the year in review. These included:

Foundational programs

2.5        FRDC has five foundation programs: Environment, Industry, Communities, People and Adoption.

2.6        The annual report details the agency's achievement of the performance indicators, as well as key projects within each of these programs.

Environment program

2.7        During 2016–17, FRDC contributed approximately 30.6 per cent ($7.46 million) of its total research and development (R&D) investment to this program.

2.8        One of the FRDC's key projects under the Environment program is the $15 million National Carp Control Plan (NCCP). The purpose of the plan is to evaluate the benefit of biological control of carp through the use of a carp virus (Cyprinid herpesvirus).[2] The FRDC provides further details about the program:

The first step is to evaluate whether the virus will effectively deliver a significant reduction in carp impacts and achieve a 95 per cent reduction in carp by 2045, at an acceptable cost. The earliest possible release date for carp virus, pending approvals, is late 2018. [3]

2.9        Another key project under FRDC's environment program is the tagging of Patagonian Toothfish. The purpose of the tagging is to determine the nature of the relationship between the Australian Heard Island and McDonald Islands Patagonian Toothfish fishery and adjacent French Kerguelen Islands fishery.[4]

Industry program

2.10      In 2016–17, FRDC contributed $12.31 million to this program.

2.11      One of the three performance indicators for the program is the development of processes and technologies to improve the efficiency of governance and regulatory systems for fishing.

2.12      A key project under the program is that of the Deckhand reporting app which enables fishers to fulfil their reporting requirements to government digitally. FRDC funding to Deckhand enabled all 168 South Australia's Southern Rock Lobster fishing vessels in the fishery's southern zone to record the details of fishing sessions, from path and pots to catch, time and location during the 2016–17 season.[5]

Communities program

2.13      FRDC contributed $0.98 million or approximately four per cent of its R&D investment to its Communities program.

2.14      FRDC supported two research projects under this program. The first project, conducted by researchers at CSIRO and James Cook University is titled Beyond GVP: The value of inshore commercial fisheries to fishers and consumers in regional communities on Queensland's east coast. Its researchers have found that Queensland inshore fisheries have a substantial flow-on effect in generating income for regional economies and in benefits to local consumers.[6]

2.15       The second project, titled Beyond GVP: Social and economic evaluation of New South Wales coastal commercial wild-catch fisheries was conducted by the University of Technology, Sydney. This research highlighted the importance of wild-catch fishing to the social and economic lives of NSW coastal communities.[7]

People program

2.16      During 2016–17, FRDC contributed approximately five per cent ($1.34 million) of R&D investment towards this program. The program had four performance indicators, all of which are on track for completion. Key projects of this program included:

Adoption program

2.17      The fifth program is Adoption. This program made up ten per cent ($2.32 million) of total R&D investment. The key projects within this program included:

Staffing information

2.18      In 2016–17, FRDC had an average of 20 staff positions spread amongst 24 people of whom seven worked part time. In addition to its core staff, more than 1000 people work on FRDC projects around the country. These include 250 principal investigators, 450 co-investigators, 200 project officers, 80 administration staff and 50 financial staff.[10]

Financial information

2.19      In 2016–17, FRDC's total expenditure amounted to $29.26 million, of which $24.41 million was spent on research and development projects, and $4.85 million was spent on management and accountability.

2.20      FRDC's total income in 2016–17 was $37.32 million. Income sources included:

Committee comments

2.21      The committee considers FRDC's annual report to be compliant with reporting requirements. The report details the activities and achievements of the agency.

2.22      The committee considers that the report could be enhanced by the inclusion of a more detailed overview of the organisational structure, including an organisational chart.

Murray-Darling Basin Authority

2.23      The 2016–17 Annual Report of the Murray-Darling Basin Authority (MDBA) presented information on the performance and operations of the agency. The report was tabled in the Senate on 29 November 2017.

Chief Executive's review

2.24      The Chief Executive's review outlined a number of the MDBA's key achievements over the year in review.

2.25      As part of efforts to build better relationships with Basin communities, the MDBA established three new regional offices over the year in Adelaide, Albury-Wodonga and Toowoomba. It also created a Regional Engagement Officer pilot program as part of its regionalisation efforts. Under this program, seven part-time officers located within community, natural resource management or local government organisations across the Basin were employed to serve as a conduit between MDBA and Basin communities.

2.26      As part of MDBA efforts to progress the implementation of the Basin Plan, the first state water resource plan, from the Warrego-Paroo-Nebine area in Queensland, was accredited. In addition, the MDBA completed its Northern Basin Review. During the review period, the MDBA met with or received evidence from approximately 450 organisations and individuals. The MDBA proposed changes to the Basin Plan based on the review findings.[12]

Key activities

2.27      The MDBA's performance is managed against a single outcome while its key performance indicators are measured against five strategic goals.

2.28      All key performance indicators (KPIs) across the strategic priorities were met.[13]

Strategic goal one

2.29      This goal is to lead the implementation of the Basin Plan to achieve a healthy working Murray-Darling Basin. The MDBA conducted a number of key activities to progress the implementation of the Basin Plan including:

Strategic goal two

2.30      Strategic goal two is to strengthen engagement with the community. Activities undertaken to achieve this goal included:

Strategic goal three

2.31      Strategic goal three is to evaluate and report the social, economic and environmental outcomes of Basin water reforms. Some of the key activities over the review period directed at achieving this goal included:

Strategic goal four

2.32      Strategic goal four is to operate the River Murray system efficiently for partner governments. Key activities directed at achieving this goal undertaken over the year in review include:

Strategic goal five

2.33      Strategic goal five is to improve the knowledge base to support sustainable water resource management. The report outlined key activities within this goal, including:

Staffing information

2.34      In order to strengthen workforce planning practices, in 2016–17, the MDBA implemented initiatives contained in its Strategic Workforce Plan 2016–26. The plan enables the MDBA to proactively manage risks associated with workforce capacity, capability and flexibility. It guides recruitment, development and retention strategies to deliver the MDBA's objectives.[19]

2.35      As of 30 June 2017, the MDBA had a staff of 307 of whom 283 were ongoing.[20]

2.36      In December 2016, the MDBA launched a pilot Talent Management Program for APS6 and EL1 level employees. The six-month program is focused on developing the capacity of employees who have been identified with high potential.[21]      

2.37      Other initiatives include the 2016–17 Summer Employment pilot program which offered undergraduate students the opportunity to gain insight into the MDBA's operations and the Australian Public Service over a 10-week period. There were eight positions offered under the program. The MDBA also ran a graduate program and in February 2017, nine graduates joined the agency.[22]

2.38      In May 2017, the MDBA launched a Gender Equality Strategy. Some of the initiatives outlined in the strategy include support for women to enter leadership positions, training for flexible work and unconscious bias, mentoring, supporting staff on parental leave, and the establishment of a Gender Officer. A review of the MDBA's data against APS data found that the agency is performing strongly but that there is scope to improve the gender balance at the Executive Level (EL) 2 level.[23]

FOI requests

2.39      In 2016–17, the MDBA received eight freedom of information requests. According to the annual report, all requests were processed in accordance with the statutory timeframes, and all reporting obligations under the Freedom of Information Act 1982 were met.[24]

Financial information

2.40      In 2016–17, the MDBA reported an operating surplus of $2.4 million, compared to an approved operating deficit of $9.4 million. It noted that the significant fluctuations in spending against the budget were due to the 'impact of the complex nature of joint programs, which reflect a high level of inherent risk associated with capital construction and environmental projects'.[25]

2.41      Over the year in review, the MDBA delivered programs costing $151.8 million, and managed over $4.9 billion in assets (gross value), including River Murray Operations infrastructure and water entitlements acquired under The Living Murray Initiative.[26]

Committee comments

2.42      The committee considers that the MDBA's annual report is compliant with relevant legislation and provides a thorough explanation of the activities and achievements of the agency over the review period.

Rural Industries Research and Development Corporation

2.43      The 2016–17 Annual Report of the Rural Industries Research and Development Corporation (RIRDC) details information on the performance and operations of the agency. The report was presented to the Senate out-of-session on 12 December 2017.

Chair's report

2.44      The Chair's report outlined the key achievements of the RIRDC over the year in review. These included:

2.45      As part of its commitment to regional Australia, the RIRDC's headquarters were relocated from Canberra, ACT to Wagga Wagga, NSW in September 2016. There were no substantial impacts on the level of service provided to industries and stakeholders as a result of the relocation.[27]

Key outcomes

2.46      The purpose of the RIRDC is 'to increase knowledge and understanding that fosters innovation, adaptive and valuable rural industries'. The RIRDC measures its outcomes against three goals and four key performance indicators (KPIs).

2.47      All four key performance indicators were achieved. Details on the three goals are provided below.[28]

Goal one

2.48      Goal one is to discover emerging opportunities and issues impacting rural industries. The key strategies outlined in the report which are used to achieve this goal include:

2.49      These strategies have been pursued through research programs into new and emerging animal industries, new and emerging plant industries, national rural issues and cross–sectoral initiatives.[29]

Goal two

2.50      This goal is to deliver research that achieves value for rural industries and for Australia. The following strategies are utilised to achieve this goal:

2.51      Programs aimed at achieving this goal are focused on research into chicken meat, ginger, honey bees and pollination, rice and tea tree oil.[30]

2.52      The RIRDC also focused on workplace health and safety under this goal through the Primary Industries Health and Safety Partnership.[31]

Goal three

2.53      Goal three is to encourage diversity and advance the potential of people in rural industries and their communities. The strategies used to achieve this goal include:

2.54      These strategies have been pursued through the Investing in People program to develop leadership and meet future demand for skilled workers. The program is focused on the provision of scholarships and other initiatives aimed at building skills and leadership amongst people in the rural sector.[33]

Staffing information

2.55      As at 30 June 2017, the RIRDC had 15 employees.[34]

2.56      In addition to its staff, the RIRDC also used a number of consultancy services during 2016–17. The sum cost of these services totaled $203,274.83. Two of these consultancies continued beyond the year in review.[35]

Financial information

2.57      In 2016–17, the RIRDC's expenditure totaled $26.5 million. Of this, $22.9 million was directed towards research programs. This represented an increase of over $5 million on the previous year's research program expenditure.

2.58      The RIRDC's total income in 2016–17 was $23.3 million. Sources included:

2.59      The deficit of $3.2 million was officially approved by the Department of Finance during the reporting period.[37]

Committee comments

2.60      The committee considers RIRDC's annual report to be compliant with reporting requirements. The report details the research programs, achievements and other activities of the agency.

2.61      The committee encourages the RIRDC to ensure attention to detail in future reports. In particular, the page numbers referenced in the compliance index are inconsistent with the actual page numbers (for example, the compliance index directs the reader to page 142 for the organisation structure; however it actually appears on page 158. This also differs from the online version in which it appears on page 160).

Grains Research and Development Corporation

2.62      The 2016–17 Annual Report of the Grains Research and Development Corporation (GRDC) was tabled in the Senate on 4 December 2017. The report provides an overview of the performance and activities of the agency over the year in review.

2.63      The report outlines the highlights of 2016–17 for the GDRC. These included:

2.64      The report outlines GRDC's progress against six performance criteria themes consisting of fifteen key performance indicators (KPIs). In 2016–17, the GRDC achieved fourteen KPIs and almost achieved the final one.[39]

Financial information

2.65      The GRDC's revenue in 2016–17 totaled $242.4 million.[40] Sources of revenue included:

2.66      Expenditure during the period in review totaled $227.7 million.[42] Sources of expenditure included:

2.67      The GRDC recorded a surplus of $14.7 million in 2016–17.

Committee comments

2.68      The committee commends the GRDC for the comprehensive compliance and alphabetical indices.

2.69      The committee considers the 2016–17 Annual Report to be compliant with reporting requirements and commends the GRDC for producing a clear, well-written report.

Infrastructure, Regional Development and Cities portfolio

Australian Rail Track Corporation

2.70      The 2016–17 Annual Report of the Australian Rail Track Corporation (ARTC) was presented to the Senate out-of-session on 1 November 2017. The report provides an overview of the activities and operations of the agency.

Key projects

Hunter Valley Network

2.71      A firming of coal prices saw business grow out of the Port of Newcastle, leading to the Hunter Valley network delivering over 160 million tonnes of export coal through the port during the year in review. The network also saw a record year for grain exports.

2.72      Upgrades to tracks along the Central North West network and to the link between Muswellbrook and Turrawan have resulted in heavier and faster trains operating on this route. This resulted in a 30 per cent increase in payload on the Central North West section.[44]

2.73      Significant progress was made on the ARTC Network Control Optimisation (ANCO). The project aims to use digital tools to optimise train paths and make in-real-time adjustments. These changes to efficiency have the potential to save hundreds of millions of dollars over the next ten years.[45]

Interstate Network

2.74      The interstate network saw a 5 per cent increase in volume in 2016–17, driven mainly by an excellent harvest season. While the economic downturn in Western Australia reduced demand on the East West corridor, this downturn was offset by an increase in volume on the North South corridor.

2.75      The interstate team achieved the milestone of a year without any injuries resulting in lost time. This was achieved through initiatives including the Fatal and Severe Risk Program, quarterly Safety Awards, and proactive safety reporting.[46]

2.76      Projects commissioned or significantly progressed during 2016–17 included:

Inland Rail

2.77      The period in review has seen a progression of planning, land acquisition and design as part of the Inland Rail pre-construction activities.

2.78      The ARTC has been working with shareholders on the funding strategy for Inland Rail. The cornerstone of the strategy is an additional equity investment of $8.4 billion over seven years from 2017–18. Additionally, the ARTC will enter into a Public Private Partnership (PPP) for the Gowrie to Kagaru section.

2.79      Inland Rail offices were established in Sydney, Brisbane, Toowoomba and Melbourne with 120 people employed across the four locations.[48]

Staffing information

2.80      As of 30 June 2017, the ARTC employed over 1,200 people across the rail network.

2.81      Female representation increased by 20 percent during the year in review. ARTC's ongoing commitment to women in the workforce was acknowledged by the Australian Railway Association when it awarded the 2016 Rail Diversity Award to the ARTC. The agency was also awarded the Australian Women in Resources Alliance Award by the Australian Mines and Metals Association.

2.82      The ARTC conducted business acumen training across a range of roles. This included a focus on improving team engagement skills and promoting positive leadership behaviours.[49]

Financial information

2.83      In 2016–17, the ARTC reported a profit from operating activities of $180.3 million.

2.84      The total revenue and other income over the period in review amounted to $826.8 million. The primary source of income was access revenue totalling $713.8 million.

2.85      Expenditure during 2016–17 totalled $646.5 million. Sources of expenditure included:

Committee comments

2.86      The committee considers that the ARTC's annual report is compliant with relevant legislation and provides a thorough explanation of the progress and achievements of the agency over the review period.

Senator Barry O'Sullivan

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