Senate Rural and Regional Affairs and Transport Legislation Committee, , 14:24 to 18:15
Senators examine why efficiency dividends are not applied to cost-recovered activities and how the department ensures minimum efficient costs for industry-funded services.
Topics: Cost recovery, Export cost recovery, Efficiency dividend
Speakers: Speaker 5, Speaker 3, Matthew Gson, Mr. Matthew Gson
>> Right. So you did say that these positions often you recover revenue for them through charges. Uh but obviously someone's paying for that and we're going to get to that uh later. So I'm just wondering I mean before you add these extra costs, what consultation do you do with the the customers so to speak have to pay for these extra staff?
>> So Senator, the the figures that we refer to, they're the our budgeted figures that are funded by appropriation from government and the price points of the fees that are set at that point in
time. But did the secretary the secretary said that a lot of the extra staff would be the cost of the extra staff would be recovered through revenue. Is that right? That's what she
said earlier. >> I I did say that operational staff I think we're talking about people in the
bio. >> So is that what what's what's exactly the truth here? And obviously there's we're looking at an overall figure. So not all of them will be potentially in these cost recovered areas. But it was the evidence the secretary gave before correct that a good portion of that 500 odd increase associated with uh revenue raising activities.
>> Uh senator some of those will definitely be associated with cost recovered
activities that department. >> Okay. We'll come back to my question then about what consultation do you do with those people have to pay these extra costs before putting them on. So
the biocurity I'll again I'm not I don't profess to be the expert in all of these things senator at this point in time but the biocurity cost recovery arrangements are are well uh publicized and and through a cost recovery impact statement every year uh and as are the um the export certification cost recovery side of the business as well. So both of those things are um made public through cost recovery impact statements and fluctuations to those are um communicated through the relevant consultative committees at the time. But again, I'm not the expert in this area. I'll defer to others um to correct me if I'm wrong.
>> Okay. Do you have an is does an efficiency dividend apply to the department at the moment? >> Yes, senator. >> That's 1%. >> Correct. Senator, >> can let Mr. take those questions. Um uh uh does the efficiency dividend apply to the cost recovered elements of the department? >> No, it does not senator.
>> Why not? >> Uh Senator, we're required to deliver uh cost recovered activities in line with the principle of minimum efficient cost. So the the efficiency dividend is applied to our appropriation funding
from government, not the cost. >> I'm just wondering obviously the department the government wants to save money. Yep, I understand that. Uh good thing. Uh but why should uh uh the benefits of a greater efficiencies only acrew to the department of finance to the overall government and not to uh the people having to pay you for services? Why don't they get more efficient services over time too?
>> Well, the efficiency dividend is not the only way Senator that we would look to reduce um costs and and drive efficiencies in the cost recovery uh in all parts of the business but specifically cost recovery. So we are well aware of the need to continue to drive efficiencies in our cost recovery business and we do have processes in place. We've worked with industry across systems issues, a range of other things to continue to drive efficiencies in the cost recovered part of our business. So just because it's not part of the 1% efficiency dividend does not exclude it from the scrutiny that you would expect us to apply to the efficiency of those businesses that we deliver, those services that we deliver, I should say.
Well, I'm sure you'd love to have the same rule applied by the Department of Finance to yourselves that there's no need for any particular rule or cut, but just uh we'll just we'll just we'll just apply scrutiny. Uh I it's a it's a vague enough term. You can get away with whatever you like. Um and we'll come back, as I say, to the cost recovered issues. Uh um uh so uh have you received any correspondence from the Department of Finance since the last time we met since December? uh around uh the need for efficiency