Senate Rural and Regional Affairs and Transport Legislation Committee, , 29:31 to 32:24
The department explains that fluctuations in cost recovery revenue are primarily driven by unforeseen changes in import volumes rather than pricing errors.
Topics: Biosecurity, Trade policy
Speakers: Miss Victoria Anderson, Matthew Geysen, Hon Matthew Canavan, Senator Ross Cadell, Unknown Speaker
>> Uh, correct Senator at the end of 2526. Yeah. In the B security arrangement. Yep. [clears throat] 26.02 million.
>> So, are you looking to eue target to under recover this year to make that up?
>> Uh, no Senator where we we were not permitted to under recover.
>> But you can over recover
>> in aggregate [clears throat] Senator. And we can under recover in aggregate as
That seems very strange. Okay. Um, so but you've got 20 Where's this 26 million? Is it in a bank account or
>> it sits as cash reserve Senator,
>> right?
>> Yeah. So we we're not allowed to rep prioritize it and use it for for other
>> Including to perhaps Okay. We [clears throat] have recovered last year, so we'll under we'll at least target >> to be 26 million under this year. Can't do that. Y
>> so to get that gone, you've got to accidentally underreover.
>> Uh we we could also take decisions to expend that money on things that reduce costs over time, for example. So I mentioned the cost recovery improvement program. One of the things I've asked the team to do within the rules is look at, you know, if we do have a a surplus, can we use a proportion of that to improve the ICT systems that are used in order to drive down costs going forward? for example. Um that may be a bad example because it's not operating costs, it's capital, but um those are the sorts of things we are looking at through this cost recovery improvement program.
>> But on the numbers we've you've just given on the recovery there've been almost a 15 14% increase year on year 10 I think 12 14 looking at that that's over that's double triple inflation.
>> Yeah.
>> So how is cost recovery driving productivity when
>> it's about the volume senator? So, so volumes of imports have increased and therefore we collect more money. So,
per box per whatever per ton to look at that efficiencies. Is that a report?
>> I'll defer to Mr. G on how we do our projections, but um but we do look at past performance and and volumes and volumes have actually pretty much astronomically gone up over the last few years.
>> That that's correct, Senator. So, every year we are required to go through a process to evaluate the prices heading into next year before we go up to consultation with industry. Um and through the last cost recovery um uh implementation statement uh we did a what I would say a comprehensive review of the biocurity charges to look at not only what indexation should be applied to it but also what other charges should either uh be modified or adjusted within that process as well. So it's it's nearly a checkpoint in the year um to ensure that those uh fees and prices heading into next year reflect the volumes that the secretary uh has said.
>> So so uh in short our our over or under recovery is usually due to an inability of us to accurately project the volume as opposed to anything else.