Department of Environment and Primary Industries of Environment Primary and Department

Annual Report 2013 Annual Report 2013 Report Annual Accountable Officer’s declaration

In accordance with the Financial Management Act 1994, I am pleased to present the Department of Environment and Primary Industries’ Annual Report for the year ending 30 June 2013.

Adam Fennessy Secretary Department of Environment and Primary Industries 9 September 2013

Cover image: Lake Catani, Mt Buffalo National Park Credit: Alison Pouliot Contents

Secretary’s message 2 Our department 4 About DEPI 10 Year in review 14 Financial review 22 Our people 24 2I¿FHEDVHGHQYLURQPHQWDOSHUIRUPDQFH  Output performance 49 Effective management of water resources to meet future urban, rural and environmental needs 50 7KHFRPPXQLW\EHQH¿WVIURPHIIHFWLYH management of Victoria’s land assets 55 Effective environmental and climate change policy, investment and regulation 62 5HGXFHGLPSDFWRIPDMRUEXVK¿UHVDQG other extreme events on people, infrastructure and the environment 72 Legislative and other information 79 Financial statements 91 $SSHQGLFHV  Appendix 1 Disclosure index 183 Appendix 2 Budget portfolio outcomes 185 Appendix 3 Capital projects 190 Appendix 4 Disclosure of grants and transfer payments 191 Appendix 5 Environmental contributions 199 Appendix 6 Acronmyns 200

Department of Environment and Primary Industries 2013 Annual Report 1 Secretary’s message

The 2012–13 Annual After being appointed Secretary of DEPI on 15 April, my first priority was to establish a transition taskforce to Report records a year ensure that the new department was ‘open for business’ of change, milestones on 1 July 2013. Following an intensive direction-setting and outstanding process, DEPI’s new structure was announced in late April. Deputy Secretaries corresponding to each of the six new achievement in providing functional groups were appointed in early May. services to Victorians. The new executive team worked together to organise the The most significant change, department into six regions across Victoria, to better align announced by the Premier of and scale operations to government priorities. Victoria on 9 April 2013, was the merger of the Department Local decision-making and service delivery are key features of Sustainability and Environment (DSE) and the Department of the new service model, which is designed to create of Primary Industries (DPI) to form the Department of value across the department’s functions, ensure flexibility Environment and Primary Industries (DEPI) and the transfer and community focus and deliver on-ground results across of Land Victoria to the new Department of Transport, Victoria’s landscapes and food and fibre industries. In the Planning and Local Infrastructure. coming year, we will continue to improve our responsiveness The changes strengthen the government’s focus on jobs, to opportunities and regional needs, as we work through investment and more effective delivery of regional services. government priorities, develop new programs and new links Positioning environment and agricultural services together with stakeholders. in one department allows us to deliver better and more Along with these initiatives, DEPI will maintain the high efficient environmental management and agricultural support standard of business as usual that made 2012–13 a and provide a ‘one-stop shop’ approach across private and successful year. The planned burning program to protect public land and water. people, property and infrastructure was especially notable. The focus of the new department is on boosting productivity Despite wet and variable spring weather and a demanding in Victoria’s world class food and fibre sector, managing bushfire season, our firefighters completed 678 burns, our natural resources, protecting the environment and treating 255,227 hectares of public land. This was 58,078 responding to fire, flood and biosecurity emergencies. hectares more than the previous year and the largest planned burning program in the past 30 years.

2 Department of Environment and Primary Industries 2013 Annual Report Sadly, this fire season was a reminder of how dangerous These policies provide opportunities for Victorians to get firefighting can be, with three firefighters losing their lives in more involved in protecting and enhancing the environment. active duty. We gratefully and respectfully acknowledge their Finally, I would like to thank staff for their resilience and commitment to protecting Victoria’s communities. dedication to delivering services during this period of The Murray-Darling Basin Plan, signed into law in November change, especially those staff members who have now 2012, establishes a new regime for the management of moved on to other areas. While visiting workplaces the water resources of the Murray-Darling Basin. Finalising across the state, I have been delighted to see the passion the plan brings clarity and certainty to northern Victoria’s that people bring to their work and the enthusiasm and communities, agriculture and industries. The department commitment to the new department. led Victoria’s negotiations with the Commonwealth over five I would also like to acknowledge the valued contribution of years and achieved several key inclusions in the final plan. In Greg Wilson who led the department for four years. During June 2013, Victoria, became the first state to sign the plan’s his time as Secretary, Greg oversaw extensive reform in the agreements. water sector, a new statewide approach to environmental Another milestone in water management was the Office of protection, strengthened relationships with our portfolio Living Victoria’s development of Melbourne’s Water Future, partners and industry and led the department through the a draft whole-of-water-cycle strategy. This will drive greater significant challenges of the 2012–13 fire season. use of rainwater, stormwater and wastewater while saving As we continue into the future I am confident that we drinking water and better managing the city’s water costs. have the resources and capability to make an important It was also a significant year in environmental policy. contribution to Victoria’s growth and quality of life. Victoria’s first Climate Change Adaptation Plan was tabled in State Parliament in March, setting out government action to manage the risks of a changing climate and build Victoria’s resilience to extreme events. The year saw the release of several key policies supporting the government’s aim to deliver better environmental outcomes through practical action, effective regulation Adam Fennessy and better services: Secretary Department of Environment and Primary Industries • Environmental Partnerships lays the foundation for government, business, industry, community groups and individuals to work together to undertake practical action to maintain a resilient, healthy environment. • Getting full value: Victoria’s Waste and Resource Recovery Policy is transforming waste management while strengthening health and environmental standards. It marks more than two years extensive research and collaboration between government, industry and the community. • The Biodiversity Conservation Strategy will protect threatened species throughout Melbourne’s four urban growth corridors. It provides greater planning certainty for development, improved biodiversity outcomes and further streamlines planning and approvals.

Department of Environment and Primary Industries 2013 Annual Report 3 Our department

Our Ministers Structural changes to the department

Minister for Agriculture and On 9 April 2013, the Victorian Premier Denis Napthine Food Security and Minister announced a number of Machinery of Government changes for Water to strengthen the focus on jobs and investment and more effectively deliver frontline services. The Hon. Peter Walsh MLA was appointed as the Minister for The changes included the merger of the Department of Agriculture and Food Security Sustainability and Environment (DSE) and the Department and the Minister for Water in of Primary Industries (DPI) to form the new Department of December 2010. He is also the Environment and Primary Industries (DEPI) from 1 July 2013. Deputy Leader of the Victorian As part of the Machinery of Government changes, the Nationals. Energy and Resources portfolio from the former DPI As Minister for Water, Peter Walsh is driving change to transferred to the new Department of State Development, deliver better water services, improved local environments Business and Innovation (DSDBI). Land Victoria transferred and increased liveability in Melbourne and Victoria’s regional from the former DSE to the new Department of Transport, cities. Planning and Local Infrastructure (DTPLI).

Minister for Environment The transfer of staff and functions following Machinery of and Climate Change Government change is undertaken pursuant to Section 30 of the Public Administration Act 2004. The Premier signed The Hon. Ryan Smith MP was the Section 30 declaration to officially transfer staff to DEPI appointed as the Minister for or DSDBI on 3 June 2013. Land Victoria staff officially Environment and Climate Change transferred to DTPLI on 1 July 2013. in December 2010. He is also the Minister for Youth Affairs. The DEPI Secretary, Adam Fennessy, assumed responsibility for the leadership and direction of the new department As Minister for Environment and and DPI on 15 April 2013. A transition taskforce with Climate Change, Ryan Smith representatives from both departments was then formed to is responsible for action to lead the establishment of the new department. effectively manage and protect Victoria’s natural environment.

4 Department of Environment and Primary Industries 2013 Annual Report Our executive

Adam Fennessy Bruce Thompson Secretary Deputy Secretary Corporate Adam Fennessy was appointed Services Secretary on 15 April 2013. Bruce Thompson was appointed Deputy Secretary for Corporate Before this appointment Adam Services on 6 May 2013. was the Acting Secretary of the former DSE. Bruce has many years of executive experience in the Adam has extensive experience public sector in Victoria and across land, water and natural Queensland, including significant resources management and has worked in both the contributions to corporate service innovations within the Commonwealth and Victorian public sectors. former DSE. His previous senior leadership roles include Deputy Before his current role, Bruce was Chief Information Officer Secretary, Environment and Natural Resources within the and the Director, Spatial Information Infrastructure in the former DSE, and as Executive Director, Infrastructure and former DSE. Economics in the Department of Premier and Cabinet. Adam has also held leadership roles within the former DSE’s Office Dr Gillian Sparkes was Deputy Secretary, Corporate and of Water and as a Commonwealth Government policy and Business Services in the former DSE from 1 July 2012 to legal adviser in transport, communications and the arts. 29 May 2013.

Greg Wilson was Secretary of the former DSE from 1 July Paul Smith 2012 to 12 April 2013. Deputy Secretary Land, Fire and Environment James Flintoft Deputy Secretary Agriculture Paul Smith was appointed Productivity Deputy Secretary for Land, Fire and Environment on 6 May 2013. James Flintoft was appointed Deputy Secretary for Agriculture Paul has broad executive Productivity on 6 May 2013. experience in using partnerships to deliver results and in driving James has substantial major reform in land, fire and experience in leadership roles environment. in both the Victorian and Commonwealth Governments. Before acting as the Deputy Secretary Environment and Natural Resources in the former DSE, Paul was Executive His previous leadership roles include Deputy Secretary at Director, Environmental Policy and Climate Change Division. Department of Agriculture, Fisheries and Forestry, Chair of the Commonwealth’s emergency taskforce on Live Animal Paul has built successful relationships with the department’s Exports and First Assistant Secretary, Strategic Policy and many environment and land portfolio partners and with Delivery Division, Department of Prime Minister and Cabinet. Victoria’s Networked Emergency Organisations. He also led the former DSE’s response to the Victorian Bushfires Royal Before joining the public service, James held senior roles at Commission. ANZ Bank and McKinsey and Company. He has worked and lived in Asia, Europe and the USA. Paul holds a Bachelor of Social Science and a PhD in Environmental Policy. James has a Bachelor of Laws and Bachelor of Science from the University of Melbourne and a MBA from the Dr Peter Appleford was Deputy Secretary Land and Fire Wharton School, University of Pennsylvania in the USA. from 1 July 2012 to 6 May 2013. Dr Bruce Kefford was Deputy Secretary Agriculture Productivity in the former DPI from 1 July 2012 to 6 May 2013.

Department of Environment and Primary Industries 2013 Annual Report 5 Bernie O’Sullivan Jane Doolan Deputy Secretary Regional Interim Deputy Secretary Services Water and Natural Resources Bernie O’Sullivan was appointed Jane Doolan was appointed Deputy Secretary for Regional as Interim Deputy Secretary for Services on 6 May 2013. Water and Natural Resources on 6 May 2013. Bernie has considerable leadership experience at a state Jane has extensive experience and national level, including across the broader water industry-based experience in portfolio, with more than 20 years primary industries. of experience working in environmental water management. Previous leadership roles include General Manager of Jane has driven key policy initiatives in river health, Agriculture for the Royal Agricultural Society of NSW, environmental water allocations and catchment Executive Director of a livestock commodity council in management, both at the state and national level, most National Farmers’ Federation House in Canberra and recently in the successful Murray-Darling Basin Plan executive positions with the NSW Farmers’ Association. negotiations with the Commonwealth. In his most recent role as lead Regional Director and Before being appointed to her current position Jane was Regional Director Loddon Mallee for DPI, Bernie built strong Deputy Secretary, Water in the former DSE and Executive statewide relationships with stakeholders and established a Director, Sustainable Water Environments. new Regional Leadership Branch, aimed at enhancing DPI’s Jane holds a PhD in Zoology from the University of engagement in country Victoria. Melbourne. Bernie studied Agricultural Science at the University of Melbourne and a Master of Public Affairs at the University of Sydney. Tony Edgar was the General Manager Regional Services in the former DSE from 1 July 2012 to 6 May 2013.

Luke Wilson Deputy Secretary Regulation and Compliance Luke Wilson was appointed Deputy Secretary for Regulation and Compliance on 6 May 2013. Luke has significant experience across agriculture and resource management; for many years he led policy development on the key issues facing Victoria’s agriculture and forestry industries. His previous leadership roles include work in energy, water and transport regulation in South Australia, in economic consulting with PricewaterhouseCoopers, and in policy analysis with the Commonwealth Government. Luke has also worked as an operational forester with Bowater Tissue Ltd in Myrtleford Victoria. Before being appointed as Deputy Secretary, Luke was Executive Director for DPI’s Portfolio Services Division, with responsibility for DPI’s communication, legal, audit and risk, regional and organisational development. Deborah Peterson was the Deputy Secretary Regulation and Compliance in the former DPI from 1 July 2012 to 6 May 2013.

6 Department of Environment and Primary Industries 2013 Annual Report Our governance structure The Secretary, as head of the department, is accountable Risk and Audit Committee to the Minister for Water and the Minister for Environment The Risk and Audit Committee is an independent body and Climate Change for the overall governance of the established in accordance with the Standing Directions of department. the Minister for Finance under the Financial Management Until the Machinery of Government changes were announced Act 1994. It provides assurance to the Secretary that the in April 2013, the department’s corporate governance department’s risk and control environment is operating arrangements included two principal governance committees: effectively and efficiently. The committee meets bi-monthly or as determined by the Chair. • Senior Leadership Team – the Secretary (Chair) and Deputy Secretaries, General Manager Regional Services In 2012–13, Risk and Audit Committee members were: and Director, Office of the Secretary met weekly as the John Rundell Independent member department’s executive decision-making body, providing (Chair) the department with leadership and direction in pursuit of government priorities and commitments. Dennis Cavagna Independent member • Executive Management Team – the Secretary (Chair) and David Holden Independent member Deputy Secretaries, General Manager Regional Services, (until September 2012) Regional Directors, General Manager Capital Projects, Rod Nelson Independent member Chief Finance Officer, Executive Director Land Victoria (until September 2012) and Director, Office of the Secretary met monthly as the principal governance group responsible for oversight of Suzanne Evans Independent member the department’s strategic direction and performance, (from September 2012) including ensuring legal and functional responsibilities Dr Peter Appleford Deputy Secretary, Land and Fire were met. (until May 2013) Following the Machinery of Government changes, a new Adam Fennessy Deputy Secretary, Natural Resources executive decision-making body, the Senior Executive Group and Environment Policy (until April 2013) comprising the Secretary (Chair) and the Deputy Secretaries was established and commenced meeting on a weekly basis. Dr Gillian Sparkes Deputy Secretary, Corporate and Business Services (until May 2013) Accredited Purchasing Unit Kylie White Executive Director, Biodiversity and The Accredited Purchasing Unit (APU) oversees the Ecosystem Services (until September department’s purchasing policies and practices for general 2012) goods and services through delegated powers assigned by the Victorian Government Purchasing Board. The APU also Mike Timpano Regional Director Gippsland oversees building and construction related procurement. (from September 2012) The APU meets fortnightly. Bruce Thompson Deputy Secretary Corporate Services In 2012–13, APU members were: (from May 2013) Anthony Connelly Executive Director, Business Operations (Chair) Ian Ireson Director, Land Registration Services (Deputy Chair) John Johnstone Manager, Strategic Planning (Deputy Chair) and Projects Michele FitzGerald Manager, Procurement Policy and APU Support Eleanora Georgiou Manager, Financial Reporting Duncan Pendrigh Director, Land Division Owen Swanton Regional Services Manager, Infrastructure and Procurement Rema Rockwood Chief Procurement Officer (from 18 February 2013)

Department of Environment and Primary Industries 2013 Annual Report 7 Risk management framework and attestation

8 Department of Environment and Primary Industries 2013 Annual Report Insurance attestation

Department of Environment and Primary Industries 2013 Annual Report 9 About DEPI

Our vision Over the next four years, DEPI will work to achieve these objectives: Productive and competitive primary industries and a resilient and healthy environment to support Victoria’s long term • Productive and competitive agricultural industries. prosperity. • Sustainable management of fish, game and forest resources. Our purpose • The community benefits from effective management DEPI has a clear and specific agenda to deliver on the of Victoria’s public and private land assets. Victorian Government’s priorities by: • Effective management of water resources to meet future • focusing on jobs and investment urban, rural and environmental needs. • boosting regional service delivery • Effective environmental and adaptation policy, investment and regulation. • increasing Victoria’s food and fibre production and exports • Reduced impact of major bushfires and other extreme • delivering better regulation events on people, infrastructure and the environment. • sustainable management of private and public land and water Enabling better service delivery DEPI will provide streamlined and responsive services to • supporting healthy, natural environments our stakeholders and a more mobile, flexible workforce with • preventing, preparing for and responding to emergencies greater capacity to respond to emergencies such as fires, such as bushfires, floods, biosecurity and other extreme floods or biosecurity incursions and to seasonal programs events. such as planned burning and compliance actions across the range of department portfolios. About us Corporate and Regional Services will build stronger collaborative partnerships to facilitate the department’s The Department of Environment and Primary Industries one-stop shop approach to service delivery by providing a (DEPI) was formed on 1 July 2013, merging the Department comprehensive single source of information and fostering a of Sustainability and Environment and the Department unified place of work that offers a safe working environment. of Primary Industries. We employ more than 3900 staff, DEPI will also support consistent and strong regional service working in 93 locations across the state. delivery across the department and work closely with the We advise and support the Hon. Peter Walsh MLA, Minister people of Victoria to deliver great results for the government for Agriculture and Food Security and the Minister for Water and community. The department’s one-stop shop and the Hon. Ryan Smith MP, Minister for Environment and approach and integrated focus on areas of shared interest Climate Change. strengthens our environmental efforts and will ensure better environmental protection and more productive landscapes DEPI is providing a better and more efficient approach for throughout Victoria. public and private land and water for the people of Victoria. DEPI is focusing on boosting productivity in Victoria’s food Our services and programs will be delivered through: and fibre sector, managing our natural resources, protecting • partnerships with the community, landcare groups and the environment and responding to fire, flood and biosecurity stakeholders emergencies. • better services at a local and regional level where it matters, with decisions made in local communities • even stronger regional capacity and service delivery.

10 Department of Environment and Primary Industries 2013 Annual Report Our regions • Hunting Advisory Committee A key priority for DEPI is to build stronger regional capability. • Indigenous land management advisory bodies We have a six-region structure, which allows us to align and • Livestock industry consultative and compensation scale our operations to deliver the government’s priorities. committees Our regions, shown in the map below, include: • Melbourne Water • Barwon South West • National Biosecurity Committee and its working groups • Gippsland • National Parks Advisory Council • Grampians • Office of Living Victoria • Hume • Parks Victoria • Loddon Mallee • Primesafe • Port Phillip • Plant Health Australia • Plant Health Committee • Reference Areas Advisory Committee • Regional Coastal Boards • Regional Waste Management Groups • Royal Botanic Gardens Board LODDON MALLEE • Scientific Advisory Committee

HUME GRAMPIANS • Surveyors Registration Board of Victoria • Sustainability Fund Advisory Panel

PORT PHILLIP GIPPSLAND • Sustainability Victoria BARWON SOUTH WEST • Trust for Nature (Victoria) • Universities • Veterinary Practitioners Registration Board of Victoria • Vertebrate Pests Committee Clients and stakeholders • Victorian Biosecurity Standing Committee The department’s clients and stakeholders are diverse • Victorian Catchment Management Council and are distributed across the state. These include public, private and not-for-profit organisations operating at local, • Victorian Coastal Council state, national and international levels, such as: Aboriginal • Victorian Environmental Assessment Council organisations, agribusinesses, animal welfare groups, • Victorian Environmental Water Holder academics, land and water managers, professional and industry bodies, local, state and Commonwealth • Victorian Adaptation and Sustainability Partnership governments and authorities and primary producers. • Victorian Mineral Water Committee • Water Corporations Service delivery partners • Water Supply Protection Area Consultative Committees DEPI performs its functions in close partnership with service • Zoological Parks and Gardens Board delivery partners. These include: • Alpine Advisory Committee Our values • Alpine Resorts Coordinating Council In 2012–13, our people were guided by the following values: • Alpine Resort Management Boards • Act with integrity • Agriculture industry groups and service providers • Focus on safety • Animal Health Committee • Make a difference • Animal Health Australia • Respect others • Catchment Management Authorities • Work together, support each other. • Cooperative research centres A range of activities is planned to involve staff at all levels • Commissioner for Environmental Sustainability to define what it is that DEPI stands for and what kind of • Committees of management of Crown land reserves workplace we would like it to be. DEPI’s culture, values • Dairy Food Safety Victoria and behaviours will draw on the strengths of both former departments and align them to public sector values • Environment Protection Authority Victoria and employment principles and what we deliver in our • Environment Protection Board environment and primary industries portfolio. • Geographic Place Names Advisory Panel

Department of Environment and Primary Industries 2013 Annual Report 11 Fisheries Biosecurity and Compliance Luke Wilson Deputy Secretary Executive Director Executive Director Executive Director Game and Forestry James Florent Emergency Planning Ross McGowan A/g Executive Director Brendan Tatham Brendan Regulation and Compliance Cassandra Meagher Chief Executive Capital Projects Peter Sammut General Counsel Deputy Secretary Executive Director Executive Director Executive Director Executive Director People and Culture Corporate Services Gary Atherton Kirsty Douglas Information Services Business Operations Finance and Planning Claire Foo (CIO) Claire Bruce Thompson Anthony Connelly Matthew Clancy (CFO) ibilities. Tim Ada Farm Services Dr German Deputy Secretary Agriculture Policy Agriculture Spangenberg Executive Director Executive Director Executive Director Executive Director James Flintoft Biosciences Research Dr Emily Phillips Agriculture Productivity Agriculture Dr Ron Prestidge Farming Systems Research The Hon. Ryan Smith MP Minister for Environment and Climate Change Minister for Environment Secretary Secretary Public Administration Act 2004. Adam Fennessy Legislation Will Guthrie Water Resources Water Sustainable Water Executive Director Executive Director Executive Director Executive Director Department of Environment and Primary Industries Department of Environment John Riddiford Graeme Turner Dr Jane Doolan Rural Water Programs Rural Water Andrew Fennessy Andrew Deputy Secretary (Interim) Deputy Secretary Water and Natural Resources Water Water Sector Governance and Water Minister for Water The Hon. Peter Walsh MLA The Hon. Peter Walsh Minister for Agriculture and Food Security Minister for Agriculture Performance Lee Miezis Chief Fire Officer Chief Fire Deputy Secretary Peter Betson Executive Director Executive Director Executive Director Executive Director Dr Paul Smith Environment Policy Environment Alan Goodwin Kate Houghton Peter Beaumont Fire Management Policy Fire Land Management Policy Land Fire and Environment Land Fire Environment and Landscape Environment Mike Waller Chief Executive Officer Office of Living Victoria* Office Hume Gippsland Grampians Port Phillip Loddon Mallee Peter Farrell Deputy Secretary Regional Director Regional Director Regional Director Regional Director Regional Director Regional Director Regional Services Barwon South West Mike Timpano Travis Dowling Travis Helen Vaughan Graham Phelps Bernie O’Sullivan Brendan Roughead Brendan * Office of Living Victoria is an administrative office established on 22 May 2012 under the of Living Victoria is an administrative office * Office Our functions and services Organisational structure new functions and respons As a consequence of policy decisions announced by government on 9 April 2013, the department acquired The organisational chart shows the department’s structure and senior executives for delivery of functions from 1 July 2013. and senior executives for delivery of functions from structure The organisational chart shows the department’s

12 Department of Environment and Primary Industries 2013 Annual Report Agriculture Productivity Regulation and Compliance The Agriculture Productivity Group delivers agriculture The Regulation and Compliance Group focuses on the policy, research and practice change services to boost the regulation of biosecurity, fisheries, game and forestry, productivity and profitability of Victoria’s agriculture, with a strengthens and coordinates emergency and security risk focus on the four sectors of greatest economic importance management capabilities, and delivers programs to preserve to Victoria: dairy, red meat, grains and horticulture. market access for Victoria’s agriculture, fisheries and forest industries. Corporate Services The Corporate Services Group supports the effective and Water and Natural Resources efficient delivery of the department’s programs and services The Water and Natural Resources Group works with water by planning for service delivery and financial performance; corporations and catchment management authorities to enabling the department with the right equipment and manage the allocation of water resources across Victoria to capabilities; compliance to ensure we work safely and balance economic, environmental and social values. Working within the standards and guidelines and reporting to to improve the environmental condition of our waterways ensure community confidence in our achievements. is a high priority along with ensuring effective governance The Group’s core responsibilities are delivered by the arrangements for a high performing water sector. following organisational divisions: Business Operations, Communications, Finance and Planning, Information Capital Projects Services, Legal Services and People and Culture. Capital Projects delivers designated infrastructure projects and assists other agencies with the delivery of major Land Fire and Environment projects. The division’s key current responsibility is delivering The Land, Fire and Environment Group is responsible for: the Victorian Desalination Project.

• public land policy and management, including direct and Land Victoria delegated sustainable management of land and water Land Victoria is responsible for land titles and records, resources on Victoria’s public land estate the Victorian Water Register, property valuation, surveying, • fire and emergency management, including bushfire online property information and services and geographic prevention and suppression on public land, reducing place names. As part of Machinery of Government changes, the impact of major bushfires and supporting broader on 1 July 2013, Land Victoria transferred to the new emergency response and preparedness Department of Transport, Planning and Local Infrastructure. • regulation, investment and research functions that support diverse and resilient natural ecosystems • policy development, advice and direction on waste, resource recovery and efficiency, ecosystem sustainability, climate change adaptation and carbon.

Regional Services Group The Regional Services Group delivers on the government’s priority of boosting regional service delivery and leadership through improving performance and driving local engagement, decision making and accountability. It is also looking at ways to best use our flexible and mobile workforce to meet service needs and to prepare for and respond to fire, flood and biosecurity emergencies.

Department of Environment and Primary Industries 2013 Annual Report 13 Year in review

The review of the year’s highlights and Effective management of water achievements is reported under the resources to meet future urban, rural and department’s objectives for 2012–13: environmental needs

Flood warnings and response • Effective management of water Victoria’s flood warning systems are being improved through resources to meet future urban, rural and a series of initiatives that are upgrading information and environmental needs. infrastructure. The plan, released by the Water Minister in December 2012, • The community benefits from effective is part of the government’s response to 31 recommendations management of Victoria’s public and relating to water issues in the Review of the 2010–11 Flood private land assets. Warnings and Response led by Neil Comrie. The implementation plan will see flood planning become • Effective environmental and climate more integrated and better aligned with other emergency management planning to ensure better coordination at state, change policy, investment and regulation. regional and local levels. • Reduced impact of major bushfires After the 2010–11 floods, the department began work on several activities consistent with the findings of the Comrie and other extreme events on people, report, including: infrastructure and the environment. • developing the web-based information system Floodzoom that uses weather forecast models, satellite observations, • A high performing and efficient river gauges and hydrological modelling to improve organisation. warnings and emergency response • conducting 14 flood risk studies in key flood prone communities with 11 completed • improving flood warning gauges with more than 116 sites completed and 20 portable flood warning gauges deployed.

Victorian Waterway Management Strategy Development of a new Waterway Management Strategy for Victoria is underway. The strategy aims to manage waterways to improve the health of rivers, estuaries and wetlands and will replace the Victorian River Health Strategy. Following the release of the draft strategy on 29 October 2012, the community and industry were invited to provide feedback and consultation sessions were held across the state. Feedback compiled through these consultation processes will influence the final strategy late in 2013.

14 Department of Environment and Primary Industries 2013 Annual Report Implementing urban water reform Planning guidelines for potable water catchment areas The Office of Living Victoria (OLV) – an administrative The department worked with water corporations, the office within the department – continued implementing Environment Protection Authority (EPA) and the Department the government’s Living Melbourne, Living Victoria urban of Health, as part of a Victorian Water Industry Association water reforms to drive generational change in planning and working group to develop new guidelines that will allow managing the water cycle. OLV developed a consultation sensible development in potable water catchment areas. draft of Melbourne’s Water Future, a plan that will introduce The Guidelines for Planning Permits in Open Potable Water an integrated water systems approach for managing Supply Catchment Areas 2012, released in November Melbourne’s increasing water service system costs, variable 2012, permit developments within catchments. Domestic climate and future population growth. wastewater must be treated and retained on the site and present a low risk to catchment water quality. OLV began work on the $1 million Living Ballarat project, the first in a planned series of strategies to translate the Water law review principles and policies of Melbourne’s Water Future into the The department is leading a review of Victoria’s water laws context of Victoria’s regional urban centres. The project will to deliver a streamlined and effective legislative framework help Ballarat develop an integrated water cycle management for water management and use in Victoria, in accordance approach and transform the way the city plans and manages with the government’s election commitments. The new Act its water supply, stormwater, wastewater, greening of the city will reflect new water policies including the Living Melbourne, and waterway health. Living Victoria agenda and the land use change policy The first round of funding applications under the developed through the Western and Gippsland regional government’s $50 million Living Victoria Fund opened in sustainable water strategies. The review will also consider December 2012. The fund encourages and supports the whether legislative changes are required to implement the community to develop innovative integrated water cycle Commonwealth’s Murray-Darling Basin Plan. management projects. OLV assessed more than 260 An expert panel with legal and industry experience registrations of interest before conditionally approving more has been appointed to oversee the review and make than $11 million for 32 projects. In addition, the City of recommendations. Proposed improvements to the legislation Melbourne and Knox City Council secured $1 million and were tested with key stakeholders at targeted forums across $500,000 respectively for a range of water cycle projects. the state in late 2012. The department is working towards Murray-Darling Basin Plan introducing a Bill to Parliament in 2014. The Murray-Darling Basin Plan was signed into law by the Managing groundwater Commonwealth Minister for Water in November 2012, A revised groundwater management framework for signifying the completion of a five-year journey from when Victoria is being implemented. The new framework covers its preparation was legislated through the Commonwealth all aquifers across the state. It will facilitate improved Water Act 2007. The department supported the Minister groundwater management and trade opportunities and for Water in leading Victoria’s negotiations with the incorporate Murray-Darling Basin Plan requirements. The Commonwealth, achieving several key inclusions in the final framework was developed with rural water corporations and plan. participation from groundwater users, local government and In June 2013, Victoria became the first participating state catchment management authorities. Groundwater users to sign the Inter-Governmental Agreement on Implementing will also have access to an online tool that shows them the Water Reform in the Murray-Darling Basin and an associated extent of the resource they might tap into. Groundwater funding agreement. These two agreements settle the catchment plans are being developed. responsibilities and costs of putting the plan into action. Urgent maintenance, repair and replacement works for the Victorian desalination plant State Observation Bore Network were funded in the State Budget. The Victorian desalination plant completed all commissioning tests in December 2012. The Independent Reviewer and Modernising irrigation infrastructure Environmental Auditor (IREA) verified that the water being Modernising irrigation infrastructure is contributing to produced is meeting the stringent drinking water quality Victoria’s on-farm efficiency, saving water, boosting the standards required. With Melbourne’s water storages in environment and helping drive the government’s aim to a strong position, a zero water order was placed with double food and fibre production by 2030. Aquasure for 2012–13 and 2013–14. In May 2013, the government announced another modernisation initiative – a $16 million upgrade to the Macalister Irrigation District in Gippsland. The project will modernise the district’s gravity fed irrigation system which includes 660 kilometres of supply channels and 409 kilometres of drainage channels.

Department of Environment and Primary Industries 2013 Annual Report 15 Channel automation projects, outlet rationalisation and The community benefits from effective construction of the Southern-Cowarr balancing storage are features of the three-year project. management of Victoria’s public and private land assets The Macalister region contains some of Australia’s most valuable and productive grazing land; about 33,500 hectares Landmark Dja Dja Wurrung settlement are under irrigation. The modernisation works will provide A landmark native title settlement in March 2013 formally irrigators with reliable and secure water supplies to help recognised the Dja Dja Wurrung people as the Traditional increase agriculture production. Owner group for lands in central Victoria. The settlement – Victorian wetland assessment between the Victorian Government and the Dja Dja Wurrung people – is the first under the Victorian Traditional Owner The first report on the condition of Victoria’s wetlands Settlement Act 2010 to use the full suite of agreements was released in August 2012. It was the first statewide available under the Act, including the first Natural Resource assessment of wetland condition in Australia. The condition Agreement and Land Use Activity Agreement. The Natural assessment provides a baseline which will help monitor Resource Agreement facilitates Dja Dja Wurrung involvement changes and measure the effectiveness of wetland protection in natural resource management and access to and use and enhancement programs. The assessment of almost of natural resources. The Land Use Activity Agreement 600 high value wetlands undertaken in 2009–10 shows that, replaces the Future act regime under the Commonwealth despite 13 years of drought, more than half of the state’s high Native Title Act 1993 and provides the Dja Dja Wurrung value wetlands were in good or excellent condition. people with different levels of procedural rights depending River frontage protection and improvement on the category of land use activity. works evaluation The settlement achieves full and final resolution of native title The department assists catchment management authorities claims to 266,532 hectares of Crown land – about 3 per to work with landholders to improve the condition of river cent of all Crown land in Victoria. The settlement includes frontages, or riparian land, through weed and pest animal the transfer of two national parks, one regional park, two management, revegetation and limiting stock access to state parks and one reserve to ‘Aboriginal title’ held by the the river bank through fencing and providing off-stream Dja Dja Wurrung, to be jointly managed by the Dhelkunya watering sites. Dja Traditional Owner Land Management Board in perpetuity with the state. An evaluation of river frontage protection and improvement work in Victoria showed landholders believed waterway The settlement is expected to start in August 2013, once health had improved since the work and they would the Indigenous Land Use Agreement is registered. The recommend other landholders get involved. Around 74 per settlement agreement will be implemented through a cent of landholders indicated they considered the condition partnership arrangement between the state and the Dja Dja of the waterway had improved as a result of the riparian Wurrung people. works. Tourism investment in national parks Regulating dam safety Guidelines for Tourism Investment Opportunities of Victoria’s first Strategic Framework for Dam Safety Regulation Significance in National Parks were released in March was released in March 2013 after a comprehensive 2013 as part of the government’s objective to increase review of dam safety regulation and extensive stakeholder the enjoyment and use of Victoria’s national parks. The engagement. The strategic framework sets out Victoria’s dam guidelines follow independent recommendations from the safety regulatory arrangements and practices and describes Victorian Competition and Efficiency Commission to remove relevant emergency management protocols and roles. regulatory obstacles to private investment to unlock the tourism potential of national parks. The guidelines allow proposals for sensible and sensitive development that are complementary to national park values and generate a net public benefit. Investment proposals must demonstrate high environmental standards, such as a detailed environmental management plan supported by an independent environmental assessment and audit.

16 Department of Environment and Primary Industries 2013 Annual Report Alpine resorts direction Steavenson Falls bushfire recovery project The Alpine Resorts Strategic Plan 2012 was tabled in Completion of the Steavenson Falls bushfire recovery project State Parliament in December 2012. The strategic plan will was celebrated at a community event in October 2012 shape the long-term direction of Victoria’s six alpine resorts which included switching on the hydro-powered light system of Falls Creek, Lake Mountain, Mt Baw Baw, Mt Buller, for the first time since the 2009 fires. Mt Hotham and Mt Stirling, ensuring they remain attractive The department managed the restoration works in tourist destinations, financially viable and can attract new partnership with Murrindindi Shire Council, Steavenson Falls investment. Committee of Management and the local community. Works Extensive public consultation helped develop the strategic included the construction of new viewing platforms at the plan. A total of 250 people participated in workshops in base and the top of the falls, new visitor facilities including Melbourne and at the resorts, and 66 submissions were toilets, shelter and interpretative signs, improved access and received. The strategic plan will facilitate simplified planning car parking, restoration of walking trails and the reserve’s and leasing decisions and allow high priority development hydro power lighting system. opportunities to be identified through the Victorian Alpine Resorts Development Program. Timber industry audit results Findings from three independent audits of commercial timber In 2012, more than 1.5 million people visited the resorts and harvesting in Victoria’s state forests showed the industry was contributed $647 million to Gross State Product, generating generally compliant with regulations governing the planning around 6000 full time equivalent jobs for winter alone. of timber harvesting, harvesting operations and forest Point Nepean National Park regeneration. The government released the final Point Nepean National The regeneration audit found 99 per cent of coupes Park Master Plan in April 2013 and announced a commercial harvested by VicForests fully satisfied mandatory expression of interest process to seek private sector regeneration performance standards, with partial non- investment in developing the historic Quarantine Station conformance found at three coupes. Another audit reviewed precinct. planning processes for commercial timber harvesting operations and noted that some aspects of documentation The 17-hectare precinct contains more than 50 buildings, could be improved. most of which have been long closed to the public. Development of the Quarantine Station buildings will be The department manages the audit system to make sure in keeping with the Guidelines for Tourism Investment harvesting and management activities in state forests Opportunities of Significance in National Parks and with comply with the relevant regulations and codes of conduct. heritage, planning and environmental legislation and national The audit process provides independent and transparent park values. information on the environmental outcomes in forests as well as progress on improving our forest management and Internal roads, car parks, power and sewerage have harvesting practices. been upgraded to support investment in the precinct. A community information session at the Quarantine Station on Coastcare Victoria Saturday 4 May 2013 was well attended by stakeholders The 2013 Summer by the Sea festival of events started and community members keen to find out more about the on 2 January 2013 with more than 300 coastal activities plans for the unique site. including rockpool rambles, kayaking, snorkelling as well as New weed identification app interactive marine and coastal discovery tours for the public to enjoy. A smart phone and tablet application was released in November 2012 to help tackle the spread of environmental The annual festival, delivered in partnership with Parks weeds following the Black Saturday bushfires. As part of a Victoria, is part of the department’s Coastcare Victoria post-fire weed control program, the department and Parks program with support from several hundred volunteers and Victoria developed the free application to help scientists, local experts. It is a great opportunity for all Victorians to land managers and the public to identify and locate weeds find out more about their remarkable coastline and to learn within the fire affected area. about some of the challenges facing our marine and coastal environments. The Weeds of Murrindindi app gives access to a catalogue and map of local weeds and outlines the treatment and Coastcare Victoria also funded the development of a new control methods for each weed. Users can also take a photo smart phone and tablet application, Barwon Bluff – Living of a weed and submit it to a map to notify other users of its on the Edge. The app includes a guided rockpool ramble or location. a virtual ramble for kids in the classroom, a comprehensive field guide for local plants and animals and an introduction to the unique Barwon Heads Bluff and Marine Sanctuary. The app was developed by the Friends of the Bluff volunteer group with support from the department, Parks Victoria and the Barwon Coast Committee of Management.

Department of Environment and Primary Industries 2013 Annual Report 17 Seawall maintenance works for Portsea beach Climate Change Adaptation Plan Portsea’s sandbag seawall was strengthened so it can Victoria’s first Climate Change Adaptation Plan was tabled continue to protect Portsea foreshore and community in State Parliament in March 2013. The plan sets out assets. The decision to strengthen the sandbag seawall government action to manage the risks of a changing and maintain other seawalls followed completion of the climate, such as hotter days and sea level rise, and builds Portsea Prefeasibility Study. The study assessed options Victoria’s resilience to extreme events. and determined that maintaining the sandbag seawall was the only viable approach for protecting Portsea foreshore. Victorian Adaptation and Sustainability Partnership In 2012–13 the Victorian Local Sustainability Accord The department is continuing to monitor all Portsea was changed to strengthen the focus on climate change seawalls. adaptation, an approach supported by an independent Supporting the introduction of the Fire Services review of the Climate Change Act 2010. A new Ministerial Property Levy Advisory Committee for the Victorian Adaptation and Sustainability Partnership plays an important advisory role The Valuer-General Victoria was responsible for valuing and acts as a conduit between state and local government 50,000 properties as part of the introduction of Victoria’s on climate change adaptation and environmental new Fire Services Property Levy. sustainability issues. In March, a $6 million funding package From 1 July 2013, a Fire Services levy on insurance to support local government action on climate change was premiums was replaced by a property-based levy collected launched. The funding, to be delivered through the Victorian by councils through rate notices. The new levy is made up of Adaptation and Sustainability Partnership, includes a new two parts: a fixed charge; and a variable charge based on a adaptation mentoring initiative to provide local councils property’s capital improved value. As recommended by the with practical assistance to undertake climate change risk Victorian Bushfires Royal Commission, the new levy means assessment and planning activities. that all property owners – not just insured property owners – contribute to funding Victoria’s fire services. Biodiversity Conservation Strategy for Melbourne’s growth corridors The Valuation of Land Act 1960 was amended, in line with The expansion of Melbourne’s four urban growth corridors the recommendation which then required all non-rateable has been comprehensively planned alongside the protection leviable properties to be valued. The Valuer-General Victoria of threatened species in a historic strategy released by the was responsible for valuing these 50,000 properties government. including power stations, reservoirs, churches, hospitals and private schools. The Biodiversity Conservation Strategy – developed by the department and launched by the Environment and Climate Effective environmental and climate Change Minister in May 2013 – provides a range of benefits to the environment and the community, including greater change policy, investment and regulation planning certainty, improved biodiversity outcomes and further streamlining of planning and approvals process. Environmental Partnerships Victorians are being encouraged to get more involved in 2 Million Trees initiative protecting and enhancing the environment after the release Two million trees are being planted across Victoria as part of a new partnership-building approach. Environmental of the government’s practical environmental action. The Partnerships – released in November 2012 – lays the 2 Million Trees initiative is planting 1.5 million trees in foundation for government, business, industry, community parklands and other public open space in metropolitan groups and individuals to work together to undertake Melbourne and half a million trees along waterways in practical and effective action to maintain a resilient, healthy regional Victoria. environment that supports the prosperity and wellbeing of current and future generations. Leading the project, the department is working closely with Parks Victoria, Melbourne Water and the Port Phillip A Cleaner Yarra River and Port Phillip Bay and Westernport Catchment Management Authority. The A new action plan is coordinating $1 billion worth of works project is supporting tree planting projects run by councils, over the next five years to contribute to the improvement of schools, community and Landcare groups, committees of the Yarra River and Port Phillip Bay. A Cleaner Yarra River management and other public land managers. The regional and Port Phillip Bay – released in October 2012 by the target of 500,000 trees has been achieved. Minister for Environment and Climate Change – will help Landcare drive investment and focus efforts to improve the iconic waterways. The plan identifies 17 actions to deliver on four The Victorian Landcare Program Strategic Plan was key priorities: launched as part of national Landcare Week celebrations in September 2012. The plan will guide the government’s • clearer, more responsive management key program of support to strengthen Landcare. This iconic • preventing pollution and reducing litter grassroots movement has grown into a thriving community with more than 60,000 members across Victoria. • providing user-friendly, accessible information • supporting Victorians to care for and protect our iconic river and bay, including litter prevention and clean-up.

18 Department of Environment and Primary Industries 2013 Annual Report Ninety days of nature Tapered galaxias rescued from fire affected habitat More than 65 events were staged in northern Victoria as More than 100 Tapered Galaxias, a newly-discovered part of Spring into Biodiversity – Ninety Days of Nature. species of freshwater fish, were transported to temporary The department and the Goulburn Broken Catchment lodging at the Arthur Rylah Institute’s specialised aquarium Management Authority and North East Catchment facility after their habitat was affected by the Aberfeldy- Management Authority joined together to present the Donnelly fire in Gippsland. The move was critical to the program. species’ survival. The entire distribution of these fish is confined to a small upland area in the fire zone and run- Events were hosted by the department, catchment off was likely to have a big impact on water quality in the management authorities, Parks Victoria, local government, catchment, potentially threatening survival of the species. Landcare and conservation management networks and local environmental and community groups. Program highlights New wildlife regulations released included a walk and talk around the Kinnairds Wetland at New regulations for keeping and trading native wildlife Numurkah, official launch of a new North East Fish, Crayfish in Victoria came into effect on 23 June 2013. The new and Turtles Guide, Striped Legless Lizard hunt at Mount regulations are more streamlined and easier to understand, Battery, near Mansfield and a reptiles and frog discovery day while continuing to ensure the industry is sustainable, ethical at Baranduda. and humane. Investing in local action To develop the new regulations, the department sought The department provided more than $68 million in direct input from animal welfare groups, private and commercial support to thousands of community groups such as wildlife keepers and traders, the scientific community and Landcare, Coastcare, committees of management of Crown wildlife and game management agencies. The community land reserves and schools across Victoria to undertake was also invited to have a say on the proposed changes in environmental works addressing local priorities. Funding was April 2013. administered through various programs including Wildlife The changes include: Rehabilitator, Landcare, Coastcare and Communities for Nature grants. • reducing the number of licence categories by combining licence types BushTender helps to protect native vegetation • revising licensing fees that were set 10 years ago with Avoca Plains landholders in the north-west of Victoria shared concessions and discounts to ensure they remain in $1.5 million through the BushTender program to improve equitable native vegetation on their properties by fencing, replanting and weed and pest control. • expanding options for business by allowing the keeping and trading of 15 additional species of wildlife and BushTender has been running since 2001, protecting more reducing the regulatory restrictions around seven other than 33,000 hectares of native vegetation with the help of species 460 different landholders. • introducing a new category of wildlife licence, the Dingo New soil strategy Licence, so dingoes can be kept as pets. In July 2013, the department released the Soil Health The new Wildlife Regulations 2013 replace the Wildlife Strategy, which was developed in conjunction with Regulations 2002 and govern the way native wildlife is catchment management authorities to provide a statewide, bought, sold, kept and bred in Victoria by more than 12,000 consistent approach to managing soil health in Victoria. private and 400 commercial licence holders. Protecting soil health preserves future land choices and options. The strategy is intended to assist catchment Rare whale stranding leads to further research planning, as well as local and state government agencies as Staff from the department and Museum Victoria performed they work with local communities to improve soil health. a post-mortem examination on a rare Shepherd’s Beaked New waste and resource recovery policy Whale (Tasmacetus sherpherdi) that stranded at Marlo in East Gippsland in July 2013. The whale was transported Victoria’s new waste and resource recovery policy, Getting back to Melbourne for further research. It is the first example full value: Victoria’s Waste and Resource Recovery Policy of this species to be added to the museum collection and was launched in April 2013. The 30-year plan is transforming will increase our understanding of the deep-diving lifestyle, waste management while strengthening health and habits and evolution of this species. environmental standards. The policy marks more than two years of extensive research and collaboration between all The 6-metre whale has a long, dolphin-like beak and is dark levels of government, industry and the community. brown with pale sides and belly and is distinguishable from other species by teeth in both its upper and lower jaws. It remains one of the least understood cetaceans (whales and dolphins), largely because of its deep water offshore habitat. Sightings of stranded whales can be reported to the Whale and Dolphin Emergency Hotline on 1300 136 017.

Department of Environment and Primary Industries 2013 Annual Report 19 Reduced impact of major bushfires Draft Fire Operation Plans on display and other extreme events on people, During August 2012, the department encouraged Victorians to find out about planned burning and other fire prevention infrastructure and the environment activities proposed for their local area. Each fire district drafted a Fire Operations Plan for the coming three years, Responding to fires setting out planned burns and other works, such as Victoria faced one of the most active fire seasons in four slashing, track works and construction of fire breaks to years. The department’s firefighters responded to 866 reduce bushfire risk to people, property and communities. fires during the 2012–13 fire season, impacting 201,630 hectares. This is significantly more than the 30-year average The Fire Operations Plans are shaped by conversations with of 638 fires per season. Sadly, this season was a reminder Victorian communities and key stakeholders such as local of how dangerous firefighting can be, with three firefighters councils, Parks Victoria, Melbourne Water, forest managers, losing their lives in the line of duty. the CFA and flora and fauna specialists and are based on the latest research and local information. They are designed For weeks large fires in and around Harrietville, Aberfeldy to be flexible, allowing the timing of planned burns over the and the Grampians tested not only the fire services but three-year period to change in response to weather. many surrounding rural communities. Crews and incident management teams from the department, Parks Victoria, Dartmouth fire boat VicForests, Melbourne Water and the Country Fire Authority A new fire boat is located at Lake Dartmouth in north-east (CFA) worked around the clock in remote and rugged terrain Victoria to improve emergency response. The boat, based to protect people, properties and communities. Firefighters at the department’s Mitta Mitta work centre, will be primarily from New Zealand and New South Wales provided much used for fire suppression, including taking firefighters and needed support to Victorian crews, whilst Victoria supported equipment to remote areas around the lake. Tasmania and New South Wales in their firefighting efforts. With the capacity to be moved across the state, the boat Bushfire rapid risk assessment teams will also be used for compliance operations and to assist in Multi-disciplinary Bushfire Rapid Risk Assessment Teams the response to other emergency situations, including floods (Bushfire RRATs) were deployed in February and March and search and rescue operations. 2013 to conduct risk assessments in areas impacted Following consultation with local indigenous groups, the by the Grampians, Harrietville and Baw Baw bushfires. boat has been named ‘Murrandu Gundha’ which means These assessments aid the transition from fire response to ‘large freshwater’ to reflect its base at Dartmouth. recovery. Level 3 incident management accreditations The Bushfire RRATs comprised staff from the department, Parks Victoria, the Office of Aboriginal Affairs Victoria and A group of staff and volunteers from the department, CFA Melbourne Water; with specialist skills in the areas of and Parks Victoria were presented with their Level 3 incident biodiversity, built assets, cultural heritage, flooding and management accreditations at a joint ceremony in May erosion, forest management, GIS mapping and leadership. 2013. It was the first joint ceremony for the Level 3 awards for Incident Controller, Operations Officer, Planning Officer, The teams moved in as the firefighters moved out and Logistics Officer and Public Information Officer roles. The conducted a rapid risk assessment of the areas affected joint accreditation was in response to a recommendation by the bushfires to assess risks to life and property, from the Victorian Bushfires Royal Commission for an in infrastructure, the environment or cultural heritage values. principle agreement between the department and the CFA Examples of these risks include the risk of flooding, landslips for a uniform and transparent accreditation process for Level due to erosion, impacts on forest regeneration and impacts 3 Incident Controllers. on flora and fauna species. Assessment reports were completed within seven days and assisted land managers The department’s Chief Fire Officer Alan Goodwin, Fire and stakeholders to develop plans to help with emergency Services Commissioner Craig Lapsley and CFA Chief Officer stabilisation and longer term recovery planning. Euan Ferguson presented the accreditations.

Planned burning program Despite wet and variable spring weather conditions and a prolonged bushfire season, firefighters from the department and Parks Victoria completed 678 planned burns treating 255,227 hectares of public land as part of a statewide plan to reduce bushfire risk to people, property and communities. This is 58,078 hectares more than was carried out last year. This achievement reflects the hard work of fire crews who went from an extremely busy fire season to preparing and undertaking the largest planned burning program in the last 30 years. In the May State Budget, the government announced a $33.7 million investment to further increase the planned burning program over the next two years.

20 Department of Environment and Primary Industries 2013 Annual Report A high performing and efficient organisation Environmental accounting The department is a leader in developing and producing Legislation environmental-economic accounts. In 2012–13 the The department supported the passage of five bills through department released the Victorian Experimental Ecosystem Parliament. This included the Alpine Resorts and National Account, a set of accounts that demonstrate how Parks Acts Amendment Act 2013, Climate Change and new international environmental-economic accounting Environment Protection Amendment Act 2012, Electronic frameworks can be applied in Victoria. The government also Conveyancing (Adoption of National Law) Act 2012 and the worked closely with the Australian Bureau of Statistics to Land (Revocation of Reservations Act) Act 2012. release Land Account: Victoria, Experimental Estimates, a set of accounts that show both economic and environmental Regulations were also made for wildlife licensing, values of land. land conservation (vehicle control) and water industry (waterways land). The information in Victorian environmental-economic accounts can be used to assess trends in the environment’s Access to government information condition, to improve understanding of the interactions The department is preparing its data sets to enable access between the environment, the economy and society and in line with the Victorian Government’s new DataVic Access to monitor the effectiveness of different policy options. This and Intellectual Property policies. These policies mandate information can then used to inform policy and decision access to state government data, in most cases, at no cost. making to improve the government’s allocation of public resources. More than 300 data sets were made available online in June 2013 through the re-developed Victorian Government data Newtech conferences directory (www.data.vic.gov.au). The department hosted Newtech Conferences in Customer service centre Shepparton and Colac to highlight initiatives in spatial technology and service delivery to regional Victorian spatial The Customer Service Centre (CSC) managed 162,222 industry practitioners. These conferences are a valuable public enquiries, covering more than 2400 separate topics means of gaining feedback from industry practitioners to with 40,053 emergency enquiries. drive improvements in existing spatial datasets and services During one of the busiest fire seasons since the devastating to better meet industry requirements. 2008–09 fires, the CSC operated around the clock seven The conference in March 2013 showcased the use of spatial days a week. The Victorian Bushfire Information Line (VBIL) information in education and involved secondary school – which the CSC operates – received 34,854 calls. During students and teachers. January 2013, the CSC handled more than 18,600 calls to the VBIL, the highest number of calls for any month other One desktop project than February 2009, when the Black Saturday bushfires hit The department began upgrading its desktops during Victoria. 2012–13. The updates included a new computer operating Over the past few years, the CSC has experienced a 15 environment, new technology capabilities and a stable per cent increase in call and email volume relating to core supported desktop environment for the future. More than business. To manage this increase the CSC has introduced 2000 desktops across metropolitan and regional offices a range of efficiency measures to maintain service delivery, were updated during 2012–13. The remainder will be including: completed by August 2013. • improvements to call volume forecasting • intra-day roster management • more efficient data capture • greater awareness by all staff on call handling times • prioritising call volumes over other activities • training all CSC staff, regardless of primary function, in call-taking skills. In early June 2013, the CSC switched to a new telephony system. This system offers improved flexibility to configure and tailor the system dynamically in response to changing circumstances, particularly in relation to emergency incidents. It also includes improved self-service options for VBIL callers and can take more calls.

Department of Environment and Primary Industries 2013 Annual Report 21 Financial review

Five-year financial summary

2013 2012* 2011* 2010* 2009* $’000 $’000 $’000 $’000 $’000

Income from government(1) 1,045,240 1,083,674 998,223 1,084,119 1,434,048

Total income from transactions 1,278,847 1,375,567 1,240,658 1,395,494 1,650,477

Total expenses from transactions 1,264,680 1,315,285 1,250,108 1,339,348 1,563,368

Net result from transactions(2) 14,167 60,282 (9,450) 56,146 87,109

Net result for the period 243,820 12,621 (3,857) (107,846) 72,416

Net cash flow from operating activities 46,255 127,780 19,369 139,028 98,123

Total assets 7,853,608 7,592,046 7,786,571 8,686,920 9,108,818

Total liabilities 295,157 283,242 367,412 366,273 454,178

Notes: 1. Income from government includes both output and special appropriations. 2. The ‘net result from transactions’ is identical to the ‘net operating balance’ for the general government sector. * Amended for impact of prior period errors and a change in accounting policy.

Current year financial review Financial performance and business review The department recorded a lower net result from Overview transactions in 2012-13, primarily due to decreases in The Victorian Government considers the net result from income. The key falls in income related to the cessation of transactions to be the appropriate measure of financial flood recovery funding, for which $72.5 million had been management that can be directly attributed to government received in 2011–12, and appropriation funding, to take into policy. This measure excludes the effects of revaluations account the advances repaid in 2011–12 referred to above. (holding gains or losses) arising from changes in market These decreases were slightly offset by increased income prices and other changes in the volume of assets shown from the Metropolitan Parks Improvement Rate. under ‘other economic flows’ on the comprehensive Expenditure was materially consistent with 2011–12, being operating statement, which are outside the control of the 4 per cent lower. The most significant changes were the department. cessation of two grant funding programs in 2011–12: In 2012–13, the department recorded a net result from contributions to the Snowy Joint Government Enterprise transactions of $14.2 million, which was $46.1 million and grants to the Rural Finance Corporation of Victoria for lower than in 2011–12. This change is largely because the floodplain restoration. department received $42.6 million of appropriation funding The net result after other economic flows for the period was in 2011–12 to repay advances made under section 37 of the a surplus of $243.8 million compared to the net result of Financial Management Act 1994. The department did not $12.6 million in 2011–12. receive any such advances in 2012–13. The overall net result of $243.8 million is the highest in the five-year period as a result of Crown land recognised for the first time.

22 Department of Environment and Primary Industries 2013 Annual Report Financial position – balance sheet DEPI’s compliance with the Direction Requirements of the Total assets increased by $261.6 million to $7,853.6 million FMCF is formally assessed at 30 June each year and the tax (up 3.4 per cent) primarily due to the recognition of Crown compliance component is subject to an independent review. land river frontages as part of an ongoing exercise by Land DEPI also maintains a number of financial policies, Victoria. Intangible assets also increased as work continued procedures and guidelines to ensure consistency in financial on the Fire and Emergency Management Portal, which is transactions and financial reporting. These are reviewed and expected to be completed in 2015. updated on an annual basis to ensure ongoing relevance Total liabilities increased by $11.9 million primarily due to and conformance to external reporting requirements. increases in accrued payables. Financial transactions are subject to regular compliance Consequently the department’s net assets increased by reviews by the compliance team within the Finance and 3.4 per cent from last year to $7,558.4 million. Planning division. Compliance reviews include Financial Data Quality Assurance Reviews and Purchasing Card transaction Cash flows reviews. Exceptions identified during the compliance reviews The department’s net cash inflow from operating activities are reported to the Executive Director Finance and Planning decreased by $81.5 million to $46.3 million. This reduction in (who is also the department’s Chief Finance and Accounting cash reflects the department’s net result from transactions for Officer for the purposes of section 43(1)(a) of the Financial the year, the impact of non-cash items such as depreciation Management Act 1994). and movements in financial assets and liabilities. Governance of Financial Management training is provided online to all staff applying for the right to exercise financial Controlled expenses from transactions by output delegations within the department. All financial delegates are required to repeat the training every three years. Payments for outputs (controlled) $’000 % There is active participation in financial management amongst leadership teams throughout DEPI and financial Effective Water Management and 261,699 20.7% compliance continues to be embedded into revised work Supply practices. Regular communication of the requirements will Public Land 109,868 8.7% continue through financial forums and daily work practices.

Biodiversity 59,963 4.7% Budget portfolio outcome statements

Natural Resources 82,949 6.6% A comparison of the budget portfolio outcome statements for the department, as published in the 2012–13 Budget Land and Fire Management 383,526 30.3% Paper No. 5, and the actual results for the year can be found at Appendix 2. Forests and Parks 198,967 15.7% Environmental Policy and Climate 47,673 3.8% Enhanced forecasting capability Change In 2012–13 the department’s Budget Management System, Land Administration and Property 120,035 9.5% Business Objects Planning, was further developed to include Information forecasting and budget update functionality. The system’s 1,264,680 100% enhanced capability enables the department to efficiently collect, process and analyse forecasts and budget update requirements for both internal and Department of Treasury Financial governance and Finance (DTF) purposes. DEPI diligently exercises its various financial management Previously, this type of information was handled through the obligations. The Minister for Finance has implemented manual completion of Excel spreadsheets, with data often various financial governance frameworks to ensure effective, transferred and replicated many times. efficient and responsible financial management of public resources, including the Financial Management Compliance The added functionality allows budget update requests to be Framework (FMCF). The FMCF governs compliance with the entered into the department’s Budget Management System provisions of the Financial Management Act 1994, Taxation and then automatically submitted to the DTF State Resource Compliance Rules, Purchasing Card Rules for Use and Information Management System (SRIMS). An added benefit Administration and Thefts and Losses Rules. has been the ability to eliminate errors at the data entry point and to automate required calculations. The FMCF provides assurance that all public entities: Internal budget reporting is now more comprehensive and • have implemented appropriate systems for the effective, reflective of business expectations, with the system able to efficient and responsible financial management of public report both officially approved budgets as well as changes resources and provides a mechanism for government to pending submission to, or approval by, DTF. monitor and review compliance with legislation The implementation of these initiatives has enhanced the • are complying with legislation in relation to the major department’s ability to provide robust and timely advice federal taxes including GST, FBT and PAYG about its forecast financial position. • have implemented efficient and effective use of purchasing cards • report all instances of thefts and losses to the Minister for Finance on an annual basis.

Department of Environment and Primary Industries 2013 Annual Report 23 Our people

Safety and wellbeing

The safety and wellbeing of our people is fundamental to the work we do and the successful delivery of our programs – and a critical factor in supporting our lead-agency role in public and private land, water and fire management.

The foundation of our approach to safety and wellbeing • The department continued to develop Safe Operating is the visibility of the Safety and Wellbeing Policy. Instructions for the use of plant and equipment and Safe Work Operating Procedures for working safely. This policy requires employees to Think Safety and Work Safely within the framework of Lead, Understand, Act • DEPI provided an ongoing commitment to the Hazardous and Improve. Trees Project which involved significant consultation across the state. The aim is to build a culture that provides a working environment, resources and support to ensure everyone • Safety and wellbeing information portals for employees returns home safely and in a good state of mind at the end and our Networked Emergency Organisation (NEO) of each work day. partners were updated. Our people are now empowered to act to eliminate and • A number of recommendations to improve the way in minimise risks and hazards to achieve the highest level of which the department responds to emergency response safety possible. Safety is everyone’s responsibility and a situations were identified at a Fire and Emergency reporting culture is central to continuous improvement and Response debrief in March 2013. compliance. • Dangerous goods and hazardous substances audits at all In support of the policy: DEPI workplaces were completed and corrective actions commenced. • The department continued to deliver the Leading Safety in DEPI and Job Safety Planning training. Leading Safety • The department continued to provide onsite staff in DEPI is a WorkSafe endorsed program designed counselling through the Employee Assistance Program to build awareness in managers and team leaders of provider. This program schedules counsellors on a regular their obligations under OHS legislation. The program is basis to visit onsite at DEPI offices and depots. mandatory for all employees who have management or • The Peer Support program was evaluated and the supervisory responsibilities of one or more employees. department commenced implementing recommendations Job Safety Planning is the process and tools used to plan from the review. jobs so that they can be completed safely. The training program is mandatory for all employees and empowers • The Office of the Workplace Conciliator pilot program employees with the tools to undertake their work safely. continued to provide assistance and support to staff looking to discuss workplace issues or concerns in an • Safety Advisors made more than 460 site and field visits informal and confidential way. across the state during 2012–13. The visits take the form of an audit program, enabling the Safety Advisors to Enforceable undertaking coach all managers and employees on how to meet their In January 2013, WorkSafe Victoria confirmed that the obligations and to integrate safety into daily tasks and department successfully completed an Enforceable strategic projects. This includes a site inspection schedule, Undertaking in response to a WorkSafe investigation Hazardous Substance and Dangerous Goods audits and following an incident in 2010. All undertakings were delivered embedding the Job Safety Planning process. and reported to WorkSafe in a timely manner. • New Contractor Safety Management and Hazardous Substances Dangerous Goods training also commenced in 2012–13.

24 Department of Environment and Primary Industries 2013 Annual Report Incident management In 2012–13 a total of 630 incidents were reported. This is a decrease from 662 in the previous year. The number of standard claims increased from 42 in 2011–12 to 51 in 2012–13. Claim costs have decreased from $44,899 in July 2012 to $39,737 in July 2013. The increased number of standard claims in 2012–13 is due to a considerable increase in fire activity around the state during the 2012–13 fire season. The department had three fatalities that occurred during fire deployment, one in Tasmania and two in the North East region. The increased fire activity also saw a growth in the use of safety resources with a large number of staff using employee assistance programs. The department’s Return to Work performance improved in 2012–13. The percentage of standard claims, who have lost less than 13 weeks time from work, improved significantly.

OHS key performance indicators

Description Performance indicator 2009–10 2010–11 2011–12* 2012–13* Incidents and hazards(1) Incidents 609 666 662 630 Lost time incidents - 108 83 84 Hazards - 153 155 152 Incident rate per 100 FTE 20.01 20.81 22.6 WorkCover(2) Claims Number of standard claims 65 58 42 51 Rate per 100 FTE 2.05 1.89 1.37 1.82 Standard claims with lost time 43 39 27 35 Rate per 100 FTE 1.35 1.27 0.88 1.25 Fatalities Number of fatalities 0003 Claim costs Average cost per claim ($) 37,919 34,829 44,899 39,737 Return to work (RTW) Percentage of RTW arrangements 72.1 73.7 63.6 94.1 initiated for claims exceeding 20 days per 100 FTE Management Evidence of safety and wellbeing policy, strategy, regular reporting to senior management, Achieved commitment safety criteria in purchasing guidelines. Consultation and Designated work group structure, health and safety representatives (HSR) and issue Achieved participation resolution procedure in place. Risk management Internal audits/inspections conducted as planned. Achieved

Reporting of incidents and injuries.

Investigation of incidents and corrective actions initiated. Training Safety and Wellbeing Induction Achieved

Job Safety Planning

HSR training

Management training Notes: 1. Data for 2010–11 and 2011–12 sourced from the department’s Safety Incident Management System and Fireweb. 2012–13 data sourced from POSSUM. 2. The incident and hazard rates based on 2012–13 FTE count taken at March 2013 and captures the majority of Project Firefighters. 3. Data sourced from the WorkCover Agent – Xchanging Pty Ltd, 2012–13 rate based on June 2013 FTE count. This excludes external contractors/consultants and temporary staff employed by employment agencies. * WorkCover results for 2012–13 have been sourced from Xchanging and differ slightly from what was reported last year.

Department of Environment and Primary Industries 2013 Annual Report 25 Public administration values and To progress gender equity across the department, actions undertaken in 2012–13 included the implementation employment principles of a pilot Women’s Leadership program ‘My mentor – The department is committed to applying the values and Challenging women to make it happen’. The Women’s employment principles as set out in the Public Administration Network met regularly during 2012–13 with guests including Act 2004. The department’s values are aligned with the Dale Fisher, CEO, Royal Women’s Hospital and Jenny public sector values and implemented through planning Gray, CEO, Zoos Victoria and Sustainability Victoria’s Vera and performance management and reward and recognition Lubczenko. The Network continues to grow and has been processes. The department applies merit and equity successful in appointing a new Executive Champion. principles when appointing staff. The selection processes The department set up an informal network for employees ensure that applicants are assessed and evaluated fairly and with disabilities and employees who are carers for family equitably on the basis of the key selection criteria and other members with disabilities to meet about shared issues and accountabilities without discrimination. offer a supportive structure at work. Leadership and management development DEPI Bairnsdale recognised for indigenous partnerships A cornerstone of the department’s People Strategy is DEPI Bairnsdale won a 2012 Wurreker Award in recognition leaders who inspire high performing teams. Capable of its partnership work with the indigenous community. managers who lead are essential for maintaining a strategic Examples of this work includes the Indigenous Cultural focus, an engaged and agile workforce and a safe working Awareness Program for staff delivered by the Gunaikurnai environment. These attributes are particularly important if Land and Waters Corporation, the Lake Tyers Land the department is to effectively respond to changes in our Management project, the annual Coastcare Summer by the operating environment and shifts in community expectations. Sea program and an ongoing commitment to indigenous To support managers and employees to adapt, embrace project firefighter employment. change and continue their important work, a range of The Wurreker awards, presented by the Victorian Aboriginal learning and development programs have been created. Educational Association Incorporated, recognise and Programs delivered included: celebrate outstanding achievements of individuals and organisations which work in partnership at a local, regional • Engaging People to Deliver Results – designed to achieve and state level to improve outcomes for Kooris in education, better quality performance conversations and prompt training and employment pathways. resolution of workplace issues – was completed by 600 managers. Lake Tyers Land Management trainee, Josh Kennedy, was named as a finalist in the ‘Public Sector Employee’ category. • A Diploma of Management was delivered for 43 regional He has secured a three-year Project Firefighter contract with participants. the department and completed a Diploma in Conservation • A range of change support programs and tools to assist and Land Management at TAFE. with stress management and prevention, resilience and business continuity for head office and regional participants. In addition the department recruited 16 first year and 12 second year graduates and established a Coaching Community of Practice to encourage managers to coach their staff and support on-the-job learning.

Diversity and inclusion The department held regular awareness raising activities to promote diversity and inclusion by highlighting employee’s responsibilities and obligations in creating a fair and equitable work environment. Events included Human Rights Day, International Day for People with a Disability, International Women’s Day, Celebrate Cultural Diversity Week, Reconciliation Week and National Aboriginal and Strategic Engagement Facilitator Joanne Eastman, Indigenous Islanders Day Observance Committee (NAIDOC) week. 3DUWQHUVKLS)DFLOLWDWRU0DU\'RODQGDQG)LHOG6HUYLFHV2I¿FHU-RVK Kennedy at the Wurreker Awards The department is developing priorities and actions to ensure diversity through the development of a Gender Equity Plan and an Aboriginal Inclusion Plan. These two plans are currently in draft form and will go through a consultation process.

26 Department of Environment and Primary Industries 2013 Annual Report Workplace relations There were 28 grievances reported in 2012–13 with one existing grievance carried over from the previous year. The VPS Determination 2012 concluded early in the financial The table shows grievances by outcome: year with Fair Work Australia able to bring the parties to an acceptable outcome. Outcome Number

Negotiations for a new Field Staff Agreement also concluded Withdrawn 4 during 2013. This Agreement covers staff primarily involved in fire suppression, planned burning and forestry work. Not substantiated 5 The department processes portfolio statutory authorities’ Rejected 1 enterprise agreements through to government approval, Resolved 14 and provides industrial advice and assistance as required. In 2012–13, 12 management logs were processed through No further action required 2 to government approval, as were nine final agreements. Open 3

Total 29

Proactive return to work strategy

This is a story about mateship, determination and Gradually Rob clawed back the life he once had. He perseverance. It is a good news story, but it started with walked, maintained his physiotherapy regime and made the simplest of accidents – a slip followed by a fall on the decision to come back to work early when offered 23 April 2012. the opportunity to supervise the depot relocation. While working with two team mates to roll a felled and Rob worked diligently to recover and restore his physical sawn storm damaged tree off the road and down an fitness. He was determined to get back to his role as a embankment, Project Firefighter Robert Grech’s hands project firefighter. On 5 October 2012 Rob was assessed slipped on the surface of the log as it was moving to the as medically fit to resume fire duties. On 12 October he edge of the road. Next thing Rob knew he was prone passed the 20 kilometre walk with a class one medical over the log, and the log was gathering momentum clearance – that is ‘no restrictions’. He’s back doing rolling off the road and down the hill – taking him with it. what he loves. Rob sustained two fractured vertebrae and would be off Rob’s determination was matched by support from work for six months. his team mates, return to work case manager and his Rob’s supervisor, David Bowdern was on the scene supervisor. Without their regular contact and interest within two hours having arranged for ambulance, SES in his recovery, the outcome could have been a lot and airlift by helicopter. Just prior to departing Dave different. spoke to Rob’s next of kin to let his mum know Rob Rob’s story is an example of the department’s proactive |was to be airlifted to Melbourne. approach to managing return to work. This consultative Dave has walked the journey of recovery with Rob. He approach involves the individual, their treating doctors has visited his home, met with his parents, worked with and managers in planning for a return to work as early medical advice and the department’s Injury Management as is safely possible. and Return to Work Advisor, Carina Johnson to identify appropriate modified duties and hours of work to help Rob get back to work. Coming back to work in a partial capacity reduces the sense of isolation and psychological distress that may occur following injuries. Rob’s wellbeing was greatly enhanced by the time team mates spent visiting his home to keep in touch and accompanying him on trips to medical appointments. The inspiration however is Rob himself. After the accident, Rob was confined in a fibreglass body suit, unable to bend much beyond 25 degrees and was grounded – no driving and no walking. His workplace in Alexandra was a good half hour drive by car from his 5REHUW*UHFKEDFNRQDFWLYHGXW\DVDSURMHFW¿UH¿JKWHU home in Yea. But Rob was fit and it was his fitness that helped him graduate to only needing the cast for walking just four weeks after the accident.

Department of Environment and Primary Industries 2013 Annual Report 27 Office of the Workplace Conciliator 2013 Queen’s Birthday Honours A total of 191 managers and staff across the department Ewan Waller, former Chief Fire Officer, received the visited the Workplace Conciliator during 2012–13. They Australian Fire Service Medal for his distinguished service presented with a wide range of issues including workplace and commitment to improving bushfire management behaviour, organisational change processes, performance across Victoria’s public land estate to protect and reduce management and career-related concerns. the bushfire risk to Victorian communities. Ewan retired in November 2012 after serving as Chief Fire Officer for seven The Workplace Conciliator pilot project was a finalist in the years. Ewan contributed his experience in forest, land IPAA Leadership in the Public Sector awards 2012 and has management and fire roles for more than 40 years. He led been nominated for the 2013 WorkSafe Awards under the the increase in planned burning as recommended by the Commitment to Workplace Health and Wellbeing category. 2009 Victorian Bushfires Royal Commission and oversaw the achievement of the largest program of planned burning Recognising excellence in public in more than two decades. administration In addition to building the department’s fire management and prevention capability, Ewan was also instrumental in working Australian Fire Service Medal with other agencies to build for Victoria one of the world’s 2013 Australia Day Honours best integrated and community-based fire management Greg McCarthy, Fire Ecology Planner in the Gippsland Region, structures. received the Australian Fire Service Medal for his outstanding Thornton Smith Medal service to firefighting over 39 years. Greg was recognised for improving fire behaviour predictions and effectiveness Chris Lester, manager of Land Victoria’s Electronic of hazard reduction treatments, as well as increased Subdivisions Unit, was awarded the University of firefighter safety and community protection. Greg is currently Melbourne’s School of Engineering 2013 Thornton Smith coordinating the fire ecology monitoring program for landscape Medal for outstanding contribution to the engineering mosaic burning in East Gippsland, working on developing new profession in the field of geomatics. techniques for mapping fire severity and extent. The award recognises Chris’s career and leadership at Land Rocky Barca, Chief Ranger at Werribee Park, received the Victoria, including the successful rollout of SPEAR (Surveying Australian Fire Service Medal for his outstanding leadership and Planning through Electronic Applications and Referrals) in responding to major Victorian bushfires as Planning Officer in Victoria and introduction of ePlan. and Incident Controller. Rocky has worked for Parks Victoria and in various fire roles with the department for more than 30 years.

Comparative workforce data

Profile of the department’s workforce: June 2013 At 30 June 2013, the department employed 2328 full time equivalent (FTE) staff across Victoria.

Table 1: FTE staffing trends 2009 to 2013

2013 2012 2011 2010 2009

2,328 2,617 2,836 2,780 2,900

Table 2: Summary of employment levels in June 2012 and 2013

Fixed term Ongoing employees and casual Total staff

Employees Full time Part time (headcount) (headcount) (headcount) FTE FTE FTE

June 2013 2,359 2,031 328 2,235 93 2,328

June 2012 2,574 2,197 377 2,435 182 2,617

28 Department of Environment and Primary Industries 2013 Annual Report Table 3: Details of employment levels in June 2012 and 2013

2013 2012 Fixed term Fixed term Ongoing and casual Ongoing and casual (headcount) FTE FTE (headcount) FTE FTE Gender Male 1,366 1,347 46 1,502 1,479 92 Female 993 888 47 1,072 956 90 Total 2,359 2,235 93 2,574 2,435 182 Age Under 25 64 51 6 78 64 14 25–34 476 463 33 540 519 72 35–44 664 612 27 692 637 52 45–54 670 642 16 723 695 22 55–64 449 436 9 492 477 20 Over 64 36 31 2 49 43 2 Total 2,359 2,235 93 2,574 2,435 182 Classification Field staff 267 266 15 302 301 20 VPS 1 4 2 1 4 2 3 VPS 2 199 178 11 217 190 24 VPS 3 492 471 16 564 539 36 VPS 4 507 481 16 529 500 38 VPS 5 443 415 16 478 448 32 VPS 6 292 283 10 322 313 15 STS 10 10 1 13 13 1 Science adaptives 53 52 1 59 58 5 Legal adaptives 20 19 3 21 20 4 Executives 48 47 0 40 40 0 Other 24 11 3 25 11 4 Total 2,359 2,235 93 2,574 2,435 182

Notes: 1. Ongoing employees includes people engaged on a open-ended contract of employment and executives engaged on a standard executive contract who were active in the last full pay period of June. 2. FTE means full time staff equivalent and is rounded to the nearest whole number. 3. Employees reported with a classification of ‘other’ include the following categories: ministerial chauffeur, principal scientists, cadets and trainees. 4. All figures reflect employment levels during the last full pay period in June each year. 5. Excluded are those on leave without pay or absent on secondment, external contractors/consultants, and temporary staff employed by employment agencies, and people who are not employees but appointees to a statutory office, as defined in the Public Administration Act 2004. 6. Employees attached to the Commissioner for Environmental Sustainability are employees of the Department Secretary and are included in the above figures. 7. Employees attached to Sustainability Victoria are employees of the Department Secretary and their numbers are included in a separate table. Employee numbers are also reported in their annual report. 8. The Office of Living Victoria was established as an Administrative Office effective 22 May 2012. Their numbers are included in a separate table. 9. The Environment Protection Authority (EPA) is a discrete agency within this portfolio that employs public servants independently of the Department Secretary. The EPA is required to produce its own annual report. Employee numbers are published in the EPA annual report. 10. As a consequence of policy decisions announced by government on 9 April 2013, some functions and associated staff were transferred from other departments to DEPI on 3 June 2013. However, the workforce data disclosed above has not been adjusted in accordance with the Administrative Order (No. 217) 2013. Refer to Note 31 of the financial statements for further details.

Department of Environment and Primary Industries 2013 Annual Report 29 Profile of Sustainability Victoria: June 2013

Table 1: Sustainability Victoria FTE staffing trends 2009 to 2013

2013 2012 2011 2010 2009 103 113 147 138 134

Table 2: Summary of employment levels in June 2012 and 2013

Ongoing employees(1) Fixed term and casual Employees Full time Part time (headcount) (headcount) (headcount) FTE(2) FTE(2) June 2013 87 71 16 81 22 June 2012 102 84 18 95 18

Table 3: Details of employment levels in June 2012 and 2013

2013 2012 Fixed term Fixed term Ongoing(1) and casual Ongoing(1) and casual (headcount) FTE(2) FTE(2) (headcount) FTE(2) FTE(2) Gender Male 36 35 8 42 41 6 Female 51 46 14 59 53 12 Total 87 81 22 102 95 18 Age Under 25 0 0 0 0 0 0 25–34 20 20 6 24 23 7 35–44 31 27 10 37 33 7 45–54 22 20 3 25 24 1 55–64 12 12 3 14 13 2 Over 64 2 2 0 1 1 0 Total 87 81 22 102 95 18 Classification VPS 1 0 0 0 0 0 0 VPS 2 0 0 0 1 1 0 VPS 3 4 4 1 9 8 1 VPS 4 35 32 3 31 27 8 VPS 5 36 33 10 36 34 6 VPS 6 12 12 3 21 21 2 STS 000220 Executive 0 0 5 2 2 1 Total 87 81 22 102 95 18

Notes: 1. Ongoing employees includes people engaged in an open-ended contract of employment and executives engaged on a standard executive contract who were active in the last full pay period of June. 2. FTE means full time staff equivalent. 3. All figures reflect employment levels during the last full pay period in June of each year. 4. Excluded are those on leave without pay or absent on secondment, external contractors/consultants and temporary staff employed by employment agencies. 5. Figures shown in workforce data staffing trends are FTEs as opposed to headcount which has been reported in previous years.

30 Department of Environment and Primary Industries 2013 Annual Report Profile of Office of Living Victoria: June 2013 At 30 June 2013, Office of Living Victoria employed 22 FTE staff.

Table 1: Office of Living Victoria FTE staffing trends 2009 to 2013

2013 2012 2011 2010 2009 220000

Table 2: Summary of employment levels in June 2012 and 2013

Fixed term Ongoing employees and casual Total staff Employees Full time Part time (headcount) (headcount) (headcount) FTE FTE FTE June 2013 76171522 June 2012 000000

Table 3: Details of employment levels in June 2012 and 2013

2013 2012 Fixed term Fixed term Ongoing and casual Ongoing and casual (headcount) FTE FTE (headcount) FTE FTE Gender Male 3 3 12 0 0 0 Female 4 4 3 0 0 0 Total 7 7 15 0 0 0 Age Under 25 0 0 1 0 0 0 25–34 3 3 7 0 0 0 35–44 3 3 4 0 0 0 45–54 0 0 2 0 0 0 55–64 0 0 1 0 0 0 Over 64 1 1 0 0 0 0 Total 7 7 15 0 0 0 Classification VPS 1 0 0 0 0 0 0 VPS 2 0 0 0 0 0 0 VPS 3 0 0 1 0 0 0 VPS 4 0 0 6 0 0 0 VPS 5 3 3 4 0 0 0 VPS 6 1 1 4 0 0 0 STS 110000 Executives 2 2 0 0 0 0 Total 7 7 15 0 0 0

Notes: 1. Ongoing employees includes people engaged on a open-ended contract of employment and executives engaged on a standard executive contract who were active in the last full pay period of June. 2. FTE means full time staff equivalent and is rounded to the nearest whole number. 3. All figures reflect employment levels during the last full pay period in June each year. 4. Excluded are those on leave without pay or absent on secondment, external contractors/consultants, and temporary staff employed by employment agencies, and people who are not employees but appointees to a statutory office, as defined in the Public Administration Act 2004. 5. The Office of Living Victoria was established as an Administrative Office on 22 May 2012. In June 2012 there were no employees associated with the Office of Living Victoria.

Department of Environment and Primary Industries 2013 Annual Report 31 Executive officer data An executive officer (EO) is defined as a person employed as a public service body head or other executive under Part 3, Division 5 of the Public Administration Act 2004. All figures reflect employment levels at the last full pay period in June of the current and corresponding previous reporting year. The definition of an EO does not include Governor in Council appointments as statutory office holders. The total group of executives is classified into two distinct categories based on the following definitions: • ‘ongoing’ executives are executives who are responsible for functions or outputs that are expected to be ongoing at the end of the reporting period • ‘special projects’ executives are executives who are employed for a specific project. These projects are generally for a fixed period of time and relate to specific government priority. For the department’s portfolio authorities (public authorities as defined under the Public Administration Act 2004), an EO is defined as a person employed as an EO at an annual remuneration rate not less than an EO employed by a department. The following tables disclose the EOs of the department and its portfolio authorities for 30 June 2013: • Table 1 discloses the number of EOs in the categories of ‘ongoing’ and ‘special projects’ and the total numbers of EOs for the department • Table 2 provides a breakdown of EOs according to gender for the categories of ‘ongoing’ and ‘special projects’ • Table 3 provides a reconciliation of executive numbers presented between the report of operations and Note 29 Remuneration of executives and payments to other personnel in the financial statements. • Table 4 provides the total executive numbers for all of the department’s portfolio agencies. • Tables 1 to 4 also disclose the variations, denoted by ‘var’, between the current and previous reporting periods. Current vacancies are shown in table 2.

Profile of DEPI Executive Officers: June 2013

Table 1: Number of DEPI EOs classified into ‘ongoing’ and ‘special projects’ (including vacancies)

Class All Ongoing Special projects

No. Var No. Var No. Var

Secretary 1 0 1 0 0 0

EO–1 1 0 1 0 0 0

EO–2 21 2 21 3 0 0

EO–3 27 2 27 2 0 0

Total 50 4 50 5 0 0

Table 2: Breakdown of EOs into gender

Class Male Female Vacancies

No. Var No. Var No. Var

Secretary 1 0 0 0 0 0

EO–1 1 0 0 0 0 0

EO–2 16 7 5 0 0 -5

EO–3 19 0 8 3 0 -1

Total 37 7 13 3 0 -6

32 Department of Environment and Primary Industries 2013 Annual Report The number of executives in the report of operations is based on the number of executive positions that are occupied at the end of the financial year. Note 29 in the financial statements lists the actual number of and amount of remuneration paid to EOs over the course of the reporting period. The financial statement note does not distinguish between executive levels, nor does it disclose separations, vacant positions, executives whose total remuneration is below $100,000, nor does it include the Accountable Officer. Separations are those executives who received more than $100,000 in the financial year and have left the department during this year. To assist readers, these two disclosures are reconciled below.

Table 3: Reconciliation of executive numbers

2013 2012

Executives with total remuneration over $100,000 39 41 (Financial Statement Note 29)

Executives employed with total remuneration below $100,000 16 8

Add Vacancies (Table 2) 0 6

Accountable Officer (Secretary) 2 1

Less Separations 54

Executives who moved to non-executive roles 1 5

Executives who commenced leave without pay 1 1

Total executive numbers 50 46

At 30 June 2013, the department employed 50 EOs and had no vacancies.

Department of Environment and Primary Industries 2013 Annual Report 33 I000022 022 I022044 022 I224011-20-3 I044011 0-3-3 I0663710314 I044044 000 I145145 000 I011011 000 I011011 000 I156167 011 I112202 100 I011134 123 I000000 000 I011011 000 I011011 000 I011011 000 I27931215156 I011011 000 I167279 112 I066055 000 I077066 0 I011011 000 I022022 000 I055055 000 Reported Department 2012 2013 Change YesYesDSEDEPI022022000 YesYesDSEDEPI123022000 YesYesDSEDEPI011101100 Falls Creek Alpine Resort Management BoardFalls Creek CorporationGippsland and Southern Rural Water Gippsland Ports Committee of Management Yes YesGlenelg Hopkins Catchment Management Authority Catchment Management Goulburn Broken Yes Yes YesAuthority Yes CorporationGoulburn Murray Rural Water Yes DSE DSE Corporation Region Water Goulburn Valley Yes CorporationGrampians Wimmera Mallee Water DSE DEP DEP Ocean Road Coast Committee Inc DSEGreat YesLake Mountain Alpine Resort Management Board DEP Yes Yes DEP AuthorityLower Murray Urban and Rural Water Yes YesMallee Catchment Management Authority Yes Yes Yes CorporationMelbourne Water Yes DSE Yes Management Group Waste DSEMetropolitan DSE YesMt Baw Alpine Resort Management Board DEP Yes Yes DSE DEP DEP Mt Buller and Stirling Alpine Resort DSEManagement Board Yes DSE DEP Yes YesMt Hotham Resort Management Board DEP North Central Catchment Management Authority DEP Yes Yes DSE Yes Yes DSE DEP Yes DSE Yes Yes DEP DSE DEP Yes DSE DEPI DSE DEP DEP 7 38 45 16 37 53 9 0 8 Organisation nameBarwon Coast Committee of Management Yes Yes 2012 DSE 2013 DEP 2012 2013 Female Male Active Female Male Active Female Male Active Barwon Region Water CorporationBarwon Region Water Bellarine Bayside Coastal Committee Committee Capel Sound Foreshore of Management Inc CorporationCentral Gippsland Region Water CorporationCentral Highlands Region Water Yes Yes CorporationColiban Region Water YesCorangamite Catchment Management Authority Yes Yes YesEast Gippsland Catchment Management Authority Yes Yes CorporationEast Gippsland Region Water DSE Yes DSE Yes DSE Yes DEP Yes Yes DEP DSE Yes DEP DSE Yes DSE DEP Yes DEP DEP DSE DSE DEP DEP Table 4: Number of executive officers for the department’s portfolio agencies for the department’s 4: Number of executive officers Table

34 Department of Environment and Primary Industries 2013 Annual Report e contract who were active in the last pay period of June. e contract who were yed by employment agencies. 32 163 195 50 171 221 18 8 26 I156156 000 I044044 000 I101101 000 I101101 000 I066055 0 I112112 000 I055156 101 I123123 000 I022022 000 I011011 000 I549639 1 0 I134033 000 I033134 101 I123123 000 I011011 000 Reported Department 2012 2013 Change YesYesYesDSEDEPI011011000 Yes DSE DEPI 0 0 0 0 0 0 0 0 0 Point Leo Foreshore and Public Parks Reserves Point Leo Foreshore Committee of Management Inc Catchment Port Phillip and Westernport Management Authority BoardRoyal Botanic Gardens CorporationSouth Gippsland Region Water The Mint Incorporated (Victoria) for Nature Trust YesVicForests Corporation Region Water Wannon Gippsland Catchment Management AuthorityWest Yes Yes Corporation Region Water Western Yes DSE Corporation Region Water Westernport YesWimmera Catchment Management Authority Yes DEP YesWinton Committee Wetlands Yes DSE Yes BoardZoological Parks and Gardens DSE YesTotal Yes Yes DEP Yes Yes Yes DEP Yes DSE Yes DSE Yes DSE Yes DSE DEP DEP DSE DSE DEP Yes DEP Yes DEP DEP Yes Yes DSE DSE DEP DEP DEPI 1 5 6 1 5 6 North East Region Water CorporationNorth East Region Water Northern Renewal Project Victoria Infrastructure Parks Victoria of Management Park Board Phillip Island Nature Yes Yes Yes Yes Yes DSE Yes DSE DEP DSE DEP DEP Yes Yes DSE DEPI 4 11 15 5 11 16 1 0 1 North East Catchment Management Authority Yes Yes DSE DEP Organisation name 2012 2013 2012 2013 Female Male Active Female Male Active Female Male Active Notes: 1. employment levels during the last pay period of June each year unless otherwise stated. reflect All figures 2. executiv Ongoing employees means people engaged on an open-ended contract of employment and executives a standard 3. emplo those on leave without pay or absent secondment, external contractors, consultants and temporary staff Excluded are Table 4: Number of executive officers for the department’s portfolio agencies (continued) for the department’s 4: Number of executive officers Table

Department of Environment and Primary Industries 2013 Annual Report 35 Profile of Sustainability Victoria Executive Officers: June 2013

Table 1: Number of Sustainability Victoria EOs classified into ‘ongoing’ and ‘special projects’ (including vacancies)

Class All Ongoing Special projects

No. Var No. Var No. Var

Secretary 000000

EO–1 000000

EO–2 0 (2) 0 (2) 0 0

EO–3 434300

Total 414100

Table 2: Breakdown of EOs into gender

Class Male Female Vacancies

No. Var No. Var No. Var

Secretary 000000

EO–1 000000

EO–2 0 (2)0000

EO–3 222102

Total 202102

Table 3: Reconciliation of executive numbers

2013 2012

Executives with total remuneration over $100,000 4 3

Executives employed with total remuneration below $100,000 0 0

Add Vacancies (Table 2) 0 2

Accountable Officer (Secretary) 0 0

Less Separations 13

Executives who moved to non-executive roles 0 1

Executives who commenced leave without pay 0 0

Total executive numbers 4 3

At 30 June 2013, Sustainability Victoria employed four EOs and had no vacancies. The Chief Executive Officer is a statutory appointment and has been excluded from the above data collection.

36 Department of Environment and Primary Industries 2013 Annual Report Profile of Office of Living Victoria Executive Officers: June 2013

Table 1: Number of Office of Living Victoria EOs classified into ‘ongoing’ and ‘special projects’ (including vacancies)

Class All Ongoing Special projects

No. Var No. Var No. Var

EO–1 000000

EO–2 222200

EO–3 000000

Total 222200

Table 2: Breakdown of EOs into gender

Class Male Female Vacancies

No. Var No. Var No. Var

EO–1 000000

EO–2 111100

EO–3 000000

Total 111100

Table 3: Reconciliation of executive numbers

2013 2012

Executives with total remuneration over $100,000 0 0

Executives employed with total remuneration below $100,000 2 0

Add Vacancies (Table 2) 0 0

Accountable Officer (Chief Executive Officer) 1 1

Less Separations 00

Executives who moved to non-executive roles 0 0

Executives who commenced leave without pay 0 0

Total executive numbers 3 1

At 30 June 2013, the Office of Living Victoria employed two EOs and had no vacancies. The Chief Executive Officer is a Governor in Council appointment and is not counted as an executive officer.

Department of Environment and Primary Industries 2013 Annual Report 37 Office-based environmental performance

The department aims to show leadership in sustainability in all its operations: reducing greenhouse gas emissions, efficiently using water and energy and other precious resources while responsibly managing waste. The following section reports on environmental performance Energy use in compliance with Financial Reporting Direction FRD24C ‘Reporting of Office-Based Environmental Data by Energy use is measured and reported for department Government Departments’. buildings across the state, covering all locations and all staff. Energy use for all energy types is measured in megajoules Achievements for 2012–13 include: (MJ) by meters at each building location. • 9 per cent reduction in emissions from energy use The primary measure of energy efficiency is energy intensity, • 2660 less reams or 6.6 tonnes less paper used expressed as megajoules of energy per building floor area (MJ/m2). Energy intensity decreased by 12 per cent and • 12 per cent reduction in total energy used and emissions total energy use decreased by 11 per cent. Overall energy from passenger vehicles. intensity for all buildings was 257 MJ/m2 for 2012–13. An office-based Environmental Management System (EMS) The reduction in reported energy usage and emissions was aims to minimise the use of energy, water and paper, limit affected by significant changes to the buildings portfolio, the generation of waste, improve the efficiency of the vehicle including the Port Phillip Region vacating the Box Hill office, fleet and increase the use of sustainable transport. relocating many staff to 8 Nicholson Street and taking up The Eco-Office Challenge program helps the EMS to new accommodation at several regional sites. educate, advise and encourage staff to improve their Completing capital works at office/depots and depots environmental behaviours at work. About 90 volunteer around the state also impacted on total buildings area and Eco-Office Challenge Champions around the state promote energy use patterns. The availability of more sub-metering environmentally-friendly workplace behaviours. Each month, of electricity use at Bendigo resulted in exclusion of a greater the champions focus on a new topic to promote to staff, portion of ‘non-department’ energy use. The full benefits of encouraging changes in behaviour to limit environmental lighting efficiency improvements at 570 Bourke Street also impacts. increased overall energy efficiency.

Energy-related greenhouse gas emissions Greenhouse gas emissions decreased by 9 per cent

to 7285 tonnes carbon dioxide equivalent (CO2-e). The lower emissions reflect both a reduction in energy use and the contribution of green power purchases (a zero-emissions source) to reduced emissions from electricity.

38 Department of Environment and Primary Industries 2013 Annual Report Table 1: Energy use indicators

Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Energy used per unit Energy intensity fell by 12%. 303 304 304 292 257 of building space The buildings portfolio changed (MJ/m2) significantly with consequent effects from new space allocations and reporting adjustments.

Total buildings floor All department managed 143,630 138,812 137,891 137,926 138,869 area (m2) buildings, with floor areas adjusted each year to match actual occupancy.

Energy used per full Energy use per FTE is 11% less 14,961 15,182 14,768 17,173 15,239 time employee than last year. (MJ/FTE)

Percentage of green The percentage of green power 28.5% 33.4% 31.1% 34.5% 31.4% power bought (as bought was maintained at similar percentage of total levels to 2011–12, by purchasing electricity used) 50% green power for all large sites under the relevant State Purchasing Contract.

Cost of green power Green power cost is for green $93,629 $112,563 $99,503 $142,356 $115,768 ($) power bought under the Victorian Government State Purchasing Contracts for electricity.

Total energy usage segmented by primary source

Electricity non-green The greenhouse emission factor 23,409,086 22,421,501 22,923,413 20,574,917 20,786,953 power (MJ) for Victorian electricity applies to this energy component.

Electricity green power Accredited green power bought 9,341,212 11,230,211 9,928,224 10,846,148 9,471,920 (MJ) is a zero-emissions energy source.

Electricity total use Total electrical energy use has 32,750,298 33,606,102 32,851,637 31,421,065 30,258,873 (MJ) reduced by 4% compared to 2011–12 and continues the downwards trend of the last six years.

Natural gas (MJ) The bulk of natural gas use is 9,514,619 7,796,549 7,877,611 7,806,800 4,674,404 for heating at large regional sites including Bendigo, Benalla, Traralgon and Bairnsdale.

LPG (MJ) LPG use is largely for heating of 1,122,028 844,859 1,144,507 1,067,315 823,382 buildings in regional locations.

Total energy all Total energy use has trended 43,386,945 42,293,120 41,873,755 40,295,180 35,756,659 sources (MJ) downwards over the last six years.

Notes: 1. Total building area (m2) includes all energy-using buildings at all department administered sites. This is consistent with energy reporting in previous years and the requirements of Energy Efficient Government Buildings (government targets) reporting since 2001. 2. FTE used for 2012–13 calculations is 2350 FTE total at 30 June 2013.

Department of Environment and Primary Industries 2013 Annual Report 39 Table 2: Total energy-related greenhouse gas emissions segmented by primary source

Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Electricity non-green power The lower emissions reflect both a 8,778 8,408 7,705 7,544 6,987

(tonnes CO2-e) reduction in total energy used and the contribution of green power purchases to reduced electricity emissions.

Natural gas Emissions from natural gas are due to 487 435 403 416 249

(tonnes CO2-e) less natural gas use.

LPG (tonnes CO2-e) Lower emissions are due to less LPG 103 49 70 64 49 use.

Total energy-related Total energy emissions fell by about 9,368 8,892 8,178 8,024 7,285

emissions (tonnes CO2-e) 9% compared to last year. Notes: 1. Energy emission factors used are the latest available from the federal Department of Climate Change, July, 2013. 2. Full fuel cycle emissions are used, including relevant factors for Victorian electricity and natural gas. Water use The department used a total of 22,414 kilolitres of water which is 2 per cent more than for 2011–12. Seasonal variations contribute to overall water use, especially for water used in cooling towers at large office buildings. Water is used for: • domestic drinking, washing, cleaning and toilet flushing • building heating and cooling systems (e.g. cooling towers) • vehicle washdown (at depots). Water conservation measures are included in new buildings, refits and renovations and as retrofits to sites wherever practicable. These measures include: • rainwater tanks • dual flush and water efficient toilets • flow restrictors and low-flow showerheads • water efficient appliances. Harvested rainwater is used as an alternative water source for toilet flushing and vehicle washdown at many depots. The department classifies sites into three categories: offices, office/depots and depots. Total water use is shown below with use separated for each site category. In 2012–13, 63 per cent of water was used at offices, 32 per cent at office/depots and 5 per cent at depots.

Table 3: Water use summary

Site Category Water use kilolitres Percentage of total use Number of sites

Office 22,414 63 23

Office/depot 11,219 32 33

Depot 1,929 5 23

Totals 35,562 100 79

Notes: 1. Includes all sites. 2. Data is from all locations where metered accounts for potable water use are available. 3. Some locations operate without reticulated town water supply e.g. river or tank water only. 4. For shared office tenancies, water use is calculated on a pro rata basis per floor area occupied.

40 Department of Environment and Primary Industries 2013 Annual Report Office water use is summarised in the tables below according to FRD24C requirements. This report covers all locations where office-only water use is separately measured. Nineteen office locations accommodating 72 per cent of FTE staff were included.

Table 4: Office water – owned and leased buildings

Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Litres per FTE 8,027 9,637 9,653 9,667 11,488

Litres per year Total water volume is all office 13,216,438 23,893,000 23,703,000 21,943,000 22,414,000 water used at included sites, for whole building use including cooling towers.

Number of sites 13 24 23 20 19

Percentage of sites Percentage of sites covered is 15.7% 29.3% 29.1% 25% 24.1% the number of sites included divided by the total number of department sites.

FTE covered The sum of FTE count at included 1,412 2,044 2,049 1,919 1,690 sites at 30 June.

Percentage of total The total FTE at included sites 49% 73% 72% 73% 72% FTE divided by the department’s total FTE at 30 June.

Department of Environment and Primary Industries 2013 Annual Report 41 Table 5: Office water use by building type

Building type Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Leased Litres Total office water 9,233 11,339 12,270 12,795 12,827 buildings per FTE consumption and total site FTE count for included sites.

Litres Total water volume is 10,880,528 19,929,000 20,721,000 19,846,000 17,357,000 per year all office water use at included sites, for whole building use including cooling towers.

Number 6 14 13 13 11 of sites

Percentage Percentage of sites 7.2% 17.1% 16.5% 13.8% 13.9% of sites covered is the number of sites included divided by the total number of department sites.

FTE covered The sum of FTE count at 1,179 1,678 1,631 1,521 1,310 included sites at 30 June.

Percentage Total FTE at included sites 39% 60% 58% 58% 56% of total FTE divided by total FTE at 30 June.

Government- Litres Data on owned sites not 4,991 5,493 3,889 4,827 8,996 owned per FTE available prior to 2007–08 buildings

Litres Total water volume is 2,335,910 3,964,000 2,982,000 3,470,000 5,072,000 per year all office water use at included sites, for whole building use including cooling towers.

Number 7 10 10 10 10 of sites

Percentage Percentage of sites 8.4% 12.2% 12.7% 11.3% 10.1% of sites covered is the number of sites included divided by the total number of department sites.

FTE covered The sum of FTE count at 289 366 419 394 337 included sites at 30 June.

Percentage The total FTE at included 10% 13% 15% 15% 14% of total FTE sites divided by total FTE at 30 June.

Notes: 1. Office water use is reported for 19 sites, including large CBD offices at 8 Nicholson Street and 570 Bourke Street. 2. Consumption data prior to 2009–10 is not directly comparable with later years; with limited sites coverage due to unavailability of data at the time. 3. Water data is reported for all sites where separate metering is available for office-only use. 4. Water use calculations per FTE uses the total FTE occupying the site; made up of DEPI staff and Parks Victoria FTE where they jointly occupy premises. 5. In shared tenancies, pro rata water use is calculated from total building use based on floor area ratio.

42 Department of Environment and Primary Industries 2013 Annual Report Paper use Office paper use decreased with 2660 less reams or 7 per cent less paper bought. This represents an annual saving of 6.6 tonnes of paper. The efficiency of paper use is measured in reams per FTE per year. For 2012–13, 14.3 reams of paper was used per FTE, an increase of 3 per cent. More than 75 per cent of all paper bought by the department had a higher than 75 per cent recycled content.

Table 6: Paper use

Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Total units of paper The usage trend reflects efficiencies 50,020 42,074 38,221 36,194 33,534 used (reams) gained in previous years, with some correlation between paper use and FTE count each year.

FTE FTE at 30 June. 2,900 2,780 2,835 2,617 2,350

Units of paper used A downward trend in paper use 17.2 15.1 13.7 13.8 14.3 per FTE (reams efficiency seen over the previous six per FTE) years has slowed.

Units of paper used A downward trend in paper use 34.6 30.3 27.5 27.7 28.6 per FTE (sheets per efficiency seen over the previous six FTE per day) years has slowed.

Percentage 75–100% The proportion of high recycled 69% 71% 77% 68.9% 75.3% recycled content copy content paper bought has returned paper bought (%) to a historical high level, from better uptake of the 80% recycled copy paper.

Percentage 50–75% This category comprises 50% 19% 18% 5% 7% 4% recycled content copy recycled content A4 papers sourced paper bought (%) primarily to cover ‘out of stock’ periods of the preferred ‘Australian 80’ paper.

Percentage 0–50% This category is almost entirely 12% 11% 18% 24% 20.4% recycled content copy A3 size and coloured A4 papers paper purchased (%) not available with higher recycled content.

Percentage of white The proportion of high recycled 74.8% 76.5% 83.4% 74.4% 81.6% A4 paper with >70% content paper bought has returned recycled content (%) to a historical high level, from better uptake of the 80% recycled copy paper.

Department of Environment and Primary Industries 2013 Annual Report 43 Waste management Waste management aims to achieve the best separation of waste streams to recycling, composting and landfill for all locations. Special collections are made by ‘Green Collect’, a non-profit social enterprise and a commercial polystyrene collection for the 8 Nicholson Street office. Several regional office/depots improved their waste management by introducing ‘Eco Bins’, organics collection and other innovative solutions. Waste data for 2012–13 is based on waste audits conducted at five large sites: 8 Nicholson Street, 570 Bourke Street, Bendigo, Benalla and Traralgon. These sites represent 60 per cent of FTE staff. A high overall recycling rate of 90 per cent was achieved for the audited sites, compared with 85 per cent in 2011–12. An estimated 171 tonnes of waste was diverted from landfill.

Emissions due to landfill waste were estimated at 4.9 tonnes CO2-e, representing a 50 per cent reduction on emission levels for 2011–12.

Table 7: Waste production

Indicator Comments 2008–09 2009–10 2010–11 2011–12 2012–13 Number of sites Five major sites were audited for 66665 audited 2012–13. Total FTE at audited Includes other FTE at audited sites 1,939 1,942 1,928 1,567 1,572 sites Total FTE reported Changes in FTE each year contribute 2,900 2,780 2,836 2,617 2,350 to the quantities of waste reported. Units of waste per FTE by destination Landfill (kg/FTE/yr) Combined values for all audited 7.7 6.4 9 13.1 7.8 sites in each year. Compost (kg/FTE/yr) Combined values for all audited 10.5 10.5 19.1 13.1 10.7 sites in each year. Paper and cardboard Separate paper and cardboard NA NA NA 48.84 47.13 recycling (kg/FTE/yr) collections from 2011–12. Co-mingled recycling Combined values for all audited 64.7 50.5 55.6 10.2 14.9 (kg/FTE/yr) sites in each year. Total waste (kg/FTE/yr) 83 67.5 83.7 85.3 80.5 Total units of waste by destination Landfill (kg/yr) Waste to landfill is only 10 per cent 22,347 17,907 25,411 34,370 18,249 of total waste. Compost (kg/yr) Reduces emissions from the 30,576 29,119 54,263 34,335 25,058 decomposition of organics in landfill. Paper and cardboard A separate paper and cardboard NA NA NA 127,759 110,589 recycling (kg/yr) collection was introduced to some sites in 2011–12. Co-mingled recycling Recycling using a range of available 187,652 140,518 157,613 26,733 35,064 (kg/yr) methods ensures that most waste is not sent to landfill. Total waste (kg/yr) Total estimated waste quantity fell 240,575 187,543 237,287 223,197 188,961 by 15%. Recycling rate The consistently high recycling 91% 90% 89% 85% 90% (% of total waste) rate reflects excellent waste management practices. Greenhouse emissions Since 2011–12 landfill waste 24.8 17.9 22.9 9.3 4.9 from waste to landfill emissions have been calculated using

(tonnes CO2-e) an adjusted emission factor based on the assessed organic content of landfill waste from recent audits. Notes: 1. Waste data is derived from waste audits conducted at five sites, using a one-day (24 hour) sample with values extrapolated based on total reported FTE to estimate total waste quantities for a year. 2. Co-mingled recycling is a mixed recycling stream that can contain plastics, aluminium, steel packaging, composite paper packaging, glass bottles, paper and cardboard.

44 Department of Environment and Primary Industries 2013 Annual Report Transport

Fleet Energy used and associated emissions for passenger car travel fell by about 13 per cent in 2012–13. Kilometres travelled decreased by 18 per cent. Low-emission vehicles including hybrids, LPG cars and four-cylinder cars account for 67.5 per cent of the fleet.

Table 8: Passenger cars

Indicators Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Energy use from passenger The total energy used for 18,384 18,445 15,191 15,115 13,186 vehicles (GJ) car travel decreased by 13% compared with last year.

Total associated greenhouse The total emissions from car 1,305 1,303 1,071 1,029 909

gas emissions (tonnes CO2-e) travel fell by 12%.

Associated greenhouse gas Passenger vehicles efficiency 0.225 0.216 0.183 0.158 0.171

emissions tonnes CO2-e per declined slightly this year, with 1000 kilometres travelled average emissions per kilometres travelled 8% higher than in 2011–12. A higher average fuel use for 6 cylinder wagons and a much lower proportion of use of LPG wagons contributed to this change.

Total passenger vehicle trip The total distance travelled in 5,799,107 6,038,365 5,848,988 6,512,473 5,308,495 kilometres associated with passenger cars fell by 18%. departmental operations (km)

Total unleaded fuel used by Unleaded petrol use fell by 3%. 399,158 379,539 302,492 367,091 355,591 passenger vehicles litres

Percentage of passenger The proportion of low-emission 64.1% 72.9% 77.6% 68.5% 67.5% vehicle fleet as low-emission vehicles in the fleet remained and LPG vehicles. similar to 2011–12.

Note: 1. The above data includes Vic Fleet hire cars.

Department of Environment and Primary Industries 2013 Annual Report 45 Table 9: Vehicle class

Indicators 2008–09 2009–10 2010–11 2011–12 2012–13

4 cylinder less than 1.8 litre

Energy use from passenger vehicles (GJ) 57 NA NA 22 168

Associated greenhouse gas emissions (tonnes CO2-e) 4 NA NA 2 12

Associated greenhouse gas emissions tonnes CO2-e per 1000 0.246 NA NA 0.195 0.213 kilometres travelled

Passenger vehicle trip kilometres associated with departmental 16,983 NA NA 7,927 54,632 operations (km)

Number of vehicles in this class 20013

4 cylinder over 1.8 litre

Energy use from passenger vehicles (GJ) 3,645 4,525 2,000 1,129 727

Associated greenhouse gas emissions (tonnes CO2-e) 266 331 146 79 51

Associated greenhouse gas emissions tonnes CO2-e per 1000 0.227 0.277 0.177 0.159 0.159 kilometres travelled

Passenger vehicle trip kilometres associated with departmental 1,172,202 1,194,803 824,059 494,826 318,448 operations (km)

Number of vehicles in this class 39 40 23 12 12

6 cylinder sedans and wagons

Energy use from passenger vehicles (GJ) 11,470 10,468 9,561 8,728 7,293

Associated greenhouse gas emissions (tonnes CO2-e) 800 722 662 586 499

Associated greenhouse gas emissions tonnes CO2-e per 1000 0.248 0.221 0.201 0.157 0.188 kilometres travelled

Passenger vehicle trip kilometres associated with departmental 3,226,337 3,262,703 3,294,566 3,744,184 2,656,412 operations (km)

Number of vehicles in this class 139 127 37 80 80

Hybrid cars

Energy use from passenger vehicles (GJ) 1,361 1,548 2,017 3,885 3,878

Associated greenhouse gas emissions (tonnes CO2-e) 99 113 147 270 270

Associated greenhouse gas emissions tonnes CO2-e per 1000 0.128 0.122 0.129 0.161 0.149 kilometres travelled

Passenger vehicle trip kilometres associated with departmental 778,202 930,733 1,142,294 1,679,797 1,816,434 operations (km)

Number of vehicles in this class 43 47 60 85 85

Note: 1. The data by vehicle class accounts for department fleet vehicles only and excludes Vic Fleet hire cars use.

46 Department of Environment and Primary Industries 2013 Annual Report Table 10: Passenger fleet composition

Year 2008–09 2009–10 2010–11 2011–12 2012–13

Percentage Percentage Percentage Percentage Percentage Count of total Count of total Count of total Count of total Count of total

Hybrid 43 19.3% 47 22% 60 36.4% 85 47.8% 76 47.5%

LPG 59 26.5% 69 32.2% 45 27.3% 24 13.5% 18 11.3%

4 cylinder cars 41 18.4% 40 18.7% 23 13.9% 13 7.3% 14 8.8%

Other vehicles 80 35.9% 58 27.1% 37 22.4% 56 31.5% 52 32.5%

Total 223 100% 214 100% 165 100% 178 100% 160 100%

Low emission 143 64.1% 156 72.9% 128 77.6% 122 68.5% 108 67.5% and LPG cars

Note: 1. Hybrid cars account for 47.5 per cent of the passenger vehicle fleet.

Air travel Staff air travel covers all domestic and international flights and associated greenhouse gas emissions.

Table 11: Air travel distance and emissions

Indicator 2008–09 2009–10 2010–11 2011–12 2012–13

Greenhouse emissions associated with air travel 1,040 975 800 685 446

(tonnes CO2-e) Distance travelled by air (km) 3,338,632 3,141,250 2,824,560 2,394,013 1,519,398

Notes: 1. Air travel data is sourced from FCM Travel reports. 2. Variation in the total distance travelled by air is directly attributable to necessary operational demands and available transport modes.

Department of Environment and Primary Industries 2013 Annual Report 47 Staff travel The annual Staff Travel survey measures how staff travel to and from the workplace. The 2012–13 survey was conducted in October 2012, attracting 692 responses or 30 per cent of FTE. Reported sustainable travel modes to and from work were at a high rate of 75.6 per cent. Melbourne CBD staff reported the highest use of sustainable travel at 92.6 per cent. The availability of several public transport options enables this high rate to be achieved each year. The lower use of sustainable travel modes for metropolitan and regional staff reflects limited public transport options and high reliance on car travel in regional Victoria. Despite this, sustainable travel in regional locations is gradually increasing.

Table 12: Staff travel modes

Indicator Units Comments 2008–09 2009–10 2010–11 2011–12 2012–13

Percentage of employees regularly (>75% of work attendance days) using public transport, cycling, walking, or car pooling to and from work or working from home, by locality type

Whole of % A high overall use of sustainable transport 78 82.8 77 74.2 75.6 department modes is continuing across the department.

CBD sites % The availability of public transport means 89.8 85.9 93.5 92.8 92.6 higher use of sustainable travel modes at CBD locations.

Metropolitan % Higher rates of car use apply at metropolitan 65.5 56.5 63.2 58.7 67.5 sites locations due to less public transport options.

Regional sites % Sustainable travel for regional sites is 27.1 26.8 33 35.6 36.9 gradually increasing despite limited public transport options.

Note: 1. Data is obtained from the annual Staff Travel Survey. The 2013 survey attracted 692 responses. Sustainable purchasing The department has incorporated sustainable purchasing principles into its procurement policies. The Accredited Purchasing Unit ensures that sustainability considerations are included in the planning procurement stage, tender specifications and in tender evaluation criteria where applicable.

48 Department of Environment and Primary Industries 2013 Annual Report Output performance

This section reports on the delivery of the department’s outputs, including details of key projects and initiatives for the year and performance results against the output measures set out in the 2012–13 Budget Paper No. 3 Service Delivery (BP3).

Structural changes to the department Output performance in 2012–13 during 2012–13 The department’s outputs for 2012–13 contributed to the As a consequence of policy decisions announced by following objectives: government on 9 April 2013, all outputs received from DPI • Effective management of water resources to meet future effective from 1 July 2013, are identified in the table below. urban, rural and environmental needs. As DPI continued to have responsibility for the outputs • The community benefits from effective management of until 30 June 2013, this report of operations presents the Victoria’s land assets. full year performance of the outputs of this department as specified in the 2012–13 Budget only, and does not • Effective environmental and climate change policy, include performance against the outputs transferred to the investment and regulation. department as per the below table. For full year performance • Reduced impact of major bushfires and other extreme of the outputs identified below, please refer to the DPI events on people, infrastructure and the environment. Annual Report. Of the 61 quality, quantity, timeliness and cost targets Date of specified in the 2012–13 State Budget, 79 per cent were 2012–13 Transferred Administrative met (within 5 per cent of target) or were exceeded, while Outputs from Arrangement 21 per cent were not met. The tables report on actual performance against State Budget output targets. Notes Primary Industries Department 3 June 2013 explain significant variations between the 2012–13 targets Policy of Primary and actuals. Industries Regulation and Compliance Changes to the output structure Strategic and Applied In 2012–13 the department continued to make improvements Scientific Research to output performance reporting by consolidating the output Practice Change structure to better reflect departmental service delivery and enhancing the quality of its performance measures. For 2012–13 the output Sustainable Water Management and Supply was changed to Effective Water Management and Supply.

Department of Environment and Primary Industries 2013 Annual Report 49 Effective management of water resources to meet future urban, rural and environmental needs

This objective will deliver on increasing the efficiency of supply and use of water in cities and towns, make a more sustainable irrigation industry, and deliver a transition strategy for the Murray-Darling Basin Plan that balances social, economic and environmental needs. In addition, this objective will improve environmental conditions and waterways supporting community needs.

Developing a new strategy for managing The community and industry were invited to provide feedback and regional information sessions were conducted Victoria’s waterways at ten locations across the state. The sessions also allowed A new waterway management strategy for Victoria is being people and organisations to ask questions about key policy finalised after several stages of development and a strong directions before making their submissions. program of stakeholder consultation. A feedback report was prepared, outlining the key The strategy aims to manage waterways during the next comments and themes from submissions to incorporate eight years to improve the health of rivers, estuaries and into the final strategy. More than 1150 comments from 78 wetlands. It will replace the Victorian River Health Strategy. formal submissions will be considered in developing the final strategy. In developing the strategy, the department began a major period of consultation when the Minister for Water and the The strategy will outline the key directions for waterway Minister for Environment and Climate Change released management in Victoria until 2021, including: the draft strategy on 29 October 2012 for six weeks • a vision, guiding principles and management approach consultation. • an integrated approach for managing rivers, estuaries The draft strategy describing the proposed policy and wetlands for waterway management included: • a framework for regional decision-making with community • guidance on regional decision-making input • investment • an adaptive and flexible approach to address challenges • management issues of drought, flood, bushfire and the potential impacts of climate change • roles and responsibilities of management agencies. • aspirational targets for on-ground works and improved waterway condition in priority areas • specific actions to deliver improved waterway management.

50 Department of Environment and Primary Industries 2013 Annual Report Victoria leads states on Murray-Darling Basin progress

On 5 June 2013, Victoria became the first participating state to • delivering a plan that balances the interests of Basin sign the Inter-Governmental Agreement on Implementing Water communities, irrigators, and the environment and is balanced Reform in the Murray-Darling Basin and an associated funding between the states agreement. • a preference for strategic buyback aligned to modernisation, The historic signing follows several years of the department rather than non-strategic general buyback that carves up leading Victoria’s negotiations for an acceptable Murray-Darling irrigation communities with little cohesion or thought for the Basin Plan. The two agreements signed in June by the Premier future. settle the responsibilities and costs of putting the plan into During the course of negotiations, Victoria achieved several key action, providing Victoria with: inclusions in the plan, including:

• $14.3 million over three years to develop offset projects to • Apportionment between the states: assigning each state a reduce the volume of water required to be recovered from clear contribution of how much water they need to return to productive use under the plan the environment. • $47.4 million over eight years for costs associated with • An adjustment mechanism for environmental offsets: implementing the plan recognising and accounting for works and measures and • a commitment from the Commonwealth to consult with smarter river operations to reduce the amount of water states on the details of a $100 million Murray-Darling Basin needing to be recovered, for similar environmental benefits, Regional Economic Diversification Program, to provide by up to 650 GL. assistance to communities affected by the plan. Victoria’s share of the 2750 GL water recovery under the plan, These funding agreements are in addition to existing before offsets from the adjustment mechanism, is 1075 GL. By Commonwealth commitments for planned water recovery in 31 December 2012 about 751 GL had either been recovered northern Victoria, including: or committed to be recovered in Victoria, leaving 324.3 GL remaining to be either returned to the environment as water, • $1.2 billion for the Goulburn-Murray Water Connections or achieved as offsets. Project, with 214 gigalitres (GL) to go to the Commonwealth, and a further 25 – 50 GL of strategic purchase to occur, Victoria has shown that the best environmental outcomes are aligned with the rollout of this project achieved by combining the active use of an environmental water • buying the Wimmera Irrigation System’s 23 GL of water entitlement with works such as regulators, pipes and pumps to give wetlands and floodplains a drink, particularly in a regulated • in principle agreement to fund $103 million for Sunraysia system like the Murray. modernisation, with 7 GL to go to the Commonwealth • up to $100 million for a new Victorian on-farm program. For example, Lindsay Island in the Murray Sunset National Park will be Victoria’s first project to recover water for the environment The department’s efforts were instrumental in producing a final using the adjustment mechanism. This project will provide Basin Plan that reflects concessions and improvements on benefits to around 6000 hectares of floodplain, wetlands and proposals from earlier drafts. creek lines and will be capable of simulating floods of 80,000 to For Victoria, the focus now is to finalise its offset proposals 130,000 megalitres (ML) per day, for around $56 million. and work with the Murray-Darling Basin Authority to settle Subject to the Lindsay Island project being approved under the implementation arrangements for the plan, including adjustment mechanism, Commonwealth funds will be made determining the final Sustainable Diversion Limits for northern available for the project, to the market value of the water offset Victoria as a result of operation of the adjustment mechanism. it will achieve, subject to due diligence.

Plan becomes law Other environmental projects that will be put forward by The Murray-Darling Basin Plan was signed into law by the Victoria for consideration under the adjustment mechanism Commonwealth Minister for Water in November 2012, signifying include Wallpolla Island, Hattah, Nyah-Vinifera, Belsar-Yungera the completion of a five-year journey from when its preparation and Guttram-Benwell floodplains, and the Upper Gunbower was legislated through the Commonwealth Water Act 2007. Floodplain project.

The plan sets a legal limit on the amount of surface water and groundwater that can be taken from Victoria’s share of the Murray-Darling Basin from 1 July 2019. Across the Basin, the plan allows for 2750 GL a year of environmental outcomes.

Throughout the process, the Victorian Government negotiated vigorously with the Commonwealth to achieve environmental outcomes in a way that will support regional communities, campaigning for:

• smarter use of water, rather than the return of a specific volume of water • minimising impacts on regional communities by recovering water through modernising irrigation systems and farms, rather than by cuts in water entitlements held by irrigators • getting better outcomes through water already returned to Gunbower wetlands. Photo by Alison Pouliot the environment, through works and smart river operations

Department of Environment and Primary Industries 2013 Annual Report 51 Melbourne’s Water Future The government’s plan for water includes a vision to Strategy will provide multiple benefits establish Victoria as a leader in liveable cities and integrated water cycle management. Melbourne’s Water Future will lower costs, provide secure, resilient and flexible drinking water To help deliver this policy, the Minister for Water appointed supplies, improve the environment and keep our a Ministerial Advisory Council (MAC) in early 2011 to neighbourhoods green by: independently advise the government. • engaging the community in integrated water In providing this advice, the MAC prepared a Living cycle management Melbourne, Living Victoria Implementation Plan. Comprehensive systems analysis demonstrated that a • designing our old and new suburbs with water new approach to water cycle planning and management in mind would have significant cost, environmental and liveability • encouraging sensible use of water in our homes advantages. and businesses In April 2012, the government released its response to the • building resilient water systems that work well MAC’s Living Melbourne, Living Victoria Implementation during flood and drought Plan. The government’s response included establishing the Office of Living Victoria (OLV) to drive the reform needed to • improving the health of natural waterways achieve the vision of ‘a smart resilient water system for a • reducing inefficiency and waste liveable, sustainable and productive Melbourne’. • accelerating water innovation and world OLV subsequently developed a draft strategy Melbourne’s recognition of expertise. Water Future to deliver this vision. The strategy signals a new era in water cycle planning and management – a major Based on the MAC systems analysis, the key change from the traditional approach of developing major benefits of the strategy to 2050 include: engineering infrastructure such as dams and desalination • total savings of around $6–7 billion in net present plants to augment water supply. value terms – a reduction of about 10–15 per cent Melbourne’s Water Future proposes a range of solutions in annual water sector costs to overcome increasing pressures on water supply, such • a reduction in demand for mains water of up to as droughts and floods, as well as a growing population 45 per cent, along with significant reductions in consuming more water and discharging more wastewater. wastewater discharge and the peaks in system Melbourne’s Water Future seeks to value and use the rain flows that falls on Melbourne. Melbourne’s stormwater runoff is • a reduction in energy use across the water sector greater than the volume used from the city’s dams and can by up to 35 per cent, with emissions savings of up provide both an alternative water supply for non-drinking to one million tonnes of carbon dioxide purposes – such as flushing toilets and watering parks and gardens – and a healthy flow to waterways. • healthier waterways due to nutrient discharge reductions of up to 20 per cent, and stormwater After further consultation in the second half of 2013, runoff reductions of up to 40 per cent. the final strategy is expected to be released in late 2013.

52 Department of Environment and Primary Industries 2013 Annual Report Desalinated water now available The project’s independently chaired Community Liaison Group brought together council and community Water is now available for Melbourne and some surrounding representatives with the department, AquaSure and its regional areas after comprehensive commissioning of the construction contractors. Victorian Desalination Project (VDP). The project workforce peaked at 4300 and, overall, about As the Wonthaggi plant undergoes close-out phase, the 10,500 people were employed throughout construction. department’s Capital Projects Division has continued to manage delivery of the VDP – Victoria’s largest Public Private A key initiative was the Housing Accord coordinated by Bass Partnership. Coast Shire Council and the construction contractor with support funding from the department. The program located In 2012–13, Capital Projects focused on ensuring hundreds of holiday homes not previously available for long commissioning was completed to contract requirements, term rent to accommodate workers and limit potential rent along with delivering savings for Melbourne water consumers. increases for local people. On 17 December 2012, project builder AquaSure completed In April 2013, the plant was judged the Global Water Awards’ a comprehensive commissioning program for the plant, Desalination Plant of the Year. marine structures, pipeline and power supply, achieving the contract milestone of Reliability Testing Finalisation. The plant was run at various rates up to its 150 billion litre capacity and proved that the water produced met high quality contractual requirements before being transferred into Melbourne’s network. The final product met all contractual, health and drinking water regulation requirements. The plant is now being put into preservation mode by AquaSure for response to a water order if required. With Melbourne’s storages in a strong position, the government determined that water would not be ordered for the 2012–13 or 2013–14 financial years. Even when the plant is not producing water, the 84 kilometre underground pipeline connecting the plant to Melbourne’s The Victorian desalination plant water system can transfer Cardinia Reservoir water back along its length to allow security of water supply to regional communities such as Westernport Water and South Gippsland Water, which previously were not connected to School Water Efficiency Program Melbourne’s water network. South East Water can also wins Award connect to the transfer pipeline. The Schools Water Efficiency Program (SWEP), The project savings of $13 million a year for the remaining 27 developed by the department and the Department of years of the contract have been secured on future payments. Education and Early Childhood Development, won The contract for operating the plant’s power supply was an Australian Water Association Award in December negotiated at a lower cost than originally budgeted in 2009 2012. The award also recognised the innovative and insurance was secured cheaper than originally forecast. use of data logging, website activity and tailored After commissioning, Capital Projects managed completion curriculum resources to make the information of the sale of licensing rights for the project’s 87 kilometre accessible to staff and students. underground 220kV power supply. SWEP is a voluntary program that helps schools In close-out phase after the successful commissioning, continuously track their water consumption and the final, non-operational construction activities are being allows students to analyse the information in their completed. This includes the last elements of planting and class room. More than 100 schools have signed landscaping on the 225 hectare ecological reserve that up for the three-year program, which is open to all surrounds and camouflages the plant site. schools in Victoria, and enables them to detect and rectify leaks and help reduce water use. Revegetating land around the plant that was formerly used for farming and mining is providing revitalised habitats for flora and fauna and will soon be open to the public for walking trails, boardwalks and other recreational facilities. The opening up of land around the plant continues close involvement with the community. During design and construction, Capital Projects undertook extensive stakeholder engagement with agencies, regulators, councils and communities in a range of forums. Thousands of people have visited the plant site and information centre and participated in forums and presentations.

Department of Environment and Primary Industries 2013 Annual Report 53 Effective Water Management and Supply This output develops policies, provides oversight of, and strategic advice on, regulatory systems and institutional arrangements to drive the effective management and efficient use of Victoria’s water resources. Key areas include river health, sustainable irrigation, ground and surface water, water reuse and recycling, and water sector agency governance and pricing.

Output results: Effective Water Management and Supply

Unit of 2012–13 2012–13 Performance measures measure Target Actual Quantity Compliance with the Murray-Darling Basin Agreement to maintain a balance in the Salinity number >0 27.5 Register such that the total of salinity credits is in excess of, or equal to, the total of salinity debits Cumulative water savings (permanent reduction in irrigation distribution system delivery losses) megalitres 695,900 626,400 realised through water recovery projects The lower actual compared to the target is mainly due to the rescheduling of works in line with the revised business cases for Stages 1 and 2 of the Connections Project. There has also been a delay in the recognition of approximately 11 gigalitres of savings for some residual works. These savings, to be recognised for the Victorian Government investment in the Shepparton irrigation area modernisation, will also be included in the annual audit of water savings in January 2014. Estimated net reduction in total load of nitrogen and phosphorus in urban and rural water number 17.5 4.3 systems (tonnes) The 2012–13 actual is lower than the 2012–13 target due to a reprioritisation of works away from this activity towards streamside zone activities. Length of river where works have been undertaken to stabilise bank erosion km 40 11 The 2012–13 actual is lower than the 2012–13 target due to a reprioritisation of works away from this activity towards streamside zone activities. Length of river where works have been undertaken, or river frontage protected, km 168 1,041 to improve the vegetation in the streamside zone The 2012–13 actual is significantly higher than the 2012–13 target due to a reprioritisation of works towards this activity due to favourable Spring planting conditions, allocation of additional funding from the Regional Growth Fund, and an improved community engagement approach enabling greater take up of works orders. Length of rivers where works have been undertaken to improve instream health km 230 371 The 2012–13 actual is higher than the 2012–13 target due to inclusion of outputs from an additional carp control program in the second half of the year. Living Victoria Program recommendations implemented per cent 50 50 Other Victorian retail water entitlements (including licences to take and use water and other per cent 73.5 73.6 miscellaneous entitlements) recorded in the water register

Rebates approved for small business for improved water efficiency number 3,000 690 The 2012–13 actual is lower than the 2012–13 target due to lower than anticipated demand from more relaxed water restrictions. Rebates approved to households for improved water efficiency in the house and garden number 30,000 16,200 The 2012–13 actual is lower than the 2012–13 target due to lower than anticipated demand from more relaxed water restrictions. River reaches and wetland systems where environmental water has been delivered to replicate number 32 85 natural flow regimes and meet environmental objectives The 2012–13 actual exceeded the target primarily due to the improvement in river conditions associated with the return to average rainfall after two seasons of flooding. Better river conditions have enabled better delivery of environmental water. Victorian water shares (entitlements to a share of water in large rural storages) recorded in the per cent 100 100 water register Water information products delivered for greater accountability in sustainable water resource number 5 5 management Quality Bulk water entitlements/environmental entitlements being complied with to ensure security of per cent 100 100 supply, environmental flows and compliance with caps Timeliness Statutory obligations of Water Corporations complied with, including annual reports and audits, per cent 100 100 corporate plans, and exercises under the Terrorism (Community Protection) Act 2003 Cost Total output cost $ million 278.1 261.7 The lower than anticipated output cost is due to lower than anticipated revenue for the Goulburn-Murray Water Connections project.

54 Department of Environment and Primary Industries 2013 Annual Report The community benefits from effective management of Victoria’s land assets

This objective delivers land management supporting social, environmental and economic outcomes, provides effective governance and management of public land and quality land administration services and information.

Popular bush track rebuilt Roads and bridges repair program Works to repair flood and fire damage were a feature of this A popular four-wheel drive track – a Bourke Street of year’s works program by the department’s State Roads and the bush in north-east Victoria – was the subject of a Bridges group. Flood repairs were the major activity and $2.05 million works program in 2012–13 as part of the included: department’s roads and bridges repair program. • three bridge repairs The 39-kilometre Circuit Road track, near Mt Buller and Mansfield, provides access to popular four-wheel drive, • four ford repairs camping and fishing areas such as the top of the Howqua • 12 logfill replacements River and the King River Valley. The track also provides critical fire fighting access around Mt Stirling and access to • 21 slip repairs totalling 350 metres large areas of state forest in this area, including Craigs Hut – • 39 culvert repairs or replacements as seen in the movie The Man from Snowy River. • 66 other repairs to roads totalling 271 kilometres. The track was badly damaged along its entire length in the September 2010 floods with the devastation in many parts Repair and replacement work on flood damaged assets described as catastrophic. The track’s infrastructure, such scheduled for 2013–14 include the repair and replacement as culverts and road surface, were overwhelmed in the of several bridges in the North East and Gippsland, the heavy rain and resultant land slips. repair of some major slips in Gippsland and the repair and replacement of several damaged crossings near Mt Cole Rebuilding the road on a firm base required excavation of and Creswick. damaged areas and any saturated fill that was no longer suitable to hold up the road. As well as these larger repair and replacement works, regions and districts will continue to repair less complex damaged Work occurred at several sites including the vital Mt Stirling road assets and sites. creek crossing which was totally destroyed by a large landslip. Another $1 million worth of repairs to complete the track works has been put out to tender. In other major projects, a 40-metre concrete bridge was built at Dandongadale over the Buffalo River to replace the old timber structure burnt in the 2006–07 fires. The bridge provides critical access to the area to the west and south of Mt Buffalo and also to critical infrastructure – high voltage transmission lines.

Dandongadale Bridge over the Buffalo River

Department of Environment and Primary Industries 2013 Annual Report 55 Helping local communities rebuild after floods

The Newbridge Recreation Reserve is a feature of the Newbridge, Cardross and Hepburn Springs are among small central Victorian town – and a showpiece for more than 130 reserves across the state benefitting from community and government partnerships – after a major a repair and rebuilding program that has been restoring rebuild to repair flood damage. community assets severely damaged in the 2011 floods. Newbridge now has a modern and multi-purpose facility after a $2 million works program and hundreds of hours of community activity, supported by staff from the North West Public Land Team. The reserve now features a rebuilt pavilion, four new tennis courts, a new cricket pitch and net, scoreboard, goal posts, coaches’ boxes, seating, fencing, shedding, bollards and toilets. Roads and power have also been upgraded. There is a similar success story at Cardross where the town’s community complex has undergone a $1.5 million rebuild after being devastated in the February 2011 floods. The rebuild of the community complex includes club rooms, change rooms and social rooms, replacing two netball courts, repairing the oval and replacing the playground.

Hepburn Pool after repairs. Photo courtesy of the Flood Recovery 2I¿FH+HSEXUQ6KLUH&RXQFLO

The projects range from minor works of $748 to $3.2 million major initiatives. The works program is drawing on $22 million allocated from the State Government’s $30 million Flood Recovery for Community Infrastructure Fund. The department is administering the funding that aims to assist committees to reinstate or rebuild community facilities on Crown land reserves. Across the state more than 180 projects received funding. The department’s Public Land Project Officers have been involved every step of the way, from helping with the initial identification of damage to assets and filling out reports to assisting with funding submissions. They also spent many hours attending committee meetings and providing advice to help local communities rebuild The Newbridge multi-function pavilion facilities, which are central to town life.

The local committee of management for the Murtoa Showyards received $161,000 to repair the netball courts and change rooms damaged during the floods. For Murtoa, a township of 912 in the Wimmera district, the netball courts and other sporting facilities represent a valuable community asset. Community buildings and infrastructure were extensively damaged across parts of the Pyrenees and Hepburn shires with each shire receiving more than $2 million for a number of flood recovery projects. One of the largest projects to receive funding was for works at the Hepburn Mineral Springs Reserve, an important heritage, recreational and tourist destination. During the floods, trees came down, there was a major landslip onto the carpark and many walls, paths and other structures were damaged. Works include repair and reconstruction of several dry stone walls, retaining walls, the creek bed, :\XQD&KDQQHODIWHUUHSDLUV3KRWRFRXUWHV\RIWKH)ORRG access roads and pathways. 5HFRYHU\2I¿FH+HSEXUQ6KLUH&RXQFLO

56 Department of Environment and Primary Industries 2013 Annual Report Gunaikurnai and Yorta Yorta Traditional Mt Buffalo Chalet redevelopment Owner Land Management Boards The Mt Buffalo chalet, located in the Mt Buffalo National The department is continuing to work with Traditional Owner Park, has been closed since 2007 following extensive groups and support the integration of indigenous knowledge bushfires in the Alps that impacted the national park. into land and resource management. In May 2013 the Victorian Government announced plans The Gunaikurnai Traditional Owner Land Management Board to proceed with a development of the Mt Buffalo Chalet to was established in October 2012. Over the next three years, provide a day visitor facility and possibly a café. This involves the board will draft a joint management plan for 10 areas of refurbishment of the most historically significant parts of the land in Gippsland, including the Gippsland Lakes Coastal building and the removal of the more recent additions at the Park and the Lakes National Park. This plan will integrate rear of the chalet. Gunaikurnai traditional knowledge and perspectives into The decision was made after an extensive public land management planning. In addition, a joint management consultation process during 2012 which highlighted strong employment program commenced, involving the employment community support for the reopening of the chalet. of Gunaikurnai people to work on the jointly managed land, undertaking environmental and cultural works, in cooperation The department is working closely with Parks Victoria, the with Parks Victoria. These two initiatives are enabling Alpine Shire Council and other partners to scope the project involvement of Gunaikurnai people in management of land at and obtain the relevant planning and heritage permits both the strategic and operational levels. to commence works. Some urgent works to protect the historic integrity of the building have commenced and these The department is also working with Yorta Yorta People will be completed by early spring 2013. to incorporate their knowledge into land management practices. The Yorta Yorta Traditional Owner Land The refurbishment of the chalet and development of the Management Board was established in July 2013 and the day visitor facility aims to make the site ready for further first members have been appointed. This board will draft a redevelopment when the opportunity arises. The regional joint management plan over Barmah National Park, an area information centre is expected to be operating at the chalet of high significance to the Yorta Yorta. from 2014.

Lighthouse land moves to new management Walk into History Trail upgrade Two historic lighthouse reserves in Queenscliff and Point The popular Walk into History, near Warburton in the Yarra Lonsdale have been handed over to Victoria’s smallest State Forest was upgraded during 2012–13 as part of a council – the Borough of Queenscliffe – after more than four program to improve recreational opportunities in regional years handover preparation by the department. communities and to promote physical activities for all Victorians. The preparation included demolishing unused, dilapidated buildings on the nine-hectare site to give the borough clean The 36-kilometre Walk into History Trail in native forest sites for a variety of uses. between Powelltown and Big Pats Creek follows old timber tramway routes, past old mills and other relics of The Queenscliff Lighthouse Reserve and the Point Lonsdale the early timber industry and includes many gully and Lighthouse Reserve, on the Bellarine Peninsula, could now stream crossings. The old timber structures spanning these become a mix of eco-accommodation, retail hospitality crossings have gradually disintegrated, leaving walkers with facilities, open public space and community facilities. some tricky and often muddy crossings. Until the handover in November 2012, DEPI staff and Upgrade works included the replacement of seven crossings one council representative served as the committee of over swamps and streams with new single log bridges. management. The reserves were originally used to provide This required intricate engineering to ensure longevity and accommodation to lighthouse keepers and their families. A aesthetic value, with the end result enhancing the historic number of lighthouse keepers were required for the manual nature of the walk. operations of the oil, gas and finally electrical lights at each lightstation, including the fog horn at Point Lonsdale. The camp site at the Ada No.2 Mill was also redeveloped with input from Bushwalking Victoria and Caulfield Grammar, The reserves on which the houses were located were which takes approximately 400 students through the Walk surrendered to the Crown in 1997 by the Port of Melbourne into History each year. Corporation. In keeping with the camp’s historical setting, relics and The council, as the new committee of management, will materials found on the site, including old wheels and boiler commission a feasibility study into developing the sites. parts from the sawmills, were used in the design and The lighthouses and their surrounds have a long history construction of new camp site facilities, including seating, and great significance in the area. They overlook the narrow fire pits and a food preparation table. All materials, including entrance to Port Phillip Bay, known as the Rip, one of the the recycled timber, had to be carried in by hand. most notorious entrances to any bay in the world. New camping platforms were built and food boxes were also A wooden lighthouse was originally built on the site at Point erected as possums forage for food at this site. Lonsdale in 1863 and replaced by the current structure Victoria has more than 200 tracks and 388 visitor sites such in 1912. Point Lonsdale is thought to be the last manned as picnic areas, camping areas and lookouts within state lighthouse in Australia, keeping a 24-hour vigil over the forest areas. entrance to the bay. The Queenscliff lighthouse, built in 1856, is now automated and unmanned.

Department of Environment and Primary Industries 2013 Annual Report 57 The department is also progressively replacing signage The transfer of historical titles covers mining leases, Crown at walking tracks as part of the rollout of the new Australian leases and freehold titles, and is one of the largest transfers Walking Track Grading System. The uniform grading system to Public Record Office Victoria. The transfer will take up to provides simple and consistent signage so walkers can two years. choose tracks that are suitable to their skills and level of The first records off the removal truck included the first fitness. land title registered in Victoria under the Torrens title system – Volume 1 Folio 001 – which was to a ‘dairyman’ in Ravenswood, Victoria in January 1863. Land Victoria also hosted the Australasian Registrars Conference at the Hotel Windsor from 2–5 October. Delegates came from Scotland, Jamaica, Mauritius, Malaysia, Singapore, Canada and New Zealand and Australian jurisdictions. A celebratory Torrens dinner at Myer Mural Hall on 4 October attracted 160 guests. The Governor, the Hon Alex Chernov, was the main guest and speaker. Former DSE Secretary Greg Wilson attended along with Murray Thompson MLA. Former and current Land Victoria staff joined guests from the property, legal, finance and conveyancing areas as well as academia, other government departments and registries. A framed copy of the oldest Victorian Torrens title, where the Ada No.2 camping area on the Walk into History Trail. Photo by land remains in its original configuration (Volume 1 Folio 7), was &KULVWLDQ3HDUVRQ0LVKH\H presented to the Mayor of Golden Plains Shire Council, the shire between Geelong and Ballarat where the land is located. New seawall to protect the coast The original title is now held by Public Record Office Victoria. at Merricks Creek Land Victoria partnered with professional bodies to present Community concern about a failing timber seawall at a series of awards as part of the Torrens anniversary Merricks Creek in Somers led to major repairs as part of celebrations. The first was the Victorian Young Property the Protection of Port Phillip Bay Beaches and Foreshores Lawyer of the Year Award, presented to Gippsland lawyer program. Belinda Wilson. Other awards were presented to university students, conveyancers and surveyors. Following reports from the local community that the timber seawall at Merricks Creek in Somers was failing and needed to be replaced the department undertook work to remove the damaged timber and build a new rock seawall. The Sir Rupert Hamer Records project was completed in October 2012. Management Awards The new 75-metre long retaining seawall has been built to withstand strong tidal movements and waves caused by Land Victoria won the most valuable transfer to one-in-50-year storms. Public Record Office Victoria at the Sir Rupert Hamer Records Management Awards in May 2013. The seawall will also provide improved protection for the abutting sand dunes and foreshore vegetation, and The awards, now in their 15th year, recognise importantly preserves a wonderful recreation area for the excellence and innovation in records management public to use. within the Victorian public sector, and seek to highlight the importance of good recordkeeping in Celebrating 150 years of Torrens title ensuring the effective accountability of governments and the efficient operation of public administration in in Victoria Victoria. Land Victoria’s celebration of 150 years of using the Torrens The award was received for the transfer of Victoria’s title system for secure and reliable property transactions 3.8 million paper land titles, including Crown peaked in October 2012 with a week of activities including a grants, titles and leases to Public Record Office seminar, celebratory dinner and award presentations. Victoria. This will ensure the preservation of the The official 150th ‘birthday’ of the Torrens system – on state’s historic paper title records that are now also Tuesday 2 October 2012 – was celebrated with a seminar, available as electronic records. Land Titling – Past, Present and Future, featuring speakers from academia, industry and overseas land registries. The same day saw the start of the transfer of 3.8 million paper records from Land Victoria’s Laverton facility to Public Record Office Victoria’s specialist storage facilities in North Melbourne.

58 Department of Environment and Primary Industries 2013 Annual Report Public Land This output provides for the management of Victoria’s Crown land, including the coast and marine environments. It works towards the improved stewardship of natural, built and historic assets, and incorporates management of public land in partnership with statutory agencies, committees and local government. It recognises the value of a public land estate that can adapt to climate change and cater for community expectations.

Output results: Public Land

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Crown land leases directly managed by the Department of Environment and Primary number 684 704 Industries

Crown land licenses directly managed by the Department of Environment and Primary number 43 44 Industries (‘000)

Number of activities undertaken by Coastcare Victoria participants number 600 600

Threatened native species and communities for which specifically targeted conservation number 8 8 measures are in place at Royal Botanic Gardens

Visitors to Zoos Victoria at Melbourne, Werribee and Healesville number 1.85 2 (million)

The 2012–13 actual exceeded the target primarily due to the government’s Free Zoos for Children Under 16 policy and new exhibits.

Quality

Foreshore protection assets around Port Phillip and Western Port bays rated as ‘good’ to per cent 80 55 ‘very good’ condition

The 2012–13 actual is lower than the 2012–13 target due to a focus on maintenance works to ensure end-of-life assets perform as required as many of the foreshore protection assets have reached this stage. An investigation is underway by Parks Victoria to determine the best approaches for adaption of assets for sea level rises, in line with the new Coastal Environments Program.

Publicly elected committees of management that have a current statutory appointment per cent 95 95

Timeliness

Rent reviews of Crown land leases undertaken within specified time frames per cent 95 100

Cost

Total output cost $ million 107.5 109.9

Department of Environment and Primary Industries 2013 Annual Report 59 Forests and Parks This output provides for the management of Victoria’s state run parks and forests. Through this output, the department manages the balance between development and protection of natural, cultural and community assets for enjoyment and sustainable use. This output works towards the improved stewardship of Victoria’s parks and forests and incorporates direct and delegated management of public land.

Output results: Forests and Parks

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Number of hectares treated to minimise the impact of pest plants, pest animals and hectares 1,309 1,387 overabundant native animals in parks managed by Parks Victoria

Number of visits to Parks Victoria managed estate number 88–92 96 (million)

Total area of estate managed by Parks Victoria hectares 4,084 4,116 (‘000)

Quality

Bay assets rated in average to excellent condition per cent 65 66

Level of compliance with environmental regulatory framework for commercial timber per cent 90 90 operations as required by the Forest Audit Program

Park assets rated in average to excellent condition per cent 80 80.3

Recreational facilities in state forests with a life expectancy greater than five years per cent 70 72

Cost

Total output cost $ million 179.6 199.0

The higher than anticipated output cost is due to the revision of depreciation costs.

60 Department of Environment and Primary Industries 2013 Annual Report Land Administration and Property Information Through this output, the department is working towards ensuring: confidence in the integrity and efficiency of the property system; accessible and transparent property markets; established and accepted natural resource markets; and comprehensive and accessible spatial information to support planning and decision making.

Output results: Land Administration and Property Information

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Maps generated on Land Channel number 19,000 19,000 (‘000)

Planning certificates issued number 35 42 (‘000)

Property transfers, discharge of mortgages and registration of new mortgages number 680 670 (‘000)

Proportion of title searches supplied (remotely) online per cent 96 96

Reports generated on Land Channel number 1,800 1,800 (‘000)

Title searches supplied number 2,180 2,169 (‘000)

Quality

Audited Vicmap digital map base not requiring correction per cent 97 97

Government owned properties sold, bought or leased within 10 per cent of valuation per cent 80 85

Timeliness

Land dealings registered within five days per cent 95 95

New titles (subdivisions) created within three weeks per cent 95 95

Update transactions for the Vicmap digital map base processed within the required per cent 98 98 timeframes

Cost

Total output cost $ million 125.3 120.0

Department of Environment and Primary Industries 2013 Annual Report 61 Effective environmental and climate change policy, investment and regulation

This objective delivers support for local communities and landholders engaged in environmental works, improves the transparency and delivery of environmental regulation, provides effective governance and investment in environmental programs and provides effective policy for environmental outcomes and resource efficiency.

Partnerships aim to boost environment The department is already successfully partnering with the community, local government and industry through a range and the economy of initiatives, including the Communities for Nature grants Environmental Partnerships is building a new active program, which helps community groups undertake on- approach to government, communities and businesses ground environmental works, and the Victorian Adaptation working together to maintain a healthy environment while and Sustainability Partnership, which supports local securing a competitive economy. government to build local capacity to adapt to a changing environment. This key policy document, produced by the department, is based on three aspirations: Environmental Partnerships forms a platform for ongoing communication and engagement with the community and • value the environment and what it has to offer the department’s key stakeholders. • act to protect, conserve and maintain the environment The department and its portfolio agencies will continue to • enjoy the wide range of benefits of a healthy environment progress the actions and approaches outlined in the policy. now and into the future. While emphasising the importance of partnerships to achieve A Cleaner Yarra River and Port Phillip Bay environmental outcomes, Environmental Partnerships clearly The health of the Yarra River and Port Phillip Bay is the focus articulates the government’s approach to maintaining a of a new action plan that identifies 17 priority actions. resilient, healthy environment. A Cleaner Yarra River and Port Phillip Bay plan sets out The Minister for Environment and Climate Change launched investment, action and responsibility to improve the the new approach in November 2012 as the Victorian quality of the Yarra and the bay. Councils, business and Government’s overarching approach to the environment. the community are all part of the plan. It will coordinate The document establishes clear priorities and sets the investment of $1 billion in river health and sewage and direction for the department’s work. The focus includes: stormwater management over the next five years. • maintaining healthy biodiversity and productive landscapes The plan was developed by a Victorian Government taskforce, led by the department. The Minister for • managing parks and other public land for the benefit of Environment and Climate Change appointed the taskforce the community to bring together the key organisations involved in managing the environmental health of waterways. • improving waste management The plan is coordinating action to deliver benefits for the • managing risks to communities and landscape from Yarra and bay and encouraging the community to play a bushfire and flood role. For example, more than 10,000 cubic metres of litter • ensuring accountable and efficient environment and organic debris from 160 traps is collected along the river agencies through stronger governance and continuous and bay every year. improvement.

62 Department of Environment and Primary Industries 2013 Annual Report A Cleaner Yarra River and Port Phillip Bay sets four key Under the strategy, developers of land released within priorities: Melbourne’s urban growth corridors will contribute nearly $1 billion over 30 years to protect threatened flora and • clearer, more responsive management fauna, while saving around $500 million in costs through • preventing pollution and reducing litter a more streamlined environmental approvals process. • providing user-friendly, accessible information The strategy also provides funds to create the Western Grasslands Reserve on Melbourne’s ‘doorstep’ and • supporting Victorians to care for and protect our iconic establish new conservation reserves and public open space. river and bay, including litter prevention and clean-up. The strategy will create: The projects are being supported by the Victorian Government’s $20 million Communities for Nature program. • 36 conservation reserves within the Urban Growth The plan’s 17 new priority actions include: Boundary comprising about 5700 hectares, including around 3000 hectares of land along major waterways to • identifying litter hotspots and forming community protect and restore habitat for the Growling Grass Frog partnerships to reduce litter (Litoria raniformis) • working with catchment managers to improve water • 1600 hectares of new reserves outside the Urban Growth quality at beaches in Port Phillip Bay Boundary across rural Victoria • better coordinating the work of agencies responsible for • 15,000 hectare Western Grasslands Reserve that extends protecting the waterways from Mt Cottrell, south east of Melton to north of Little • investigating and trialling improved early warning and River, west of Werribee community information programs for sewage spills and • 1200 hectare grassy woodland reserve outside the Urban leaks affecting waterways Growth Boundary south west of Whittlesea. • improving key water quality monitoring programs, such Several species including the Growling Grass Frog, Golden as the EPA’s Beach Report Sun Moth (Synemon plana), Spiny Rice-flower (Pimelea • supporting Victorians to take action to protect water spinescens), the Southern Brown Bandicoot (Isoodon quality and reduce litter and encouraging environmental obesulus) and the Matted Flax-lily (Dianella amoena) will citizenship. benefit from the strategy. The strategy will ensure large scale projects can proceed New Biodiversity Conservation Strategy under the Commonwealth Environment Protection and for Melbourne’s urban growth corridors Biodiversity Conservation Act 1999. The expansion of Melbourne’s four urban growth corridors has been comprehensively planned alongside the protection Victoria’s native vegetation permitted of threatened species in a historic strategy released by clearing regulations the government. A department review of native vegetation permitted clearing The Biodiversity Conservation Strategy – developed by the regulations has paved the way for Victoria to deliver better department and launched by the Environment and Climate targeted environmental outcomes and greater certainty and Change Minister in May 2013 – provides a range of benefits lower costs for landholders and the community. to the environment and the community, including greater The outcome of the review, Reforms to Victoria’s native planning certainty, improved biodiversity outcomes and vegetation permitted clearing regulation, were released in May further streamlining of planning and approvals process. 2013 by the Minister for Environment and Climate Change. The strategy is expected to unlock billions of dollars worth The reforms to the regulations clarify how impacts on of housing development, hundreds of construction jobs biodiversity will be considered in planning permit applications and see almost $1 billion invested in establishing new to remove native vegetation for farming, housing and major conservation reserves and protection for native vegetation infrastructure projects and how permitted clearing of native and species. vegetation is best offset to maintain biodiversity values. Melbourne’s urban growth corridors – the Western Growth Public feedback was a feature of the review which released Corridor, Sunbury Growth Corridor, North Growth Corridor a consultation paper Future directions for native vegetation in and South East Growth Corridor – can now be developed Victoria. The paper proposed four priority and five supporting with greater certainty for balancing development and reforms and called for feedback on implementing them. conservation and preserving the city’s environmental values. The review identified scope to improve the current regulations In addition, 28 existing precincts and two major transport across several areas – address confusion regarding projects – the Outer Metro Transport Corridor and the the objectives of regulations, reduce costly information Regional Rail Link – will benefit from the strategy’s clarity. requirements for landholders, improve consistency and clarity The strategy establishes a transparent and consistent cost for the decision-making on application of the regulations and recovery model to help mitigate any potential impacts on improve the functioning of offset arrangements. native vegetation and species as Victoria’s demand for housing continues to grow.

Department of Environment and Primary Industries 2013 Annual Report 63 These reforms to the native vegetation permitted clearing First adaptation plans builds Victoria’s regulations will deliver: climate resilience • a fair and well-targeted system with stronger focus on the Victoria’s first Climate Change Adaptation Plan – prepared value of native vegetation for statewide biodiversity by the department’s Environment Policy Division – was • upfront information about native vegetation, so tabled in State Parliament in March 2013 by the Minister for landholders can make informed decision and plans, and Environment and Climate Change. face reduced regulatory burden when applying for permits The whole-of-government plan outlines action to manage • clearer and more consistent decision-making about the risks of a changing climate, such as hotter days and sea permits to remove native vegetation level rise, and builds Victoria’s resilience to extreme events. • increased confidence that offsets are delivering tangible With input from all 11 government departments, the plan outcomes for the environment. sets priorities for action and integrates climate risk planning across all portfolios from transport and agriculture, through Implementing the reforms will be a key focus in 2013–14. to health and emergency management. ‘Spider’ seedlings boost rare orchid The plan addresses several key areas: One of Victoria’s rarest orchids may have a new lease on life • roles and responsibilities – providing greater guidance on after being propagated by the department and the Wimmera the roles and responsibilities of state, local government Catchment Management Authority (CMA). and business Fewer than 10 McIvor Spider Orchids are known to exist in • establishes key whole-of-government strategies and the wild – but hundreds more could be joining them. priorities Researchers have propagated 1000 tiny seedlings at the • highlights existing adaptation responses CMA’s Horsham laboratory and will reintroduce them into • integrating climate risk management – embedding climate the plant’s natural environment in dry Box Ironbark country in risk management across all government departments and Central Victoria and the Wimmera. regions Some plants will be given to the Royal Botanic Gardens • partnerships – strengthening partnerships with local in Melbourne to provide a genetic seed bank for future government and communities propagation. • regional focus – recognising the importance of place- The McIvor Spider Orchid (Arachnorchis audasii) grows to based responses to managing climate risks. around 20cm tall and flowers from August to October. It has a single pale yellow to greenish flower with petals up to Working with local government 60mm long. Local government is a key partner in helping Victorians It was found in Bendigo in the early 1990s by a local field adapt to a changing climate. Under the plan, the state naturalist and since that time many attempts have been government will share research, information and knowledge made by different organisations to propagate the species. with local government. The two levels of government will work together to make informed decisions about Victoria’s The successful propagation used advancements in fungal future at the local, regional and state level. isolation techniques and specific temperatures. The Victorian Adaptation and Sustainability Partnership, The project team also includes the Australasian Native which represents all 79 Victorian local councils, is a key Orchid Society, Royal Botanic Gardens Melbourne, the mechanism to help state and local government work former DPI, North Central CMA, Parks Victoria and many together on practical climate change adaptation. enthusiastic volunteers. The Minister also announced that $6 million had been allocated to the Victorian Adaptation and Sustainability Partnership to support the local government sector, including grants and partnership projects to undertake climate adaptation and enhance sustainability locally. The commitment includes a new adaptation mentoring initiative to provide adaptation planning mentors and develop skills for local government and relevant partners.

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64 Department of Environment and Primary Industries 2013 Annual Report GPS data loggers keep tabs on Murray turtles

Indigenous concern over dying turtles on the Murray River resulted in a monitoring program that includes fitting turtles with Global Positioning System (GPS) backpack transmitters. The project was initiated by the Yorta Yorta people when large numbers of turtles were found dying throughout the Barmah-Millewa forest during the drought. The Broad-shelled Turtle is of great cultural significance as a totem to the Yorta Yorta people. The project is believed to be the first time this GPS technology has been used in Australia to track the location of turtles. The units – purposely built for the turtles – include a freshwater switch specifically designed by the manufacturer. The switch turns the transmitter off when the turtles are under water and are difficult to track. Nine Broad-shelled Turtles (Chelodina expansa) and four Common Long-necked Turtles (Chelodina longicollis) have been fitted with the backpack units &RPPRQ/RQJQHFNHG7XUWOHVDW%ODFN6ZDPS3KRWRE\ during the first pilot study. Katie Howard Researchers from the department’s Arthur Rylah Institute (ARI) and the Yorta Yorta Nation also gathered data during the drought to assess the response of turtles to flooding of the forest in the past three years. This information, along with the movement data, will be used to identify and protect important habitat and nesting sites for these species and the Murray River Turtle (Emydura macquarii).

Broad-shelled Turtle. Photo by Katie Howard

Information on turtle movements – especially for the secretive Broad-shelled Turtle which spends most of its time at the bottom of billabongs and rivers and is the most difficult to observe – will help protect the species and may help direct future indigenous management, such as using cultural water flow allocations. All surveying is conducted in conjunction with the Yorta Yorta people and also involves the Caring For our Country team from the Barmah National Park.

The surveys are funded by the Murray-Darling Greta Morgan from Parks Victoria and a Broad-shelled Turtle Basin’s The Living Murray Program. The project is ¿WWHGZLWK*36GDWDORJJHU3KRWRE\.DWLH+RZDUG the subject of a video (http://www.youtube.com/ watch?v=YEZAQqYw1MQ).

Department of Environment and Primary Industries 2013 Annual Report 65 Western Alliance for Greenhouse New waste management approach Action Climate Change Adaptation Risk Victoria’s approach to managing waste is being transformed Response Plan by a new plan for recovering materials and unlocking their value. Port Phillip Region’s Strategy and Integration team contributed to the successful completion of the Western Getting full value: Victoria’s Waste and Resource Recovery Alliance for Greenhouse Action (WAGA) Climate Change Policy is a component of the Victorian Government’s Adaptation Risk Response Plan. economic and environmental strategies, as set out in Securing Victoria’s Economy: Planning, Building, Delivering The project was delivered with funding from the Victorian and Environmental Partnerships. Government’s Sustainability Fund under the Victorian Adaptation and Sustainability Partnership. The policy – released by Environment and Climate Change Minister in April 2013 – establishes a 30-year vision for WAGA is a partnership that brings together interested waste and resource recovery with priorities to guide actions councils committed to collaboratively responding to climate during the next 10 years. change across the western region of Melbourne. These councils are: Maribyrnong City Council, Moonee Valley The policy has six major goals: City Council, Brimbank City Council, Melton Shire Council, • assisting Victorians to generate less waste and achieve Hobsons Bay City Council and Wyndham City Council. financial savings through efficient resource use Port Phillip staff worked closely with project leader • facilitating strong markets for recovered resources Maribyrnong City Council and WAGA partners to connect people to funding and resources, strategic advice and other • facilitating a Victorian waste and resource recovery system organisations throughout the two-year project. that maximises the economic value of waste The project used risk management principles to prepare an • reducing the environmental and public health risks of waste Adaptation Strategy together with an Adaptation Action Plan • reducing illegal dumping and littering to address climate change risk at a regional scale. • reforming and strengthening the way institutions work and The strategy aims to embed robust adaptation decision- are governed to effectively implement waste policy. making into council’s processes by: Getting full value will help drive economic productivity • establishing a shared vision for long term cooperative through growing and improving waste management and action to adapt to climate change in Melbourne’s western resource recovery industries. It will also resolve some of the region challenging environmental and public health problems posed • providing a framework for strategically and collectively by waste in Victoria. implementing actions for adapting to the priority climate In the past decade Victoria’s waste has grown from roughly change risks 8 million tonnes in 2000 to 11.9 million tonnes in 2011. • providing WAGA and its member councils with a strategic Between 2010 and 2011 there was a 7 per cent increase in pathway for action to adapt to the priority regional risks, the total amount of waste. between now and 2020 The department helped develop the policy which involved • continuing to build strong regional partnerships to extensive research and consultation with the waste industry, coordinate risk identification, adaptation action and review. local and state government, business and the community. Councils will use the strategy to guide the development of Getting full value provides clear rules about what is expected municipal-level climate change adaptation plans. from industry in delivering integrated waste management and resource recovery systems to the highest standard, from planning, building and operating facilities, through to managing landfills after they close.

66 Department of Environment and Primary Industries 2013 Annual Report Community baiting programs give The program has also allowed other aspects of fauna management to be studied, including assessing different threatened species a boost approaches to surveying the threatened Heath Mouse Across the state, the department and Parks Victoria are (Pseudomys shortridgei) and the use of remote cameras to running long term community baiting programs to control assess the abundance of feral cats and foxes. pest animals such as foxes which spread weeds and disease Building on the program’s success, a new study is underway and pose a significant threat to a range of native wildlife. to investigate the role of planned fire and predation in Southern Ark the conservation of native species, which is part of the department’s response to the 2009 Victorian Bushfires In far East Gippsland, fourteen years of fox control has led to Royal Commission recommendations. Native fauna such as the remarkable reappearance of bandicoots and potoroos at bandicoots and potoroos have been considered at greater popular camping grounds around Cape Conran. risk to predators after fires (including planned burns) but this In May 1999, before the Southern Ark fox control initiative is the first time the interaction will be measured. The project started, no-one camping at Cape Conran would have seen a will inform new approaches to reducing the risk of predation potoroo or bandicoot because they were so rare in this area. after planned burns. After years of strategic control, campers have now Monitoring is taking place at four sites in the Far South completed more than 250 Critter Sightings Sheets, each one West fire district that were burnt during the autumn planned confirming a growing population of potoroos and bandicoots. burns. Motion cameras are being used to monitor activity at the sites. The project team assessed the abundance of The sheets were introduced in 2006, when campers started native fauna before the planned burns were undertaken. ARI to report strange animals in the campground. These animals researchers are capturing and tracking foxes and feral cats turned out to be Long-nosed Bandicoots (Perameles nasuta). in the same burn areas using GPS collars. Some campers have also seen Long-nosed Potoroos (Potorous tridactylus) and Southern Brown Bandicoots Central Highlands Ark (Isoodon obesulus) out and about during the day. In October 2012 a three-year fox control program on public These sightings confirm the success of the Southern Ark fox land in the Central Highlands of Victoria started. As part of control initiative which has now been expanded to include the Central Highlands Ark project about 150,000 hectares of most forested areas in far East Gippsland, covering almost parks and forests, including Lake Eildon National Park, Big one million hectares. River State Forest, Rubicon State Forest, Cathedral Range State Park, Marysville State Forest, Yarra Ranges National Landholders from as far afield as Deddick and Tubbut in the Park and Toolangi State Forest are being baited. north, Bete Bolong and Marlo Plains in the south and Genoa and Wangarabell are also involved in the community baiting Fewer foxes will allow wildlife populations to increase, program. Landholders bury baits on their own land and particularly in areas which are now recovering from the 2009 undertake many safety activities. They advise their adjoining bushfires. The project aims to reduce fox numbers and aid neighbours in writing of their intent to lay baits and erect the recovery of species such as the threatened Long-nosed warning signs at all entry points to their properties. Potoroo, Long-nosed Bandicoot and the White-footed Dunnart (Sminthopsis leucopus). Baits containing 1080 poison are laid at strategic sites and known areas of fox habitat. Baiting sites and adjoining landholders are clearly sign-posted to prevent domestic dogs accidentally taking baits.

Southern Brown Bandicoot. Photo by Andrew Murray

Glenelg Ark The Glenelg Ark project, established in 2005, is recovering native mammal populations in the far south west region by undertaking broadscale, continuous fox baiting across /RQJQRVHG3RWRURR3KRWRE\$QGUHZ0XUUD\ 100,000 hectares of public land. Monitoring, as part of the program, reveals that Southern Brown Bandicoots, Long-nosed Potoroos and Common Brushtail Possums (Trichosurus vulpecular) are now more common in areas that have received long term sustained fox control compared to areas that have had no fox control.

Department of Environment and Primary Industries 2013 Annual Report 67 Biodiversity The department works with land managers and a range of other organisations to protect, enhance and restore biodiversity assets, maintain ecological assets and provide for the sustainable use of Victoria’s flora and fauna. The department also improves the understanding of ecosystem services to better inform land use decisions and conducts terrestrial and freshwater ecological research to support the management and protection of biodiversity assets across the state.

Output results: Biodiversity

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Native vegetation credit trading agreements (which produce potential offsets to clearing of number 60 75 native vegetation) signed through the BushBroker program

The 2012–13 actual exceeded the target primarily due to higher than anticipated demand for native vegetation credit trading agreements.

Quality

Presentations made and scientific publications in peer reviewed journals number 60 60

Timeliness

Game and Wildlife Licence renewals processed by target dates per cent 96 95

The 2012–13 actual was slightly lower than anticipated as it does not include game licences that are now administered separately by the Game Management Authority.

Planning referrals relating to native vegetation processed within statutory timeframes per cent 80 75.8

The 2012–13 actual did not meet the 2012–13 target primarily due to diversion of resources as a result of the longer than anticipated 2012–13 fire suppression season.

Cost

Total output cost $ million 66.5 60.0

68 Department of Environment and Primary Industries 2013 Annual Report Natural Resources This output leads policy and investment in research for the achievement of highly productive and sustainable landscapes. It provides a partnership approach with communities, catchment management authorities, other government agencies and research institutes for improvement in the condition of our state’s natural assets through policy implementation, program design, project investment, monitoring and reporting.

Output results: Natural Resources

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Area covered by the regional land health projects hectares 1.37 1.33 (million)

While the 2012–13 actual was lower than the 2012–13 target, all projects across the 10 CMA regions that received Land Health funding reached or were very close to their targets.

Landcare members and community volunteers participating in Landcare activities number 81,000 81,000

Regional investment plans proposing natural resources improvement projects submitted, number 10 10 assessed and recommended to responsible Minister(s) for funding

Regional land health projects being implemented number 15–18 18

Quality

Corporate plans submitted by catchment management authorities are aligned with ministerial per cent 100 100 guidelines and template, and meet the requirement of relevant Acts

Regional investment plans align with government directions per cent 100 100

Timeliness

All regional investment plans submitted to Minister(s) for approval by the prescribed date date June 2013 June 2013

Catchment management authority corporate plans submitted to the Minister by the number 10 10 prescribed date

Cost

Total output cost $ million 85.9 82.9

Department of Environment and Primary Industries 2013 Annual Report 69 Environmental Policy and Climate Change Through this output, the department leads the development and implementation of strategic, whole-of-government responses to issues around environmental and climate change policy.

Output results: Environmental Policy and Climate Change

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Number of Victorian Local Sustainability Accord grant project evaluations and acquittals number 10 20 completed

The 2012–13 actual exceeded the target primarily due to a number of projects being ahead of schedule.

Percentage of Victorian schools accredited in the ResourceSmart Schools program per cent 27 35

Quality

Completion of annual reporting and board appointment processes in accordance with per cent 100 100 legislation

Departmental stakeholder satisfaction with completed policy projects per cent 95 100

Departmental stakeholder satisfaction with technical economic analysis, advice and support per cent 85 100

Cost

Total output cost $ million 37.6 47.7

The higher 2012–13 output cost reflects additional funding associated with helping charities deal with illegal dumping, the Sustainability Accord and the development of the new policy work for waste and the Yarra river catchment.

70 Department of Environment and Primary Industries 2013 Annual Report Statutory Activities and Environment Protection This output protects, cares for and improves beneficial uses of the environment by developing statutory and non-statutory processes, setting and enforcing goals and standards, and undertaking monitoring and research. The monitoring and research activities help ensure that the beneficial uses of water are protected, waste management occurs, noise in the community is managed, contamination of land and groundwater is prevented, better management of air quality is promoted and global air quality issues are addressed.

Output results: Statutory Activities and Environment Protection

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Environmental condition research reports issued, improvement tools, guidelines, policies, number 54 63 systems and plans completed and issued

The implementation of EPA’s Compliance and Enforcement Review required EPA to update and review a range of policies, fact sheets and guidance material throughout the year. This work has contributed to EPA exceeding the target.

Increase in EPA notices issued for illegal dumping of waste per cent 46 68

The Illegal Dumping Strikeforce program exceeded its 2012–13 target of 48 notices as a result of a continued high level of focus from the organisation. Further illustrating this focus, the program completed in excess of 235 inspections (including inspections as part of investigations).

Quality

Hours during which air quality standards were met, as a proportion of hours in the reporting per cent 99 97 cycle

The lower result was due to the results of the Brooklyn industrial precinct air monitoring. EPA has a targeted campaign to address air quality issues in Brooklyn (the program will continue in 2013–14). EPA is committed to ongoing monitoring and reporting to the community on air quality in this area. Due to dust impacts on air quality, Brooklyn’s monitoring results detrimentally affect the measure of overall Victorian air quality.

Land audits submitted by EPA appointed auditors are reviewed to ensure compliance with per cent 90 94 statutory requirements and guidelines

Notices complied with by due date or escalation in line with Compliance and Enforcement per cent 90 69 policy

The 2012–13 actual is lower than the 2012–13 target due to a major reform of EPA IT systems.

Timeliness

Pollution incident reports acted on within three days per cent 92 99

The higher 2012–13 actual is due to the implementation of a new IT system which automates and tracks the previously manual allocation and prioritisation of pollution reports, and improved system support to field officers.

Works approvals and licences completed within required statutory timelines per cent 96 91

The 2012–13 actual was lower than the 2012–13 target due to higher than anticipated community interest in a number of projects.

Cost

Total output cost $ million 151.4 139.1

The lower than anticipated output cost is associated with the timing of payments from the Environmental Protection Fund.

Department of Environment and Primary Industries 2013 Annual Report 71 Reduced impact of major bushfires and other extreme events on people, infrastructure and the environment

This objective delivers a planned burning program that reduces the threat and impact of bushfires for Victoria and delivers a risk-based approach to preparing and responding to fire and non-fire emergency events.

2012–13 Fire season

Victoria experienced a significant fire season in Tragically, this season was a reminder of how dangerous 2012–13. By the start of December 2012, the firefighting can be, with three firefighters losing their lives department had responded to 174 fires. The occurrence in the line of duty. of bushfires early in the season, particularly in coastal Telephone alerting was used this season and proved forests and the west of the state, indicated an increased effective in alerting hikers on Mt Feathertop to the nearby fire threat for the 2012–13 season. This was largely due threat during the Harrietville fire. It was also used during to above average temperatures, long periods without the night and early morning to warn the Seaton and rain and rapid curing of grass and other fire fuels Heyfield communities of nearby fires. During January the following prolonged heat events. Victorian Bushfire Information Line (which is managed From January 2013, very dry conditions were apparent by the department’s Customer Service Centre) received throughout the state, resulting in fires that were intense 18,636 calls – the second highest number of calls and fast moving, and which ran through the night. recorded for a single month, except for February 2009. Many fires occurred in difficult terrain, making them Victoria was called on to support our interstate hard to control. A number of these fires continued counterparts in January when both Tasmania and New to burn throughout February, the most significant South Wales experienced significant fires. Seventy-seven being Chepstowe (1300 hectares), Aberfeldy (86,000 firefighters from the department and NEO were deployed hectares), Harrietville (35,000 hectares), Donnybrook to support our interstate colleagues. (1900 hectares), Dereel (1200 hectares) and the Grampians complex (36,000 hectares). For weeks, large campaign fires tested not just the fire services but many rural communities. Specialist forest firefighters from New Zealand and New South Wales were called on to assist local firefighters with the fires at Harrietville, Aberfeldy and the Grampians. These firefighters assisted with managing forest fires and their contribution was greatly appreciated. The Donnybrook fire placed significant pressure on the peri-urban growth areas north of Epping and highlighted that the risk of fire in outer metropolitan Melbourne is significant. Initial attack was a key factor to firefighting success and included the extensive use of firefighting aircraft to support ground crews, who performed exceptionally well. Over the 2012–13 fire season, firefighters from the department and our Networked Emergency Organisation (NEO) partners responded to 866 bushfires affecting 201,630 hectares. *UDPSLDQV¿UH3KRWRE\$VKOH\)HQWRQ

72 Department of Environment and Primary Industries 2013 Annual Report Rappel crews drop in to protect historic Helitack 332 drops in to class alpine huts Firefighting helicopter, Helitack 332, was enlisted in fire In February 2013, the department’s specialist firefighting education activities this fire season – without leaving the fire rappel crews prepared some of Victoria’s historic alpine huts zone. The Helitack 332, which flies rappel crews to incidents in a bid to protect them from fire. and is also a water bombing aircraft, was the subject of a special close-up lesson for students at Harrietville Primary Westons Hut, which was burnt in the 2006–07 Great Divide School. Fires and only recently rebuilt, was wrapped in special fire wrap. The rappel crew created a bare earth perimeter The Harrietville-Alpine North fire broke out near Harrietville around the hut and brush-cut the surrounding grass. Dibbins on 21 January 2013. Firefighting aircraft and rappel crews Hut was also wrapped in material and Blairs Hut was undertook vital work fighting the fires in difficult to access sprayed with fire retardant foam by a land crew. areas. Federation Hut (rebuilt after the 2003 fires with more fire Two teams of rappellers worked on the Harrietville fire. resistant materials) and the University of Melbourne’s The rappel crews were dropped into strategic locations to Mountaineering Club Hut, were protected from direct fire by build control lines by removing fuels using rake hoes. The a retardant called Phoscheck. Aircraft sprayed the retardant rappel crews also built a helipad at Diamantina River for on and around the huts and on nearby vegetation to reduce the helicopters to use to drop crews. They cleared away fire intensity. vegetation and tree branches so even the largest of the helicopters could land. The helipad was used by more than The fire passed through the area without damaging the huts. 100 crews. Protection works were also carried out on some new toilets and recently-built camping platforms in the park. Whilst fighting the Harrietville alpine fires, the Helitack 332 and other helicopters used the cricket ground near the The department’s rappel crews are a team of specially school as a landing pad. After several weeks of seeing the trained firefighters who can access hard to reach areas for students’ keen interest, classes were invited to visit the firefighting by descending from a hovering helicopter down cricket ground to meet both the pilot and rappel crews from ropes from heights of up to 100 metres above the ground. Helitack 332 and have a close look at the aircraft. Once landed, they are followed by specialised firefighting equipment which is lowered from the helicopter. The helicopter is equipped with a belly tank which can assist the crew on the ground by bombing the fire with water or foam. Media resources

The department has four seven-person rappel crews based The State Control Centre (SCC) media room is the at Heyfield in Gippsland and Ovens in the North East for centre of Victoria’s fire and emergency management firefighting in heavily forested areas. activities, releasing fire information and news releases, answering media queries and arranging interviews. This year, staff from a number of Networked Emergency Organisations worked in the media room during emergencies. The department collaborated with partner agencies to develop and deliver practical training for 40 whole-of-Victorian-Government media officers. The training gave media officers the knowledge and confidence with SCC media room procedures and systems before their first deployment to an activated or ‘live’ SCC.

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Department of Environment and Primary Industries 2013 Annual Report 73 New incident management centre opens Cobaw staff ride – learning from past events in Heyfield During 2012–13 the department and members of the In August 2013, Deputy Premier Peter Ryan officially opened Multi-agency Capability Committee (MACC) working group the new DEPI Heyfield Office. During the multi-agency planned and delivered a series of bushfire staff rides to response to the Aberfeldy fires, the new Heyfield office and support the development of incident management staff. depot operated at full capacity as a Level 3 Incident Control A bushfire staff rides provides a unique opportunity to learn Centre – the highest incident management level in Victoria. objectively from past events. Fire agencies in the United Firefighters, managers and emergency response staff from States have used staff rides to develop leadership skills. This the department, Parks Victoria, CFA, SES, Victoria Police, is the first time bushfire staff rides have been tried in Victoria. Melbourne Water, wildlife rescue volunteers and interstate Victoria’s first bushfire staff ride was held in the Cobaw firefighters ran their operations from this office and depot as State Forest near Macedon in May 2012. Two more staff part of a huge fire response and recovery effort. rides were held in August and October 2012 involving The $9.1 million facility is fully equipped to manage high- more than 90 participants from the department, Parks level emergency incidents. Up to 40 staff can work in the Victoria, Metropolitan Fire and Emergency Services Board, new facility day-to-day and it can accommodate twice that Melbourne Water and the CFA. number during an incident. Staff rides allow participants to examine a sequence of The office includes the latest technology and extensive events in significant detail, in this case a planned burn that cabling for phone, computer and radio communications to escaped from the Cobaw State Forest in April 2003. enable staff from any emergency management agency to Unlike a simple historical tour, participants are ‘put in the walk into the building and start working immediately. shoes’ of those involved at the time and given the chance to The building also incorporates environmentally sustainable analyse the fire ground for themselves and make their own design principles equivalent to a 4-Star Green Star (Design) tactical decisions in the same circumstances. rating, resulting in low operating costs through reduced On the face of it, the Cobaw planned burn seemed a simple energy and water use. and routine operation, but proved to be complex. The Heyfield office has been the management hub for large- Course participants were challenged to push past the basic scale fires and floods in Gippsland and the new facility has questions of ‘what happened’ and examine the deeper significantly strengthened the region’s incident management questions of leadership, decision-making and the human capabilities. factors in bushfire fighting together with identifying learning opportunities. Importantly staff and crew involved in the 2003 event took part in the ‘ride’, sharing their experiences and observations. This multi-agency project won the Fire Service Award at the 2012 State Fire Awareness Awards. The working groups from the MACC are made up of staff from agencies involved in bushfire preparedness and response and develops multi-agency training opportunities.

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74 Department of Environment and Primary Industries 2013 Annual Report Planned burning Combined effort for local burn helps the survival of the Button Wrinklewort Significant milestone achieved A planned burn near Ararat has helped the survival A significant milestone was achieved in 2012–13, with more of the endangered Button Wrinklewort (Rutidosis than 250,000 hectares of planned burning carried out on leptorrhynchoides), a small grassland wildflower now found public land to reduce the risk of bushfires. Reaching the in only a few locations in Victoria. 250,000 hectare mark was an important achievement and A member of the daisy family, the Button Wrinklewort reflected the hard work of fire crews from the department was once widespread across the grasslands and grassy and Parks Victoria. Despite a prolonged bushfire season, woodlands south of the Great Dividing Range in Victoria and 678 planned burns were carried out treating 255,227 into south eastern New South Wales. hectares of public land – 58,078 hectares more than last year. Crews switched straight from bushfire suppression The daisy needs to be clear of vegetation for it to flourish to preparing and undertaking the largest planned burning and set seed. Where possible, planned burning is the program in the past 30 years. preferred method to reduce vegetation surrounding the flower, but opportunities are rare – the weather and Scaling up the state’s planned burning program is a big conditions have to be suitable for burning, and the burn challenge. During the peak burning period, resources were needs to be timed around when the daisy will reshoot. moved across the state to take advantage of all planned burning opportunities. These well coordinated resource Such an opportunity arose in late April 2013, and a multi- movements were informed by weather forecasts provided agency planned burn was carried out by the department by the Bureau of Meteorology and field observation and and CFA crews as part of a strategic fire break near Middle monitoring of weather conditions. Creek, between Beaufort and Ararat. This year’s bushfires reinforced the need for an extensive The burn was planned to get the timing right, ensuring strategic planned burning program, including large burns resources, relevant permits, traffic management and rail in areas like East Gippsland as well as the smaller asset safety had been taken care of so that everything was ready protection burns around areas like Melbourne. Crews also at the first opportunity. carried out a lot of other work to reduce fuel loads including The planned burn’s success was due to expertise and input slashing, mowing and clearing in high-risk areas such as the from the department, CFA, VLine and La Trobe University. Dandenong Ranges. This collaborative effort will be ongoing and another burn is Planned burn protects Mt Dandenong communities expected to be carried out in two to three years to help the and assets Button Wrinklewort continue to re-seed. Fire crews carried out a planned burn within metres of Planned burning reform program Melbourne’s television transmission towers on Mt Dandenong The department is reforming its approach to planned in April 2013. burning to deliver an increased program across the state to The 30-hectare planned burn was conducted to help reduce reduce bushfire risk on public land. bushfire risk to the towers and nearby satellite dishes, Under the reform program, the department has resolved a tourism assets and the thousands of people who live on top number of policy issues impeding the delivery of the planned of the Dandenongs. burning program. This includes the removal of native The high priority burn was conducted by crews from the vegetation for bushfire management purposes, establishing department and Parks Victoria on the north-west face of requirements for planned burning in old growth forests and Mt Dandenong, where it was ignited in the morning and an annual reporting template that implements 2009 Victorian completed after dark. Smoke and flames were visible Bushfires Royal Commission recommendations. throughout the night from surrounding suburbs and greater The department has also implemented a model to ensure eastern Melbourne. Crews remained on site throughout the that an excess of area across the state is planned and night to patrol the burn. prepared for planned burning on an ongoing basis. This It was the first time in 10 years the weather and conditions approach maximises the chance that planned burning can had been suitable to conduct a planned burn at the site. be undertaken in the limited ‘burning windows’ available (due largely to weather). It also allows resources to be moved from areas where conditions are unfavourable to other areas where conditions are most suitable for planned burning. The planned burning reform program has also focused on ensuring that burn preparation is better aligned with the department’s road program. The road network is frequently used to bound burns and alignment of the two programs is critical for safety and efficiency.

Mt Dandenong planned burn

Department of Environment and Primary Industries 2013 Annual Report 75 Planned burning 2012–13 final results

Region Fire management zone Total

Strategic Asset wildfire Ecological protection moderation management Other

Gippsland Number of burns 21 38 67 8 134

Area treated (ha) 4,557 49,333 59,036 91 113,017

North East Number of burns 9 40 50 2 101

Area treated (ha) 2,122 32,833 37,009 20 71,984

North West Number of burns 10 29 36 75

Area treated (ha) 896 9,921 32,377 43,195

Port Phillip Number of burns 5 9 30 4 48

Area treated (ha) 228 2,867 801 53 3,949

South West Number of burns 6 36 34 76

Area treated (ha) 211 6,284 13,740 20,235

Regeneration Number of burns 244 burns

Area treated (ha) 2,847

Statewide Number of burns 51 152 217 14 678

Area treated (ha) 8,015 101,239 142,962 164 255,227

Area treated (ha) as a proportion 11.2% 7.39% 2.71% 00.1% 3.59% of the total area of the fire management zone

Note: 1. Name changes of zones in accordance with the Code of Practice for Bushfire Management on Public Land 2012.

76 Department of Environment and Primary Industries 2013 Annual Report New concept firefighting vehicles eMap – emergency mapping As part of building an improved fleet of firefighting vehicles, A new mapping and information system is changing the way the department developed and tested eight concept vehicles bushfire and other hazards information is monitored and during its 2012–13 fire management operations and planned shared. burning program. The department and CFA jointly developed eMap in Designed specifically to suit Victoria’s terrain and firefighting response to recommendations made by the Victorian needs, the new concept firefighting vehicles were developed Bushfires Royal Commission, for agencies to standardise after extensive consultation and testing, including trials of their operating systems and information technologies. interstate vehicles in various environments. Support has also been provided by the SES and Metropolitan Fire Brigade (MFB). The fleet of concept vehicles is made up of various designs for single cab and dual cab chassis and light, ultra-light and eMap is built on a geospatial technology platform common heavy tankers. Some of the improvements include innovative to all agencies and includes operational and reference data emergency light systems, increased crew protection from fire for the whole state across standard, aerial and satellite or falling trees, easier to use hose reels and GPS mapping formats, as well as bushfire intelligence data and real time and tracking. Ergonomics and the use of different colours to weather and road closure information. A field version is also enhance crew safety in low visibility situations were also a available to support ground observers and offline users. key part of the design considerations. During the fire season, eMap was accessed by staff from the The new designs and equipment were tested during department, CFA and NEO to show current fire information bushfires, planned burns and general works by local crews and prepare hard copy maps for the fire ground. More than during a four-month tour around the state. 20 million maps were generated, displaying information such as infrared fire scans, fire perimeters, resource tracking The new equipment fitted to the vehicles proved its worth. of firefighting vehicles and aircraft and live weather, all The vehicles were called in to help at the Grampians bushfire contributing to a greater ability to monitor fire activity. with both asset protection and to suppress the fire in the national park. One of the key improvements that stood out With its new features and faster load times, eMap proved to was the high pressure, low water-use hose which allowed be a valuable and reliable tool providing our firefighters with crews to black-out three times the area with one tank of accurate, real-time information on which to base decisions. water than the previous designs allowed. Testing around the state enabled the designs to be fine tuned prior to the department advertising for a supplier for more than for more than 400 firefighting vehicles, as part of an overhaul of the firefighting fleet. These vehicles will help build a more efficient, fit-for-purpose, safer fleet for our crews to fight fires and conduct fuel reduction work.

1HZYHKLFOHGHVLJQVDQGHTXLSPHQWZHUHSXWWRWKHWHVWGXULQJ¿UH management operations and planned burns

Department of Environment and Primary Industries 2013 Annual Report 77 Land and Fire Management This output covers activities under an integrated land and fire management framework, for the effective planning and management of fire across public land.

Output results: Land and Fire Management

Unit of 2012–13 2012–13 Performance measures measure Target Actual

Quantity

Community engagement plans developed and implemented in response to social research number 6 6 findings on community consultation needs of the planned burning program

Fuel reduction burning completed to protect key assets hectares 250,000 255,227

Personnel with accreditation in a fire role number 1,500 1,903

The target has been exceeded over the past number of years and will be revised upwards to 1800 for 2013–14.

State forests bridges (on Category 1 roads) with documented inspections to meet regulatory per cent 100 100 obligations

State forests roads (Category 1) with documented inspection and maintenance programs to per cent 100 100 meet regulatory obligations

Strategic engagement forums held to enhance community understanding and sustain number 10 10 support for the planned burning program

Quality

Fire controlled at less than five hectares to suppress fires before they become established, per cent 80 79 minimising impact

Personnel accredited to serve in a senior capacity (level 2 or 3) in a fire role number 300 276

With a focus on fire suppression and planned burning over an extended season, assessors have not been available.

Timeliness

Assessments of model of cover completed prior to fire season to assess resources available date Dec 2012 Feb 2013 and requirement for the upcoming fire season

The 2012–13 actual date was later than the target as a result of program delays primarily related to vehicle resource needs analysis. The final Model of Cover was drafted and completed in February 2013.

District fire operations plans completed date Oct 2012 Oct 2012

Fires controlled at first attack to suppress fires before they become established, minimising per cent 80 76 impact

Although slightly below the target, the result was impressive given the level of fire danger that the State experienced with very dry conditions coupled with lightning strike events.

Readiness and response plans completed prior to fire season date Dec 2012 Dec 2012

Cost

Total output cost $ million 353.2 383.5

Higher than anticipated output cost due to the intensity of the 2012–13 fire season and associated suppression activities.

78 Department of Environment and Primary Industries 2013 Annual Report Legislative and other information

Major entities

Environment and climate change • Ministerial Advisory Committee (VASP MAC)5 • Alpine Advisory Committee1 • Victorian Catchment Management Council • Alpine Resorts Coordinating Council • Victorian Coastal Council • Border Groundwater Agreement Review Committee • Victorian Environmental Assessment Council • Budj Bim Council • Victorian Environmental Water Holder • Central Coast Regional Coastal Board • Victorian Local Sustainability Advisory Committee5 • Committees of management and trustees for Crown land • Victorian Mineral Water Committee6 reserves2 • West Gippsland Catchment Management Authority • Commissioner for Environmental Sustainability • Western Coast Regional Coastal Board • Corangamite Catchment Management Authority • Wimmera Catchment Management Authority • East Gippsland Catchment Management Authority • Winyula Council • Environment Protection Authority • Yorta Yorta Joint Body • Environment Protection Board • Yorta Yorta Traditional Owner Land Management Board7 • Falls Creek Alpine Resort Management Board • Zoological Parks and Gardens Board • Geographic Place Names Advisory Panel3 • Gippsland Lakes and Coast Regional Coastal Board • Glenelg Hopkins Catchment Management Authority • Goulburn Broken Catchment Management Authority • Gunaikurnai Traditional Owner Land Management Board4 • Lake Mountain Alpine Resort Management Board • Mallee Catchment Management Authority • Metropolitan Waste Management Group • Mount Baw Baw Alpine Resort Management Board • Mount Buller and Mount Stirling Alpine Resort Management Board • Mount Hotham Alpine Resort Management Board • National Parks Advisory Council • North Central Catchment Management Authority • North East Catchment Management Authority • Parks Victoria • Port Phillip and Westernport Catchment Management Authority • Reference Areas Advisory Committee • Regional Waste Management Groups (x 12) • Royal Botanic Gardens Board • Scientific Advisory Committee • Surveyors Registration Board of Victoria3 • Sustainability Fund Advisory Panel • Sustainability Victoria • Trust for Nature (Victoria) • Victorian Adaptation and Sustainability Partnership

Department of Environment and Primary Industries 2013 Annual Report 79 Water Acts administered • Barwon Region Water Corporation The department is responsible for administering a number • Central Gippsland Region Water Corporation of acts of Parliament. More information is available on our • Central Highlands Region Water Corporation website (www.depi.vic.gov.au). • City West Water Corporation8 • Coliban Region Water Corporation Minister for Environment and Climate Change • East Gippsland Region Water Corporation Aboriginal Lands Act 1991 • Gippsland and Southern Rural Water Corporation • Goulburn Valley Region Water Corporation This Act is jointly and severally administered with the Minister for Aboriginal Affairs. • Goulburn-Murray Rural Water Corporation • Grampians Wimmera Mallee Water Corporation Alpine Resorts Act 1983 • Lower Murray Urban and Rural Water Corporation Alpine Resorts (Management) Act 1997 • Melbourne Water Corporation • North East Region Water Corporation Catchment and Land Protection Act 1994 • Office of Living Victoria This Act is jointly and severally administered with the Minister 8 • South East Water Corporation for Water. • South Gippsland Region Water Corporation • Wannon Region Water Corporation Climate Change Act 2010 • Water Supply Protection Area Consultative Committees9 Except section 5 (which is administered by the Premier). • Western Region Water Corporation • Westernport Region Water Corporation Coastal Management Act 1995 • Yarra Valley Water Corporation8 Commissioner for Environmental Sustainability Act 2003 Notes: Conservation, Forests and Lands Act 1987 1. The Alpine Advisory Committee was re-established with new Terms of Reference on 23 May 2013. Certain provisions are jointly, or jointly and severally, 2. There are more than 1200 committees of management and administered with the Minister for Agriculture and Food trustees for Crown land reserves. Security. Insofar as it relates to the exercise of powers for 3. Responsibility for the Geographic Place Names Advisory Panel the purposes of the Catchment and Land Protection Act and the Surveyors Registration Board of Victoria transferred 1994, these powers are jointly and severally exercised with to the Minister for Planning as part of the Machinery of the Minister for Water. In so far as it relates to the exercise Government changes that took effect on 1 July 2013. of powers for the purposes of the Fisheries Act 1995 these 4. The Gunaikurnai Traditional Owner Land Management powers are exercised by the Minister for Agriculture and Board was established by determination of the Minister for Environment and Climate Change published in the Government Food Security. Gazette on 2 August 2012, pursuant to s82B(1) of the Crown Land (Reserves) Act 1978 Conservation, Forests and Lands Act 1987. 5. VASP MAC is an advisory committee established with new Except for certain Crown lands administered by other terms of reference by the Minister for Environment and Climate Ministers and the Assistant Treasurer. Change in December 2012. VASP MAC replaced the Victorian Local Sustainability Advisory Committee (VLSAC). Environment Protection Act 1970 6. The Victorian Mineral Water Committee was re-established with Fences Act 1968 new functions by Ministerial Direction dated 29 December 2012. No appointments were made to the committee during the Section 19. The Act is otherwise administered by the reporting period. Attorney-General. 7. The Yorta Yorta Traditional Owner Land Management Board was established by determination of the Minister for Environment Flora and Fauna Guarantee Act 1988 and Climate Change published in the Government Gazette on 13 June 2013, pursuant to s82B(1) of the Conservation, Forests Certain provisions of this Act are jointly administered with and Lands Act 1987. No appointments were made to the board the Minister for Agriculture and Food Security. during the reporting period. 8. On 1 July 2012, following the proclamation of the Water Forests Act 1958 Amendment (Governance and Other Reforms) Act 2012, the Certain provisions of this Act are jointly and severally businesses of the three metropolitan water retailers (namely City administered with the Minister for Agriculture and Food West Water Limited, South East Water Limited and Yarra Valley Water Limited) transferred to three new corporations established Security or are administered by the Minister for Agriculture under the Water Act 1989. Responsibility for the three new and Food Security alone. corporations (City West Water Corporation, South East Water Geographic Place Names Act 1998 Corporation and Yarra Valley Water Corporation) transferred to the Minister on that date. Heritage Rivers Act 1992 9. The two remaining Water Supply Protection Area Consultative Committees (WSPACCs) (the Loddon Highlands WSPACC and Instruments Act 1958 the Lower Campaspe Valley WSPACC) both ceased to exist in the reporting period, on 21 November 2012 and on 2 July 2012 Insofar as it relates to the management and administration respectively. of the Office of the Registrar-General and the Office of Titles. This Act is otherwise administered by the Attorney-General.

80 Department of Environment and Primary Industries 2013 Annual Report Land Act 1958 Temperance Halls Act 1958 Except for certain Crown lands administered by other Transfer of Land Act 1958 Ministers or the Assistant Treasurer. This Act is administered by the Minister for Environment and Land Conservation (Vehicle Control) Act 1972 Climate Change insofar as it relates to the management and administration of the Office of the Registrar-General and the Section 3 of this Act is jointly administered with the Minister Office of Titles. The Act is otherwise administered by the for Agriculture and Food Security. Attorney-General. Melbourne and Olympic Parks Act 1985 Valuation of Land Act 1960 Sections 24-28. The remaining provisions are jointly Except Divisions 1 and 2 of Part III and Divisions 4 and 5 and severally administered by the Minister for Sport and of Part III where they relate to the determination of appeals Recreation and the Premier. by a Land Valuation Division of the Victorian Civil and National Environment Protection Council (Victoria) Act 1995 Administrative Tribunal and Part IV in so far as it relates to the administration of those provisions. These provisions are National Parks Act 1975 administered by the Attorney-General. Parks Victoria Act 1998 Victorian Conservation Trust Act 1972 Pollution of Waters by Oil and Noxious Substances Act 1986 Victorian Environment Assessment Council Act 2001 Sections 8-13, 18, 19-23, 23B, 23D, 23E, 23G, 23J, 23L Victorian Plantations Corporation Act 1993 and 24E. Sections 30 and 47 are jointly administered with the Minister for Ports. The Act is otherwise administered by Water Industry Act 1994 the Minister for Ports. Parts 4, 4A, 7 and 8. The Act is otherwise administered by Property Law Act 1958 the Minister for Water. Insofar as it relates to the management of the Office of the Wildlife Act 1975 Registrar-General and the Land Titles Office. The Act is Certain provisions of this Act are jointly administered with the otherwise administered by the Attorney-General. Minister for Agriculture and Food Security or are administered Reference Areas Act 1978 by Minister for Agriculture and Food Security alone. Royal Botanic Gardens Act 1991 Zoological Parks and Gardens Act 1995

Safety on Public Land Act 2004 Minister for Water Insofar as it relates to the provisions enforcing public safety Catchment and Land Protection Act 1994 zones for the purposes of timber harvesting operations the This Act is jointly and severally administered with the Minister Act is jointly and severally administered with the Minister for for Environment and Climate Change. Agriculture and Food Security. Conservation, Forests and Lands Act 1987 State Owned Enterprises Act 1992 Insofar as it relates to the exercise of powers for the purposes Division 2 of Part 2 insofar as it relates to the Victorian of the Catchment and Land Protection Act 1994, these Plantations Corporation. The Act is otherwise administered powers are jointly and severally exercised with the Minister by the Minister for Multicultural Affairs and Citizenship, the for Environment and Climate Change. The Act is otherwise Minister for Water and the Treasurer. administered by the Minister for Agriculture and Food Security Subdivision Act 1988 and the Minister for Environment and Climate Change. Insofar as it relates to the management of the Office of the Groundwater (Border Agreement) Act 1985 Registrar-General and the Land Titles Office. The Act is Murray Darling Basin Act 1993 otherwise administered by the Minister for Consumer Affairs and the Minister for Planning. State Owned Enterprises Act 1992 Survey Co-ordination Act 1958 Division 2 Part 2 insofar as it relates to the Water Training Centre. The Act is otherwise administered by the Minister Surveying Act 2004 for Multicultural Affairs and Citizenship, the Minister for Sustainability Victoria Act 2005 Environment and Climate Change and the Treasurer. Sustainable Forests (Timber) Act 2004 Water Act 1989 Part 2, section 45, Division 1 of Part 6 and Part 8. Sections Water (Commonwealth Powers) Act 2008 3, 22, 23(1) and 24 and Part 9 are jointly administered with Water Efficiency Labelling and Standards Act 2005 the Minister for Agriculture and Food Security. The Act is otherwise administered by the Minister for Agriculture and Water Industry Act 1994 Food Security. Except for Parts 4, 4A, 7 and 8, which are administered by the Minister for Environment and Climate Change.

Department of Environment and Primary Industries 2013 Annual Report 81 Implementation of the Victorian Industry Contracts completed Participation Policy During 2012–13, the department completed 11 contracts totalling $41.8 million in value to which VIPP applied. The The Victorian Industry Participation Policy Act 2003 contracts included two in metropolitan Melbourne with a requires public bodies and departments to report on the total value of $9.3 million, eight in regional Victoria with a implementation of the Victorian Industry Participation Policy total value of $21 million and one statewide with a total value (VIPP). VIPP requires opportunities for local supply and/ of $11.5 million. or participation to be identified as part of the tendering process. Departments and public bodies are required to The outcomes reported by contractors under VIPP included: apply VIPP in all tenders over $3 million in metropolitan • an overall level of local content ranging from 36 to 100 per Melbourne and $1 million in regional Victoria. cent of the total value of the contracts Contracts commenced • 170 full time equivalent jobs During 2012–13 the department commenced eight • one apprenticeship/traineeship. contracts totalling $39.7 million in value to which the VIPP applied. The contracts commenced included one in The benefits to the Victorian economy in terms of increased metropolitan Melbourne with a total value of $8.4 million, five skills and technology transfer include: in regional Victoria with a total value of $8.8 million and two • management, maintenance and development of VicMap statewide with a total value of $22.5 million. Topographic database The commitments by contractors under VIPP include: • construction of bridges, engineering and design in coastal • an overall level of local content ranging from 45 to 100 per land slips cent of the total value of the contracts • fleet management. • 133 full time equivalent jobs • 10 apprenticeships/traineeships. Consultancies The benefits to the Victorian economy in terms of skills and Details of consultancies greater than $10,000 technology transfer include: The department did not engage any consultants during • management, maintenance and software training on 2012–13 where the total fees payable were valued in excess VicMap topographic data of $10,000 (exclusive of GST). • civil works, installation of fire services and storm water Details of consultancies less than $10,000 storage The department did not engage any consultants during • innovative development and methodology in native 2012–13 where the total fees payable were valued at less vegetation information management. than $10,000 (exclusive of GST). Disclosure of major contracts During 2012–13, the department entered into one contract greater than $10 million in value. Details of the contract were published on the Victorian Government’s contracts publishing system and can be viewed online (www.tenders. vic.gov.au).

82 Department of Environment and Primary Industries 2013 Annual Report Disclosure of government advertising expenditure Details of advertising and communication campaigns conducted in 2012–13 are provided in the table below.

Details of government advertising expenditure (campaigns with a media spend of $150,000 or greater)

Creative and Research Other Advertising campaign and Print and campaign Start (media) development evaluation collateral expenditure and 2012–13 2012–13 2012–13 2012–13 2012–13 Campaign Campaign end name summary date (ex GST) (ex GST) (ex GST) (ex GST) (ex GST)

Planned The department implemented 1 July $542,582 $8,839 $84,000 NA $157,186 burning an external communications 2012 – campaign focused on alerting 30 June communities to the increased 2013 planned burning program and how to seek further information about where and when burns are taking place. The campaign includes: advertisements, media placements, improved notification methods, roadside signage and social media activity. Advertisements also inform people about precautions they can take to reduce the impacts of smoke on health and information is also distributed through health networks.

Freedom of Information The total number of requests received was higher than the number received in 2011–12. The department received more The Freedom of Information Act 1982 gives everyone the requests from Members of Parliament (31 compared to 22 in right to seek access to documents held by government. 2011–12) and individuals (45 compared to 29 in 2011–12). The department’s Freedom of Information (FOI) Unit can be Fewer requests were received from journalists (12 compared contacted on 9637 8186. to 17 in 2011–12). A greater number of requests were FOI requests have to be made in writing. A request can be received from lawyers (40 compared to 33 in 2011–12). submitted using the website FOI Online (www.foi.vic.gov.au) For the same period, the department made decisions on or by sending an application to: 104 requests. Sixteen of these requests were received Freedom of Information during the previous financial year. The outcomes were: Department of Environment and Primary Industries PO Box 500 Number Per cent East Melbourne Victoria 3002 Full access granted 26 25% From 1 July 2013, the application fee to make an FOI Partial access granted 46 44% request is $25.70. For people on a low income, the department can waive this fee. There may be further charges Access denied 10 10% depending on the time it takes to find the documents and photocopy them and the number of pages to be No relevant documents found 22 21% photocopied. The average processing time was 24 days. The number of For the period 1 July 2012 to 30 June 2013, the department days taken was: received 144 new FOI requests. They came from: Number Per cent Number Per cent 0 – 45 days 103 99% Individuals 45 31% 46 – 90 days 1 1% Lawyers 40 28% 91+ days 0 0% Members of Parliament 31 22%

Journalists 12 8%

Companies 10 7%

Community groups 6 4%

Department of Environment and Primary Industries 2013 Annual Report 83 The department also responded to an additional 29 Reporting procedures requests. The outcomes were: Disclosures of improper conduct or detrimental action by the department or its employees may be made to the following Number officers: Request not processed * 17 Protected Disclosure Coordinator Transferred 12 Ms Jennifer Berensen * Request not processed includes: all requested documents PO Box 500 released outside the Act; request withdrawn by applicant; East Melbourne Victoria 3002 request was not processed; deposit not paid. Telephone: (03) 9637 8697 Fax: (03) 9637 8128 The Secretary received nine applications for an internal Email: [email protected] review of decisions to deny access to some or all documents requested. The results of these internal reviews were: Protected Disclosure Officer Ms Kim Reeves Number PO Box 500 East Melbourne Victoria 3002 Original decision upheld 7 Telephone: (03) 9637 9730 Original decision varied 2 Fax: (03) 9637 8128 Original decision overturned 0 Email: [email protected] Alternatively, disclosures of improper conduct or detrimental action by the department or its employees may also be Two applications for review of an FOI decision were made made directly to the Independent Broad-based Anti- to the Victorian Civil and Administrative Tribunal (VCAT). corruption Commission (IBAC): VCAT confirmed the agency decision for one application. The second was withdrawn. One application received in IBAC Victoria the previous financial year was also finalised this year. VCAT Level 1, North Tower, 459 Collins Street varied the original decision. Melbourne, VIC 3001 Phone: 1300 735 135 Ombudsman enquiries Mail: IBAC, GPO Box 24234, Melbourne, VIC 3000 The Ombudsman referred 15 general enquiries to the www.ibac.vic.gov.au department in 2012–13. All of these enquiries were finalised by the department during the year. No formal investigations Further information were conducted by the Ombudsman. Written guidelines outlining the procedures for reporting protected disclosures are available on the department’s Protected Disclosure Act 2012 (formerly website (www.depi.vic.gov.au). the Whistleblowers Protection Act 2001) There were no disclosures made to the department and notified to IBAC during 2012–13. The Protected Disclosure Act 2012 encourages and assists people in making disclosures of improper conduct by public There were no disclosures under the Whistleblowers officers and public bodies. The Act provides protection to Protection Act 2001 during 2012–13. people who make disclosures in accordance with the Act and establishes a system for the matters disclosed to be Compliance with the Carers Recognition investigated and rectifying action to be taken. Act 2012 The Protected Disclosure Act 2012 commenced on 10 February 2013 when the Whistleblowers Protection The department has taken all practical measures to comply Act 2001 was repealed. with its obligations under the Carers Recognition Act 2012 to ensure staff have an awareness and understanding The department does not tolerate improper conduct by of the care relationship principles set out in the Act. employees, nor the taking of reprisals against those who come forward to disclose such conduct. The department is The department has a carer’s leave policy that allows committed to ensuring transparency and accountability in its staff to take leave to care for immediate family members. administrative and management practices, and supports the This includes spouses, children, siblings, parents and making of disclosures that reveal corrupt conduct, conduct grandparents. New staff are made aware of the policy involving a substantial mismanagement of public resources, as part of the induction program. or conduct involving a substantial risk to public health and The department has also set up an informal network for safety or the environment. employees with disabilities and employees who are carers The department will take all reasonable steps to protect for family members with disabilities to meet about shared people who make such disclosures from any detrimental issues and offer a supportive structure at work. action in reprisal for making the disclosure. The department In addition, a formal program of awareness raising about will also afford natural justice to the person who is the the Act is planned for the second half of 2013. subject of the disclosure to the extent it is legally possible.

84 Department of Environment and Primary Industries 2013 Annual Report Compliance with the Building Act 1993 Competitive neutrality requires government businesses to ensure where services compete – or potentially compete The department complies with the Building Act 1993, – with the private sector, any advantage arising solely from the Building Regulations 2006 and associated statutory their government ownership be removed if they are not in requirements and amendments. Either an Occupancy the public interest. Government businesses are required to Permit or a Certificate of Final Inspection is obtained for cost and price these services as if they were privately owned new facilities or for upgrades to existing facilities endorsed and thus be fully cost reflective. Competitive neutrality policy by a Municipal Building Surveyor or a Registered Building provides government businesses with a tool to enhance Surveyor Practitioner. decisions on resource allocation. This policy does not Major works projects commenced or completed in 2012–13 override other policy objectives of government and focuses include: on efficiency in the provision of service. The department is working to ensure that competitive neutrality requirements • Anglesea office and depot redevelopment are fulfilled. • Daylesford depot redevelopment • Heidelberg office refurbishment Water Resource Assessment Program • Laverton statewide seed shed Background • Toolangi office and depot upgrade Under Section 22 (1) of the Water Act 1989, the Minister is required to ensure that a continuous program of assessment • Bendoc depot redevelopment of the state’s water resources is undertaken. Under Section • Dargo depot redevelopment 22 (2), the water resources assessment program must provide for the collection, collation, analysis and publication • Altona rappel tower of information about: • Noojee office and depot redevelopment. (a) the availability of water, including surface water and groundwater Maintenance of buildings in a safe and serviceable condition (ac) the environmental water reserve The department’s leased portfolio is managed by the (b) the disposal of wastewater (including trade waste, Department of Treasury and Finance’s Shared Service sewage and saline water) Provider. (c) the use and re-use of water resources The department has a facilities management contract with Five D Holdings Pty Ltd for the balance of its owned portfolio (d) floodwaters across 190 sites. The owned portfolio includes offices, (e) drainage and waterway management combined office/depot sites, depots, residences, airbases and fire lookout towers. Five D is responsible for maintaining (f) water quality (including salinity) the buildings in a safe and serviceable condition and for (g) in-stream uses of water providing the annual essential safety measures report for the buildings. Quality assurance, performance measures and (ga) current and historic levels of allocation and use of governance are incorporated into the contract to ensure that surface water and groundwater contract requirements are met and standards maintained. (gb) current and historic condition of waterways and aquifers (h) anything else that the Minister decides is appropriate. National Competition Policy Section 26 of the Act requires the department to report In 1996, the federal, state and territory governments annually on these areas. The information below summarises agreed to review and, where appropriate, reform all existing the processes in place to collect and provide information legislative restrictions on competition. Under the National about these areas. Competition Policy, the guiding legislative principle is that legislation, including future legislative proposals, should not a) Availability of water restrict competition unless it can be demonstrated that: Surface water • the benefits of the restriction to the community as a whole The state’s surface water resources assessment network outweigh the costs includes 845 sites that were monitored in 2012–13 • the objectives of the legislation can only be achieved by through four regional water monitoring partnerships. These restricting competition. partnerships comprise 37 public and private organisations that procure their monitoring requirements under this The department has reviewed all legislation under its program. The partnerships include state government control, and continues to apply the competition assessment departments, water corporations, catchment management guidelines in the Victorian Guide to Regulation to all new authorities, local shires and councils, the Bureau of legislative proposals. Meteorology, and the Murray-Darling Basin Authority. Surface water monitoring services are procured by the department on behalf of the regional water monitoring partnerships to ensure efficiency and statewide consistency in data quality.

Department of Environment and Primary Industries 2013 Annual Report 85 The program delivers legislative obligations under section 22 ab) Use of one water source as a substitute for of the Act and section 126 of the Commonwealth Water Act another water source 2007 and contributes to a range of business needs across Under Ministerial Reporting Direction 03, water corporations the partnership including: are required to provide information in their annual reports on • operational decision making how they are promoting the integrated and sustainable use of water resources in their region, including better use of • compliance reporting alternative supplies. This includes any projects undertaken • flood warning to meet targets set in the entity’s corporate plan to deliver water recycling and water conservation. Water corporations’ • statewide policy development for water resources annual reports are tabled in Parliament. • river health management ac) Environmental water reserve • reporting for the monthly water report, the annual water The Environmental Water Reserve (EWR) is the legal term quality reports and the longer term water quality trend for water set aside for the environment under the Water Act reports. 1989. The EWR comprises water defined by: All surface water data collected through the partnerships is • entitlements for the environment which are called available via the Victorian Water Resources Data Warehouse either environmental bulk entitlements or environmental (www.vicwaterdata.net). Summary reports on historical entitlements longer term trends of surface water quality and the current status water quantity are available on the data warehouse • the operation of caps on licensed consumptive water and the Monthly Water Report (www.depi.vic.gov.au/water). use (such as sustainable diversion limits or permissible consumptive volumes), and conditions on consumptive Victorian water resources data warehouse bulk entitlements, licences and permits, and as set out in The Victorian Water Resources Data Warehouse management plans. (www.vicwaterdata.net) was launched in June 2000 and The majority of the EWR is set aside through the latter. contains current and historical information on stream flow, groundwater levels, water quality and river health for Victoria. In regulated systems, the EWR is established through environmental entitlements, environmental bulk entitlements A project to replace the Victorian Water Resources Data and various operational conditions on consumptive water Warehouse began in April 2009 and is due to be completed use. The environmental entitlements and environmental in September 2013. The system is based on industry bulk entitlements refer to water usually held in and released standard software Hydstra, and will increase the access and from storages. They are held by the Victorian Environmental useability of groundwater and surface water information. Water Holder (VEWH), which was established on 1 July 2011 as an independent statutory body responsible for making Groundwater decisions on the most efficient and effective use of Victoria’s Groundwater occurrence varies in size and volume environmental water entitlements. Environmental watering throughout Victoria. It lies beneath all parts of the state decisions by the VEWH are guided by seasonal watering but is not always useable. Its potential for use is generally proposals prepared by each of the catchment management dependent on salinity and how much water can be extracted authorities and Melbourne Water. VEWH weighs the regional (aquifer yield). The location of aquifers is independent of priorities identified in these proposals to develop an annual surface water basins, with some aquifers extending beneath seasonal watering plan for the state. The plan specifies the several. objectives for the use of the water, planned storage releases While groundwater can be a reliable source of water, its and monitoring requirements. The operation of the VEWH overuse can result in failure of supply. Groundwater has is overseen by the Minister for Environment. Further details a value when it is extracted for a range of uses including about VEWH can be found on its website (www.vewh.vic. irrigation, commercial, urban or stock watering, and when gov.au). left in situ where it may support groundwater dependent The water holdings held by VEWH increased during ecosystems including contributing to base flow in streams 2012–13 through the granting of two new environmental and wetlands or supporting a variety of terrestrial flora. entitlements. The Campaspe River Environmental Victoria monitors around 2500 bores on a quarterly basis to Entitlement 2013 provides 15,053 ML of high reliability understand the groundwater level trends. Additionally, rural entitlement and 8,100 ML of long term average entitlement water corporations conduct monthly monitoring of about to the Campaspe system. The Blue Rock Environmental 500 bores. Accurate monitoring data is important and helps Entitlement 2013 provides VEWH 9 per cent of the inflow with the resolution of management issues, questions or into Blue Rock Reservoir in the Latrobe system. disputes raised by groundwater users. Amendments were also made to the following entitlements All groundwater data, including data collected during held by VEWH: 2012–13, is available via the Victorian Water Resources Data • Bulk Entitlement (Thomson River – Environment) Warehouse (www.vicwaterdata.net). Summary reports on Conversion Order 2005 historical longer term trends in groundwater levels across the state are available on the departmental website (www.water. • Bulk Entitlement (Loddon River – Environment) Order 2005 vic.gov.au). Information on groundwater use and trends is • Bulk Entitlement (River Murray – Flora and Fauna) also provided in the annual Victorian Water Accounts. Conversion Order 1999.

86 Department of Environment and Primary Industries 2013 Annual Report During 2012–13, Victoria’s rivers, wetlands and floodplains • continued investigations with North East Water into experienced another year of average to wet conditions. co-investment options to improve environmental flows Some systems experienced natural flooding, providing in the Ovens River. continued opportunity for much-needed recovery of plant and animal populations following the extended and severe b) Disposal of wastewater (including trade waste, drought experienced since 1997. Environmental watering in sewage and saline water) 2013–14 will largely focus on building on this environmental Regional water corporations are required to provide a recovery and further enhancing the priority environmental performance report on wastewater disposals, as part of the values of Victoria’s rivers, wetlands and floodplains. report of operations in their annual reports. The performance report includes indicators related to financial, service delivery Environmental water delivery during 2012–13 benefited 71 and environmental performance. Specific wastewater Index of Stream Condition river reaches and 14 wetlands indicators are prepared for reliability of collection services, including: quality of disposal and management. The annual reports are • Thomson and Macalister rivers and the lower Latrobe tabled in Parliament. Wetlands in Gippsland c) Use and re-use of water resources • Yarra, Tarago, Werribee and Moorabool rivers in central See section ab) above, ‘The use of one water source as a Victoria substitute for another water source’. • Wimmera, McKenzie and Glenelg rivers in western Victoria d) Floodwaters • six wetlands in the Wimmera-Mallee wetland complex The department is the lead agency for coordination of • Corangamite wetlands (Hospital Swamps) floodplain management in Victoria. One of its primary functions is to help reduce flood risks and reduce the cost • the following systems in northern Victoria of damage to the community. The department assists – Goulburn, Campaspe and Loddon rivers and Broken, catchment management authorities and municipalities to Gunbower and Birches creeks improve their knowledge of areas of flood risk and ensuring – Living Murray Icon sites – including Barmah-Millewa that new development is compatible with the flood risk. Forest, Gunbower Forest and Lindsay Island (Lake Regional floodplain management strategies developed by Wallawalla) each catchment management authority provide a framework – Mallee River Murray wetlands – including Robertson through which high priority flood studies are carried out and wetland, Cardross Lake, Lake Koorlong, Brickworks floodplain management strategies implemented. These are Billabong, Sandilong Creek, Round Lake, McDonalds generally funded using a combination of local, state and Swamp and Richardson’s Lagoon. federal funding. The department contributes to the funding, provides input where appropriate, helps assess funding bids Full details of 2012–13 environmental watering activities will and monitors progress. be provided in the annual watering booklet developed by the VEWH. This will be available on the VEWH website along Flooding occurred in Melbourne and Gippsland in June with the 2011–12 booklet (www.vewh.vic.gov.au/news- 2013, but impacts were not as significant as 2010–11 where and-resources/resource-library/annual-watering-booklets). much of Victoria was affected. The department provided Previous watering booklets were prepared by the former support staff, as required, to SES-led operations at the state DSE and can be found on the department’s website (www. and incident level. water.vic.gov.au/environment/rivers/flows). In November 2012 the Victorian Government released its In unregulated rivers, the EWR is set aside either through response to 31 recommendations related to the department’s conditions on licences and bulk entitlements, caps or through portfolio contained in the Review of 2010–11 Flood Warnings statutory water management plans and non-statutory local and Response, by Neil Comrie. The review was released management plans. Water corporations are responsible for in December 2011. A multi-departmental committee has ensuring that these conditions for the EWR are met. been established to oversee the implementation of the government’s response to the recommendations. During 2012–13, the State Government implemented improved environmental flows and management conditions In response to the review, the department is working in priority, flow stressed unregulated and regulated rivers by: collaboratively with relevant agencies to improve and enhance flood information in three key areas: • finalising Victoria’s first integrated surface water and groundwater management plan for the Upper Ovens River • flood gauging improvements: upgrades to existing river height gauges and installation of new rainfall and river • finalising two other stream flow management plans height gauges • expanding the use of smart meters to provide real-time • flood mapping and risk assessments: mapping floods for information on water use and stream flows, enabling use in emergency response and land use planning, and better flow sharing arrangements to manage Victoria’s the identification of mitigation measures water resources • flood intelligence platform: a computer-based platform • improving estimates of water interception by farm dams that integrates flood observations and flood mapping with throughout the state potential impacts before, during and after a flood event. • finalising the revision of the FLOWS methodology for This platform will enable better agency cooperation and determining water requirements for streams and the inform communities with locally specific flood advice. Estuary Environmental Flows Assessment Methodology

Department of Environment and Primary Industries 2013 Annual Report 87 To date, upgrades to river heights gauges have focused g) In-stream uses of water on the regions affected by the 2011 floods, with more than Stream use 110 gauge upgrades completed or underway. Extensive consultation is underway to identify and scope the key Refer to the ‘Environmental water reserve’ section above for requirements for the flood intelligence platform. details regarding the in-stream use of water Funding has been provided through the Natural Disaster ga) Current and historic levels of allocation and use of Resilience Grants Scheme for 13 new and 13 ongoing surface water and groundwater flood mitigation projects in 2012–13. These focus on flood Groundwater mapping and risk assessments, flood education, flood warning system improvements and levee construction. Groundwater is extracted for a variety of purposes, including Applications for 2013–14 are being considered jointly with town water supply, rural domestic consumption, stock the Office of the Emergency Services. watering, irrigation and industry. Areas of significant demand are classified as water supply protection areas (WSPAs) or The Environment and Natural Resources Committee (ENRC) groundwater management areas (GMAs). tabled its report on the Parliamentary Inquiry into Flood Mitigation Infrastructure in Victoria in August 2012. The Increased demands for access to groundwater have come government’s response to the Inquiry has been delayed from a range of sources including exploration and mining. by a separate inquiry into regional drainage (completed New earth resource technologies are also looking to in June 2013). The department is coordinating the groundwater to support their extraction processes. In order to government’s response, which is expected early in 2013–14. manage groundwater effectively across the state, Victoria is Preparatory work has been undertaken on the Victoria Flood implementing a revised groundwater management framework. Management Strategy, which will be updated in 2013–14. The framework includes describing groundwater management The update will be informed by the outcomes of the Victorian at a catchment scale and updated guidance on the approach Floods Review and the ENRC Inquiry. to sharing and managing Victoria’s groundwater resource. The department is working with relevant councils on four gb) Current and historic condition of waterways and local coastal hazard assessments, in priority coastal areas aquifers to help them plan for potential flooding associated with sea Assessment of river, wetland and estuary condition level rise and storm surges. Waterway condition or health in Victoria is measured using e) Drainage and waterway management a number of integrated monitoring tools known as the Index of Stream Condition (ISC), Index of Wetland Condition (IWC) Waterway management and the Index of Estuary Condition (IEC). These assessments The implementation of waterway management actions is the are carried out every eight years and they measure statewide responsibility of catchment management authorities across condition and the long-term effectiveness of the river Victoria and Melbourne Water in the Port Phillip and Western health rehabilitation programs. The results of the third ISC Port region under the Water Act 1989. In 2012–13 the assessment will be released during 2013. The first statewide State Government invested more than $25.9 million for the wetland assessment looked at 827 wetlands. An Index of protection and restoration of Victoria’s rivers and wetlands. Estuary Condition (IEC) has been trialled across 40 estuaries. As the caretakers of river health, catchment management authorities invest these funds according to agreed h) Victorian water accounts works programs and at the end of the year report their The Victorian Water Accounts (VWA) is an annual statewide achievements. The delivery of projects and services through summary of Victoria’s water resources. The Victorian Water these agreed works programs is tracked and reported Accounts 2010–2011, the eighth annual report to provide annually through performance reports. These reports are a summary of water availability, water allocation and use at consolidated to demonstrate the statewide effort to protect bulk water supply level, was publicly released in October and restore the health of Victoria’s rivers and wetlands 2012. Including a statewide overview and basin water accounts for the 29 Victorian river basins, the accounts form Drainage a publicly available record of surface water and groundwater The department provided a submission into an ENRC inquiry resources for the water year 1 July 2010 to 30 June 2011. into regional drainage. The Committee’s report was released in June 2013. Published in hard copy and online, the VWA documents water availability and provides assessments of rainfall, f) Water quality (including salinity) stream flow and groundwater levels, as well as water storage information. Information regarding water taken for Surface water quality monitoring program consumptive use and water set aside for environmental Water quality monitoring was conducted at 451 partnership purposes is provided in the context of the Victorian water sites across the state in 2012–13. A range of water quality allocation framework. The framework sets out entitlements parameters are either continuously monitored or sampled to water. Information on reuse of treated wastewater is also at regular intervals from these sites, and cover a range of reported in the accounts. physical, chemical, nutrient, metal, anion, cation, organic load and algal analyses. Data from the monitoring network The VWA sources key data from the state’s surface water is made publicly available through the Victorian Water and groundwater monitoring networks, and draws on Resources Data Warehouse. information from water businesses, the department, the Essential Services Commission, the Murray-Darling Basin Authority and catchment management authorities.

88 Department of Environment and Primary Industries 2013 Annual Report The 2010–2011 VWA complements the work being Blue Rock drought reserve undertaken within Victoria and nationally to improve water Since the release of the Gippsland Region SWS, the accounting and reporting. department has been working closely with stakeholders to establish a drought reserve in Blue Rock Reservoir. The Sustainable water strategies drought reserve was established in early July 2013 and will provide entitlement holders on the Latrobe River system with Sustainable water strategies (SWS) set out long term plans access to additional water supplies in times of drought. In to secure each region’s water future. The strategies identify addition, more water has been provided for the environment threats to water availability in the region and identify policies in the Latrobe River through a new environmental entitlement and actions to help water users, water corporations and in Blue Rock Reservoir. The department is continuing work catchment management authorities manage and respond to on arrangements to make an additional share of Blue Rock those threats over the next 50 years. Reservoir available for Gippsland Water and for irrigators on Four regional sustainable water strategies that cover the the lower Latrobe River. state were produced between 2006 and 2011. The first Local management plans strategies completed were the Central Region SWS in 2006 and the Northern Region SWS in 2009. The Gippsland Local management plans are being developed for Region SWS and the Western Region SWS were completed many areas across Victoria (GRSWS Action 3.4 and in November 2011. WRSWS Action 3.5) with the aim of documenting existing management arrangements. Across the two SWS regions, Previous DSE annual reports have documented progress in 13 surface water plans are expected to be completed implementing the strategies, as required under section 22J mid–2013 after the bulk of the work on them was completed of the Water Act 1989. in 2012–13, and a further two more will be completed by the end of 2013. Groundwater local management plans Western Region and Gippsland Region Sustainable for all of Southern Victoria have been prepared and will be Water Strategies complete pending final approval by Southern Rural Water. The Western Region covers agricultural and urban centres Guidelines are being drafted to guide future reviews of the including Colac, Port Campbell, Horsham, Stawell, Ararat, local management plans. Hamilton, Warrnambool and Portland. River basins include the Otway Coast, Corangamite, Hopkins, Glenelg, Portland, Harvesting of high flows, and staged release of Millicent, Wimmera, Avoca and the southern half of the unallocated water Mallee. During 2012–13, actions about harvesting high flows outside The Gippsland Region spans the area south of the Great the winter-fill period (GRSWS Action 4.3, WRSWS Action Dividing Range in Victoria from the Latrobe River catchment 3.10) and the staged release of unallocated water (GRSWS and the Strzelecki Ranges, to the New South Wales border Action 3.3, WRSWS Action 3.14) were initiated. Due to in the east. The larger urban centres within the region include better streamflow over the past few years, and a lack of Warragul, Traralgon, Wonthaggi, Sale and Bairnsdale. demand for new water, there has been less of an imperative to implement these actions immediately. Many of the actions and policies in the Gippsland Region Sustainable Water Strategy (GRSWS) and the Western The action about harvesting high flows outside the winter-fill Region Sustainable Water Strategy (WRSWS) were due for period is underway, and will identify proposed changes to completion by the end of 2012 and have been successfully the take and use policies to enable water corporations to implemented. Other actions are still to be completed or are implement the policy on relevant river systems through their of an ongoing nature. Some actions that were implemented local management plans. over 2012–13 are described below. The GRSWS confirmed 6 GL would be made available through an expression of interest or auction process on the Improved approach to managing groundwater Mitchell River system. Southern Rural Water has deferred During 2012–13 work continued on improving the way releasing the unallocated water, pending the completion groundwater is managed in Victoria. Some of the main tasks of the Lindenow Valley Water Security Project. On other were: systems, Southern Rural Water will continue to consider • developing a program to upgrade and refine the applications for new water where winter fill licences are groundwater monitoring network (GRSWS Action 3.8, available. WRSWS Action 4.9) Water law review • identifying new groundwater management boundaries The Water Act 1989 and Water Industry Act 1994 are that will be progressively reflected in management currently being reviewed. An Exposure Draft of the new arrangements over the next few years (GRSWS Action Water Bill 2014 is being prepared for public comment in 3.15, WRSWS Action 4.1) late 2013. After feedback on this Bill is considered, it will • documenting existing management arrangements in local be finalised with the intention that it will be introduced into management plans (see below). Parliament in the first half of 2014.

Department of Environment and Primary Industries 2013 Annual Report 89 For efficiency, SWS actions and policies that require The department will undertake a stocktake of any remaining amendments to the Water Act are being addressed through or ongoing Central Region SWS actions and their relation to this review. These include: the Living Melbourne, Living Victoria agenda to confirm how they will be drawn to a close. • reviewing the process for declaring water supply protection areas and developing statutory management Where appropriate, actions or policies from these SWSs that plans (GRSWS Action 3.5, WRSWS Action 3.6) are ongoing or longer term in nature will be built into work programs of the government priorities mentioned above or • amending the Water Act 1989 to clarify rights to alternative other relevant government initiatives. water sources i.e. stormwater in local government drains (GRSWS Action 4.5b, WRSWS Action 3.13b) Additional information available on • providing the legislative framework to manage the water impacts of land use change (GRSWS Action 3.10, request WRSWS Action 5.3) In compliance with the requirements of the Standing • providing clarity for users around the entitlements and Directions of the Minister for Finance, details in respect of allocation framework (GRSWS Action 3.14, WRSWS the items listed below have been retained by the department Action 3.4) and are available to the relevant ministers, Members of Parliament and the public on request (subject to freedom of • enabling take and use licences to be issued for up to 20 information requirements, if applicable). years provided the benefits and risks have been assessed (GRSWS Action 3.6, WRSWS Action 3.1) (a) A statement that declarations of pecuniary interests have been duly completed by all relevant officers. • improving information about stock and domestic use (GRSWS Actions 3.12 and 3.13, WRSWS Actions 3.2 (b) Details of shares held by a senior officer as nominee or and 3.3) held beneficially in a statutory authority or subsidiary. • streamlining the approval of works licences to construct (c) Details of publications produced by the entity about storages (GRSWS Action 4.4, WRSWS Action 3.9) itself, and how these can be obtained. • consistent groundwater licensing requirements for new (d) Details of changes in prices, fees, charges, rates and quarries and mines (GRSWS Action 3.17). levies charged by the entity. (e) Details of any major external reviews carried out on the Northern Region and Central Region Sustainable entity. Water Strategies Most key actions in the Northern Region and Central Region (f) Details of major research and development activities sustainable water strategies have now been implemented. undertaken by the entity. Further consideration of the outstanding actions proposed (g) Details of overseas visits undertaken including a in these strategies is now required given more recent summary of the objectives and outcomes of each visit. developments and government priorities, such as finalising and implementing the Murray-Darling Basin Plan, (h) Details of major promotional, public relations and undertaking a comprehensive review of water legislation, marketing activities undertaken by the entity to develop developing a new Victorian Waterway Management community awareness of the entity and its services. Strategy, and implementing the Government’s Living (i) Details of assessments and measures undertaken Melbourne, Living Victoria agenda. to improve the occupational health and safety of The Northern Region SWS was released in December employees. 2009. Most actions in the Northern Region SWS have (j) A general statement on industrial relations within been completed or are of an ongoing nature. A number of the entity and details of time lost through industrial remaining actions are closely linked to the Murray-Darling accidents and disputes. Basin Plan, which was finalised in December 2012. (k) A list of major committees sponsored by the entity, the Given these links, and the significant implications the purposes of each committee and the extent to which Basin Plan will have on water management in northern the purposes have been achieved. Victoria, the department is reviewing remaining or ongoing Northern Region SWS actions to determine their relation to (l) Details of all consultancies and contractors including implementation of the Basin Plan and best means of drawing consultants/contractors engaged; services provided; them to a close. and expenditure committed to for each engagement. The Central Region SWS was released in 2006. Most actions Requests for additional information may be made by in the Central Region SWS have been implemented or are telephone on (03) 9637 8807 or in writing to the following of an ongoing nature. In the Central Region, the government address: is focused on implementing the Living Melbourne, Living Executive Director Finance and Planning Victoria agenda, which aims to establish Victoria as a Department of Environment and Primary Industries world leader in integrated water cycle management. The 8 Nicholson Street government established the Office of Living Victoria to East Melbourne Victoria 3002 deliver key aspects of this initiative, including administering the Leading the Way – Living Victoria Fund, developing an integrated water strategy for Melbourne and preparing integrated water cycle plans for Melbourne’s regions.

90 Department of Environment and Primary Industries 2013 Annual Report Financial Statements 30 June 2013

Contents Page Comprehensive operating statement 92 %DODQFHVKHHW  Statement of changes in equity 94 &DVKÀRZVWDWHPHQW  1RWHVWRWKH¿QDQFLDOVWDWHPHQWV  $FFRXQWDEOH2I¿FHU¶VDQG&KLHI)LQDQFHDQG$FFRXQWLQJ2I¿FHU¶VGHFODUDWLRQ  $XGLWRU*HQHUDO¶VUHSRUW 

These financial statements cover the Department of Environment and Primary Industries as an individual entity and are presented in the Australian currency. The Department of Environment and Primary Industries is a government department of the State of Victoria. Its principal address is: Department of Environment and Primary Industries 8 Nicholson Street East Melbourne Victoria 3002 A description of the nature of the department’s operations and its principal activities is included in the Report of Operations. These financial statements were authorised for issue by the Secretary – Mr Adam Fennessy and the Executive Director Finance and Planning – Mr Matthew Clancy on 4 September 2013. For queries in relation to our financial reporting please call 13 61 86, or visit our website (www.depi.vic.gov.au).

Department of Environment and Primary Industries 2013 Annual Report 91 Department of Environment and Primary Industries Financial Statements

Comprehensive operating statement for the financial year ended 30 June 2013

2013 2012(i)(ii) Notes $’000 $’000

Income from transactions

Output appropriations 1(f), 24 1,030,695 1,065,143

Special appropriations 1(f), 24 14,545 18,531

Interest 1(f), 4(a) 2,313 3,063

Sale of goods and services 1(f), 4(b) 42,534 53,582

Metropolitan Parks Improvement Rate 1(f), 4(c) 136,763 131,482

Grants 1(f), 4(d) 35,555 96,905

Fair value of assets received free of charge or for nominal consideration 1(f), 4(e) 5,000 0

Other income 1(f), 4(f) 11,442 6,861

Total income from transactions 1,278,847 1,375,567

Expenses from transactions

Employee expenses 1(g), 5(a) (276,238) (271,063)

Depreciation 1(g), 5(b) (46,606) (49,362)

Interest expense 1(g), 5(c) (1,869) (1,838)

Grants and other transfers 1(g), 5(d) (494,101) (560,244)

Capital asset charge 1(g) (75,659) (75,393)

Supplies and services 1(g), 5(e) (362,398) (339,305)

Other operating expenses 1(g), 5(f) (7,809) (18,080)

Total expenses from transactions (1,264,680) (1,315,285)

Net result from transactions (net operating balance) 14,167 60,282

Other economic flows included in net result

Net gain/(loss) on non–financial assets 1(h), 6(a) 220,642 (43,806)

Net loss on financial instruments 1(h), 6(b) (39) 0

Share of net profits/(losses) of associates, excluding dividends 1(k), 6(c) 4,019 (1,607)

Other gains/(losses) from other economic flows 1(h), 6(d) 5,031 (2,248)

Total other economic flows included in net result 229,653 (47,661)

Net result 243,820 12,621

Other economic flows – other comprehensive income

Items that will not be classified to net result

Changes in physical asset revaluation surplus 23 4,606 0

Total other economic flows – other comprehensive income 4,606 0

Comprehensive result 248,426 12,621

The comprehensive operating statement should be read in conjunction with the notes to the financial statements. Notes: (i) Refer to Note 32. Correction of prior year errors for details. (ii) Refer to Note 1(v) Comparative amounts for details.

92 Department of Environment and Primary Industries 2013 Annual Report Balance sheet as at 30 June 2013

Restated As at 1 July 2013 2012(i) 2011(i) Notes $’000 $’000 $’000

Assets

Financial assets

Cash and deposits 1(k), 22(a) 249,976 258,218 251,012

Receivables 1(k), 7 204,618 176,055 198,788

Investments and other financial assets 1(k), 8 20,143 00

Investments accounted for using the equity method 1(k), 9 14,412 9,212 0

Total financial assets 489,149 443,485 449,800

Non-financial assets

Inventories 1(l), 10 12,875 13,218 11,893

Non-financial physical assets classified as held for sale 1(l), 11 574 2,543 628

Property, plant and equipment 1(l), 12 7,329,603 7,115,463 7,269,244

Biological assets 0 0 24,874

Intangible assets 1(l), 13 11,594 7,315 21,292

Prepayments 1(l) 9,813 10,022 8,840

Total non-financial assets 7,364,459 7,148,561 7,336,771

Total assets 7,853,608 7,592,046 7,786,571

Liabilities

Payables 1(m), 14 144,617 114,879 199,656

Borrowings 1(m), 15 27,535 30,549 25,130

Unearned income 1(m) 270 113 291

Provisions 1(m), 16 122,735 137,701 142,335

Total liabilities 295,157 283,242 367,412

Net assets 7,558,451 7,308,804 7,419,159

Equity

Accumulated deficit (2,171) (245,991) (258,612)

Physical asset revaluation surplus 23 5,650,255 5,645,649 5,645,649

Contributed capital 1(o) 1,910,367 1,909,146 2,032,122

Net worth 7,558,451 7,308,804 7,419,159

Commitments for expenditure 1(p), 19

Contingent assets and contingent liabilities 1(q), 20

The balance sheet should be read in conjunction with the notes to the financial statements. Note: (i) Refer to Note 32. Correction of prior year errors for details.

Department of Environment and Primary Industries 2013 Annual Report 93 Statement of changes in equity for the financial year ended 30 June 2013

Physical asset revaluation Accumulated Contributions surplus deficit by owners Total Notes $’000 $’000 $’000 $’000

Balance at 1 July 2011 5,642,080 (231,089) 2,032,122 7,443,113

Net effect of correction of errors(i) 32 3,569 (27,523) 0 (23,954)

Restated balance at 1 July 2011(i) 5,645,649 (258,612) 2,032,122 7,419,159

Net result for the year(i) 0 12,621 0 12,621

Other comprehensive income for the year (i) 23 0 0 0 0

Capital appropriations 24 0 0 147,327 147,327

Capital contributions of non-current assets 0 0 (148,166) (148,166)

Capital contributions transferred to portfolio entities 0 0 (122,137) (122,137)

Restated balance at 30 June 2012 5,645,649 (245,991) 1,909,146 7,308,804

Net result for the year 0 243,820 0 243,820

Other comprehensive income for the year 23 4,606 0 0 4,606

Capital appropriations 24 0 0 114,199 114,199

Capital contributions of non-current assets 0 0 (31,358) (31,358)

Capital contributions transferred to portfolio entities 0 0 (81,620) (81,620)

Balance at 30 June 2013 5,650,255 (2,171) 1,910,367 7,558,451

The statement of changes in equity should be read in conjunction with the notes to the financial statements. Note: (i) Refer to Note 32. Correction of prior year errors for details.

94 Department of Environment and Primary Industries 2013 Annual Report Cash flow statement for the financial year ended 30 June 2013

2013 2012 Notes $’000 $’000

Cash flows from operating activities

Receipts

Receipts from government 1,058,100 1,196,473

Receipts from other entities 191,840 202,128

Goods and Services Tax recovered from the ATO(i) 48,721 54,275

Interest received 2,467 3,086

Total receipts 1,301,128 1,455,962

Payments

Payments of grants and other transfers (494,232) (582,243)

Payments to suppliers and employees (683,112) (668,722)

Capital asset charge payments (75,659) (75,393)

Interest and other costs of finance paid (1,870) (1,824)

Total payments (1,254,873) (1,328,182)

Net cash flows from operating activities 22(c) 46,255 127,780

Cash flows used in investing activities

Payments for investments (20,143) (12,000)

Purchases of non-financial assets (68,708) (58,973)

Sales of non-financial assets 17,376 7,253

Net cash flows used in investing activities (71,475) (63,720)

Cash flows from/(used in) financing activities

Capital contributions by State Government 114,199 147,327

Payments of capital contributions (81,620) (122,137)

Repayments of finance leases (12,117) (9,225)

Proceeds from advances 0 0

Repayments of advances (3,484) (72,819)

Net cash flows from/(used in) financing activities 16,978 (56,854)

Net increase/(decrease) in cash and cash equivalents (8,242) 7,206

Cash and cash equivalents at the beginning of the financial year 258,218 251,012

Cash and cash equivalents at the end of the financial year 22(a) 249,976 258,218

Non-cash financing and investing activities are disclosed in Note 22(b). The cash flow statement should be read in conjunction with the accompanying notes. Note: (i) Goods and Services Tax recovered from the ATO is presented on a net basis.

Department of Environment and Primary Industries 2013 Annual Report 95 Notes to the financial statements for the year ended 30 June 2013

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96 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies

These annual financial statements represent the audited future salary movements and future discount rates (refer to general purpose financial statements for the Department Note 1(m) Liabilities). of Environment and Primary Industries (the department) for These financial statements are presented in Australian the period ended 30 June 2013. The purpose of the report dollars, and have been prepared in accordance with the is to provide users with information about the department’s historical cost convention, except for: stewardship of resources entrusted to it. • non-financial physical assets which, subsequent to (a) Statement of compliance acquisition, are measured at a revalued amount being These general purpose financial statements have been their fair value at the date of the revaluation less any prepared in accordance with the Financial Management Act subsequent accumulated depreciation and subsequent 1994 (FMA) and applicable Australian Accounting Standards impairment losses. Revaluations are made with sufficient (AAS) which include Interpretations, issued by the Australian regularity to ensure that the carrying amounts do not Accounting Standards Board (AASB). In particular, they are materially differ from their fair value presented in a manner consistent with the requirements of • the fair value of any other asset is generally based on its AASB 1049 Whole of Government and General Government depreciated replacement value. Sector Financial Reporting. Where appropriate, those AAS paragraphs applicable to not- (c) Reporting entity for-profit entities have been applied. The financial statements cover the department as an individual reporting entity. Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies The department is a government department of the State the concepts of relevance and reliability, thereby ensuring of Victoria, established pursuant to an order made by the that the substance of the underlying transactions or other Premier under the Administrative Arrangements Act 1983. events is reported. Its principal address is: To gain a better understanding of the terminology used in Department of Environment and Primary Industries this report, please refer to Note 33. Glossary of terms and 8 Nicholson Street style conventions. East Melbourne Victoria 3002 These annual financial statements were authorised for issue The department is an administrative agency acting on behalf by the Secretary of the department on 4 September 2013. of the Crown. (b) Basis of accounting preparation and measurement The financial statements include all the controlled activities of The accrual basis of accounting has been applied in the the department. preparation of these financial statements whereby assets, The following bodies are included in the department’s liabilities, equity, income and expenses are recognised in reporting entity: the reporting period to which they relate, regardless of when cash is received or paid. • The Office of the Environmental Monitor is an administrative office of the department established Judgements, estimates and assumptions are required to be under section 11 of the Public Administration Act 2004. made about the carrying values of assets and liabilities that The Monitor provides regular reports to the Minister for are not readily apparent from other sources. The estimates Environment and Climate Change, but is administratively and associated assumptions are based on professional responsible to the Secretary of the department. The judgements derived from historical experience and various Order in Council creating the administrative office became other factors that are believed to be reasonable under the effective on 1 January 2008. circumstances. Actual results may differ from these estimates. • The Office of Living Victoria is an administrative office of Revisions to accounting estimates are recognised in the the department established under section 11 of the Public period in which the estimate is revised and also in future Administration Act 2004. The Office of Living Victoria periods that are affected by the revision. Judgements and reports to the Minister for Water on the implementation assumptions made by management in the application of of the government’s Living Melbourne, Living Victoria AASs that have significant effects on the financial statements policies, but is administratively responsible to the and estimates relate to: Secretary of the department. The Order in Council creating • the fair value of land, buildings, infrastructure, plant and the administrative office became effective on 22 May 2012. equipment (refer to Note 1(l) Non-financial assets) The following statutory bodies are excluded from the • the impairment of non-financial assets (refer to Note 1(h) department’s reporting entity: Other economic flows included in the net result) • The Commissioner for Environmental Sustainability was • the estimated useful lives over which non-financial assets established by the Victorian Government in November are depreciated 2003 under the Commissioner for Environmental Sustainability Act 2003 to provide an independent voice • the estimation of amounts required to be provisioned or that audits and reports on environmental sustainability. disclosed as contingent liabilities The Commissioner for Environmental Sustainability is • assumptions for employee benefit provisions based on designated as a separate reporting entity and is excluded likely tenure of existing staff, patterns of leave claims, from the department’s financial report.

Department of Environment and Primary Industries 2013 Annual Report 97 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

• The Victorian Environmental Water Holder was established Administered items by the Victorian Government in July 2011 under the Water Certain resources are administered by the department on Amendment (Victorian Environmental Water Holder) Act behalf of the state. While the department is accountable 2010 to manage the state’s environmental water holdings. for the transactions involving administered items, it does The Victorian Environmental Water Holder is designated not have the discretion to deploy the resources for its own as a separate reporting entity and is excluded from the benefit or the achievement of its objectives. Accordingly, department’s financial report. transactions and balances relating to administered items are A description of the nature of the department’s operations not recognised as departmental income, expenses, assets and its principal activities is included in the report of or liabilities within the body of the financial statements. operations in the Annual Report which does not form part of The department is administering the desalination plant these financial statements. arrangements on behalf of the state and therefore recognises the associated income, expenses, assets and Objectives and funding liabilities as administered items. The department’s objectives are the effective management of water resources to meet future urban, rural and Other administered items include fees from land titles environmental needs; the community benefits from transactions, environmental contributions from Victorian effective management of Victoria’s land assets; effective water businesses and the state’s share of the Murray-Darling environmental and climate change policy, investment and Basin Authority’s jointly controlled assets. regulation; and reduced impact of major bushfires and Except as otherwise disclosed, administered resources other extreme events on people, infrastructure and the are accounted for on an accrual basis using the same environment. accounting policies adopted for recognition of the The department is predominantly funded by accrual based departmental items in the financial statements. Both parliamentary appropriations for the provision of outputs that controlled and administered items of the department are are further described in Note 2. Departmental (controlled) consolidated into the financial statements of the state. outputs. It provides, on a fee for service basis, various goods Disclosures related to administered items can be found in and services. Note 3. Administered (non-controlled) items.

Outputs of the department Funds held in trust Information about the department’s output activities, and The department receives monies in a trustee capacity for the expenses, income, assets and liabilities which are various purposes and holds it in a number of trust funds. reliably attributable to those output activities is set out in the output activities schedule (Note 2. Departmental (controlled) Trust funds where the department has discretion to deploy outputs). Information about income, expenses, assets and the resources for its own benefit or the achievement of its liabilities administered by the department are given in the objectives are controlled trust funds. Controlled trust funds schedule of administered income and expenses and the are recognised in these financial statements. schedule of administered assets and liabilities (Note 3. Trust funds where the department does not have the Administered (non-controlled) items). discretion to deploy the resources for its own benefit or the achievement of its objectives are administered trust funds. (d) Basis of consolidation These transactions and balances are reported in Note 3. In accordance with AASB 127 Consolidated and Separate Administered (non-controlled) items. Financial Statements, the consolidated financial statements exclude bodies within the department’s portfolio that are The department does not hold any trust funds on behalf of not controlled by the department and therefore are not third parties external to the Victorian Government. consolidated. Bodies and activities that are administered Disclosures related to trust fund transactions and balances (see explanation below under administered items) are also can be found in Note 27. Trust account balances. not controlled and not consolidated. (e) Scope and presentation of financial statements Consistent with the requirements of AASB 1004 Contributions, contributions by owners (that is, contributed Comprehensive operating statement capital and its repayment) are treated as equity transactions Income and expenses in the comprehensive operating and, therefore, do not form part of the income and expenses statement are classified according to whether or not they of the department. arise from ‘transactions’ or ‘other economic flows’. This classification is consistent with the whole-of-government Jointly controlled assets or operations reporting format and is allowed under AASB 101 Interests in jointly controlled assets or operations are not Presentation of Financial Statements. consolidated by the department, but are accounted for in accordance with the policy outlined in Note 1(k) Financial ‘Transactions’ and ‘other economic flows’ are defined by assets. the Australian System of Government Finance Statistics Concepts, Sources and Methods 2005 and Amendments to Australian System of Government Finance Statistics, 2005 (ABS Catalogue No. 5514.0) (the GFS manual, refer to Note 33. Glossary of terms and style conventions).

98 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

‘Transactions’ are those economic flows that are considered to the purposes defined under the relevant appropriations to arise as a result of policy decisions, usually interactions act. Additionally, the department is permitted under section between two entities by mutual agreement. Transactions 29 of the FMA to have certain income annotated to the also include flows within an entity, such as depreciation annual appropriation. The income which forms part of a where the owner is simultaneously acting as the owner of section 29 agreement is recognised by the department the depreciating asset and as the consumer of the service and the receipts paid into the Consolidated Fund as an provided by the asset. Taxation is regarded as mutually administered item. At the point of income recognition, agreed interactions between the government and taxpayers. section 29 provides for an equivalent amount to be added Transactions can be in kind (e.g. assets provided/given free to the annual appropriation. Examples of receipts which can of charge or for nominal consideration) or where the final form part of a section 29 agreement are Commonwealth consideration is cash. specific purpose grants, municipal council special purpose grants, the proceeds from the sale of assets and income ‘Other economic flows’ are changes arising from market from the sale of products and services. re-measurements. Refer to Note 1(h) Other economic flows included in the net result for more information. Where applicable, amounts disclosed as income are net of returns, allowances, duties and taxes. All amounts of The net result is equivalent to profit or loss derived in income over which the department does not have control accordance with AASs. are disclosed as administered income in the schedule Balance sheet of administered income and expenses (see Note 3. Administered (non-controlled) items). Income is recognised Assets and liabilities are presented in liquidity order with for each of the department’s major activities as follows: assets aggregated into financial assets and non-financial assets. Output appropriations Current and non-current assets and liabilities (non-current Income from the outputs the department provides to the being those assets or liabilities expected to be recovered or government is recognised when those outputs have been settled in more than 12 months) are disclosed in the notes, delivered and the relevant minister has certified delivery of where relevant. those outputs in accordance with specified performance criteria. Statement of changes in equity The statement of changes in equity presents reconciliations Interest of non-owner and owner changes in equity from the opening Interest income includes interest received on bank term balance at the beginning of the reporting period to the deposits and other investments and the unwinding over closing balance at the end of the reporting period. It also time of the discount on financial assets. Interest income shows separately changes due to amounts recognised is recognised using the effective interest method which in the ‘Comprehensive result’ and amounts recognised in allocates the interest over the relevant period. ‘Other economic flows – other movements in equity’ related Net realised and unrealised gains and losses on the to ‘Transactions with owner in its capacity as owner’. revaluation of investments do not form part of income from Cash flow statement transactions, but are reported either as part of income from other economic flows in the net result or as unrealised gains Cash flows are classified according to whether or not they or losses taken directly to equity, forming part of the total arise from operating, investing or financing activities. This change in net worth in the comprehensive result. classification is consistent with requirements under AASB 107 Statement of Cash Flows. Sale of goods and services For cash flow statement presentation purposes, cash Income from the supply of services and cash equivalents includes bank overdrafts, which are Income from the supply of services is recognised by included as current borrowings on the balance sheet. reference to the stage of completion of the services being Rounding performed. The income is recognised when: Amounts in the financial statements have been rounded to • the amount of the income, stage of completion and the nearest $1,000, unless otherwise stated. Please refer to transaction costs incurred can be reliably measured the end of Note 33. Glossary of terms and style conventions • it is probable that the economic benefits associated with for a style convention explaining that minor discrepancies in the transaction will flow to the department. totals of tables are due to rounding. Under the stage of completion method, income is (f) Income from transactions recognised by reference to the successful completion of Income is recognised to the extent that it is probable that milestones in individual contracts in each annual reporting the economic benefits will flow to the department and the period. income can be reliably measured at fair value. Income from the sale of goods Appropriation income Income from the sale of goods is recognised when: Appropriated income becomes controlled and is recognised • the department no longer has any of the significant risks by the department when it is appropriated from the and rewards of ownership of the goods transferred to the Consolidated Fund by the Victorian Parliament and applied buyer

Department of Environment and Primary Industries 2013 Annual Report 99 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

• the department no longer has continuing managerial (g) Expenses from transactions involvement to the degree usually associated with Expenses from transactions are recognised as they are ownership, nor effective control over the goods sold incurred, and reported in the financial year to which they • the amount of income, and the costs incurred or to be relate. incurred in respect of the transactions, can be reliably Employee expenses measured Refer to the section in Note 1(m) regarding employee • it is probable that the economic benefits associated with benefits. the transaction will flow to the department. These expenses include all costs related to employment Sale of goods and services includes regulatory fees which (other than superannuation which is accounted for are recognised at the time the regulatory fee is billed. separately) including wages and salaries, fringe benefits tax, leave entitlements, redundancy payments and WorkCover Metropolitan Parks Improvement Rate premiums. The Metropolitan Parks Improvement Rate is recognised as income when it is received. Superannuation The amount recognised in the comprehensive operating Grants statement is the employer contributions for members of both Income from grants (other than contributions by owners) is defined benefit and defined contribution superannuation recognised when the department obtains control over the plans that are paid or payable during the reporting period. contribution. The Department of Treasury and Finance (DTF) in their Where such grants are payable into the Consolidated Fund, Annual Financial Statements, disclose on behalf of the state they are reported as administered income (refer to Note as the sponsoring employer, the net defined benefit cost 1(d) Basis of consolidation and (i) Administered income). related to the members of these plans as an administered For reciprocal grants (i.e. equal value is given back by the liability. Refer to DTF’s Annual Financial Statements for more department to the provider), the department is deemed to detailed disclosures in relation to these plans. have assumed control when the department has satisfied its performance obligations under the terms of the grant. For Depreciation non-reciprocal grants, the department is deemed to have All items of property, plant and equipment that have finite assumed control when the grant is receivable or received. useful lives are depreciated. Depreciation is generally Conditional grants may be reciprocal or non-reciprocal calculated on a straight-line basis, at rates that allocate the depending on the terms of the grant. asset’s value, less any estimated residual value, over its estimated useful life. Fair value of assets received free of charge or for nominal consideration The estimated useful lives, residual values and depreciation Contributions of resources received free of charge or for method are reviewed at the end of each annual reporting nominal consideration are recognised at fair value when period, and adjustments made where appropriate. control is obtained over them, irrespective of whether these The following estimated useful lives for the different asset contributions are subject to restrictions or conditions over classes are used in the calculation of depreciation: their use. Asset class Useful life Other income Buildings and structures 5 to 100 years User fees and charges The department recognises controlled and administered Roads 80 years user fees and charges at the time an invoice is issued Plant and equipment 3 to 20 years for the goods or services provided, or cash is received where no invoice supports the goods or service provided. Historic, cultural and environment assets 99 years The exceptions are receipts for Land Titles services, and Buildings leasehold improvement Term of lease a portion of log sales, which are invoiced monthly based (1 to 15 years) on an annual royalty, averaged over 12 months. Where the provision of goods and services is incomplete at the Finance leased motor vehicle assets Term of lease reporting date, the value of the incomplete portion is (1 to 5 years) recognised as unearned income for the period and classified as a liability. Where assets have separately identifiable components, those components are assigned useful lives distinct from Other income the item of plant and equipment to which they relate and Amounts disclosed as income are, where applicable, net of depreciated accordingly. returns, allowances and duties and taxes. Intangible produced assets with finite useful lives are All other amounts of income over which the department depreciated as an expense from transactions on a straight- does not gain control are disclosed as administered line basis that allocate the asset’s value, less any estimated income in the schedule of administered items (see Note 3. residual value, over the asset’s useful life. A residual value Administered (non-controlled) items). is only included where there is either a commitment by a third party to purchase the asset at the end of its useful life,

100 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued) or an active market. Depreciation begins when the asset Net gain/(loss) on non-financial assets is available for use, that is, when it is in the location and Net gain/(loss) on non-financial assets and liabilities includes condition necessary for it to be capable of operating in the realised and unrealised gains and losses as follows: manner intended by management. Net gain/(loss) on disposal of property, plant and equipment The consumption of intangible non-produced assets with finite useful lives is not classified as a transaction, but as Any gain or loss on the disposal of property, plant and amortisation and is included in the net result as an other equipment is recognised at the date of disposal and is economic flow. The amortisation period and the amortisation determined after deducting from the proceeds the carrying method for an intangible asset with a finite useful life are value of the asset at that time. reviewed at least at the end of each annual reporting period. Recognition and derecognition of non-financial assets Intangible assets with indefinite useful lives are not Refer to Note 1(l) Non-financial assets. depreciated or amortised, but are tested annually for impairment. Impairment of non-financial assets Intangible assets with indefinite useful lives (and intangible Interest expense assets not yet available for use) are tested annually for Interest expense is recognised in the period in which it is impairment (as described below) and whenever there is an incurred. Refer to Note 33. Glossary of terms and style indication that the asset may be impaired. conventions for an explanation of interest expense items. All other assets are assessed annually for indications of Grants and other transfers impairment, except for: Grants and other transfers to third parties (other than • inventories (refer Note 1(l) Non-financial assets) contributions to owners) are recognised as an expense in the reporting period in which they are paid or payable. • non-financial physical assets held for sale (refer Note 1(l) They include transactions such as: grants, subsidies, other Non-financial assets). transfer payments made to state-owned agencies, local If there is an indication of impairment, the assets concerned government and community groups. Refer to Note 33. are tested as to whether their carrying value exceeds Glossary of terms and style conventions for an explanation their recoverable amount. Where an asset’s carrying value of grants and other transfers. exceeds its recoverable amount, the difference is written off as an other economic flow, except to the extent that the Capital asset charge write-down can be debited to an asset revaluation surplus The capital asset charge is calculated on the budgeted amount applicable to that class of asset. carrying amount of applicable non-financial physical assets. If there is an indication that there has been a change in the Supplies and services estimate of an asset’s recoverable amount since the last Supplies and services costs are recognised as an expense in impairment loss was recognised, the carrying amount shall the reporting period in which they are incurred. The carrying be increased to its recoverable amount. This reversal of the amounts of any inventories held for distribution are expensed impairment loss occurs only to the extent that the asset’s when distributed. carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or Other operating expenses amortisation, if no impairment loss had been recognised in Other operating expenses generally represent the day-to- prior years. day running costs incurred in normal operations. It is deemed that, in the event of the loss or destruction of an asset, the future economic benefits arising from the use Fair value of assets and services provided free of charge or of the asset will be replaced unless a specific decision to the for nominal consideration contrary has been made. The recoverable amount for most Contributions of resources provided free of charge or for assets is measured at the higher of depreciated replacement nominal consideration are recognised at their fair value cost and fair value less costs to sell. when the transferee obtains control over them, irrespective of whether restrictions or conditions are imposed over Refer to Note 1(l) Non-financial assets in relation to the the use of the contributions, unless received from another recognition and measurement of non-financial assets. government department or agency as a consequence of a Net gain/(loss) on financial instruments restructuring of administrative arrangements. In the latter case, such a transfer will be recognised at its carrying value. Net gain/(loss) on financial instruments includes: Contributions in the form of services are only recognised • realised and unrealised gains and losses from revaluations when a fair value can be reliably determined and the services of financial instruments at fair value would have been purchased if not donated. • impairment and reversal of impairment for financial instruments at amortised cost (refer to Note 1(j) Financial (h) Other economic flows included in the net result instruments) Other economic flows measure the change in volume or value of assets or liabilities that do not result from • disposals of financial assets. transactions.

Department of Environment and Primary Industries 2013 Annual Report 101 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Revaluations of financial instruments at fair value Grants Refer to Note 1(j) Financial instruments. The department’s administered grants mainly comprise funds provided by the Commonwealth to assist the State Share of net profits/(losses) of associates, excluding Government in meeting general or specific service delivery dividends obligations, primarily for the purpose of aiding the financing Refer to Note 1(d) Basis of consolidation. of the operations of the recipient, capital purposes and/or for on passing to other recipients. The department also receives Other gains/(losses) from other economic flows grants for on passing from other jurisdictions. Grant revenue Other gains/(losses) from other economic flows include the is recognised on an accrual basis. Refer to Note 1(f) Income gains or losses from: from transactions for the accounting of grants.

• the revaluation of the present value of the long service Jointly controlled assets received free of charge leave liability due to changes in bond interest rates On behalf of the state, the department jointly controlled • transfer of amounts from the reserves and/or accumulated assets of the Murray-Darling Basin Authority. Jointly surplus to net result due to disposal or derecognition or controlled assets received free of charge give rise to reclassification. revenue, which is recognised on an accrual basis.

(i) Administered income Other income The department does not gain control over assets arising Amounts disclosed as other income include leases, licenses from administered income, consequently no income is and royalties. Income from royalties is recognised on an recognised in the department’s financial statements. The accrual basis in accordance with the terms of the relevant department collects these amounts on behalf of the state. agreements. Accordingly, the amounts are disclosed as income in the schedule of Administered Items (see Note 3. Administered (j) Financial instruments (non-controlled) items). Financial instruments arise out of contractual agreements that give rise to a financial asset of one entity and a financial Appropriations – Payments on behalf of the State liability or equity instrument of another entity. Due to the Appropriation income is recognised on an accrual basis nature of the department’s activities, certain financial assets based for the provision of outputs delivered through and financial liabilities arise under statute rather than a Payments on Behalf of the State (POBOS). contract. Such financial assets and financial liabilities do not meet the definition of financial instruments in AASB Finance lease interest 132 Financial Instruments: Presentation. For example, Interest income from finance leases is recognised to reflect a statutory receivables arising from taxes, fines and penalties constant periodic rate of return on the state’s net investment do not meet the definition of financial instruments as they in finance leases. do not arise under contract. However, guarantees issued by the Treasurer on behalf of the department are financial Sales of goods and services instruments because, although authorised under statute, the Income from sales of goods and services is recognised by terms and conditions for each financial guarantee may vary reference to the stage of completion of the services being and are subject to an agreement. performed and when the department no longer has any of Where relevant, for note disclosure purposes, a distinction the significant risks and rewards of ownership of the goods is made between those financial assets and financial transferred to the buyer. liabilities that meet the definition of financial instruments in Land titles income accordance with AASB 132 and those that do not. Income for the provision of land titles data is recognised on The following refers to financial instruments unless otherwise behalf of the state on an accrual basis when services are stated. provided. Categories of non-derivative financial instruments Environmental contribution Loans and receivables Water authorities are required to contribute towards Loans and receivables are financial instrument assets with initiatives to improve the sustainable management of water. fixed and determinable payments that are not quoted on These contributions are collected through the Environmental an active market. These assets are initially recognised at Contribution Levy and recognised as revenue when the fair value plus any directly attributable transaction costs. department has the right to receive them on behalf of the Subsequent to initial measurement, loans and receivables state in accordance with AASB 1004 Contributions. are measured at amortised cost using the effective interest method, less any impairment. Loans and receivables category includes cash and deposits (refer to Note 1(k) Financial assets), term deposits with maturity greater than three months, trade receivables, loans and other receivables, but not statutory receivables.

102 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Financial liabilities at amortised cost Receivables Financial instrument liabilities are initially recognised on Receivables consist of: the date they are originated. They are initially measured at • contractual receivables, which include mainly debtors fair value plus any directly attributable transaction costs. in relation to goods and services, loans to third parties, Subsequent to initial recognition, these financial instruments accrued investment income, and finance lease receivables are measured at amortised cost with any difference between (refer to Note 1(n) Leases) the initial recognised amount and the redemption value being recognised in profit and loss over the period of the interest- • statutory receivables, which include predominantly bearing liability, using the effective interest rate method (refer amounts owing from the Victorian Government and to Note 33. Glossary of terms and style conventions). GST input tax credits recoverable. Receivables that are contractual are classified as financial instruments. Financial instrument liabilities measured at amortised Statutory receivables are not classified as financial cost include all of the department’s contractual payables, instruments. deposits held and advances received, interest-bearing arrangements other than those designated at fair value Contractual receivables are classified as financial instruments through profit or loss, but not statutory payables. and categorised as loans and receivables (refer to Note 1(j) Financial instruments for recognition and measurement). Offsetting financial instruments Statutory receivables are recognised and measured similarly Financial instrument assets and liabilities are offset and the to contractual receivables (except for impairment), but are net amount presented in the consolidated balance sheet not classified as financial instruments because they do not when, and only when, the department concerned has a arise from a contract. legal right to offset the amounts and intend either to settle Receivables are subject to impairment testing as described on a net basis or to realise the asset and settle the liability below. A provision for doubtful receivables is recognised simultaneously. when there is objective evidence that the debts may not be Reclassification of financial instruments collected, and bad debts are written off when identified (refer to Note 1(k) Impairment of financial assets). Subsequent to initial recognition and under rare circumstances, non-derivative financial instruments assets Investments and other financial assets that have not been designated at fair value through profit or Investments are classified in the following categories: loss upon recognition, may be reclassified out of the fair value through profit or loss category, if they are no longer held for • financial assets at fair value through profit or loss the purpose of selling or repurchasing in the near term. • loans and receivables Financial instrument assets that meet the definition of • held-to-maturity loans and receivables may be reclassified out of the fair value through profit and loss category into the loans and • available-for-sale financial assets. receivables category, where they would have met the The classification depends on the purpose for which the definition of loans and receivables had they not been investments were acquired. Management determines the required to be classified as fair value through profit and classification of its investments at initial recognition. loss. In these cases, the financial instrument assets may be reclassified out of the fair value through profit and loss Any dividend or interest earned on the financial asset is category, if there is the intention and ability to hold them for recognised in the comprehensive operating statement as a the foreseeable future or until maturity. transaction.

Available-for-sale financial instrument assets that meet the Investments accounted for using the equity method definition of loans and receivables may be reclassified into the loans and receivables category if there is the intention Associates are those entities over which the department and ability to hold them for the foreseeable future or until exercises significant influence, but not control. maturity. Investments in associates are accounted for in the financial statements using the equity method. Under this method, the (k) Financial assets department’s share of the post-acquisition profits or losses of Cash and deposits associates is recognised in the net result as other economic flows. The share of post-acquisition movements in revaluation Cash and deposits, including cash equivalents, comprise surpluses and any other reserves is recognised in both the cash on hand and cash at bank, deposits at call and those comprehensive operating statement and the statement highly liquid investments with an original maturity of three of changes in equity. The cumulative post acquisition months or less, which are held for the purpose of meeting movements are adjusted against the cost of the investment. short term cash commitments rather than for investment purposes, and which are readily convertible to known Joint ventures are contractual arrangements between the amounts of cash and are subject to an insignificant risk of department or a subsidiary entity and one or more other changes in value. party to undertake an economic activity that is subject to joint control. Joint control only exists when the strategic, financial and operating decisions relating to the activity require the unanimous consent of the parties sharing control (the venturers).

Department of Environment and Primary Industries 2013 Annual Report 103 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Interests in jointly controlled entities are accounted for in the The amount of the allowance is the difference between the financial statements using the equity method, as applied to financial asset’s carrying amount and the present value of investments in associates. estimated future cash flows, discounted at the effective interest rate. Investments in jointly controlled assets and operations In assessing impairment of statutory (non-contractual) Concerning any interest in jointly controlled assets, financial assets, which are not financial instruments, the department recognises in its administered financial professional judgement is applied in assessing materiality statements: using estimates, averages and other computational methods • its share of jointly controlled assets in accordance with AASB 136 Impairment of Assets.

• any liabilities that it had incurred (l) Non-financial assets • its share of liabilities incurred jointly by the joint venture Inventories • any income earned from the selling or using of its share of Inventories include goods and other property held either the output from the joint venture for sale, or for distribution at zero or nominal cost, or for consumption in the ordinary course of business operations. • any expenses incurred in relation to being an investor in the joint venture. Inventories held for distribution are measured at cost, adjusted for any loss of service potential. All other inventories For jointly controlled operations the state recognises the are measured at the lower of cost and net realisable value. assets that it controls, the liabilities and expenses that it Where inventories are acquired for no cost or nominal incurs and its share of income that it earns from selling consideration, they are measured at current replacement outputs of the joint venture. cost at the date of acquisition. Derecognition of financial assets Cost includes an appropriate portion of fixed and variable A financial asset (or, where applicable, a part of a financial overhead expenses. Cost is assigned to high value, low asset or part of a group of similar financial assets) is volume inventory items on a specific identification of cost derecognised when: basis. Cost for all other inventory is measured on the basis of weighted average cost. • the rights to receive cash flows from the asset have expired; or Bases used in assessing loss of service potential for inventories held for distribution include current replacement • the department retains the right to receive cash flows from cost and technical or functional obsolescence. Technical the asset, but has assumed an obligation to pay them in obsolescence occurs when an item still functions for full without material delay to a third party under a ‘pass some or all of the tasks it was originally acquired to do, through’ arrangement; or but no longer matches existing technologies. Functional • the department has transferred its rights to receive cash obsolescence occurs when an item no longer functions the flows from the asset and either: way it did when it was first acquired.

(a) has transferred substantially all the risks and rewards Non-financial physical assets classified as held for sale of the asset; or Non-financial physical assets (including disposal group (b) has neither transferred nor retained substantially all assets) are treated as current and classified as held for sale the risks and rewards of the asset, but has transferred if their carrying amount will be recovered through a sale control of the asset. transaction rather than through continuing use. Where the department has neither transferred nor retained This condition is regarded as met only when: substantially all the risks and rewards or transferred control, • the asset is available for immediate use in the current the asset is recognised to the extent of the department’s condition continuing involvement in the asset. • the sale is highly probable and the asset’s sale is expected Impairment of financial assets to be completed within 12 months from the date of At the end of each reporting period, the department classification. assesses whether there is objective evidence that a financial These non-financial physical assets, related liabilities and asset or group of financial assets is impaired. All financial financial assets are measured at the lower of carrying instrument assets, except those measured at fair value amount and fair value less costs to sell, and are not subject through profit or loss, are subject to annual review for to depreciation or amortisation. impairment. Receivables are assessed for bad and doubtful debts on a Property, plant and equipment regular basis. Those bad debts considered as written off by All non-financial physical assets are measured initially at cost mutual consent are classified as a transaction expense. Bad and subsequently revalued at fair value less accumulated debts not written off by mutual consent and the allowance depreciation and impairment. Where an asset is acquired for doubtful receivables are classified as other economic for no or nominal cost, the cost is its fair value at the date flows in the net result. of acquisition. Assets transferred as part of a Machinery of Government change are transferred at their carrying amount.

104 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

The initial cost for non-financial physical assets under a For the accounting policy on impairment of non-financial finance lease (refer to Note 1(n) Leases) is measured at physical assets, refer to impairment of non-financial assets amounts equal to the fair value of the leased asset or, if under Note 1(h) Impairment of non-financial assets. lower, the present value of the minimum lease payments, The department capitalises expenditures on individual items each determined at the inception of the lease. of $5,000 or more, and records these as non-financial Non-financial physical assets such as national parks, other assets. Aggregate expenditure on items that will, when Crown land and heritage assets are measured at fair value completed, result in non-financial assets that provide future with regard to the property’s highest and best use after economic benefits is recognised as construction in progress. due consideration is made for any legal or constructive restrictions imposed on the asset, public announcements Leasehold improvements or commitments made in relation to the intended use of The cost of leasehold improvements is capitalised as an the asset. Theoretical opportunities that may be available asset and depreciated over the shorter of the remaining term in relation to the asset are not taken into account until it is of the lease or the estimated useful life of the improvements. virtually certain that the restrictions will no longer apply. Revaluations of non-financial physical assets The fair value of cultural assets and collections, heritage Non-financial physical assets are measured at fair value on assets and other non-financial physical assets that the a cyclical basis, in accordance with the Financial Reporting department intends to preserve because of their unique Direction 103D Non-Current Physical Assets (FRD 103D). A historical, cultural or environmental attributes, is measured full revaluation normally occurs every five years, based upon at the replacement cost of the asset less, where applicable, the asset’s government purpose classification but may occur accumulated depreciation (calculated on the basis of such more frequently if fair value assessments indicate material cost to reflect the already consumed or expired future changes in values. Independent valuers are generally economic benefits of the asset) and any accumulated used to conduct these scheduled revaluations. Certain impairment. These policies and any legislative limitations infrastructure assets are revalued using specialised advisors. and restrictions imposed on their use and/or disposal may Any interim revaluations are determined in accordance with impact their fair value. the requirements of FRD 103D. Road network assets (including earthworks of the Revaluation increases or decreases arise from differences operational road networks) are measured at fair value, between an asset’s carrying value and fair value. determined by reference to the asset’s depreciated replacement cost. The roads, tracks and trails managed by Net revaluation increases (where the carrying amount of a the department are defined as Rural Class 5 and are sub- class of assets is increased as a result of a revaluation) are divided into five sub-classes as follows: recognised in ‘Other economic flows – other comprehensive income’, and accumulated in equity under the physical asset • 5A Primary roads: all-weather road, predominantly two revaluation surplus. However, the net revaluation increase lane and mainly sealed is recognised in the net result to the extent that it reverses • 5B Secondary roads: all-weather two lane road, formed a net revaluation decrease in respect of the same class of and gravelled or single lane sealed road with gravel property, plant and equipment previously recognised as an shoulders expense (other economic flows) in the net result. • 5C Minor roads: generally all-weather, single lane two-way Net revaluation decreases are recognised in ‘Other unsealed formed road, usually lightly gravelled economic flows – other comprehensive income’ to the extent that a credit balance exists in the physical asset • 5D Access roads: substantially single lane, two-way, revaluation surplus in respect of the same class of property, generally dry weather formed (natural materials) road plant and equipment. Otherwise, the net revaluation • 5E Tracks and trails: predominantly single lane, two-way decreases are recognised immediately as other economic earth tracks (unformed) at or near the natural surface level. flows in the net result. The net revaluation decrease Costs are expensed as incurred, because these tracks recognised in ‘Other economic flows – other comprehensive and trails have a useful life of less than one year. income’ reduces the amount accumulated in equity under the asset revaluation surplus. The fair value of plant, equipment and vehicles, is normally determined by reference to the asset’s depreciated Revaluation increases and decreases relating to individual replacement cost. For plant, equipment and vehicles, assets within a class of property, plant and equipment, existing depreciated historical cost is generally a reasonable are offset against one another within that class but are proxy for depreciated replacement cost because of the short not offset in respect of assets in different classes. Any lives of the assets concerned. asset revaluation surplus is not normally transferred to accumulated funds on derecognition of the relevant asset. Certain assets are acquired under finance leases, which may form part of a service concession arrangement. Refer Recognition and derecognition of land to Notes 1(n) Leases and 1(p) Commitments for more Land is recognised under the categories set out at Note information. 12. Property, plant and equipment when the department The cost of constructed non-financial physical assets identifies specific parcels of land, park, forest or reserve includes the cost of all materials used in construction, direct that it controls and their cost can be reliably determined. labour on the project, and an appropriate proportion of The department considers relevant information, such as the variable and fixed overheads. purpose for which a particular parcel has been reserved,

Department of Environment and Primary Industries 2013 Annual Report 105 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued) to determine the parcels of Crown land over which it has Refer to Note 1(g) Depreciation and Note 1(h) Impairment of control and records this information in its Land Information non-financial assets. Management System. Where land has been received at Expenditure on research activities is recognised as an no cost the fair value is determined by the Valuer-General expense in the period in which it is incurred. Victoria. An internally-generated intangible asset arising from Other government entities are able to change the status of development (or from the development phase of an internal Crown land, through grants and reservations made under project) is recognised if, and only if, all of the following are legislation that is not administered by either of the Ministers demonstrated: who hold portfolio responsibility for the department (for example, Crown grants may be issued under the Project (a) the technical feasibility of completing the intangible Development and Construction Management Act 1994). asset so that it will be available for use or sale The department’s policy is to recognise the effect of such (b) an intention to complete the intangible asset and use or changes when it is made aware of the change in status. sell it Land is derecognised when it is not eligible to be treated (c) the ability to use or sell the intangible asset as a return of equity. Gains or losses on the recognition or derecognition of land are recognised in the net result (other (d) the intangible asset will generate probable future economic flows). economic benefits

Third party transfers (e) the availability of adequate technical, financial and other resources to complete the development and to use or Land transferred to third parties is treated as a return of sell the intangible asset equity via administered expenses as per the requirements of FRD 117 Contributions of Existing Non-Financial Assets to (f) the ability to measure reliably the expenditure Third Parties. attributable to the intangible asset during its development. Biological assets Productive trees in commercial native forests are recognised Other non-financial assets as biological assets. These biological assets are measured Prepayments at fair value less costs to sell and are revalued at 30 June Other non-financial assets include prepayments which each year. represent payments in advance of receipt of goods or For productive trees, revaluation to fair value is determined services or that part of expenditure made in one accounting using a discounted cash flow method based on expected period covering a term extending beyond that period. net future cash flows, discounted by a current market determined rate. (m) Liabilities An increase or decrease in the fair value of these biological Payables assets is recognised in the consolidated comprehensive Payables consist of: operating statement as an other economic flow. • Contractual payables, such as accounts payable, Intangible assets statutory payables and accruals. Accounts payable represent liabilities for goods and services provided to the Purchased intangible assets are initially recognised at department prior to the end of the financial year that are cost. Subsequently, intangible assets with finite useful lives unpaid, and arise when the department becomes obliged are carried at cost less accumulated depreciation and to make future payments in respect of the purchase of accumulated impairment losses. Costs incurred subsequent those goods and services to initial acquisition are capitalised when it is expected that additional future economic benefits will flow to the • Statutory payables, such as goods and services tax and department. fringe benefits tax payables. When the recognition criteria in AASB 138 Intangible Contractual payables are classified as financial instruments Assets are met, internally generated intangible assets and categorised as financial liabilities at amortised cost (refer are recognised and measured at cost less accumulated to Note 1(j) Financial instruments). Statutory payables are depreciation and impairment. recognised and measured similarly to contractual payables, but are not classified as financial instruments and not Currently, intangible assets reported by the department are included in the category of financial liabilities at amortised software related. Where expenditure exceeds $300,000 on cost, because they do not arise from a contract. the development of databases, the department recognises databases as assets, at the value of the total expenditure on Advances from the Public Account are made pursuant to the development of the database. section 37 of the FMA and represent payments made in advance of receiving appropriation funding. These advances are recognised at the gross value of amounts owing and are not discounted to the present value of future cash flows.

106 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Borrowings (ii) Long service leave All interest-bearing liabilities are initially recognised at fair Liability for long service leave (LSL) is recognised in the value of the consideration received, less directly attributable provision for employee benefits. transaction costs (refer also to Note 1(n) Leases). The measurement basis subsequent to initial recognition Unconditional LSL is disclosed in the notes to the depends on whether the department has categorised financial statements as a current liability, even where the its interestbearing liabilities as either financial liabilities department does not expect to settle the liability within designated at fair value through profit or loss, or financial 12 months, because it will not have the unconditional liabilities at amortised cost. Any difference between the initial right to defer the settlement of the entitlement should recognised amount and the redemption value is recognised an employee take leave within 12 months. in net result over the period of the borrowing using the The components of this current LSL liability are effective interest method. measured at: Unearned income • nominal value – component that the department Unearned income consists of amounts received in advance expects to settle within 12 months from customers for goods and services that are to be • present value – component that the department delivered or provided by the department after the reporting does not expect to settle within 12 months. date. Conditional LSL is disclosed as a non-current liability. Provisions There is an unconditional right to defer the settlement of the entitlement until the employee has completed the Provisions are recognised when the department has a requisite years of service. This non-current LSL liability present obligation, the future sacrifice of economic benefits is measured at present value. is probable, and the amount of the provision can be measured reliably. Any gain or loss following revaluation of the present value of non-current LSL liability is recognised as a The future sacrifice of economic benefits includes transaction, except to the extent that a gain or loss costs associated with insurance claims, restoration and arises due to changes in bond interest rates for which it rehabilitation related to bushfire activities involving the is then recognised as an other economic flow (refer to department, and other environmental activities such as Note 1(h) Other economic flows included in net result). native vegetation offsets. (iii) Termination benefits The amount recognised as a liability is the best estimate of the consideration required to settle the present obligation Termination benefits are payable when employment at reporting period, taking into account the risks and is terminated before the normal retirement date, or uncertainties surrounding the obligation. Where a provision when an employee accepts voluntary redundancy is measured using the cash flows estimated to settle the in exchange for these benefits. The department present obligation, its carrying amount is the present value recognises termination benefits when it is demonstrably of those cash flows, using discount rate that reflects the time committed to either terminating the employment of value of money and risks specific to the provision. current employees according to a detailed formal plan without possibility of withdrawal or providing When some or all of the economic benefits required to termination benefits as a result of an offer made to settle a provision are expected to be received from a third encourage voluntary redundancy. Benefits falling due party, the receivable is recognised as an asset if it is virtually more than 12 months after the end of the reporting certain that recovery will be received and the amount of the period are discounted to present value. receivable can be measured reliably. Employee benefits on-costs Employee benefits Employee benefits on-costs such as payroll tax, workers Provision is made for benefits accruing to employees in compensation and superannuation are recognised respect of wages and salaries, annual leave and long service separately from the provision for employee benefits. leave for services rendered to the reporting date. (i) Wages, salaries and annual leave Onerous contracts An onerous contract is considered to exist when the Liabilities for wages and salaries, including non- unavoidable cost of meeting the contractual obligations monetary benefits and annual leave are recognised exceeds the estimated economic benefits to be received. in the provision for employee benefits, classified as Present obligations arising under onerous contracts are current liabilities. Those liabilities which are expected to recognised as a provision to the extent that the present be settled within 12 months of the reporting period, are obligation exceeds the estimated economic benefits to be measured at their nominal values. Those liabilities that received. are not expected to be settled within 12 months are also recognised in the provision for employee benefits as current liabilities, but are measured at the present value of the amounts expected to be paid when the liabilities are settled using the remuneration rate expected to apply at the time of settlement.

Department of Environment and Primary Industries 2013 Annual Report 107 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

(n) Leases (o) Equity A lease is a right to use an asset for an agreed period of time Contributions by owners in exchange for payment. Additions to net assets which have been designated as Leases are classified at their inception as either operating contributions by owners are recognised as contributed or finance leases based on the economic substance of the capital. Other transfers that are in the nature of contributions agreement to reflect the risks and rewards incidental to or distributions have also been designated as contributions ownership. Leases of property, plant and equipment are by owners. classified as finance leases whenever the terms of the lease Transfers of net assets arising from administrative transfer substantially all the risks and rewards of ownership restructurings are treated as distributions to or contributions from the lessor to the lessee. All other leases are classified by owners. Transfers of net liabilities arising from as operating leases. administrative restructurings are treated as distributions to Finance leases owners. Department as lessor Transfers of net assets to third parties are treated as a return of equity via administered expenses, as required under FRD Amounts due from lessees under finance leases are 117 Contributions of Existing Non-Financial Assets to Third recorded as receivables. Finance lease receivables are Parties. initially recorded at amounts equal to the present value of the minimum lease payments receivable plus the present (p) Commitments value of any unguaranteed residual value expected to Commitments for future expenditure include operating accrue at the end of the lease term. Finance lease receipts and capital commitments arising from contracts. These are apportioned between periodic interest income and commitments are disclosed by way of a note (refer to Note reduction of the lease receivable over the term of the lease in 19. Commitments for expenditure and Note 3. Administered order to reflect a constant periodic rate of return on the net (non-controlled) items) at their nominal value and inclusive of investment outstanding in respect of the lease. the goods and services tax (GST) payable. In addition, where Department as lessee it is considered appropriate and provides additional relevant information to users, the net present values of significant At the commencement of the lease term, finance leases are individual projects are stated. These future expenditures initially recognised as assets and liabilities at amounts equal cease to be disclosed as commitments once the related to the fair value of the lease property or, if lower, the present liabilities are recognised in the balance sheet. value of the minimum lease payment, each determined at the inception of the lease. The lease asset is depreciated (q) Contingent assets and contingent liabilities over the shorter of the estimated useful life of the asset or Contingent assets and contingent liabilities are not the term of the lease. recognised in the balance sheet, but are disclosed by way Minimum finance lease payments are apportioned between of a note (refer to Note 20. Contingent assets and reduction of the outstanding lease liability and periodic contingent liabilities) and, if quantifiable, are measured at finance expense, which is calculated using the interest nominal value. Contingent assets and liabilities are presented rate implicit in the lease and charged directly to the inclusive of GST receivable or payable respectively. comprehensive operating statement. Contingent rentals associated with finance leases are recognised as an (r) Service concession arrangements expense in the period in which they are incurred. The department sometimes enters into certain arrangements with private sector participants to design and construct or Operating leases upgrade an asset used to provide public services. These Department as lessee arrangements are typically complex and usually include the provision of operational and maintenance services for Operating lease payments, including any contingent rentals, a specified period of time. These arrangements are often are recognised as an expense in the comprehensive referred to as either Public Private Partnerships (PPPs) or operating statement on a straight-line basis over the lease Service Concession Arrangements (SCAs). term, except where another systematic basis is more representative of the time pattern of the benefits derived The department pays the operator over the period of the from the use of the leased asset. The leased asset is not arrangement, subject to specified performance criteria being recognised in the balance sheet. met. At the date of commitment to the principal provisions of the arrangement, these estimated periodic payments are All incentives for the agreement of a new or renewed allocated between a component related to the design and operating lease are recognised as an integral part of the construction or upgrading of the asset and components net consideration agreed for the use of the leased asset, related to the ongoing operation and maintenance of the irrespective of the incentive’s nature or form or the timing asset. The former component is accounted for as a lease of payments. payment. The remaining components are accounted for as In the event that lease incentives are received to enter commitments for operating costs and capital expenditure into operating leases, the aggregate cost of incentives are which are accounted for in the comprehensive operating recognised as a reduction of rental expense over the lease statement and balance sheet as they are incurred. term on a straight-line basis, unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

108 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

The department classifies PPPs as controlled or the end of the reporting period are translated at the closing administered items in accordance with AASB 1050 rate at the date of the end of the reporting period. Non- Administered Items and the Victorian Government’s monetary assets carried at fair value that are denominated in business rule, BFMG 60 Administered Items. Key indicators foreign currencies are translated at the rates prevailing at the of control are where a PPP contributes to the achievement date when the fair value was determined. of the department’s outputs, or where controlled sources of Foreign currency translation differences are recognised income are used to fund obligations to the operator. in other economic flows and accumulated in a separate (s) Accounting for the goods and services tax (GST) component of equity, in the period in which they arise. Income, expenses and assets are recognised net of the (u) Events after the reporting period amount of associated GST, except where the GST incurred Note disclosure is made about events between the end of is not recoverable from the taxation authority. In this case, the reporting period and the date the financial statements the GST payable is recognised as part of the cost of are authorised for issue where the events relate to conditions acquisition of the asset or as part of the expense. which arose after the end of the reporting period and which Receivables and payables are stated inclusive of the amount may have a material impact on the results of subsequent of GST receivable or payable. The net amount of GST years. recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance (v) Comparative amounts sheet. Where the presentation or classification of items in the financial statements changes, the comparative amounts are Cash flows are presented on a gross basis. The GST also reclassified unless it is impractical to do so. The nature, components of cash flows arising from investing or financing amount and reason for the reclassification is also disclosed. activities which are recoverable from, or payable to the If the reclassification affects an item on the balance sheet, a taxation authority, are presented as operating cash flows. third statement of financial position is also presented. Commitments for expenditure and contingent assets and The department has reviewed its financial statements liabilities are also stated inclusive of GST. and determined to reclassify some classes of income and (t) Foreign currency balances/transactions expenditure in order to reflect the classification used by DTF for whole-of-government reporting. The review has affected All foreign currency transactions during the financial year are the line items in the financial statements and notes as set brought to account using the exchange rate in effect at the out below. date of the transaction. Foreign monetary items existing at

Comprehensive operating statement line item – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Output appropriations 1,083,674 (18,531) 1,065,143

Special appropriations 0 18,531 18,531

Sales of goods and services 48,037 5,545 53,582

Other income 12,406 (5,545) 6,861

Employee expenses (272,425) 1,362 (271,063)

Interest expense (1,824) (14) (1,838)

Supplies and services (338,696) (609) (339,305)

Total expenses from transactions (1,316,024) 739 (1,315,285)

Net result from transactions 59,543 739 60,282

Other gains/(losses) from other economic flows (1,509) (739) (2,248)

Total other economic flows included in net result (46,922) (739) (47,661)

Department of Environment and Primary Industries 2013 Annual Report 109 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Note 3(a) Administered income and expenses – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Provision of services 29,045 (29,045) 0

Licenses and leases 23,348 (23,348) 0

Royalties 908 (908) 0

Grants 5,740 958 6,698

Other income 68,124 (44,811) 23,313

Sales of goods and services 0 97,148 97,148

Interest 0 6 6

Note 4(b) Sales of goods and services – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Rendering of services 0 47,578 47,578

Sales of goods 0 331 331

User fees and charges 48,037 (47,937) 100

Refunds and reimbursements 0 5,573 5,573

Total sale of goods and services 48,037 5,545 53,582

Note 4(d) Grants – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Commonwealth grants 11,684 (11,684) 0

Grants from portfolio entities 83 (83) 0

Grants from other public bodies 6,755 (6,755) 0

Other state government grants 78,383 (78,383) 0

Specific purpose grants 0 11,695 11,695

Other contributions and grants 0 85,210 85,210

Note 4(e) Other income – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Settlements and reimbursements 12,406 (12,406) 0

Other miscellaneous income 0 6,861 6,861

Total other income 12,406 (5,545) 6,861

110 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Note 5(a) Employee expenses – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Other on-costs (fringe benefits tax, payroll tax and workcover levy) (18,735) 1,362 (17,373)

Total employee expenses (272,425) 1,362 (271,063)

Note 5(c) Interest expense – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Other interest expense (3) (14) (17)

Total interest expense (1,824) (14) (1,838)

Note 5(d) Grants and other transfers – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Sustainable Water Management and Supply (183,058) 183,058 0

Public Land (66,075) 66,075 0

Biodiversity (7,895) 7,895 0

Natural Resources (83,605) 83,605 0

Land and Fire Management (15,765) 15,765 0

Forests and Parks (185,546) 185,546 0

Environmental Policy and Climate Change (17,160) 17,160 0

Land Administration and Property Information (1,140) 1,140 0

Grants to portfolio agencies 0 (313,888) (313,888)

Grants to catchment management authorities 0 (125,614) (125,614)

Grants to non-portfolio agencies 0 (50,144) (50,144)

Grants to DPI research institutes 0 (13,778) (13,778)

Grants to the Commonwealth, other state, territory and local governments 0 (32,239) (32,239)

Grants to private individuals, businesses and non-profit organisations 0 (24,411) (24,411)

Other grants and transfers 0 (170) (170)

Department of Environment and Primary Industries 2013 Annual Report 111 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

Note 5(e) Supplies and services – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

General expenses (37,866) (1,362) (39,228)

Office and accommodation (32,108) 753 (31,355)

Total supplies and services (338,696) (609) (339,305)

Note 6(d) Other gains/(losses) from other economic flows – line items affected

Actual Reclassified 2012 Reclassification 2012 $’000 $’000 $’000

Other provision discount rate adjustments (14) (739) (753)

Total other gains/(losses) from other economic flows (1,509) (739) (2,248)

(w) AASs issued that are not yet effective Certain new AASs have been published that are not mandatory for the 30 June 2013 reporting period. DTF assesses the impact of all these new standards and advises the department of their applicability and early adoption where applicable. As at 30 June 2013, the following AASs have been issued by the AASB but are not yet effective. They become effective for the first financial statements for reporting periods commencing after the stated operating date as follows:

Applicable for annual reporting Standard/ periods beginning Impact on public sector entity Interpretation Summary on or after financial statements

AASB 9 Financial This Standard simplifies requirements for 1 January 2015 Subject to AASB’s further modifications Instruments the classification and measurement of to AASB 9, together with the financial assets resulting from Phase 1 of the anticipated changes resulting from the IASB’s project to replace IAS 39 Financial staged projects on impairments and Instruments: Recognition and Measurement hedge accounting, details of impacts (AASB 139 Financial Instruments: will be assessed. Recognition and Measurement).

AASB 10 This Standard forms the basis for 1 January 2014 Not-for-profit entities are not permitted Consolidated determining which entities should be to apply this Standard prior to the Financial Statements consolidated into an entity’s financial mandatory application date. statements. AASB 10 defines ‘control’ as Subject to AASB’s final deliberations on requiring exposure or rights to variable ED 238 and any modifications made to returns and the ability to affect those returns AASB 10 for not-for-profit entities, the through power over an investee, which may entity will need to re-assess the nature broaden the concept of control for public of its relationships with other entities, sector entities. including those that are currently not The AASB has issued an exposure draft ED consolidated. 238 Consolidated Financial Statements – Australian Implementation Guidance for Not- for-Profit Entities that explains and illustrates how the principles in the Standard apply from the perspective of not-for-profit entities in the private and public sectors.

112 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

AASB 11 Joint This Standard deals with the concept of 1 January 2014 Not-for-profit entities are not permitted Arrangements joint control, and sets out a new principles- to apply this Standard prior to the based approach for determining the type mandatory application date. of joint arrangement that exists and the Subject to AASB’s final deliberations corresponding accounting treatment. The and any modifications made to new categories of joint arrangements under AASB 11 for not-for-profit entities, AASB 11 are more aligned to the actual the entity will need to assess the rights and obligations of the parties to the nature of arrangements with other arrangement. entities in determining whether a joint arrangement exists in light of AASB 11.

AASB 12 Disclosure This Standard requires disclosure of 1 January 2014 Not-for-profit entities are not permitted of Interests in Other information that enables users of financial to apply this Standard prior to the Entities statements to evaluate the nature of, and mandatory application date. risks associated with, interests in other Impacts on the level and nature of the entities and the effects of those interests disclosures will be assessed based on on the financial statements. This Standard the eventual implications arising from replaces the disclosure requirements in AASB 10, AASB 11 and AASB 128 AASB 127 Separate Financial Statements Investments in Associates and Joint and AASB 131 Interests in Joint Ventures. Ventures. The exposure draft ED 238 proposes to add some implementation guidance to AASB 12, explaining and illustrating the definition of a ‘structured entity’ from a not-for-profit perspective.

AASB 13 Fair Value This Standard outlines the requirements 1 January 2013 Disclosure for fair value measurements Measurement for measuring the fair value of assets and using unobservable inputs are relatively liabilities and replaces the existing fair value detailed compared to disclosure for fair definition and guidance in other Australian value measurements using observable accounting standards. AASB 13 includes inputs. Consequently, the Standard a ‘fair value hierarchy’ which ranks the may increase the disclosures required valuation technique inputs into three levels assets measured using depreciated using unadjusted quoted prices in active replacement cost. markets for identical assets or liabilities; other observable inputs; and unobservable inputs.

AASB 119 Employee In this revised Standard for defined benefit 1 January 2013 Not-for-profit entities are not permitted Benefits superannuation plans, there is a change to apply this Standard prior to the to the methodology in the calculation of mandatory application date. superannuation expenses, in particular While the total superannuation expense there is now a change in the split between is unchanged, the revised methodology superannuation interest expense (classified is expected to have a negative impact as transactions) and actuarial gains and on the net result from transactions a losses (classified as ‘Other economic flows – few Victorian public sector entities that other movements in equity’) reported on the report superannuation defined benefit comprehensive operating statement. plans.

AASB 127 Separate This revised Standard prescribes the 1 January 2014 Not-for-profit entities are not permitted Financial Statements accounting and disclosure requirements for to apply this Standard prior to the investments in subsidiaries, joint ventures mandatory application date. The and associates when an entity prepares AASB is assessing the applicability of separate financial statements. principles in AASB 127 in a not-for- profit context.

As such, the impact will be assessed after the AASB’s deliberation.

Department of Environment and Primary Industries 2013 Annual Report 113 Notes to the financial statements for the year ended 30 June 2013 Note 1. Summary of significant accounting policies (continued)

AASB 128 This revised Standard sets out the 1 January 2014 Not-for-profit entities are not permitted Investments in requirements for the application of the equity to apply this Standard prior to the Associates and Joint method when accounting for investments in mandatory application date. The Ventures associates and joint ventures. AASB is assessing the applicability of principles in AASB 128 in a not-for- profit context.

As such, the impact will be assessed after the AASB’s deliberation.

AASB 1053 This Standard establishes a differential 1 January 2013 The Victorian Government is currently Application of financial reporting framework consisting considering the impacts of Reduced Tiers of Australian of two tiers of reporting requirements Disclosure Requirements (RDRs) for Accounting for preparing general purpose financial certain public sector entities, and has not Standards statements. decided if RDRs will be implemented in the Victorian public sector.

AASB 1055 AASB 1055 extends the scope of budgetary 1 January 2014 The entity will be required to restate in Budgetary Reporting reporting that is currently applicable for the financial statements the budgetary the whole of government and general information in accordance with the government sector (GGS) to not-for-profit presentation format prescribed in entities within the GGS, provided that these Australian Accounting Standards and entities present separate budgets to the explain the significant variances from parliament. the original budget.

In addition to the new standards above, the AASB has • AASB 2011–11 Amendments to AASB 119 (September issued a list of amending standards that are not effective for 2011) arising from Reduced Disclosure Requirements. the 2012–13 reporting period (as listed below). In general, • AASB 2011–12 Amendments to Australian Accounting these amending standards include editorial and references Standards arising from Interpretation 20. changes that are expected to have insignificant impacts on public sector reporting. The two AASB Interpretations in the • 2012–1 Amendments to Australian Accounting Standards list below are also not effective for the 2012–13 reporting – Fair Value Measurement – Reduced Disclosure period and are considered to have insignificant impacts on Requirements. public sector reporting. • 2012–2 Amendments to Australian Accounting Standards • AASB 2009–11 Amendments to Australian Accounting – Disclosures – Offsetting Financial Assets and Financial Standards arising from AASB 9. Liabilities. • AASB 2010–2 Amendments to Australian Accounting • 2012–3 Amendments to Australian Accounting Standards Standards arising from Reduced Disclosure Requirements. – Offsetting Financial Assets and Financial Liabilities. • AASB 2010–7 Amendments to Australian Accounting • 2012–5 Amendments to Australian Accounting Standards Standards arising from AASB 9 (December 2010). arising from Annual Improvements 2009–2011 Cycle. • AASB 2010–10 Further Amendments to Australian • 2012–7 Amendments to Australian Accounting Standards Accounting Standards – Removal of Fixed Dates for First- arising from Reduced Disclosure Requirements. time Adopters. • 2012–9 Amendment to AASB 1048 arising from the • AASB 2011–2 Amendments to Australian Accounting Withdrawal of Australian Interpretation 1039. Standards arising from the Trans-Tasman Convergence • 2012–10 Amendments to Australian Accounting Project – Reduced Disclosure Requirements. Standards – Transition Guidance and Other Amendments. • AASB 2011–4 Amendments to Australian Accounting • 2012–11 Amendments to Australian Accounting Standards to Remove Individual Key Management Standards – Reduced Disclosure Requirements and Other Personnel Disclosure Requirements. Amendments. • AASB 2011–6 Amendments to Australian Accounting • 2013–1 Amendments to AASB 1049 – Relocation of Standards – Extending Relief from Consolidation, the Budgetary Reporting Requirements. Equity Method and Proportionate Consolidation – Reduced Disclosure Requirements. • 2013–2 Amendments to AASB 1038 – Regulatory Capital. • AASB 2011–7 Amendments to Australian Accounting • 2013–3 Amendments to AASB 136 – Recoverable Standards arising from the Consolidation and Joint Amount Disclosures for Non-Financial Assets. Arrangements Standards. • AASB Interpretation 20 Stripping Costs in the Production • AASB 2011–8 Amendments to Australian Accounting Phase of a Surface Mine. Standards arising from AASB 13. • AASB Interpretation 21 Levies. • AASB 2011–10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011).

114 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 2. Departmental (controlled) outputs

A description of departmental outputs performed during Effective Environmental and Climate Change Policy, the year ended 30 June 2013, and the objectives of these Investment and Regulation outputs, are summarised below. The department is the Victorian Government’s lead agency for the development of environmental policy. Environmental Effective Water Management and Supply policy is an evolving policy area for all levels of government. Effective management of Victoria’s water supply and At a national level, the focus is on reducing Australia’s its quality is fundamental to our economy, society and greenhouse gas emissions, helping communities, industries environment. Issues requiring continued attention include and governments adapt to a changing climate. The salinity, the health of rivers and estuaries, reliable water department also works to ensure contemporary standards of supply and water quality and pricing. environmental regulation are maintained.

Objectives to which the output contributes Objectives to which the output contributes This output contributes to the departmental objective of This output contributes to the departmental objective delivering effective management of water resources to meet of effective environmental and climate change policy, future urban, rural and environmental needs. investment and regulation.

Effective Water Management and Supply Biodiversity This output develops policies, provides oversight of, and The department works with land managers and a range strategic advice on, regulatory systems and institutional of other organisations to protect, enhance and restore arrangements to drive the effective use of Victoria’s water biodiversity assets, maintain ecological assets and provide resources. Key areas include river health, sustainable for the sustainable use of Victoria’s flora and fauna. The irrigation, ground and surface water, water reuse and department also improves the understanding of ecosystem recycling, and water sector agency governance and pricing. services to better inform land use decisions. The department also conducts terrestrial and freshwater ecological research Effective Management of Victoria’s Land Assets to support the management and protection of biodiversity Victoria’s public land including its parks, forests and coasts assets across the state. have significant cultural and recreational value and are pivotal in protecting biodiversity values. Victoria’s diverse Natural Resources public land estate also supports tourism and other important This output leads policy and investment in research for industries. the achievement of highly productive and sustainable landscapes. It provides a partnership approach with Objectives to which the output contributes communities, catchment management authorities, This output contributes to the departmental objective of the other government agencies and research institutes for community benefits from effective management of Victoria’s improvement in the condition of our state’s natural assets public and private land assets. through policy implementation, program design, project investment, monitoring and reporting. Public Land This output provides for the management of Victoria’s Crown Environmental Policy and Climate Change land, including the coast and marine environment. It works Through this output, the department leads the development towards the improved stewardship of natural, built and and implementation of strategic, whole-of-government historic assets, and incorporates management of public land responses to issues around environmental sustainability and in partnership with statutory agencies, committees and local climate change policy. government. It recognises the value of a public land estate that can adapt to climate change and cater for community Effective Management of Fire expectations. The department will work with its Networked Emergency Organisation partners (including Parks Victoria, Department Forests and Parks of Primary Industries, Department of Planning and This output provides for the management of Victoria’s state Community Development, Melbourne Water and VicForests) run parks and forests. Through this output, the department to further improve our response to fire risk and make manages the balance between development and protection adjustments to land management, fire suppression, planned of natural, cultural and community assets for enjoyment and burning and recovery activities. The department will also sustainable use. This output works towards the improved refine how fire management is understood and translated stewardship of Victoria’s parks and forests and incorporates into operational policies and procedures. direct and delegated management of public land. Objectives to which the output contributes Land Administration and Property Information This output contributes to the departmental objective of Through this output, the department is working towards reduced impact of major bushfires and other extreme events ensuring: confidence in the integrity and efficiency of the on people, infrastructure and the environment. property system; accessible and transparent property markets; established and accepted natural resource Land and Fire Management markets; and comprehensive and accessible spatial This output covers activities under an integrated land and information to support planning and decision making. fire management framework, for the effective planning and management of fire across public land.

Department of Environment and Primary Industries 2013 Annual Report 115 Notes to the financial statements for the year ended 30 June 2013 Note 2. Departmental (controlled) outputs (continued)

Schedule A - Controlled income and expenses for the year ended 30 June 2013

Land Effective Water Administration Management & & Property Supply Public Land Forests & Parks Information 2013 2012 2013 2012 (i) 2013 2012 2013 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Income from transactions Output appropriations 204,824 229,649 69,556 78,689 92,676 132,811 101,994 109,110 Special appropriations 14,442 18,531 0 0 0 0 0 0 Interest 0 0 2,313 3,063 0 0 0 0 Sale of goods and services 5,651 5,691 1,558 1,611 1,071 1,509 11,236 10,804 Metropolitan Parks Improvement Rate 0 0 38,859 38,785 97,904 92,697 0 0 Grants 21,906 44,013 3,433 23,775 6,529 11,709 378 448 Fair value of assets received free of 0 0 5,000 0 0 0 0 0 charge or for nominal consideration Other income 6,657 5,890 24 29 421 659 0 2 Total income from transactions 253,480 303,774 120,743 145,952 198,601 239,385 113,608 120,364 Expenses from transactions Employee expenses (26,391) (28,123) (20,975) (22,017) (15,573) (18,701) (47,168) (47,245) Depreciation (1,514) (2,548) (2,405) (3,009) (10,694) (8,011) (3,999) (8,014) Interest expense (134) (30) (156) (58) (53) (20) (211) (52) Grants and other transfers (176,635) (183,058) (44,211) (66,075) (154,610) (185,546) (538) (1,140) Capital asset charge (1,319) (1,378) (16,546) (16,537) (174) (221) (5,052) (5,003) Supplies and services (55,612) (57,128) (25,340) (30,234) (17,665) (18,832) (62,420) (58,086) Other operating expenses (94) (103) (235) (278) (198) (388) (647) (1,161) Total expenses from transactions (261,699) (272,368) (109,868) (138,208) (198,967) (231,719) (120,035) (120,701) Net result from transactions (8,219) 31,406 10,875 7,744 (366) 7,666 (6,427) (337) (net operating balance) Other economic flows included in net result Net gain/(loss) on non-financial assets 27,064 (6,629) 185,297 108 30 (2,936) 74 (8,155) Net gain/(loss) on financial instruments 0 1 2 2 (5) 0 (22) 0 Share of net profits/(losses) of 0 0 0 0 0 0 4,019 (1,607) associates, excluding dividends Other gains/(losses) from other 543 (277) 486 (215) 217 (123) 823 (342) economic flows Total other economic flows 27,607 (6,905) 185,785 (105) 242 (3,059) 4,894 (10,104) included in net result Net result 19,388 24,501 196,660 7,639 (124) 4,607 (1,533) (10,441) Other economic flows – other comprehensive income Items that will not be classified to net result Changes in physical asset 0 0 4,589 0 17 0 0 0 revaluation surplus Total other economic flows – 0 0 4,589 0 17 0 0 0 other comprehensive income Comprehensive result 19,388 24,501 201,249 7,639 (107) 4,607 (1,533) (10,441)

Note: (i) Refer to Note 32. Correction of prior year errors for details.

116 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 2. Departmental (controlled) outputs (continued)

Schedule A - Controlled income and expenses for the year ended 30 June 2013 (continued)

Environmental Policy Land & Fire Biodiversity Natural Resources & Climate Change Management Totals

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012(i) $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

37,518 62,056 81,527 101,831 41,054 51,958 401,546 299,039 1,030,695 1,065,143

0 0 0 0 0 0 103 0 14,545 18,531

0 0 0 0 0 0 0 0 2,313 3,063

14,426 21,520 256 95 1,644 2,290 6,692 10,062 42,534 53,582

0 0 0 0 0 0 0 0 136,763 131,482

1,898 2,651 7 4,461 1,157 1,920 247 7,928 35,555 96,905

0 0 0 0 0 0 0 0 5,000 0

25 173 9 54 4,300 1 6 53 11,442 6,861

53,867 86,400 81,799 106,441 48,155 56,169 408,594 317,082 1,278,847 1,375,567

(27,459) (32,802) (10,426) (12,421) (12,703) (13,976) (115,543) (95,778) (276,238) (271,063)

(2,151) (3,299) (628) (1,089) (429) (887) (24,786) (22,505) (46,606) (49,362)

(198) (179) (34) (15) (41) (11) (1,042) (1,473) (1,869) (1,838)

(9,219) (7,895) (64,841) (83,605) (25,577) (17,160) (18,470) (15,765) (494,101) (560,244)

(1,914) (2,022) (240) (265) (131) (179) (50,283) (49,788) (75,659) (75,393)

(18,318) (30,180) (6,740) (8,580) (8,772) (9,994) (167,531) (126,271) (362,398) (339,305)

(704) (963) (40) (49) (20) (12,032) (5,871) (3,106) (7,809) (18,080)

(59,963) (77,340) (82,949) (106,024) (47,673) (54,239) (383,526) (314,686) (1,264,680) (1,315,285)

(6,096) 9,060 (1,150) 417 482 1,930 25,068 2,396 14,167 60,282

459 (5,068) 73 (1,747) 12 (2,396) 7,633 (16,983) 220,642 (43,806)

0 (6) 0 0 0 0 (14) 3 (39) 0

0 0 0 0 0 0 0 0 4,019 (1,607)

404 (242) 133 (74) 163 (100) 2,262 (875) 5,031 (2,248)

863 (5,316) 206 (1,821) 175 (2,496) 9,881 (17,855) 229,653 (47,661)

(5,233) 3,744 (944) (1,404) 657 (566) 34,949 (15,459) 243,820 12,621

0 0 0 0 0 0 0 0 4,606 0

0 0 0 0 0 0 0 0 4,606 0

(5,233) 3,744 (944) (1,404) 657 (566) 34,949 (15,459) 248,426 12,621

Note: (i) Refer to Note 32. Correction of prior year errors for details.

Department of Environment and Primary Industries 2013 Annual Report 117 Notes to the financial statements for the year ended 30 June 2013 Note 2. Departmental (controlled) outputs (continued)

Schedule B - Controlled assets and liabilities as at 30 June 2013 Effective Water Management & Supply Public Land Forests & Parks 2013 2012 2011 2013 2012(i) 2011(i) 2013 2012(i) 2011(i) $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Assets Financial assets 21,057 25,376 74,506 19,230 35,119 56,505 28,793 7,645 17,951 Non-financial assets 104,268 70,081 112,180 2,492,983 2,325,738 2,773,790 2,669,486 2,678,214 2,470,311 Total assets 125,325 95,457 186,686 2,512,213 2,360,857 2,830,295 2,698,279 2,685,859 2,488,262 Liabilities 36,275 15,943 80,907 59,176 60,587 70,947 6,174 8,830 10,950 Total liabilities 36,275 15,943 80,907 59,176 60,587 70,947 6,174 8,830 10,950 Net assets 89,050 79,514 105,779 2,453,037 2,300,270 2,759,348 2,692,105 2,677,029 2,477,312

Land Administration & Property Information Biodiversity Natural Resources 2013 2012 2011 2013 2012 2011 2013 2012 2011(i) $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Assets Financial assets 382,944 364,464 174,484 28,675 30,349 42,603 (3,915) (3,949) 5,352 Non-financial assets 42,053 43,109 68,208 32,217 36,248 11,024 12,946 14,244 10,315 Total assets 424,997 407,573 242,692 60,892 66,597 53,627 9,031 10,295 15,667 Liabilities 31,451 31,369 35,700 16,726 24,298 20,539 8,135 11,162 19,176 Total liabilities 31,451 31,369 35,700 16,726 24,298 20,539 8,135 11,162 19,176 Net assets 393,546 376,204 206,992 44,166 42,299 33,088 896 (867) (3,509)

Environmental Policy & Climate Change Land & Fire Management Totals 2013 2012 2011 2013 2012 2011 2013 2012(i) 2011(i) $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Assets Financial assets 4,522 168 9,731 7,843 (15,687) 68,668 489,149 443,485 449,800 Non-financial assets 5,516 7,560 6,883 2,004,990 1,973,367 1,884,059 7,364,459 7,148,561 7,336,771 Total assets 10,038 7,728 16,614 2,012,833 1,957,680 1,952,727 7,853,608 7,592,046 7,786,571 Liabilities 9,387 11,284 11,474 127,833 119,769 117,719 295,157 283,242 367,412 Total liabilities 9,387 11,284 11,474 127,833 119,769 117,719 295,157 283,242 367,412 Net assets 651 (3,556) 5,140 1,885,000 1,837,911 1,835,008 7,558,451 7,308,804 7,419,159 Note: (i) Refer to Note 32. Correction of prior year errors for details.

118 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items

In addition to the specific departmental operations which are included in the financial statements (balance sheet, comprehensive operating statement, cash flow statement and statement of changes in equity), the department administers or manages other activities and resources on behalf of the state. The transactions relating to these activities are reported as administered items in this note.

(a) Administered income and expenses for the year ended 30 June 2013 Effective Water Land Administration Management & & Property Supply Public Land Forests & Parks Information 2013 2012 2013 2012 2013 2012 2013 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Administered income from transactions Appropriations – Payments on 447,420 29,724 0 0 0 0 0 0 behalf of the State (POBOS) Interest 302,543 0 0 0 2 3 0 0 Sales of goods and services 446,543 54,581 2,221 2,056 6,507 17,383 22,543 19,964 Land Titles income 0 0 0 0 0 0 237,145 233,792 Environmental contribution 69,420 69,420 0 0 0 0 0 0 Grants 25,200 3,252 500 825 100 100 0 0 Jointly controlled assets received 16,136 20,623 0 0 0 0 0 0 free of charge Other income 8 14,146 7,100 4,808 271 801 13 17 Total administered income 1,307,270 191,746 9,821 7,689 6,880 18,287 259,701 253,773 from transactions Administered expenses from transactions Grants and other transfers (30,650) (29,379) 0 0 0 0 0 0 Finance lease interest expense (302,718) 0 0 0 0 0 0 0 Supplies and services (86,348) 0 (19,607) 0 0 (4) 0 0 Depreciation of jointly controlled (10,692) (8,093) 0 0 0 0 0 0 assets Other expenses associated with 0 (2,683) 0 0 0 0 0 0 jointly controlled assets Payments into the Consolidated (800,739) (102,943) (16,968) (10,771) (5,954) (22,781) (254,252) (253,866) Fund Total administered expenses (1,231,147) (143,098) (36,575) (10,771) (5,954) (22,785) (254,252) (253,866) from transactions Total administered net result 76,123 48,648 (26,754) (3,082) 926 (4,498) 5,449 (93) from transactions (net operating balance) Administered other economic flows included in the administered net result Net gain/(loss) on non-financial (18,415) 26,107 (2,660) (53,224) 2,372 (4,026) (406) (1,316) assets Net gain/(loss) on financial 0 0 (155) 0 2 0 (139) 0 instruments Total administered other (18,415) 26,107 (2,815) (53,224) 2,374 (4,026) (545) (1,316) economic flows Administered net result 57,708 74,755 (29,569) (56,306) 3,300 (8,524) 4,904 (1,409) Administered other economic flows – other comprehensive income Items that will not be classified to net result Changes in physical asset 0 44,034 0 0 0 0 0 0 revaluation surplus Total administered other economic flows – other 0 44,034 0 0 0 0 0 0 comprehensive income Total administered 57,708 118,789 (29,569) (56,306) 3,300 (8,524) 4,904 (1,409) comprehensive result

Department of Environment and Primary Industries 2013 Annual Report 119 Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(a) Administered income and expenses for the year ended 30 June 2013 (continued) Environmental Policy Land & Fire Biodiversity Natural Resources & Climate Change Management Totals 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

0 0 0 0 0 0 0 0 447,420 29,724 0 0 1 3 0 0 0 0 302,546 6 143 3,147 0 0 0 0 76 17 478,033 97,148 0 0 0 0 0 0 0 0 237,145 233,792 0 0 0 0 0 0 0 0 69,420 69,420 47 360 1,673 2,161 0 0 0 0 27,520 6,698 0 0 0 0 0 0 0 0 16,136 20,623 911 3,432 36 11 3 5 60 93 8,402 23,313 1,101 6,939 1,710 2,175 3 5 136 110 1,586,622 480,724

0 0 0 0 0 0 0 0 (30,650) (29,379) 0 0 0 0 0 0 0 0 (302,718) 0 0 0 0 0 0 0 0 0 (105,955) (4) 0 0 0 0 0 0 0 0 (10,692) (8,093) 0 0 0 0 0 0 0 0 0 (2,683) 987 (7,000) (1,328) (2,264) 440 (33) 5,975 (342) (1,071,839) (400,000) 987 (7,000) (1,328) (2,264) 440 (33) 5,975 (342) (1,521,854) (440,159) 2,088 (61) 382 (89) 443 (28) 6,111 (232) 64,768 40,565

(422) (528) (101) (87) (59) (168) (1,393) (2,714) (21,084) (35,956) 0 0 0 0 0 0 0 0 (292) 0 (422) (528) (101) (87) (59) (168) (1,393) (2,714) (21,376) (35,956) 1,666 (589) 281 (176) 384 (196) 4,718 (2,946) 43,392 4,609

0 0 0 0 0 0 0 0 0 44,034 0 0 0 0 0 0 0 0 0 44,034 1,666 (589) 281 (176) 384 (196) 4,718 (2,946) 43,392 48,643

120 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(b) Administered assets and liabilities as at 30 June 2013

Effective Water Land Administration & Management & Supply Public Land Forests & Parks Property Information

2013 2012 2013 2012 2013 2012 2013 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Administered financial assets(i)

Cash 505 512 107 104 125 149 156 133

Receivables 72,878 73,482 5,158 649 2,482 (55) 10,417 180

Finance lease 4,319,535 0 0 0 0 0 0 0 receivables

Total administered 4,392,918 73,994 5,265 753 2,607 94 10,573 313 financial assets

Administered non-financial assets

Share of jointly 793,829 776,695 0 0 0 0 0 0 controlled assets

Other non-financial 11,948 13,804 0 0 0 430 0 0 assets

Total administered 805,777 790,499 0 0 0 430 0 0 non-financial assets

Total administered 5,198,695 864,493 5,265 753 2,607 524 10,573 313 assets

Administered liabilities(ii)

Creditors and 290,254 3 5,123 8 (519) 164 (1,920) 4 accruals

Unearned income 51,426 368,431 6,028 7,254 1 2 589 639

Interest-bearing 4,316,023 0 0 0 0 0 0 0 liabilities

Other liabilities 1 6,973 105 215 (19) 36 2 150

Total administered 4,657,704 375,407 11,256 7,477 (537) 202 (1,329) 793 liabilities

Total administered 540,991 489,086 (5,991) (6,724) 3,144 322 11,902 (480) net assets

Notes: (i) The state’s investment in all its controlled entities is disclosed in the administered note of DTF’s financial statements. This includes the investment in the Department of Environment and Primary Industries’ portfolio entities. (ii) DTF discloses the net liability related to defined benefit superannuation plans as an administered liability in its financial statements, on behalf of the state as the sponsoring employer. Refer to DTF’s financial statements for more detailed disclosures in relation to these plans.

Department of Environment and Primary Industries 2013 Annual Report 121 Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(b) Administered assets and liabilities as at 30 June 2013 (continued)

Environmental Policy Land & Fire Biodiversity Natural Resources & Climate Change Management Totals

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

89 94 75 91 30 39 420 339 1,507 1,461

4,136 (137) 1,136 (45) 1,393 (61) 19,258 (529) 116,858 73,484

0 0 0 0 0 0 0 0 4,319,535 0

4,225 (43) 1,211 46 1,423 (22) 19,678 (190) 4,437,900 74,945

0 0 0 0 0 0 0 0 793,829 776,695

0 0 0 1 0 0 0 0 11,948 14,235

0 0 0 1 0 0 0 0 805,777 790,930

4,225 (43) 1,211 47 1,423 (22) 19,678 (190) 5,243,677 865,875

(1,347) 3 (343) 20 (421) 1 (5,817) 11 285,010 214

1 3 0 0 0 0 4 3 58,049 376,332

0 0 0 6 0 0 0 0 4,316,023 0

(5) (4) 25 20 0 0 5 1 114 7,397

(1,351) 2 (318) 46 (421) 1 (5,808) 15 4,659,196 383,943

5,576 (45) 1,529 1 1,844 (23) 25,486 (205) 584,481 481,932

Notes: (i) The state’s investment in all its controlled entities is disclosed in the administered note of DTF’s financial statements. This includes the investment in the Department of Environment and Primary Industries’ portfolio entities. (ii) DTF discloses the net liability related to defined benefit superannuation plans as an administered liability in its financial statements, on behalf of the state as the sponsoring employer. Refer to DTF’s financial statements for more detailed disclosures in relation to these plans.

122 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(c) Leases (i) Disclosures for lessees – finance lease liabilities Commissioned public private partnership – Victorian Desalination Plant The State of Victoria entered into a 30-year Public Private Partnership (PPP) arrangement with the AquaSure consortium (AquaSure) on 30 July 2009. The project was initiated to design, build and operate a desalination plant capable of supplying 150 gigalitres of water per annum into the Melbourne network. Construction of the desalination plant in Wonthaggi began in September 2009. The state, AquaSure and SPI PowerNet entered into arrangements for the purchase, use and operation of the High Voltage Alternating Current (HVAC) transmission line assets on 14 December 2012. These arrangements are reflected in the minimum lease payments disclosed below. The lease term commenced upon the achievement of commercial acceptance on 17 November 2012, which is when the desalination plant was first operational at its 150 gigalitre per annum capacity. The Project Deed that governs the PPP requires AquaSure to transfer the project assets to the state at the end of the project term for no additional payment by the state. Under the arrangement, the state has an obligation to make Water Security Payments (WSPs) to the consortium provided the plant is maintained to the appropriate standard. The WSPs have two components: finance lease payments for the project assets (refer to table 3.1 below) and other expenses for operating, maintenance and lifecycle costs (refer to Note 3(d)(i) and Table 3.3). The state will also make Water Usage Payments (WUPs) for any water that is ordered and delivered to the required standard. Water is ordered annually for flexible amounts from 0 to 150 gigalitres (in set increments). The state’s lease liability to AquaSure is offset by a sub-lease agreement between the department, on behalf of the state, and the Melbourne Water Corporation (refer to Note 3(c)(ii) and Table 3.2). Melbourne Water Corporation has recognised the finance lease asset. The department does not control the income arising under this sub-lease and is required to pay receipts from the Melbourne Water Corporation into the state’s Consolidated Fund. The PPP arrangement does not form part of the department’s output cost, so funding to meet the payments to AquaSure is provided through an administered parliamentary appropriation, Payments on Behalf of the State (POBOS). The department has therefore classified this item as administered, in accordance with the requirements of AASB 1050 Administered Items and BFMG 60 Administered Items.

Table 3.1: Victorian Desalination Plant finance lease liability

Minimum future lease Present value of minimum payments future lease payments(i)

2013 2012 2013 2012 $’000 $’000 $’000 $’000

Commissioned PPP related finance lease liabilities payable

Not longer than one year 539,190 0 54,486 0

Longer than one year but no later than five years 2,087,670 0 212,987 0

Longer than five years 10,723,730 0 4,048,550 0

Minimum future lease payments 13,350,590 0 4,316,023 0

Less future finance charges (9,034,567) 0 0 0

Present value of minimum lease payments 4,316,023 0 4,316,023 0

Included in administered assets and liabilities as:

Interest-bearing liabilities (Note 3 (b)) 4,316,023 0

Note: (i) The present value of the ‘Minimum future lease payments’ has been discounted to 30 June of the respective financial years using the interest rate implicit in the lease.

Department of Environment and Primary Industries 2013 Annual Report 123 Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(c) Leases (continued) (ii) Disclosures for lessors – finance lease receivables Victorian Desalination Plant sub-lease The Minister for Water issued a Statement of Obligations (SoO) to the Melbourne Water Corporation under section 4(l) of the Water Industry Act 1994 on 26 June 2009. The SoO requires the Melbourne Water Corporation to pay all monies payable by the state under the project deed with AquaSure. This arrangement gives rise to a finance lease receivable equal to the value of the finance lease liability disclosed in Note 3(c)(i). The lease term commenced upon the achievement of commercial acceptance on 17 November 2012, triggering the recognition of the finance lease receivable. Under the arrangement, the Melbourne Water Corporation has an obligation to make project deed payments. The portions of the project deed payments that relate to the right to use the project assets are accounted for as a finance lease as disclosed in the Table 3.2. In addition, the project deed payments also include other commitments for operating, maintenance and lifecycle costs (refer to Note 3(d) and Table 3.5). The department will transfer the desalination plant assets to the Melbourne Water Corporation at the end of the project contract term.

Table 3.2: Victorian Desalination Plant finance lease receivable

Minimum future lease Present value of minimum receivables future lease receivables(i)

2013 2012 2013 2012 $’000 $’000 $’000 $’000

Finance lease receivables

Not longer than one year 539,190 0 54,642 0

Longer than one year but not longer than five years 2,087,670 0 213,633 0

Longer than five years 10,723,730 0 4,051,260 0

Minimum future lease receivables 13,350,590 0 4,319,535 0

Less unearned finance income (9,031,055) 0 0 0

Present value of minimum lease receivables 4,319,535 0 4,319,535 0

Included in administered assets and liabilities as:

Finance lease receivables (Note 3 (b)) 4,319,535 0

Note: (i) The present value of the ‘Minimum future lease receivables’ (that is, the gross investment in the lease) has been discounted to 30 June of the respective financial years using the interest rate implicit in the lease to determine the ‘Present value of minimum lease receivables’ (that is, the net investment in the lease).

124 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(d) Commitments (i) PPP related commitments – Victorian Desalination Plant Under the PPP arrangement that the state entered into with AquaSure (refer to Note 3(c)(i)) the state pays a base Water Security Payment, provided the plant is maintained to the appropriate standard, that includes other commitments for its operation, maintenance and lifecycle costs. The nominal amounts for the other commitments below represent the charges payable under the agreement at the end of the reporting period. The disclosures for ‘other commitments’ at 30 June 2012 has been restated to include renewable energy certificates (RECs). The department did not disclose these items as commitments at 30 June 2012, because the Reliability Testing Finalisation (RTF) period was not completed until 17 December 2012. The Project Deed requires a minimum number of RECs to be purchased to offset the electricity used by the plant. The number of RECs that are consumed will vary based on the volume of water produced by the plant. If there are any surplus RECs at the end of the project term, the Project Deed requires AquaSure to transfer them to the state, or sell them on arms length commercial terms on behalf of the state with all proceeds paid to the state. The department will transfer any surplus RECS or proceeds from sales thereof to the Melbourne Water Corporation at the end of the project contract term. The disclosures for ‘other commitments’ at 30 June 2012 has also been restated to include the connection service commitment. The restatement has increased the commitment reported in the comparative year by $1,448 million in nominal terms.

Table 3.3: Victorian Desalination Plant PPP commitments

2013 2012

Commissioned PPP – other commitments

Other commitments Other commitments

Present Nominal value value Present value Nominal value $’000 $’000 $’000 $’000

Victorian Desalination Plant(i)(iii)(iv) 1,454,608 5,004,290 00

Sub-total 1,454,608 5,004,290 00

Uncommissioned PPP – total commitments

Minimum lease Minimum lease payments Other Total payments Other Total Discounted commitments commitments Discounted commitments commitments value Present value Nominal value value Present value Nominal value $’000 $’000 $’000 $’000 $’000 $’000

Victorian Desalination Plant(ii)(iv)

Minimum lease payments 004,523,655 14,522,982

Other commitments 00 1,408,838 4,602,954

Sub-total 0 0 4,523,655 1,408,838 19,125,936

Total commitments for PPP

Total 1,454,608 5,004,290 4,523,655 1,408,838 19,125,936

Notes: (i) The present value of the minimum lease payments for the commissioned PPP is recognised on the balance sheet and is not disclosed as a commitment. (ii) The discounted value of the minimum lease payments for the uncommissioned PPP has been discounted to the project’s expected date of commissioning, and the present value of other commitments has been discounted to 30 June of the respective financial year. After adjusting for GST, the discounted values of minimum lease payments reflect the expected impact on the balance sheet when the PPPs are commissioned. (iii) Refer to Note 3(c) for the finance lease liabilities for the Victorian Desalination Plant project. This note discloses only the other capital and operating and maintenance commitments for this project. (iv) On 17 November 2012, the desalination plant became operational and thus moved from uncommissioned to commissioned.

Department of Environment and Primary Industries 2013 Annual Report 125 Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(d) Commitments (continued) (ii) Commitments payable

Table 3.4: Victorian Desalination Plant PPP commitments

2013 2012 $’000 $’000

PPP commitments – Victorian Desalination Plant

Other commitments

Not longer than one year 115,361 316,323

Longer than one year but not longer than five years 497,987 401,454

Longer than five years 4,390,942 3,885,177

Total PPP commitments for expenditure (inclusive of GST) 5,004,290 4,602,954

Less GST recoverable from the Australian Taxation Office (454,935) (418,450)

Total commitments for expenditure (exclusive of GST) 4,549,355 4,184,504

Note: (i) The future finance lease payments are recognised in the statement of administered assets and liabilities (refer to Note 3(b)).

(iii) Commitments receivable

Table 3.5: Victorian Desalination Plant other commitments receivable

2013 2012 $’000 $’000

Commitments receivable – Victorian Desalination Plant

Other commitments

Not longer than one year 115,361 316,323

Longer than one year but not longer than five years 497,987 401,454

Longer than five years 4,390,942 3,885,177

Total commitments receivable (inclusive of GST) 5,004,290 4,602,954

Less GST payable to the Australian Taxation Office (454,935) (418,450)

Total commitments receivable (exclusive of GST) 4,549,355 4,184,504

Note: (i) The future finance lease receivables are recognised in the statement of administered assets and liabilities (refer to Note 3(b)).

126 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(e) Financial instruments (i) Financial risk management objectives and policies The principal financial instruments the department administers on behalf of the state are the finance lease liability payable and finance lease asset receivable associated with the desalination plant. Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect to the classes of financial asset and financial liability above are disclosed in Note 1 to the financial statements. The disclosures below relate exclusively to the Victorian Desalination Plant. Other administered financial instruments, such as receivables and payables, are not considered significant for the evaluation of the department’s financial position and performance with respect to administered items. For disclosures concerning the department’s controlled financial instruments refer to Note 21. Financial instruments.

Table 3.6: Categorisation of financial instruments

2013 2012 Contractual Contractual Contractual Contractual financial financial financial financial

assets - liabilities at assets - liabilities at loans and amortised loans and amortised receivables cost Total receivables cost Total $’000 $’000 $’000 $’000 $’000 $’000 Contractual financial assets Finance lease receivable 4,319,535 0 4,319,535 0 00 Contractual financial liabilities Finance lease liability 0 4,316,023 4,316,023 0 0 0

Table 3.7: Net holding gain/(loss) on financial instruments by category

2013 2012 Total interest Total interest income/ income/

(expense) Total (expense) Total $’000 $’000 $’000 $’000 Contractual financial assets Finance lease receivable 302,512 302,512 00 Contractual financial liabilities Finance lease liability at amortised cost (302,687) (302,687) 00

(ii) Credit risk

Table 3.8: Credit quality of contractual financial assets that are neither past due nor impaired

2013 2012 Government Government agencies Total agencies Total

$’000 $’000 $’000 $’000 Contractual financial assets Finance lease receivable 4,319,535 4,319,535 00

Table 3.9: Ageing analysis of contractual financial assets

2013 2012 Not past Not past Carrying due and not Carrying due and not

amount impaired amount impaired $’000 $’000 $’000 $’000 Contractual financial assets Finance lease receivable 4,319,535 4,319,535 00

Department of Environment and Primary Industries 2013 Annual Report 127 Notes to the financial statements for the year ended 30 June 2013 Note 3. Administered (non-controlled) items (continued)

(e) Financial instruments (continued) (iii) Liquidity risk

Table 3.10: Maturity analysis of contractual financial liabilities

Maturity dates

Carrying Nominal Less than 2–3 3 months– amount amount 1 month months 1 year 1–5 years 5 years + $’000 $’000 $’000 $’000 $’000 $’000 $’000

2013

Finance lease liability 4,316,023 13,350,590 44,959 89,873 404,358 2,087,670 10,723,730

2012

Finance lease liability 0000000

(iv) Market risk

Table 3.11: Interest rate exposure of financial instruments

2013 2012

Interest rate Interest rate exposure exposure

Weighted Weighted average Carrying Fixed average Carrying Fixed interest interest rate amount interest rate interest rate amount rate $’000 $’000 $’000 $’000 $’000 $’000

Financial assets

Finance lease receivable 11.29% 4,319,535 4,319,535 000

Financial liabilities

Finance lease liability 11.29% 4,316,023 4,316,023 000

(v) Fair value

Table 3.12: Comparison between carrying amount and fair value

2013 2012

Carrying Carrying amount Fair value amount Fair value

$’000 $’000 $’000 $’000

Contractual financial assets

Finance lease receivable 4,319,535 4,319,535 0 0

Contractual financial liabilities

Finance lease liability 4,316,023 4,316,023 0 0

128 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 4. Income from transactions

2013 2012 $’000 $’000

(a) Interest

Interest from financial assets not at fair value through profit or loss:

Interest on cash deposits and investments 2,307 3,063

Other interest income 6 0

Total interest 2,313 3,063

(b) Sales of goods and services

Rendering of services 39,568 47,578

Sales of goods 668 331

User fees and charges 100 100

Refunds and reimbursements 2,198 5,573

Total sale of goods and services 42,534 53,582

(c) Metropolitan Parks Improvement Rate

Metropolitan Parks Improvement Rate(i) 136,763 131,482

Total Metropolitan Parks Improvement Rate 136,763 131,482

(d) Grants

Specific purpose grants 7,865 11,695

Other contributions and grants 27,690 85,210

Total grants 35,555 96,905

(e) Fair value of assets received free of charge or for nominal consideration:

Land at fair value 5,000 0

Total fair value of assets received free of charge or for nominal consideration 5,000 0

(f) Other income

Other miscellaneous income 11,442 6,861

Total other income 11,442 6,861

Note: (i) Metropolitan Parks Improvement Rate This rate commonly known as the ‘parks charge’ is an annual levy on all commercial and residential properties in the Melbourne and metropolitan areas. The Water Industry Act 1994 determines how the parks charge is to be levied and requires that money collected be spent on developing and managing open space, parks, waterways and bays within the metropolitan area for the purposes of conservation, recreation, leisure, tourism and navigation. The parks charge is paid into the Parks and Reserves Trust Account controlled by the department on behalf of the Minister for Environment and Climate Change. By agreement with the department, the parks charge is billed and collected by the three metropolitan retail water corporations and is paid directly into the trust account. For 2012–13 the minimum charge was levied at the rate of $66.80 (2012: $65.18) and the rate in the dollar of Net Annual Value was 0.402 cents (2012: 0.393 cents). During the 2012–13 financial year a total of $130.275 million was disbursed from the trust (in 2012, $130.456 million was disbursed for the full financial year) for the following purposes: • Parks Victoria • Zoological Parks and Gardens Board • Royal Botanic Gardens • Shrine of Remembrance • purchase of public open space • other projects approved by the Minister in line with the Water Industry Act 1994.

Department of Environment and Primary Industries 2013 Annual Report 129 Notes to the financial statements for the year ended 30 June 2013 Note 5. Expenses from transactions

2013 2012 $’000 $’000

(a) Employee expenses

Post-employment benefits

Defined contribution superannuation expense (12,674) (13,106)

Defined benefit superannuation expense (5,727) (6,507)

Termination benefits (12,787) (1,709)

Salaries and wages (205,332) (206,051)

Leave expenses (27,656) (26,317)

Other on-costs (fringe benefits tax, payroll tax and workcover levy) (12,062) (17,373)

Total employee expenses (276,238) (271,063)

(b) Depreciation

Property, plant and equipment

Buildings and structures (11,638) (11,027)

Buildings leasehold improvements (1,612) (1,983)

Finance lease assets (10,212) (11,209)

Plant, machinery and equipment (9,165) (7,697)

Roads infrastructure (13,060) (13,056)

Historical, cultural and environmental assets (16) (16)

Total depreciation of property, plant and equipment (45,703) (44,988)

Intangible produced assets

Software (903) (4,374)

Total depreciation (46,606) (49,362)

(c) Interest expense

Interest on finance leases (1,869) (1,821)

Other interest expense 0 (17)

Total interest expense (1,869) (1,838)

(d) Grants and other transfers

Grants to portfolio agencies (302,927) (313,888)

Grants to catchment management authorities (121,858) (125,614)

Grants to non-portfolio agencies (8,942) (50,144)

Grants to DPI research institutes (8,955) (13,778)

Grants to the Commonwealth, other state, territory and local governments (29,239) (32,239)

Grants to private individuals, businesses and non-profit organisations (21,997) (24,411)

Other grants and transfers (183) (170)

Total grants and other transfers (494,101) (560,244)

130 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 5. Expenses from transactions (continued)

2013 2012 $’000 $’000

(e) Supplies and services

Community awareness and publicity (2,039) (2,427)

Contract and professional services (172,387) (172,219)

Equipment maintenance and hire (58,213) (26,707)

General expenses (26,725) (39,228)

IT costs (9,259) (10,974)

Laboratory, farm and livestock expenses (1,132) (872)

Motor vehicle costs (8,104) (9,014)

Office and accommodation (31,507) (31,355)

Office expenses (5,909) (6,248)

Payments for shared services (24,816) (23,902)

Postage and telephone (14,819) (11,903)

Travel and subsistence (7,488) (4,456)

Total supplies and services (362,398) (339,305)

(f) Other operating expenses

Fair value of services provided free of charge or for nominal consideration:

Services 0 (177)

Total fair value of services provided free of charge or for nominal consideration 0 (177)

Operating lease rental expenses:

Minimum lease payments – operating leases (1,393) (779)

Total operating lease rental expenses (1,393) (779)

Sub-total (1,393) (956)

Cost of goods sold/distributed (5,774) (3,842)

Ex-gratia payments (see Note 25) (105) 0

Research and development costs immediately expensed (6) (28)

Settlement of litigation(i) (531) (13,254)

Total other operating expenses (7,809) (18,080)

Note: (i) 2012–13 amounts predominantly relate to the settlement of various land registry claims. 2011–12 amounts predominantly related to the settlement of a landfill case.

Department of Environment and Primary Industries 2013 Annual Report 131 Notes to the financial statements for the year ended 30 June 2013 Note 6. Other economic flows included in net result

2013 2012 (i) $’000 $’000

(a) Net gain/(loss) on non-financial assets

Net gain/(loss) on disposal of property, plant and equipment 10,410 (314)

Net recognition of non-financial assets (Note 1(l)) 212,222 11,422

Impairment of intangible assets (Note 13) 0 (3,949)

Write-down of inventory (301) (5)

Write-down of property, plant and equipment and intangible assets (1,689) (50,960)

Total net gain/(loss) on nonfinancial assets 220,642 (43,806)

(b) Net loss on financial instruments

Impairment of receivables(ii) (39) 0

Total net loss on financial instruments (39) 0

(c) Share of net profits/(losses) of associates, excluding dividends

Share of net profits/(losses) of associates, excluding dividends 4,019 (1,607)

Total share of profits/(losses) of associates, excluding dividends 4,019 (1,607)

(d) Other gains/(losses) from other economic flows

Net gain/(loss) arising from revaluation of long service leave liability(iii) 834 (1,495)

Other provision discount rate adjustments 4,197 (753)

Total other gains/(losses) from other economic flows 5,031 (2,248)

Notes: (i) Refer to Note 32. Correction of prior year errors for details. (ii) This item represents the net (increase)/decrease in the provision for doubtful debts, the unilateral write off of bad debts and other debt from other economic flows – refer to Note 1(h). (iii) Revaluation gain/(loss) due to changes in bond rates.

132 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 7. Receivables

2013 2012 $’000 $’000

Current receivables

Contractual

Trade receivables(i) (Note 21) 18,579 11,664

Provision for doubtful contractual receivables(i) (Notes 7(a), 21) (34) (72)

Accrued income(ii) (Note 21) 162 599

Accrued interest(ii) (Note 21) 29 190

18,736 12,381

Statutory

Amounts owing from Victorian Government(iii) 134,467 106,295

GST input tax credit recoverable 7,285 5,452

141,752 111,747

Total current receivables 160,488 124,128

Non-current receivables

Statutory

Amounts owing from Victorian Government(iii) 44,130 51,927

Total non-current receivables 44,130 51,927

Total receivables 204,618 176,055

Notes: (i) The average credit period on sales of goods and services and for other receivables is 30 days. No interest is charged on trade debtors for the first 30 days from the date of the invoice. Thereafter, interest is charged at 10.5% p.a. (2012: 10.5% p.a.) on the outstanding balance of invoices relating to forest activities and land licences. The interest rate is determined under the Penalty Interest Rate Act 1983. A provision has been made for estimated irrecoverable amounts from the sale of goods when there is objective evidence that an individual receivable is impaired. The movement in the allowance of $38,000 was recognised in the operating result for the current financial year. (ii) No interest is charged on accrued receivables for the outstanding balance. An allowance is made for estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience. No such allowance has been made in this financial year for accrued receivables. (iii) The amounts recognised from Victorian Government represent funding for all commitments incurred through the appropriations and are drawn from the Consolidated Fund as the commitments fall due.

2013 2012 $’000 $’000

(a) Movement in the provision for doubtful debts

Balance at 1 July 72 74

Reversal of unused provision recognised in the net result 0 (29)

Reversal of provision of receivables written off during the year as uncollectible (59) (2)

Increase in provision recognised in the net result 21 29

Balance at 30 June 34 72

(b) Ageing analysis of receivables

Refer to Table 21.3 in Note 21. Financial instruments for the ageing analysis of contractual receivables.

(c) Nature and extent of risk arising from receivables

Refer to Note 21. Financial instruments for the nature and extent of risks arising from contractual receivables.

Department of Environment and Primary Industries 2013 Annual Report 133 Notes to the financial statements for the year ended 30 June 2013 Note 8. Investments and other financial assets

2013 2012 $’000 $’000

Current investments and other financial assets

Term deposits:

Australian dollar term deposits greater than three months 20,143 0

Total investments and other financial assets 20,143 0

Note 9. Investments accounted for using the equity method

Associates accounted for using the equity method The department has an investment in an associate entity, National E-Conveyancing Development Limited (NECDL). NECDL was established in January 2010 to develop a single national electronic conveyancing system for settling property transactions. The department participated in an additional share subscription in October 2012 at a cost of $1.2 million. The subscription in October, plus further subscriptions in February and June 2013 have diluted the department’s interest in NECDL. The department still holds significant influence by participating in policy-making processes through its representation on the board of directors, and the provision of essential technical information (being the intellectual property for the Victorian electronic conveyancing system). The carrying value of the investment has been adjusted to reflect the department’s share of the carrying value of NECDL’s net assets (see Note 6(c)).

Ownership interest

2013 2012 Country of incorporation % $’000 % $’000

Non-current investments in associates

National E-Conveyancing Development Australia 13.9 14,412 24.2 9,212 Limited

Total investments 14,412 9,212

2013 2012 $’000 $’000

Summarised financial information of associate:

Current assets 64,622 19,315

Non-current assets 49,605 23,490

Total assets 114,227 42,805

Current liabilities 9,928 4,443

Non-current liabilities 320 322

Total liabilities 10,248 4,765

Net assets 103,979 38,040

Share of associate’s net assets 14,412 9,212

Contingent liabilities and capital commitments The department’s share of the contingent liabilities, capital commitments and other expenditure commitments of its associates are disclosed in Note 19. Commitments for expenditure and Note 20. Contingent assets and contingent liabilities.

134 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 10. Inventories

2013 2012 $’000 $’000

Current inventories

Supplies and consumables – at cost

Fire stores 9,047 9,045

Publications held for distribution 30 71

Seed bank 1,768 1,941

Weedicides 124 117

Other stores and materials 1,570 1,630

12,539 12,804

Inventories held for distribution

Publications held for sale – at cost 336 414

Total inventories 12,875 13,218

Note 11. Non-financial physical assets classified as held for sale

2013 2012 $’000 $’000

Non-financial physical assets classified as held for sale

Land held for sale – at carrying amount 57 121

Finance lease motor vehicles – held for sale 517 2,422

Total non-financial physical assets classified as held for sale 574 2,543

Land held for sale represents the carrying amount of Crown land deemed surplus to the needs of the state. As Crown land is unalienated from the Crown, it does not have a cost of acquisition. No development costs have been incurred in preparing this land for sale. The department intends to dispose of this land within the next 12 months. Finance lease motor vehicles held for sale represent vehicles identified for immediate disposal in their current condition through the VicFleet disposal process. It is anticipated that these disposals will be completed within the next 12 months.

2013 2012 $’000 $’000

Movements in non-financial physical assets classified as held for sale

Balance at 1 July 2,543 628

Reclassification of land held for sale from Crown land 57 121

Reclassification of vehicles held for sale from plant and equipment 517 2,422

Disposals (2,543) (628)

Balance at 30 June 574 2,543

Department of Environment and Primary Industries 2013 Annual Report 135 Notes to the financial statements for the year ended 30 June 2013 Note 12. Property, plant and equipment

2013 2012(i) 2011(i) $’000 $’000 $’000 Land Freehold land At fair value 5,800 0 304 Total freehold land 5,800 0 304 Crown land – Land and unused roads At fair value 2,426,744 2,267,128 2,388,389 Total Crown land – Land and unused roads 2,426,744 2,267,128 2,388,389 Crown land – National parks At fair value 1,061,790 1,059,470 1,049,907 Total Crown land – National parks 1,061,790 1,059,470 1,049,907 Crown land – State forests At fair value 1,150,492 1,149,674 1,149,365 Total Crown land – State forests 1,150,492 1,149,674 1,149,365 Crown land – Conservation reserves At fair value 642,437 642,095 636,610 Total Crown land – Conservation reserves 642,437 642,095 636,610 Crown land – Metropolitan parks At fair value 311,235 308,802 306,150 Total Crown land – Metropolitan parks 311,235 308,802 306,150 Crown land – Land used for operational purposes At fair value 84,397 74,324 73,851 Total Crown land – Land used for operational purposes 84,397 74,324 73,851 Total land 5,682,895 5,501,493 5,604,576 Buildings and structures At fair value 537,599 488,494 425,664 Less accumulated depreciation (49,166) (37,927) (13,479) Total buildings and structures 488,433 450,567 412,185 Roads At fair value 1,044,988 1,044,767 1,044,491 Less accumulated depreciation (26,116) (13,056) 0 Total roads 1,018,872 1,031,711 1,044,491 Plant and equipment At fair value 98,238 93,283 92,764 Less accumulated depreciation (64,222) (55,780) (51,058) 34,016 37,503 41,706 Under finance lease at cost 46,620 53,320 47,755 Less accumulated amortisation (19,016) (24,607) (22,478) 27,604 28,713 25,277 Total plant and equipment 61,620 66,216 66,983

Note: (i) Refer to Note 32. Correction of prior year errors for details.

136 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 12. Property, plant and equipment (continued)

2013 2012(i) 2011(i) $’000 $’000 $’000

Assets under construction at cost

Buildings and structures 58,817 57,526 90,505

Roads 70 271 0

Plant and equipment 17,386 6,146 48,965

Total assets under construction at cost 76,273 63,943 139,470

Historic, cultural and environment assets

At fair value 1,552 1,561 1,561

Less accumulated depreciation (42) (28) (22)

Total historic, cultural and environment assets 1,510 1,533 1,539

Total property, plant and equipment 7,329,603 7,115,463 7,269,244

Note: (i) Refer to Note 32. Correction of prior year errors for details.

Schedule of valuations 2013 2012

Land – all classes 30 June 2013 (managerial assessment 30 June 2012 (managerial assessment of fair value) of fair value)

Buildings and structures 30 June 2013 (managerial assessment 30 June 2012 (managerial assessment of fair value) of fair value)

Roads 30 June 2013 (managerial assessment 30 June 2012 (managerial assessment of fair value) of fair value)

Plant and equipment 30 June 2013 (managerial assessment 30 June 2012 (managerial assessment of fair value) of fair value)

Historic, cultural and environment assets 30 June 2013 (managerial assessment 30 June 2012 (managerial assessment of fair value) of fair value)

Valuation methodology

All property, plant and equipment asset classes, other than plant and equipment, were revalued as at 30 June 2011 by Valuer-General Victoria. The department’s next formal revaluation is due in 2015–16 in accordance with the revaluation cycle outlined in FRD 103D. During 2012–13, management conducted fair value assessments of land, roads and buildings and structures by applying indicators provided by Valuer-General Victoria. As the assessments indicated an immaterial movement in value, no change to carrying amounts is required. For plant and equipment the department considered whether there is evidence that a market based fair value exists and whether the evidence indicates a fair value materially different from the existing carrying value (depreciated cost). The assessment identified that for a number of classes there is no market in which fair value could be reliably measured. As such, the department considers that the carrying value represents a fair approximation of fair value for all classes of plant and equipment. Where a market existed for the remaining classes, there was no evidence that the market indicated fair value that was materially different from the carrying amount. For historic, cultural and environmental assets management undertook a fair value assessment of during 2012–13 and deemed that the existing carrying value represented a fair approximation of fair value.

Aggregate depreciation An assessment of useful lives is conducted on an annual basis and there was no change to useful lives in 2012–13.

Department of Environment and Primary Industries 2013 Annual Report 137 Total Total $’000 $’000 assets Historical, cultural and environment environment $’000 under Assets construction $’000 Plant and equipment $’000 Roads and $’000 Buildings structures structures

Land $’000 used for purposes operational $’000 parks Metropolitan $’000 reserves Conservation State $’000 forests forests $’000 parks National 0 0 0 0 0 0 (13,010) (13,056) (18,906) 0 (16) (44,988) $’000 roads roads unused (61,044) 1,565 0 515 0 0 1,222 0 0 0 0 (57,742) for details. Land and 0 11,423 0 0 0 0 (12) 752 0 (12) (51,699) 10 (39,538) 0 (4,373) 0 0 0 0 0 0 0 (353) 0 0 (4,726) 000000000000 0 000000000000 0 325 0 0 0 0 0 0 0 (2,240) 0 0 (1,915) 0 (21,419) (2,535) 0 0 0 0 00 0 (6,187)0 2,267,128 1,059,470 0 1,149,674 0 642,095 0 308,802 0 74,324 0 450,567 0 (23,954) 1,031,711 66,216 0 63,943 0 1,533 7,115,463 0 0 0 0 0 (6,187) 304 2,388,389 1,049,907 1,149,365 636,610 306,150 73,851 412,185 1,044,491 66,983 139,470 1,539 7,269,244 land (304) (8,705) 7,609 309 955 2,652 (2,517) 49,254 276 1,889 (49,982) 0 1,436 $’000 Freehold Freehold (i) (i) Correction of prior year errors (i) (i) Net effect of correction of prior year of correction Net effect errors Depreciation expense (refer to Note 5(b)) expense (refer Depreciation 0 Recognition / (derecognition), Recognition / (derecognition), (write-down) of assets Revaluation increments / (decrements)Revaluation increments 0 0 0 0 0 0 0 0 0 0 0 0 0 Net transfers in/(out) – from other Net transfers in/(out) – from to Note 13) categories (refer to parties Transfers 0 (51,101) 0 0 (647) 0 0 0 0 0 (905) 0 (52,653) disposal entity to administered Transfers for Capital contributions (to)/from owners Capital contributions (to)/from to other government entities Transfers 0 Net transfers in – Resources free free Net transfers in – Resources of charge Reclassification to asset classified to Note 11) as held for sale (refer Net effect of correction of prior year of correction Net effect error Disposals 0 (1,599) 0 0 0 0 0 (4,223) 0 (3,141) 0 0 (8,963) Balance at 1 July 2011 304 2,409,808 1,052,442 1,149,365 636,610 306,150 73,851 412,185 1,044,491 66,983 139,470 1,539 7,293,198 Restated balance at 1 July 2011 Restated balance at 1 July 2012 Additions 0 0 389 0 4,662 0 3,002 4,387 0 21,996 27,059 0 61,495 Notes to the financial statements for year ended 30 June 2013 plant and equipment (continued) Note 12. Property, purpose group in the ‘Public Safety and Environment’ Movements in carrying amounts – All departmental assets are Note: (i) Refer to Note 32.

138 Department of Environment and Primary Industries 2013 Annual Report Total Total $’000 $’000 assets Historical, cultural and environment $’000 under Assets construction $’000 Plant and equipment $’000 Roads and $’000 Buildings structures structures

Land $’000 used for purposes operational $’000 parks Metropolitan $’000 reserves Conservation State $’000 forests forests $’000 parks National $’000 roads roads unused Land and for details. 0 2,267,128 1,059,470 1,149,674 642,095 308,802 74,324 450,567 1,031,711 66,216 63,943 1,533 7,115,463 0 (57) 0 0 0 0 0 0 0 (517) 0 0 (574) 0 5,000 0 0 0 0 0 0 0 0 0 0 5,000 0 185,141 0 0 37 0 (8) 27,051 0 0 (1,631) 0 210,590 land $’000 5,917 (9,263) 2,278 818 254 2,406 (2,410) 22,925 221 5,099 (28,774) 0 (529) (10,450) (2,621) 0 0 0 0 0 0 0 (197) 0 (7) (13,275) Freehold Freehold (i) Correction of prior year errors Restated balance at 1 July 2012 Additions 5,800 0 1 0 51 27 12,491 2,699 0 15,270 42,735 0 79,074 Disposals 0 (1,176) 0 0 0 0 0 (1,282) 0 (4,508) 0 0 (6,966) Reclassification to asset classified to Note 11) as held for sale (refer Net transfers in – Resources free free Net transfers in – Resources of charge Capital contributions (to)/from owners Capital contributions (to)/from to other government entities Transfers 0 2,143 24 0 0 0 0 (277) 0 (366) 0 0 1,524 disposal entity to administered Transfers for to parties Transfers 0 (19,607) 0 0 0 0 0 0 0 0 0 0 (19,607) Net transfers in/(out) – from other Net transfers in/(out) – from to Note 13) categories (refer Revaluation increments / (decrements)Revaluation increments 4,533 56 17 0 0 0 0 0 0 0 0 0 4,606 Recognition / (derecognition), Recognition / (derecognition), (write-down) of assets Depreciation expense (refer to Note 5(b)) expense (refer Depreciation 0 0 0 0 0 0 0 (13,250) (13,060) (19,377) 0 (16) (45,703) Balance at 30 June 2013 5,800 2,426,744 1,061,790 1,150,492 642,437 311,235 84,397 488,433 1,018,872 61,620 76,273 1,510 7,329,603 Notes to the financial statements for year ended 30 June 2013 plant and equipment (continued) Note 12. Property, Note: (i) Refer to Note 32.

Department of Environment and Primary Industries 2013 Annual Report 139 Notes to the financial statements for the year ended 30 June 2013 Note 13. Intangible assets

2013 2012 $’000 $’000

Software

Gross carrying amount at 1 July at cost 44,566 44,566

Accumulated depreciation (40,563) (39,661)

Accumulated impairment (3,949) (3,949)

54 956

Construction in progress – at cost 11,540 6,359

Net book value at 30 June 11,594 7,315

Depreciation of intangible assets Capitalised expenditure on intangible assets, such as databases and software, is depreciated on a straight-line basis over an estimated useful life of between three and 10 years. Aggregate depreciation allocated during the year is recognised as an expense and disclosed in Note 5(b) to the financial statements.

Significant intangible assets The department has software development expenditure for a number of systems. The major component of the carrying amount of software is the Fire and Emergency Management Portal under development. The expected cost of the system is $21.50 million and is anticipated to be completed in 2015.

2013 2012 $’000 $’000

Movements in carrying amounts

Balance at 1 July 7,315 21,292

Additions 4,710 3,953

Net transfers from other categories (Note 12) 529 (1,436)

Disposals 0 (8,171)

Write-down (57) 0

Depreciation expense(i) (903) (4,374)

Impairment expense(ii) 0 (3,949)

Balance at 30 June 11,594 7,315

Notes: (i) Depreciation expense is included in the line item ‘depreciation’ in the comprehensive operating statement. (ii) The 2012 impairment expense related to the Government Infrastructure Management System (GIMS). The GIMS platform was not supported by the software supplier past November 2012 and as such, was impaired in accordance with AASB 136 Impairment of Assets.

140 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 14. Payables

2013 2012 $’000 $’000

Current payables

Contractual

Trade creditors(i) 18,197 18,606

Accrued grants and other transfers 20,803 3,880

Accrued capital contributions 15,245 12,718

Other accrued expenses 55,294 40,848

Other (includes superannuation) payable(i) 735 468

110,274 76,520

Statutory

Advance from the Public Account(ii) 10,159 9,253

Taxes payable 1,485 2,007

11,644 11,260

Total current payables 121,918 87,780

Non-current payables

Statutory

Advance from the Public Account(ii) 22,699 27,099

Total non-current payables 22,699 27,099

Total payables 144,617 114,879

Notes: (i) The average credit period is 30 days. No interest is charged on the trade creditors or other payables for the first 30 days from the date of the invoice. Thereafter, interest may be charged at differing rates determined by the individual trade arrangements entered into. (ii) These advances are for varying terms and do not normally bear interest. The advances are unsecured and the term of the advance is usually agreed by the Minister at the time the advance was provided.

(a) Maturity analysis of contractual payables Refer to Table 21.4 in Note 21. Financial instruments for the maturity analysis of contractual payables.

(b) Nature and extent of risk arising from contractual payables Refer to Note 21. Financial instruments for the nature and extent of risks arising contractual from payables.

Department of Environment and Primary Industries 2013 Annual Report 141 Notes to the financial statements for the year ended 30 June 2013 Note 15. Borrowings

2013 2012 $’000 $’000

Current borrowings – secured(i)

Finance lease liabilities 11,717 15,086

Total current borrowings 11,717 15,086

Non-current borrowings – secured(i)

Finance lease liabilities 15,818 15,463

Total non-current borrowings 15,818 15,463

Total borrowings 27,535 30,549

Note: (i) Secured by the leased assets.

(a) Maturity analysis of borrowings Refer to Table 21.4 in Note 21. Financial instruments for the maturity analysis of borrowings.

(b) Nature and extent of risk arising from borrowings Refer to Note 21. Financial instruments for the nature and extent of risks arising from borrowings.

(c) Defaults and breaches During the current and prior year, there were no defaults and breaches of any of the loans.

142 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 16. Provisions

2013 2012 $’000 $’000

Current provisions

Employee benefits – annual leave(i) (Note 16(a))

Unconditional and expected to be settled within 12 months(iii) 16,824 17,398

Unconditional and expected to be settled after 12 months(iv) 292 488

Employee benefits – long service leave(i) (Note 16(a))

Unconditional and expected to be settled within 12 months(iii) 34,513 37,425

Unconditional and expected to be settled after 12 months(iv) 5,288 7,848

56,917 63,159

Provisions related to employee benefit on-costs: (Notes 16(a) and 16(b))

Unconditional and expected to be settled within 12 months(iii) 10,307 10,442

Unconditional and expected to be settled after 12 months(iv) 1,120 1,588

11,427 12,030

Onerous lease contracts(ii) (Notes 16(b) and 18) 775 1,481

Provision for insurance deductibles (Note 16(b)) 22,554 22,286

Provision for fire rehabilitation (Note 16(b)) 4,647 5,799

Provision for native vegetation offset (Note 16(b)) 5,970 9,738

Provision for flood recovery works (Note 16(b)) 2,138 2,222

Other (Note 16(b)) 8,823 10,354

Total current provisions 113,251 127,069

Non-current provisions

Employee benefits(i)(iv) (Note 16(a)) 7,551 5,643

Employee benefits on-costs(iv) (Note 16(a) and 16(b)) 1,516 1,075

Onerous lease contracts(ii) (Notes 16(b) and 18) 417 3,914

Total non-current provisions 9,484 10,632

Total provisions 122,735 137,701

Department of Environment and Primary Industries 2013 Annual Report 143 Notes to the financial statements for the year ended 30 June 2013 Note 16. Provisions (continued)

(a) Employee benefits and related on-costs

2013 2012 $’000 $’000

Current employee benefits(i)

Annual leave entitlements(iii) 17,116 17,886

Long service leave entitlements(iv) 39,801 45,273

56,917 63,159

Non-current employee benefits(i)

Long service leave entitlements(iv) 7,551 5,643

Total employee benefits 64,468 68,802

Current on-costs 11,427 12,030

Non-current on-costs(iv) 1,516 1,075

Total on-costs 12,943 13,105

Total employee benefits and related on-costs 77,411 81,907

Notes: (i) Provisions for employee benefits consist of amounts for annual leave and long service leave accrued by employees, not including on- costs. (ii) The provision for onerous lease contracts represents the present value of the future lease payments that the department is presently obligated to make in respect of onerous lease contracts under non-cancellable operating lease agreements, less income expected to be earned on the lease including estimated future sub-lease income, where applicable. The estimate may vary as a result of changes in the utilisation of the leased premises and sub-lease arrangements where applicable. The unexpired term of the leases vary up to a maximum of 15 years. (iii) The amounts disclosed are nominal amounts. (iv) The amounts disclosed are discounted to present values.

(b) Movement in provisions

Onerous Native Flood lease Insurance Fire vegetation recovery On-costs contracts deductibles rehab. offset works Other Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Balance at 1 July 2012 13,105 5,395 22,286 5,799 9,738 2,222 10,354 68,899

Additional provisions 827 0 1,42500002,252 recognised

Reductions arising from (257) 0 (1,157) (1,152) (768) (84) (1,531) (4,949) payments/other sacrifices of future economic benefits

Reductions resulting (593) (4,197) 0 0 (3,000) 0 0 (7,790) from remeasurement or settlement without cost

Unwind of discount and (139) (6)00000(145) effect of changes in the discount rate

Balance at 30 June 12,943 1,192 22,554 4,647 5,970 2,138 8,823 58,267 2013

Current 11,427 775 22,554 4,647 5,970 2,138 8,823 56,334

Non-current 1,516 417000001,933

12,943 1,192 22,554 4,647 5,970 2,138 8,823 58,267

144 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 17. Superannuation

Government Employees’ Superannuation Fund Employees of the department are entitled to receive superannuation benefits and the department contributes to both defined benefit and defined contribution plans. The defined benefit plan provides benefits based on years of service and final average salary. The department does not recognise any defined benefit liability in respect of the plan because the entity has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as they fall due. DTF discloses the state’s defined benefit liabilities in its disclosure for administered items. However, superannuation contributions paid or payable for the reporting period are included as part of employee benefits in the comprehensive operating statement of the department. The name, details and amounts expensed in relation to the major employee superannuation funds and contributions made by the department are as follows:

Contribution outstanding Paid contribution for the year at year end

2013 2012 2013 2012 Fund $’000 $’000 $’000 $’000

Defined benefit plan:

Emergency Services Superannuation Scheme 5,727 6,507 0 0

Defined contribution plans:

Victorian Superannuation Fund – Vic Super Scheme 10,606 11,129 0 0

Various other 2,068 1,977 0 0

Total superannuation contributions 18,401 19,613 0 0

Notes: (i) The bases for contributions are determined by the various schemes. (ii) All employees of the department are entitled to varying levels of benefits on retirement, disability or death. Some superannuation plans provide defined benefits based on years of service and final average salary. The others are classified as contribution schemes. Contributions by the department of a minimum of 9% of employee’s wages and salaries are legally enforceable on the department. (iii) The above amounts were measured as at 30 June of each year or in the case of employer contributions they relate to the years ended 30 June.

Department of Environment and Primary Industries 2013 Annual Report 145 Notes to the financial statements for the year ended 30 June 2013 Note 18. Leases

Disclosure for lessees – finance leases Finance leases relate to motor vehicles leased through the VicFleet lease facility. The lease term is the period over which the vehicle is to be leased. Generally, vehicles must be retained for three years or 60,000 kms, whichever occurs first. On disposal of the vehicle any profit or loss on sale is borne by the department. The finance leases disclosed below are exempt from GST.

Minimum future lease Present value of minimum payments future lease payments

2013 2012 2013 2012 $’000 $’000 $’000 $’000

Finance lease liabilities payable

Not longer than one year 13,050 16,528 11,717 15,086

Longer than one year but not longer than five years 16,604 16,513 15,818 15,463

Minimum future lease payments 29,654 33,041 27,535 30,549

Less future finance charges (2,119) (2,492) 0 0

Present value of minimum lease payments 27,535 30,549 27,535 30,549

Included in the financial statements as:

Current finance lease liability (Note 15) 11,717 15,086

Non-current finance lease liability (Note 15) 15,818 15,463

Total lease liabilities 27,535 30,549

The weighted average interest rate implicit in the leases is 6.62% p.a (2012: 6.78% p.a).

(a) Maturity analysis of finance lease liabilities Please refer to Table 21.4 in Note 21. Financial instruments for the maturity analysis of finance lease liabilities.

(b) Nature and extent of risk arising finance lease liabilities Please refer to Note 21. Financial instruments for the nature and extent of risks arising from finance lease liabilities.

146 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 18. Leases (continued)

Disclosure for lessees – operating leases Operating leases predominantly relate to office and other facilities with lease terms of between two to 15 years, some with options to extend the lease. Some operating lease contracts contain annual market review clauses. Other leases will consist mainly of aircraft leases relating to fire bombing services. Such leases have terms between one to five years. The department does not have an option to purchase the leased assets at the expiry of the lease period. All amounts shown in the leases note are nominal amounts.

2013 2012 $’000 $’000

Non-cancellable operating leases payable

Not longer than one year 85,470 93,686

Longer than one year but not longer than five years 78,865 85,105

Longer than five years 311 262

Total commitment for operating leases (inclusive of GST) 164,646 179,053

Less GST recoverable from the Australian Taxation Office (14,968) (16,277)

Total commitments for operating lease expenditure 149,678 162,776

In respect of non-cancellable operating leases the following liabilities have been recognised:

Current

Onerous lease contracts (Note 16) 775 1,481

Non-current

Onerous lease contracts (Note 16) 417 3,914

Total liabilities for non-cancellable operating leases 1,192 5,395

Department of Environment and Primary Industries 2013 Annual Report 147 Notes to the financial statements for the year ended 30 June 2013 Note 19. Commitments for expenditure

2013 2012 $’000 $’000

Capital expenditure commitments

Not later than one year 93,287 60,570

Later than one year but no later than five years 223,839 269,026

Later than five years 0 20,432

Total capital expenditure commitments 317,126 350,028

Other expenditure commitments

Other operating commitments

Not later than one year 198,431 157,361

Later than one year but no later than five years 811,859 858,909

Later than five years 2,694 72,234

1,012,984 1,088,504

Department’s share of associate’s capital expenditure commitments

Not later than one year 261 214

261 214

Total other expenditure commitments 1,013,245 1,088,718

Total commitments for expenditure (inclusive of GST) 1,330,371 1,438,746

Less GST recoverable from the Australian Taxation Office (10,269) (15,507)

Total commitments for expenditure (exclusive of GST) 1,320,102 1,423,239

Lease commitments Finance lease liabilities and non-cancellable operating lease commitments are disclosed in Note 18. Leases to the financial statements.

Note 20. Contingent assets and contingent liabilities

2013 2012 $’000 $’000

Contingent assets

Damages claims 2,838 2,838

Public liability insurance claims 29,490 22,145

Breach of contract 0 5,100

Other 17,325 23,125

49,653 53,208

Contingent assets The department did not have any contingent assets in either 2013 or 2012.

Associates The department does not have quantifiable or unquantifiable contingent assets or liabilities in relation to its investment in NECDL.

148 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments

(a) Financial risk management objectives and policies The department’s principal financial instruments comprise: • cash and deposits • investments (excluding investments in associates) • receivables (excluding statutory receivables) • payables (excluding statutory payables) • borrowings. Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect of each class of financial asset and financial liability above are disclosed in Note 1. Summary of significant accounting policies to these financial statements. The department holds financial instruments as a result of its ordinary business activities (in the case of receivables and payables), government policy (in the case of cash and borrowings), or to prudentially manage cash balances (in the case of cash deposits and investments). The department’s main financial risks include credit risk and interest rate risk. The department manages these financial risks in accordance with its financial management policies. The carrying amounts of the department’s contractual financial assets and financial liabilities by category are disclosed in Table 21.1 below.

Table 21.1: Categorisation of financial instruments

2013 2012 Contractual Contractual Contractual financial financial financial Contractual assets liabilities at assets – financial – loans and amortised loans and liabilities at receivables cost Total receivables amortised cost Total $’000 $’000 $’000 $’000 $’000 $’000 Contractual financial assets Cash and deposits Cash, deposits on call and term 249,976 0 249,976 258,218 0 258,218 deposits less than 3 months Receivables(i) Trade receivables 18,545 0 18,545 11,592 0 11,592 Accrued income 162 0 162 599 0 599 Accrued interest 29 0 29 190 0 190 Investments: Term deposits greater than 3 months 20,143 0 20,143 000 Total contractual financial assets 288,855 0 288,855 270,599 0 270,599 Contractual financial liabilities Payables(ii) Trade creditors 0 18,197 18,197 0 18,606 18,606 Accrued grants and other transfers 0 20,803 20,803 0 3,880 3,880 Accrued capital contributions 0 15,245 15,245 0 12,718 12,718 Other accrued expenses 0 55,294 55,294 0 40,848 40,848 Other payables 0 735 735 0 468 468 Borrowings Finance lease liabilities 0 27,535 27,535 0 30,549 30,549 Total contractual financial liabilities 0 137,809 137,809 0 107,069 107,069

Notes: (i) The amount of receivables disclosed excludes statutory receivables (i.e. Amounts owing from Victorian Government and GST input tax credit receivable) totalling $185.882 million (2012: $163.674 million) – Refer Note 7. Receivables. (ii) The amount of payables disclosed excludes statutory payables (i.e. Amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $34.343 million (2012: $38.359 million) – Refer Note 14. Payables.

Department of Environment and Primary Industries 2013 Annual Report 149 Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

Table 21.2: Net holding gain/(loss) on financial instruments by category

2013 2012

Total interest Total interest income/ Impairment income/ Impairment (expense) loss Total (expense) loss Total $’000 $’000 $’000 $’000 $’000 $’000

Contractual financial assets

Cash and deposits

Cash, deposits on call and term 2,033 0 2,033 3,063 0 3,063 deposits less than 3 months

Receivables:

Trade receivables (i) 0 (38) (38) 0 (2) (2)

Investments:

Term deposits greater than 3 274 0 274 0 0 0 months

Total contractual financial assets 2,307 (38) 2,269 3,063 (2) 3,061

Contractual financial liabilities

Payables:

Trade payables 0 0 0 (3) 0 (3)

Borrowings:

Lease liabilities (1,869) 0 (1,869) (1,821) 0 (1,821)

Total contractual financial (1,869) 0 (1,869) (1,824) 0 (1,824) liabilities

Note: (i) The amount of receivables disclosed excludes statutory receivables (i.e. Amounts owing from Victorian Government and GST input tax credit receivable) totalling $185.882 million (2012: $163.674 million) – Refer to Note 7. Receivables. The net holding gains or losses disclosed above are determined as follows: • for cash and deposits, receivables and investments, the net gain or loss is calculated by subtracting any impairment recognised in the net result from the interest income • for financial liabilities measured at amortised cost, the net gain or loss reflects the interest expense.

(b) Credit risk Credit risk arises when there is the possibility of the department’s counter party defaulting on their contractual obligations resulting in financial loss to the department. Credit risk is measured at fair value and is monitored on a regular basis. Credit risk associated with the department’s contractual financial assets is minimal because the main debtor is the Victorian Government. Credit assessments are required for all debtors other than state and federal government departments, councils and other public bodies, where $5000 or more of goods or services are provided. The department reviews receivables for impairment consistent with the ageing disclosed in Table 21.3. In addition, the department does not engage in hedging for its contractual financial assets and mainly obtains contractual financial assets that are on fixed interest, except for cash held on call at bank. The department’s policy complies with Standing Direction 4.5.6 issued by the Minister for Finance and only permits deposits to be placed with authorised deposit- taking institutions. Provision for impairment for contractual financial assets is recognised when there is objective evidence that the department will not be able to collect a receivable. Objective evidence includes financial difficulties of the debtor, default payments, debts which are more than 30 days overdue, and changes in debtor credit ratings. The carrying amount of contractual financial assets recorded in the financial statements, net of any allowances for losses, represents the department’s maximum exposure to credit risk without taking account of the value of any collateral obtained.

150 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

Contractual financial assets that are either past due or impaired There are no material financial assets which are individually determined to be impaired. Currently the department does not hold any collateral as security nor credit enhancements relating to any of its financial assets. There are no contractual financial assets that have had their terms renegotiated so as to prevent them from being past due or impaired, and they are stated at the carrying amounts as indicated. The following table discloses the ageing only of contractual financial assets that are past due but not impaired:

Table 21.3: Ageing analysis of contractual financial assets

Past due but not impaired Not past Carrying due and not Less than 1 3 months – amount impaired Month 1–3 months 1 year 1–5 years $‘000 $‘000 $‘000 $‘000 $‘000 $‘000

2013

Cash and deposits

Cash, deposits on call and term 249,976 249,9760000 deposits less than 3 months

Receivables(i)

Trade receivables 18,545 17,257 780 133 306 69

Accrued income 162 1620000

Accrued interest 29 290000

Investments

Term deposits greater than 20,143 20,1430000 3 months

Total 288,855 287,567 780 133 306 69

2012

Cash and deposits

Cash, deposits on call and term 258,218 258,2180000 deposits less than 3 months

Receivables(i)

Trade receivables 11,592 9,374 1,822 319 77 0

Accrued income 599 5990000

Accrued interest 190 1900000

Total 270,599 268,381 1,822 319 77 0

Note: (i) Ageing analysis of receivables excludes statutory receivables totalling $185.882 million (2012: $163.674 million) for amounts owing from the Victorian Government and GST input tax credit recoverable as these amounts are not contractual and are therefore outside the scope of this disclosure – Refer to Note 7. Receivables.

(c) Liquidity risk Liquidity risk arises when the department is unable to meet its financial obligations as and when they fall due. The department operates under the government fair payments policy of settling financial obligations within 30 days and in the event of a dispute, making payments within 30 days from the date of resolution. The department’s maximum exposure to liquidity risk is the carrying amounts of financial liabilities as disclosed in the face of the balance sheet. The department manages its liquidity risk by ensuring that it has access to sufficient cash in the public account to meet its current liabilities. The department’s exposure to liquidity risk is deemed insignificant based on prior period data and current assessment of risk. Cash for unexpected events is generally sourced by drawing on amounts receivable from the Victorian government through the Public Account. The following table discloses the contractual maturity analysis for the department’s contractual financial liabilities.

Department of Environment and Primary Industries 2013 Annual Report 151 Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

Table 21.4: Maturity analysis of contractual financial liabilities

Maturity dates

Carrying Nominal Less than 1 month – 3 months amount amount(i) 1 month 3 months – 1 year 1–5 years 5+ years $’000 $‘000 $‘000 $‘000 $‘000 $‘000 $‘000

2013

Payables(i)

Trade creditors 18,197 18,197 7,947 8,961 784 505 0

Accrued grants and other 20,803 20,803 20,8030000 transfers

Accrued capital contributions 15,245 15,245 15,2450000

Other accrued expenses 55,294 55,294 55,2940000

Other payables 735 735 7350000

Borrowings:

Finance lease liabilities 27,535 27,535 3,503 1,696 6,518 15,818 0

Total 137,809 137,809 103,527 10,657 7,302 16,323 0

2012

Payables(i)

Trade creditors 18,606 18,606 17,611 305 152 538 0

Accrued grants and other 3,880 3,880 3,8800000 transfers

Accrued capital contributions 12,718 12,718 12,7180000

Other accrued expenses 40,848 40,848 40,8480000

Other payables 468 468 4680000

Borrowings:

Finance lease liabilities 30,549 30,549 3,792 1,889 9,405 15,463 0

Total 107,069 107,069 79,317 2,194 9,557 16,001 0

Note: (i) Ageing analysis of payables excludes statutory payables totalling $34.343 million (2012: $38.359 million) for amounts owing to the Victorian Government for advances from the public account and taxes payable as these amounts are not contractual and are therefore outside the scope of this disclosure – refer Note 14. Payables.

152 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

(d) Market risk The department’s exposures to market risk are primarily through interest rate risk with only insignificant exposure to foreign currency risks. Objectives, policies and processes used to manage each of these risks are disclosed below.

Foreign currency risk The department occasionally transacts in foreign currencies where the counter party invoices in a foreign currency. The foreign currency risk is managed by ensuring that the period from the initial transaction and settlement is short (less than 30 days). Based on past and current assessment of economic outlook, it is deemed unnecessary for the department to enter into any hedging arrangements to manage the risk. The department had no exposure to foreign currency risk as at either 30 June 2013 or 30 June 2012.

Interest rate risk Exposure to interest rate risk solely relates to cash balances held in deposits at variable interest rates. Minimisation of risk is achieved by undertaking fixed rate or non-interest bearing financial instruments. The department’s sole borrowings are VicFleet motor vehicle leases. The department’s interest bearing liabilities are managed by VicFleet and interest rates are fixed at the inception of the lease. The department’s exposure to interest rate risk is set out in the Table 21.5.

Table 21.5: Interest rate exposure of financial instruments

Interest rate exposure Weighted average Carrying Fixed Variable Non-interest effective amount interest rate interest rate bearing interest rate $‘000 $‘000 $‘000 $‘000

2013

Financial assets

Cash and deposits

Cash, deposits on call and term deposits less 3.16% 249,976 636 34,550 214,790 than 3 months

Receivables

Trade receivables 18,545 0 0 18,545

Accrued income 162 0 0 162

Accrued interest 29 0 0 29

Investments

Term deposits greater than 3 months 3.29% 20,143 20,143 0 0

Total financial assets 288,855 20,779 34,550 233,526

Financial liabilities

Payables

Trade creditors 18,197 0 0 18,197

Accrued grants and other transfers 20,803 0 0 20,803

Accrued capital contributions 15,245 0 0 15,245

Other accrued expenses 55,294 0 0 55,294

Other payables 735 0 0 735

Borrowings

Finance lease liabilities 6.62% 27,535 27,535 0 0

Total financial liabilities 137,809 27,535 0 110,274

Department of Environment and Primary Industries 2013 Annual Report 153 Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

Table 21.5: Interest rate exposure of financial instruments

Interest rate exposure Weighted average Carrying Fixed Variable Non-interest effective amount interest rate interest rate bearing interest rate $‘000 $‘000 $‘000 $‘000

2012

Financial assets

Cash and deposits

Cash, deposits on call and term deposits 4.57% 258,218 20,779 25,950 211,489 less than 3 months

Receivables

Trade receivables 11,592 0 0 11,592

Accrued income 599 0 0 599

Accrued interest 190 0 0 190

Total financial assets 270,599 20,779 25,950 223,870

Financial liabilities

Payables

Trade creditors 18,606 0 0 18,606

Accrued grants and other transfers 3,880 0 0 3,880

Accrued capital contributions 12,718 0 0 12,718

Other accrued expenses 40,848 0 0 40,848

Other payables 468 0 0 468

Borrowings

Finance lease liabilities 6.78% 30,549 30,549 0 0

Total financial liabilities 107,069 30,549 0 76,520

154 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

Sensitivity disclosure analysis and assumptions Taking into account past performance, future expectations, economic forecasts, and management’s knowledge and experience of the financial markets, the department believes the following movements are ‘reasonably possible’ over the next 12 months (the cash rate, exchange rate and inflation rate are all sourced from the Reserve Bank of Australia): • a parallel shift of +0.5% and -0.5% in market interest rates (AUD) from the year-end base rate of 2.75% (2012: 3.50%). Table 21.6 discloses the impact on net operating result and equity for each category of financial instrument held by the department at year-end as presented to key management personnel, if the above movements were to occur.

Table 21.6: Interest rate risk sensitivity

2013 Interest rate risk -0.5% +0.5% (-50 basis (+50 basis Carrying points) points) amount Net result Net result $’000 $‘000 $‘000 Contractual financial assets: Cash and deposits(i) 249,976 (173) 173 Investments 20,143 0 0 Receivables(ii) 18,736 0 0 Total impact (173) 173 Contractual financial liabilities: Payables(ii) 110,274 0 0 Borrowings(iii) 27,535 0 0 Total impact 0 0

Notes: (i) All cash and cash equivalents are held in Australian dollars. $35.186 million cash and cash equivalents were held on deposit at variable interest rates. The remainder of the balance was held in non-interest bearing accounts. This item is not subject to any other identified risk sensitivities. (ii) The carrying amount is denominated in Australian dollars and is non-interest bearing. This item is not subject to the identified risk sensitivities. (iii) Borrowings relate to finance lease liabilities associated with motor vehicles. Each contract has interest fixed at the inception of the lease. This item is not subject to identified risk sensitivities.

2012 Interest rate risk -1.0% +1.0% (-100 basis (+100 basis Carrying points) points) amount Net result Net result $’000 $‘000 $‘000 Contractual financial assets: Cash and deposits(i) 258,218 (260) 260 Receivables(ii) 12,381 0 0 Total impact (260) 260 Contractual financial liabilities: Payables(ii) 76,520 0 0 Borrowings(iii) 30,549 0 0 Total impact 00

Notes: (i) All cash and cash equivalents are held in Australian dollars. $46.729 million cash and cash equivalents were held on deposit at variable interest rates. The remainder of the balance was held in non-interest bearing accounts. This item is not subject to any other identified risk sensitivities. (ii) The carrying amount is denominated in Australian dollars and is non-interest bearing. This item is not subject to the identified risk sensitivities. (iii) Borrowings relate to finance lease liabilities associated with motor vehicles. Each contract has interest fixed at the inception of the lease. This item is not subject to identified risk sensitivities.

Department of Environment and Primary Industries 2013 Annual Report 155 Notes to the financial statements for the year ended 30 June 2013 Note 21. Financial instruments (continued)

(e) Fair value The fair value of financial instrument with standard terms and conditions and traded in active liquid markets are determined with reference to quoted market prices. The department considers the carrying amount of financial assets and financial liabilities recorded in the financial statements to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be paid in full. The following table shows that the fair value of most of the contractual financial assets and liabilities are the same as the carrying amounts.

Table 21.7: Comparison between carrying amount and fair value

2013 2012

Carrying Carrying amount Fair value(i) amount Fair value(i) $’000 $‘000 $’000 $‘000

Contractual financial assets

Cash and deposits

Cash, deposits on call and term deposits less than 3 months 249,976 249,976 258,218 258,218

Receivables(i)

Trade receivables 18,545 18,545 11,592 11,592

Accrued income 162 162 599 599

Accrued interest 29 29 190 190

Investments

Term deposits greater than 3 months 20,143 20,143 00

Total contractual financial assets 288,855 288,855 270,599 270,599

Contractual financial liabilities

Payables(ii)

Trade creditors 18,197 18,197 18,606 18,606

Accrued grants and other transfers 20,803 20,803 3,880 3,880

Accrued capital contributions 15,245 15,245 12,718 12,718

Other accrued expenses 55,294 55,294 40,848 40,848

Other payables 735 735 468 468

Borrowings

Finance lease liabilities 27,535 27,535 30,549 30,549

Total contractual financial liabilities 137,809 137,809 107,069 107,069

Notes: (i) The amount of receivables disclosed exclude statutory receivables (i.e. Amounts owing from Victorian Government and GST input tax credit receivable) totalling $185.882 million (2012: $163.674 million) – Refer Note 7. Receivables. (ii) The amount of payables disclosed exclude statutory payables (i.e. Amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $34.343 million (2012: $38.359 million) – Refer Note 14. Payables.

156 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 22. Cash flow information

2013 2012 $’000 $’000

(a) Reconciliation of cash and cash equivalents

Cash at bank and on hand(i) (1,041) (1,048)

Funds held in trust – cash 215,831 212,537

Funds held in trust – deposits on call and term deposits less than 3 months 35,186 46,729

Total cash and deposits disclosed in the balance sheet 249,976 258,218

Balance per cash flow statement 249,976 258,218

Note: (i) Due to the State of Victoria’s investment policy and government funding arrangements, the department does not hold a large cash reserve in their bank accounts. Cash received by the department from the generation of income is generally paid into the state’s bank account, known as the Public Account. Similarly, any departmental expenditure, including those in the form of cheques drawn by the department for the payment of goods and services to its suppliers and creditors are made via the Public Account. The process is such that, the Public Account would remit to the department the cash required for the amount drawn on the cheques. This remittance by the Public Account occurs upon the presentation of the cheques by the department’s suppliers or creditors.

2013 2012 $’000 $’000

(b) Non-cash financing and investing activities

Acquisition of non-current assets by means of finance leases 9,804 19,459

(c) Reconciliation of net result for the period

Net result for the period 243,820 12,621

Non-cash movements

Net (gain)/loss on disposal of property, plant and equipment (10,410) 314

Depreciation 46,606 49,362

Net (gain)/loss on financial instruments 39 (2)

Assets received free of charge or for nominal consideration (5,000) 0

Net recognition of non-financial assets (212,222) (11,422)

Write-down of non-financial assets 1,990 50,960

Impairment of intangible assets 0 3,949

Movements included in investing and financing activities

Share of associate’s (gains)/losses, excluding dividends (4,019) 1,607

Movements in assets and liabilities

Decrease/(increase) in receivables (28,564) 22,742

Decrease/(increase) in inventories 342 (1,327)

Decrease/(increase) in prepayments (2,095) 9,258

Increase/(decrease) in payables 30,696 (5,477)

Decrease in provisions (14,966) (4,628)

Increase/(decrease) in other liabilities 38 (177)

Net cash flows from operating activities 46,255 127,780

Department of Environment and Primary Industries 2013 Annual Report 157 Notes to the financial statements for the year ended 30 June 2013 Note 23. Physical asset revaluation surplus

2013 2012(i) 2011(i) $’000 $’000 $’000

Physical asset revaluation surplus

Balance at the beginning of the year 5,645,649 5,645,649 6,480,392

Increment/(decrement) on revaluation during the year resulting from:

Buildings and structures 0 0 163,689

Historical, cultural and environment assets 0 0 232

Crown land – Conservation reserves 0 (4,783) (213,607)

Crown land – Land and unused roads 56 0 (594,303)

Crown land – Land used for operational purposes 0 13 1,870

Crown land – Metropolitan parks 0 0 (163,680)

Crown land – National parks 17 4,783 (305,818)

Crown land – State forests 0 0 (264,088)

Freehold land 4,533 (13) 13

Roads 0 0 540,949

Balance as at the end of the year 5,650,255 5,645,649 5,645,649

Net change in physical asset revaluation surplus 4,606 0 (834,743)

Nature and purpose of physical asset revaluation surplus The physical asset revaluation surplus is used to record increments and decrements on the revaluation of non-current physical assets, as described in accounting policy Note 1(l) Non-financial assets. Note: (i) Refer to Note 32. Correction of prior year errors for details.

158 Department of Environment and Primary Industries 2013 Annual Report $’000 Variance Variance $’000 applied Appropriation Appropriation Total Total $’000 29,724 29,724 0 30,913 30,650 263 426,079 416,770 9,309 authority

parliamentary $’000 Section 35 In accordance with accrual output-based management In accordance ministered transactions are those that are undertaken on behalf those that are transactions are ministered $’000 Section 32 required to be paid AquaSure. required ture on a number of major initiative projects and appropriation funding approved but funding approved and appropriation on a number of major initiative projects ture appropriations available in 2013 for use in 2014 for proposed expenditure on a expenditure available in 2013 for use 2014 proposed appropriations $’000 Section 30 $’000 Section 29 from from $’000 Advance Treasurer Treasurer 10006030 300000 00000000 0 00000000 000000000 900000 Appropriation ActAppropriation Financial Management Act 1994 $’000 29,12 30,318 0 3,982 0 504 0 34,804 34,394 410 30,91 47,837 0 30,388 (8,959) 106,120 0 175,386 114,199 61,187 Annual 127,086 5,379 42,582 758 81,348 0 257,153 144,942 112,211 927,252 28,229 108,830 (758) 55,578 0 1,119,131 1,065,143 53,988 819,858 35,704 112,885 8,959426,07 51,612 99,322 1,128,340 1,030,695 97,645 1,113,777 33,608 155,394 0 138,033 0 1,440,812 1,274,203 166,609 appropriation appropriation (iii) (ii) Murray Darling Basin Act 1993 (i) not required. number of major initiative projects. The Environmental Protection Authority is no longer funded by parliamentary appropriation. Protection The Environmental number of major initiative projects. Total 1,324,687 35,704 143,273 0 157,732 99,322 1,760,718 1,592,314 168,404 Additions to Net Assets Base (ATNAB) Administered Payments made on Behalf of the State (POBOS) State contribution under the Provision of outputs – Environment Protection Authority Protection of outputs – Environment Provision Controlled of outputs – Department Environment Provision and Primary Industries As at 30 June 2013 As at 30 June 2012 Notes to the financial statements for year ended 30 June 2013 (iii) Payments on Behalf of the State (POBOS) the amount to the delay in commissioning Victorian Desalination Plant, reducing The 2013 variance of $9.3 million relates Notes: (i) of outputs Provision to the carry over of output relates of output for the department $97.6 million predominately The 2013 variance in provision (ii) Addition to Net Assets Base (ATNAB) expendi to the carry over of funding available in 2013 for use 2014 proposed The 2013 variance of $61.2 million relates procedures ‘Provision for outputs’ and ‘Additions to net assets’ are disclosed as ‘controlled’ activities of the department. Ad disclosed as ‘controlled’ for outputs’ and ‘Additions to net assets’ are ‘Provision procedures or discretion. of the state over which department has no control Note 24. Summary of compliance with annual parliamentary and special appropriations (a) Summary of compliance with annual parliamentary appropriations by the department for year. received The following table discloses the details of various parliamentary appropriations

Department of Environment and Primary Industries 2013 Annual Report 159 Notes to the financial statements for the year ended 30 June 2013 Note 24. Summary of compliance with annual parliamentary and special appropriations (continued)

(b) Summary of compliance with special appropriations

Appropriation Applied

2013 2012 Authority Purpose $’000 $’000

Output special appropriations

Section 10 of the Financial Management Act 1994 Appropriation of Commonwealth grants etc. 14,545 18,531

Capital special appropriations

Section 10 of the Financial Management Act 1994 Appropriation of Commonwealth grants etc. 0 2,385

Total special appropriations 14,545 20,916

(c) Total controlled appropriations applied

Notes

Provision of outputs

Annual Parliamentary Appropriations 24(a) 1,030,695 1,065,143

Special appropriations 24(b) 14,545 18,531

Total provision of output appropriations applied 1,045,240 1,083,674

Additions to net asset base

Annual Parliamentary Appropriations 24(a) 114,199 144,942

Special appropriations 24(b) 0 2,385

Total additions to net asset appropriations applied 114,199 147,327

Note 25. Ex-gratia payments

2013 2012 $’000 $’000

The department has made the following ex-gratia payments:

Ex-gratia payments 105 0

The department made ex-gratia payments for the following reasons: • to provide some private individuals and businesses with independent water supplies, as plans to develop a departmental depot would affect their existing supplies • in relation to the memorial services of firefighters who died during the fire season.

160 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 26. Annotated income agreements

The following is a listing of section 29 annotated income agreements approved by the Treasurer:

2013 2012 $’000 $’000 Capital items Goulburn-Murray Water Connections Project Stage 1 718 2,970 718 2,970 Commonwealth specific purpose payments – capital Barwon Water/ Shell Recycling 2,000 6,500 Black Rock Water Recycling Project 3,000 6,000 Extending Water Recycling at Torquay 2,360 1,000 Warnambool Roof Harvesting 0 476 7,360 13,976 User charges, or sales of goods and services BushBroker 130 164 Commercial Forest 0 72 Electronic Conveyancing 10,768 10,746 Revenue retained on behalf of the EPA 1,725 0 Land Titles Office 320 356 Landata 18,046 15,913 Mapping 3,447 2,482 Goulburn-Murray Water Connections Project Stage 1(i) 5,632 21,570 Parks user fees and Werribee Mansion 5,382 4,718 Queenscliff Harbour Redevelopment 43 52 Sale of timber resources to Australian Paper 0 11,523 SPEARS Project 2,710 777 Sunraysia Modernisation 455 0 Water Register – Planning 325 381 Water Register – State 1,179 1,320 50,162 70,074 Commonwealth specific purpose payments – output Bureau of Meteorology Water Information Improvements 0 635 Caring for our Country 29,571 29,988 Goulburn-Murray Water Connections Project Stage 2 433 0 Murray-Darling Basin - Environmental Works and Measures Feasibility Program 603 1,610 National Ground Water Action Plan 0 1,127 National Framework for Compliance and Enforcement 4 35 National Water Commission – Accounting for all Significant Water Users 0 631 North East Victoria Bushfire Spotting Digital Regions Initiative 103 0 Raising National Water Standards 0 144 Roads to Recovery Program 70 0 Water Register – Commonwealth – Stage 2 489 554 Wimmera Irrigation Water Procurement and District Decommissioning 25,200 0 56,473 34,724 Total annotated income agreements 114,713 121,744

Note: (i) Referred to as ‘Northern Victorian Irrigation Renewal Project’ in 2011–12.

Department of Environment and Primary Industries 2013 Annual Report 161 Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances

The following is a listing of trust account balances in cash, deposits and investments relating to trust accounts controlled and administered by the department.

2013

Balance as Total Total Balance as at 1 July receipts payments at 30 June $’000 $’000 $’000 $’000

Controlled trusts

Cash, deposits and investments

Albury Wodonga Land Transfer 830 177 (65) 942

Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and earns interest for the appropriate management and protection of land transferred from the Albury Wodonga Corporation.

Department Suspense 79 209 (29) 259

Operates under s19(2) of the Financial Management Act 1994 as a working account. It holds all generic unclaimed funds until they have been identified.

DTF VicFleet(i) 4,155 11,283 (6,274) 9,164

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and makes payments in relation to the government motor vehicle pool.

Melbourne Strategic Assessment Trust Account 0 3,480 (28) 3,452

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives fees and disburses payments in relation to the delivery of the Melbourne Strategic Assessment Program.

Parks and Reserves Trust Account 46,868 139,443 (130,333) 55,978

Operates under s153A of the Water Industry Act 1994 as a specific purpose operating account. It receives the Metropolitan Parks Improvement Rate and makes payments for the management and control of open spaces, parks and waterways in the metropolitan area.

Plant and Machinery Trust Account 46,698 17,755 (12,663) 51,790

Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the renewal, replacement, operation, maintenance and repair of plant and machinery.

Project Trust Account 142,069 77,034 (93,417) 125,686

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives income and makes payments associated with services the department has been contracted to supply on a fee for service basis.

162 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2013

Balance as Total Total Balance as at 1 July receipts payments at 30 June $’000 $’000 $’000 $’000

Controlled trusts (continued)

Revenue Suspense 62 0 (3) 59

Operates under s19(2) of the Financial Management Act 1994 as a departmental account. It records all unknown revenue receipts; funds are held until receipts are identified.

Stores Suspense 5,009 10,334 (2,667) 12,676

Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the purchase of stores and the cost of manufacturing articles for stock.

Treasury Trust – Small Scale Community Support Fund 0 30 (30) 0

Operates under s19 of the Financial Management Act 1994 as a shared operating account. It allocates funds the government receives from gaming machines back to the community through a variety of programs.

Treasury Trust – Floods 13,496 14,839 (17,181) 11,154

Operates under s19 of the Financial Management Act 1994 as a shared operating account. It makes state funds available for the restoration of assets and public facilities damaged in floods.

Total controlled trusts 259,266 274,584 (262,690) 271,160

Department of Environment and Primary Industries 2013 Annual Report 163 Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2012

Balance as Total Balance as at 1 July Total receipts payments at 30 June $’000 $’000 $’000 $’000

Controlled trusts

Cash, deposits and investments

Albury Wodonga Land Transfer 636 272 (78) 830

Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and earns interest for the appropriate management and protection of land transferred from the Albury Wodonga Corporation.

Department Suspense 15 64 0 79

Operates under s19(2) of the Financial Management Act 1994 as a working account. It holds all generic unclaimed funds until they have been identified

DTF VicFleet(i) 0 6,262 (2,107) 4,155

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and makes payments in relation to the government motor vehicle pool.

Parks and Reserves Trust Account 42,743 137,911 (133,786) 46,868

Operates under s153A of the Water Industry Act 1994 as a specific purpose operating account. It receives the Metropolitan Parks Improvement Rate and makes payments for the management and control of open spaces, parks and waterways in the metropolitan area.

Plant and Machinery Trust Account 43,559 13,019 (9,880) 46,698

Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the renewal, replacement, operation, maintenance and repair of plant and machinery.

Project Trust Account 157,900 89,768 (105,599) 142,069

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives income and makes payments associated with services the department has been contracted to supply on a fee for service basis.

Revenue Suspense 94 0 (32) 62

Operates under s19(2) of the Financial Management Act 1994 as a departmental account. It records all unknown revenue receipts; funds are held until receipts are identified.

164 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2012

Balance as Total Balance as at 1 July Total receipts payments at 30 June $’000 $’000 $’000 $’000

Controlled trusts (continued) Snowy River Flow Trust Account 0 7,500 (7,500) 0

Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It receives the Commonwealth’s contribution to the Joint Government Enterprise, and transfers the State Appropriation and Commonwealth contributions to the State Trustees Limited.

Stores Suspense 6,644 3,393 (5,028) 5,009

Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the purchase of stores and the cost of manufacturing articles for stock.

Treasury Trust – Small Scale Community Support Fund 0 200 (200) 0

Operates under s19 of the Financial Management Act 1994 as an operating account shared across government. It allocates funds the government receives from gaming machines back to the community through a variety of programs.

Treasury Trust – Floods 502 73,770 (60,776) 13,496

Operates under s19 of the Financial Management Act 1994 as a shared operating account. It makes state funds available for the restoration of assets and public facilities damaged in floods.

Total controlled trusts 252,093 332,159 (324,986) 259,266

Note: (i) VicFleet is part of a Trust Fund held by DTF. Any deficit represents a loss on the early termination of individual motor vehicle finance leases by the department. The department is required to reimburse the Trust Fund held by DTF for any deficit balance.

Department of Environment and Primary Industries 2013 Annual Report 165 Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2013

Balance as Total Total Balance as at 1 July receipts payments at 30 June $’000 $’000 $’000 $’000

Administered trusts

Cash, deposits and investments

CH Barbour Forestry Foundation 80 08

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Forests Commission Prizes and Scholarships 0000

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

J Gilmore Farm Water Supply and Hanslow Cup 40 2 (1) 41

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Natural Disaster Relief Fund 405 0 0 405

Operates under s19(2) of the Financial Management Act 1994 as a holding account. It holds money supplied by the Commonwealth until required for expenditure in the case of any natural disasters.

Paid Parental Leave Treasury Trust Fund 27 22 0 49

Operates under s19(2) of the Financial Management Act 1994 as a working account. It receives funds from the Commonwealth to meet the eligible costs of parental leave for departmental employees.

Public Service Commuters’ Club(ii) (73) 24 0 (49)

Operates under s19 of the Financial Management Act 1994 as a working account. It services loans to staff for the purchase of yearly tickets and funds are recouped through staff salaries and wages.

Securities Trust Fund 41 11 (21) 31

Operates under s19 of the Financial Management Act 1994 as a working account. It receives and holds bonds for use by third parties of public land.

Sidney Plowman Award 220022

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

166 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2013

Balance as Total Total Balance as at 1 July receipts payments at 30 June $’000 $’000 $’000 $’000

Administered trusts (continued)

Treasury Trust 916 42 (34) 924

Operates under s19(2) of the Financial Management Act 1994 as a working account. It records the receipt and disbursement of unclaimed and unidentified monies such as unpresented cheques, surplus cash, unidentified remittances etc.

Victorian State Foresters’ Association 742076

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Total administered trusts 1,460 103 (56) 1,507

Department of Environment and Primary Industries 2013 Annual Report 167 Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2012

Balance as Total Balance as at 1 July Total receipts payments at 30 June $’000 $’000 $’000 $’000

Administered trusts

Cash, deposits and investments

CH Barbour Forestry Foundation 8008

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Forests Commission Prizes and Scholarships 3 0 (3) 0

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

J Gilmore Farm Water Supply and Hanslow Cup 56 1 (17) 40

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Natural Disaster Relief Fund 486 0 (81) 405

Operates under s19(2) of the Financial Management Act 1994 as a holding account. It holds money supplied by the Commonwealth until required for expenditure in the case of any natural disasters.

Paid Parental Leave Treasury Trust Fund 027027

Operates under s19(2) of the Financial Management Act 1994 as a working account. It receives funds from the Commonwealth to meet the eligible costs of parental leave for departmental employees.

Public Service Commuters’ Club(ii) (36) 0 (37) (73)

Operates under s19 of the Financial Management Act 1994 as a working account. It services loans to staff for the purchase of yearly tickets and funds are recouped through staff salaries and wages.

Securities Trust Fund 42 0 (1) 41

Operates under s19 of the Financial Management Act 1994 as a working account. It receives and holds bonds for usage by third parties of public land.

Sidney Plowman Award 418022

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

168 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

2012

Balance as Total Balance as at 1 July Total receipts payments at 30 June $’000 $’000 $’000 $’000

Administered trusts (continued) Treasury Trust 844 80 (8) 916

Operates under s19(2) of the Financial Management Act 1994 as a working account. It records the receipt and disbursement of unclaimed and unidentified monies such as unpresented cheques, surplus cash, unidentified remittances etc.

Victorian State Foresters’ Association 71 4 (1) 74

Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.

Total administered trusts 1,478 130 (148) 1,460

Department of Environment and Primary Industries 2013 Annual Report 169 Notes to the financial statements for the year ended 30 June 2013 Note 27. Trust account balances (continued)

Trust Accounts opened or closed by the department during 2013 The Melbourne Strategic Trust Account was opened during the year.

Treasury Trust – Victorian floods The state has made funds available for the restoration of assets and public facilities damaged in floods through the Treasury Trust Fund.

2013 2012 $’000 $’000

Treasury Trust – Victorian floods

Cash at bank at 30 June 11,154 13,496

Total funds under management 11,154 13,496

Contributions by the Victorian government 14,839 73,770

Total receipts 14,839 73,770

Payments to catchment management authorities 2,456 6,447

Payments to portfolio agencies 5,954 10,959

Payments to non-portfolio agencies 1,502 16,463

Payments to local governments 1,937 15,131

Payments to community groups 550 4,915

Payments on state-owned assets 252 128

Other payments 4,530 6,733

Total payments 17,181 60,776

Balance carried forward at 30 June 11,154 13,496

Third party funds under management No third party funds were held under management for either 2012–13 or 2011–12.

170 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 28. Responsible persons

In accordance with the Ministerial Directions issued by the Minister for Finance under the Financial Management Act 1994, the following disclosures are made regarding responsible persons for the reporting period.

Names The persons who held the positions of Ministers and Accountable Officers in the department are as follows:

Minister for Water The Hon. Peter Walsh MP 1 July 2012 to 30 June 2013 Minister for Environment and Climate Change The Hon. Ryan Smith MP 1 July 2012 to 30 June 2013 Secretary Mr Greg Wilson 1 July 2012 to 12 April 2013 Secretary Mr Adam Fennessy 13 April 2013 to 30 June 2013

Acting arrangements The Hon. Terry Mulder MP acted as Minister for Water during the period 21 September 2012 to 27 September 2012. The Hon. Michael O’Brien MP acted as Minister for Environment and Climate Change during the period 24 September 2012 to 5 October 2012. The Hon. Peter Walsh MP acted as Minister for Environment and Climate Change during the period 7 January 2013 to 11 January 2013. The Hon. Hugh Delahunty MLA acted as Minister for Water during the period 10 June 2013 to 21 June 2013. The Hon. Mary Wooldridge MP acted as Minister for Environment and Climate Change during the period 15 June 2013 to 22 June 2013. Mr Adam Fennessy acted in the position of Secretary of the department during the periods 2 July 2012 to 20 July 2012 and 25 March 2013 to 12 April 2013. His salary for these periods is included in Note 29(a) Remuneration of executive officers. His salary for the period 13 April 2013 to 30 June 2013 is included below.

Remuneration Remuneration received or receivable by the Accountable Officer in connection with the management of the department during the reporting period was in the range:

2013 2012 No. No. Income band $80,000 – $89,999 1 0 $340,000 – $349,999 1 0 $410,000 – $419,999 0 1

Amounts relating to Ministers are reported in the financial statements of the Department of Premier and Cabinet.

Related party transactions Other related transactions and loans requiring disclosure under the Directions of the Minister for Finance have been considered and there are no matters to report.

Note 29. Remuneration of executives and payments to other personnel

(a) Remuneration of executive officers The number of executive officers, other than Ministers and the Accountable Officer, and their total remuneration during the reporting periods are shown in the first two columns in the table below in their relevant income bands. The base remuneration of executive officers is shown in the third and fourth columns. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits. The total annualised employee equivalent provides a measure of full time equivalent executive officers over the reporting period. Several factors have affected total remuneration payable to executives over the year. A number of employment contracts were completed and renegotiated and a number of executives received bonus payments during the year. These bonus payments depend on the terms of individual employment contracts. Some contracts provide for an annual bonus payment whereas other contracts only include the payment of bonuses on the successful completion of the full term of the contract. A number of these contract completion bonuses became payable during the year. A number of executive officers retired, resigned or were retrenched in the past year. This has had a significant impact on total remuneration figures due to the inclusion of annual leave, long service leave and retrenchment payments. As of 30 June 2013, the department employed 50 executive officers (2012: 40 executive officers).

Department of Environment and Primary Industries 2013 Annual Report 171 Notes to the financial statements for the year ended 30 June 2013 Note 29. Remuneration of executives and payments to other personnel (continued)

Total remuneration Base remuneration

2013 2012 2013 2012 No. No. No. No.

Income band

Less than $100,000 16 8 16 10

$110,000 – $119,999 1121

$120,000 – $129,999 1110

$130,000 – $139,999 1112

$140,000 – $149,999 2111

$150,000 – $159,999 3275

$160,000 – $169,999 4616

$170,000 – $179,999 2647

$180,000 – $189,999 5463

$190,000 – $199,999 6 4 4 4

$200,000 – $209,999 2332

$210,000 – $219,999 4151

$220,000 – $229,999 4302

$230,000 – $239,999 0211

$240,000 – $249,999 0022

$250,000 – $259,999 2100

$260,000 – $269,999 1100

$270,000 – $279,999 0101

$290,000 – $299,999 0000

$320,000 – $329,999 0001

$330,000 – $339,999 0010

$350,000 – $359,999 1000

$360,000 – $369,999 0100

$390,000 – $399,999 0100

$540,000 – $549,999 0100

Total number of executives 55 49 55 49

Total annualised employee equivalent 43.4 42.2 43.4 42.2

Total amount $’000 8,392 8,908 8,050 7,785

Notes: (i) As disclosed in Note 31, the Department of Primary Industries (DPI) has recognised and disclosed the remuneration of executives transferred to the department under section 30 of the Public Administration Act 2004 in its 2012–13 financial statements. Three executives transferred to the department on 13 May 2013, their remuneration after this date is disclosed. The remainder of the transferred executives had continued to contribute to the delivery of the outputs of DPI until 30 June 2013. (ii) Includes executives from the Office of Living Victoria, which forms part of the reporting entity.

172 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 29. Remuneration of executives and payments to other personnel (continued)

(b) Payments to other personnel (i.e. contractors charged with significant management responsibilities) The following disclosures are made in relation to other personnel of the department, i.e. contractors charged with significant management responsibilities. Payments have been made to a number of contractors with significant management responsibilities, which are disclosed in expense bands of $10,000. These contractors are responsible for planning, directing or controlling, directly or indirectly, some of the department’s activities. 2013 2012

Expense band

$260,000 – $269,999 0 1

$324,000 – $324,999 1 0

$425,000 – $425,999 1 1

Total expenses (exclusive of GST) $749,778 $693,963

Note 30. Remuneration of auditors 2013 2012 $’000 $’000

Victorian Auditor-General’s Office

Audit of the financial statements 276 269

Other audit services: acquittals 0 17

276 286

Note 31. Restructure of administrative arrangements

Restructuring of administrative arrangements On 9 April 2013, the government announced a restructure of its activities and on 25 June 2013 issued Administrative Order No. 217 under the Administrative Arrangements Act 1983. The restructure resulted in a number of changes to the department’s functions and outputs. The changes, effective from 1 July 2013, are summarised below.

Outputs transferred:

2012–13 Outputs Transferee

Land Administration and Property Information Department of Transport, Planning and Local Infrastructure

Outputs received:

2012–13 Outputs Transferor:

Primary Industries Policy Department of Primary Industries

Regulation and Compliance Department of Primary Industries

Strategic and Applied Scientific Research Department of Primary Industries

Practice Change Department of Primary Industries

As part of the restructure, the Premier made two declarations under section 30 of the Public Administration Act 2004. The declarations transferred staff between affected departments on 3 June 2013 and 1 July 2013 respectively. Nevertheless, Administrative Order No. 217 requires the financial reporting for the functions and outputs transferred between departments to take effect from 1 July 2013. As responsibility for the delivery of the 2012–13 outputs specified in the 2012–13 Budget remained with the department until 1 July 2013, all associated income, expenses, assets and liabilities are reported in the financial statements of the department in 2012–13. Assets and liabilities associated with outputs transferred to, or received from, another department on 1 July 2013 will be reflected in the financial statements for 2013–14. Expenses relating to transferred staff and other directly associated business expenses incurred between 3 June to 30 June 2013, which amount to $11,004,879, are reflected in the financial statements of the department from which they transferred as the transferred staff continued to contribute to the delivery of that department’s outputs during 2012–13.

Department of Environment and Primary Industries 2013 Annual Report 173 Notes to the financial statements for the year ended 30 June 2013 Note 32. Correction of prior year errors

The errors described below have been adjusted by restating each of the affected financial statement line items for the prior year.

(a) Errors in recording asset transfers As part of the ongoing state Crown land reconciliation, a number of duplicate Crown land parcels have been identified that were recorded both by the department and another government entity. Adjustments have been made to correct prior year balances. Apart from the impact on the prior year operating results of these errors, these items also included valuations booked by the department in prior years. As part of the ongoing maintenance of the land information management system, a number of Crown land parcels were identified that were created in error.

The net impact of these errors is: 2011–12 Opening balances • an overstatement of property, plant and equipment of $23.954 million • an overstatement of accumulated deficit of $27.523 million • an understatement of the physical asset revaluation surplus of $3.569 million.

2011–12 • an overstatement of property, plant and equipment of $6.187 million • an overstatement of the accumulated deficit of $6.187 million. The below section titled ‘Restatement of financial statements as a result of the correction of an error’ shows the restatement of each line item affected by the error.

(b) Restatement of financial statements as a result of the correction of an error – 30 June 2012 comparative year Financial statement line item affected:

Correction of Restated Actual 2012 2012 errors 2012 Comprehensive operating statement (Extract) Notes $’000 $’000 $’000 Other economic flows included in net result Net gain/(loss) on non-financial assets (37,619) (6,187) (43,806) Total other economic flows included in net result (40,735) (6,187) (46,922) Net result 18,808 (6,187) 12,621 Other economic flows – other comprehensive income Changes in physical asset revaluation surplus 23 0 0 0 Total other economic flows – other comprehensive income 0 0 0 Comprehensive result 18,808 (6,187) 12,621

Correction of errors to 30 Correction of Restated Actual 2012 June 2011 2012 errors 2012 Balance sheet (Extract) Notes $’000 $’000 $’000 $’000 Non-financial assets Property, plant and equipment 1(l),12 7,145,604 (23,954) (6,187) 7,115,463 Total non-financial assets 7,178,702 (23,954) (6,187) 7,148,561 Total assets 7,622,187 (23,954) (6,187) 7,592,046 Net assets 7,338,945 (23,954) (6,187) 7,308,804 Equity Accumulated deficit (212,281) (27,523) (6,187) (245,991) Physical asset revaluation surplus 23 5,642,080 3,569 0 5,645,649 Contributed capital 1,909,146 0 0 1,909,146 Net worth 7,338,945 (23,954) (6,187) 7,308,804

174 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 32. Correction of prior year errors (continued)

Correction of Restated Actual 2012 2012 errors 2012 Note 6 – Other economic flows included in net result (Extract) $’000 $’000 $’000

(a) Net gain/(loss) on non-financial assets

Net gain/(loss) on disposal of property, plant and equipment 5,873 (6,187) (314)

Total gain/(loss) on non-financial assets (37,619) (6,187) (43,806)

Correction of errors to 30 Correction of Restated Actual 2012 June 2011 2012 errors 2012 Note 12 – Property, plant and equipment (Extract) $’000 $’000 $’000 $’000

Crown land – Land and unused roads

At fair value 2,294,734 (21,419) (6,187) 2,267,128

Total Crown land – Land and unused roads 2,294,734 (21,419) (6,187) 2,267,128

Crown land – National parks

At fair value 1,062,005 (2,535) 0 1,059,470

Total Crown land – National parks 1,062,005 (2,535) 0 1,059,470

Total land 5,531,634 (23,954) (6,187) 5,501,493

Total property, plant and equipment 7,145,604 (23,954) (6,187) 7,115,463

Correction of errors to 30 Correction of Restated Actual 2012 June 2011 2012 errors 2012 Note 23 – Physical asset revaluation surplus (Extract) $’000 $’000 $’000 $’000

Physical asset revaluation surplus

Balance at the beginning of the financial year 5,642,080 3,569 0 5,645,649

Crown land – Land and unused roads 0000

Crown land – National parks 4,783 0 0 4,783

Balance at the end of the year 5,642,080 3,569 0 5,645,649

Net change in physical asset revaluation surplus 0000

(c) Restatement of financial statements as a result of the correction of an error – 30 June 2011 comparative year Financial statement line item affected:

Correction of Restated Actual 2011 error 2011 Comprehensive operating statement (Extract) Notes $’000 $’000 $’000

Net result from transactions (net operating balance)

Other economic flows included in net result

Net loss on non-financial assets 1(h),1(l), 6(a) 32,183 (27,523) 4,660

Total other economic flows included in net result 33,116 (27,523) 5,593

Net result 23,666 (27,523) (3,857)

Other economic flows – other comprehensive income

Changes in physical asset revaluation surplus 23 (838,312) 3,569 (834,743)

Total other economic flows – comprehensive income (838,312) 3,569 (834,743)

Comprehensive result (814,646) (23,954) (838,600)

Department of Environment and Primary Industries 2013 Annual Report 175 Notes to the financial statements for the year ended 30 June 2013 Note 32. Correction of prior year errors (continued)

Correction of Restated Actual 2011 error 2011 Balance sheet (Extract) Notes $’000 $’000 $’000

Non-financial assets

Property, plant and equipment 1(l),12 7,293,198 (23,954) 7,269,244

Total non-financial assets 7,360,725 (23,954) 7,336,771

Total assets 7,810,525 (23,954) 7,786,571

Net assets 7,443,113 (23,954) 7,419,159

Equity

Accumulated deficit (231,089) (27,523) (258,612)

Physical asset revaluation surplus 23 5,642,080 3,569 5,645,649

Contributed capital 2,032,122 0 2,032,122

Net worth 7,443,113 (23,954) 7,419,159

Correction of Restated Actual 2011 error 2011 Note 12 – Property, plant and equipment (Extract) $’000 $’000 $’000

Crown land – Land and unused roads

At fair value 2,409,808 (21,419) 2,388,389

Total Crown land – Land and unused roads 2,409,808 (21,419) 2,388,389

Crown land – National parks

At fair value 1,052,442 (2,535) 1,049,907

Total Crown land – National parks 1,052,442 (2,535) 1,049,907

Total land 5,628,530 (23,954) 5,604,576

Total property, plant and equipment 7,293,198 (23,954) 7,269,244

Correction of Restated Actual 2011 error 2011 Note 23 – Physical asset revaluation surplus (Extract) $’000 $’000 $’000

Physical asset revaluation surplus

Balance at the beginning of the financial year 6,480,392 0 6,480,392

Crown land – Land and unused roads (596,605) 2,302 (594,303)

Crown land – National parks (307,085) 1,267 (305,818)

Balance at the end of the year 5,642,080 3,569 5,645,649

Net change in physical asset revaluation surplus (838,312) 3,569 (834,743)

176 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 33. Glossary of terms and style conventions

Glossary of terms Financial asset Associates A financial asset is any asset that is: Associates are all entities over which an entity has significant (a) cash influence but not control, generally accompanying a (b) an equity instrument of another entity shareholding and voting rights of between 20 per cent and 50 per cent. (c) a contractual or statutory right:

Borrowings • to receive cash or another financial asset from another entity; or Borrowings refers to interest-bearing finance leases and other interest-bearing arrangements. • to exchange financial assets or financial liabilities with another entity under conditions that are Comprehensive result potentially favourable to the entity; or The net result of all items of income and expense recognised (d) a contract that will or may be settled in the entity’s own for the period. It is the aggregate of operating result and equity instruments and is: other non-owner movements in equity. • a non-derivative for which the entity is or may be Capital asset charge obliged to receive a variable number of the entity’s own equity instruments; or The capital asset charge represents the opportunity cost of capital invested in the nonfinancial physical assets used in • a derivative that will or may be settled other than by the provision of outputs. the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own Commitments equity instruments. Commitments include those operating, capital and other Financial instrument outsourcing commitments arising from noncancellable A financial instrument is any contract that gives rise to a contractual or statutory sources. financial asset of one entity and a financial liability or equity Depreciation instrument of another entity. Financial assets or liabilities that are not contractual (such as statutory receivables or Depreciation is an expense that arises from the consumption payables that arise as a result of statutory requirements through wear or time of a produced physical or intangible imposed by governments) are not financial instruments. asset. This expense is classified as a ‘transaction’ and so reduces the ‘net result from transaction’. Financial liability Effective interest method A financial liability is any liability that is: The effective interest method is used to calculate the (a) A contractual obligation: amortised cost of a financial asset and of allocating interest (i) to deliver cash or another financial asset to another income over the relevant period. The effective interest rate entity; or is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument, (ii) to exchange financial assets or financial liabilities or, where appropriate, a shorter period to the net carrying with another entity under conditions that are amount of the financial asset or financial liability. potentially unfavourable to the entity; or

Employee benefits expenses (b) A contract that will or may be settled in the entity’s own equity instruments and is: Employee benefits expenses include all costs related to employment including wages and salaries, fringe benefits (i) a non-derivative for which the entity is or may be tax, leave entitlements, redundancy payments, defined obliged to deliver a variable number of the entity’s benefits superannuation plans and defined contribution own equity instruments; or superannuation plans. (ii) a derivative that will or may be settled other than by Ex-gratia payments the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own Ex-gratia payment is the gratuitous payment of money equity instruments. For this purpose the entity’s where no legal obligation exists. own equity instruments do not include instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments.

Department of Environment and Primary Industries 2013 Annual Report 177 Notes to the financial statements for the year ended 30 June 2013 Note 33. Glossary of terms and style conventions (continued)

Financial statements Interest expense Depending on the context of the sentence where the Costs incurred in connection with the borrowing of funds term ‘financial statements’ is used, it may include only the includes interest on bank overdrafts and short term and long main financial statements (i.e. comprehensive operating term borrowings, amortisation of discounts or premiums statement, balance sheet, cash flow statements, and relating to borrowings, interest component of finance leases statement of changes in equity); or it may also be used repayments, and the increase in financial liabilities and non- to replace the old term ‘financial report’ under the revised employee provisions due to the unwinding of discounts to AASB 101 (September 2007), which means it may include reflect the passage of time. the main financial statements and the notes. Interest income Grants and other transfers Interest income includes unwinding over time of discounts Transactions in which one unit provides goods, services, on financial assets and interest received on bank term assets (or extinguishes a liability) or labour to another unit deposits and other investments. without receiving approximately equal value in return. Grants can either be operating or capital in nature. Joint ventures Joint ventures are contractual arrangements between the While grants to governments may result in the provision department and one or more other parties to undertake of some goods or services to the transferor, they do not an economic activity that is subject to joint control. Joint give the transferor a claim to receive directly benefits of control only exists when the strategic financial and operating approximately equal value. For this reason, grants are decisions relating to the activity require the unanimous referred to by the AASB as involuntary transfers and are consent of the parties sharing control (the venturers). termed nonreciprocal transfers. Receipt and sacrifice of approximately equal value may occur, but only by Net result coincidence. For example, governments are not obliged to Net result is a measure of financial performance of the provide commensurate benefits, in the form of goods or operations for the period. It is the net result of items of services, to particular taxpayers in return for their taxes. income, gains and expenses (including losses) recognised Grants can be paid as general purpose grants which refer for the period, excluding those that are classified as ‘other to grants that are not subject to conditions regarding their non-owner changes in equity’. use. Alternatively, they may be paid as specific purpose grants which are paid for a particular purpose and/or have Net result from transactions/net operating balance conditions attached regarding their use. Net result from transactions or net operating balance is a key fiscal aggregate and is income from transactions minus General government sector expenses from transactions. It is a summary measure of The general government sector comprises all government the ongoing sustainability of operations. It excludes gains departments, offices and other bodies engaged in providing and losses resulting from changes in price levels and other services free of charge or at prices significantly below their changes in the volume of assets. It is the component of the cost of production. General government services include change in net worth that is due to transactions and can be those which are mainly non-market in nature, those which attributed directly to government policies. are largely for collective consumption by the community and those which involve the transfer or redistribution of income. Net worth These services are financed mainly through taxes, or other Assets less liabilities, which is an economic measure of compulsory levies and user charges. wealth.

Grants for onpassing Non-financial assets All grants paid to one institutional sector (e.g. a state general Non-financial assets are all assets that are not ‘financial government entity) to be passed on to another institutional assets’. It includes inventories, land, buildings, road sector (e.g. local government or a private non-profit networks, land under roads, plant and equipment, cultural institution). and heritage assets, intangible and biological assets.

Intangible produced assets Non-produced assets Refer to produced assets in this glossary. Non-produced assets are assets needed for production that have not themselves been produced. They include land, Intangible non-produced assets subsoil assets, and certain intangible assets. Non-produced Refer to non-produced asset in this glossary. intangibles are intangible assets needed for production that have not themselves been produced. They include constructs of society such as patents.

178 Department of Environment and Primary Industries 2013 Annual Report Notes to the financial statements for the year ended 30 June 2013 Note 33. Glossary of terms and style conventions (continued)

Non-profit institution Taxation income A legal or social entity that is created for the purpose of Taxation income represents income received from the state’s producing or distributing goods and services but is not taxpayers and includes: permitted to be a source of income, profit or other financial • levies (including the environmental levy) on statutory gain for the units that establish, control or finance it. corporations in other sectors of government Other economic flows • the Metropolitan Parks Improvement Rate Other economic flows are changes in the volume or value • other taxes, including landfill levies, licence and of an asset or liability that do not result from transactions. It concession fees. includes: • gains and losses from disposals, revaluations and Transactions impairments of nonfinancial physical and intangible assets Transactions are those economic flows that are considered to arise as a result of policy decisions, usually an interaction • actuarial gains and losses arising from defined benefit between two entities by mutual agreement. They also superannuation plans include flows within an entity such as depreciation where • fair value changes of financial instruments and agricultural the owner is simultaneously acting as the owner of the assets. depreciating asset and as the consumer of the service provided by the asset. Taxation is regarded as mutually In simple terms, other economic flows are changes arising agreed interactions between the government and taxpayers. from market re-measurements. Transactions can be in kind (e.g. assets provided/given free Payables of charge or for nominal consideration) or where the final consideration is cash. In simple terms, transactions arise Includes short and long term trade debt and accounts from the policy decisions of the government. payable, grants, taxes and interest payable. Style conventions Produced assets Figures in the tables and in the text have been rounded. Produced assets include buildings, plant and equipment, Discrepancies in tables between totals and sums of inventories, cultivated assets and certain intangible assets. components reflect rounding. Percentage variations in all Intangible produced assets may include computer software, tables are based on the underlying unrounded amounts. and research and development costs (which does not include the start-up costs associated with capital projects). The notation used in the tables is as follows:

Receivables (xxx.x) negative numbers Includes amounts owing from government through 200x year period appropriation receivable, short and long term trade credit 200x–0x year period and accounts receivable, accrued investment income, grants, and interest receivable. The financial statements and notes are presented based on the illustration for a government department in the 2012–13 Sales of goods and services Model Report for Victorian Government Departments. The Refers to income from the direct provision of goods and presentation of other disclosures is generally consistent services and includes fees and charges for services with the other disclosures made in earlier publications of the rendered, sales of goods and services, fees from regulatory department’s annual reports. services and work done as an agent for private enterprises. It also includes rental income under operating leases and on produced assets such as buildings and entertainment, but excludes rent income from the use of non-produced assets such as land. User charges includes sale of goods and services income.

Supplies and services Supplies and services generally represent cost of goods sold and the day-to-day running costs, including maintenance costs, incurred in the normal operations of the department.

Department of Environment and Primary Industries 2013 Annual Report 179 Notes to the financial statements for the year ended 30 June 2013 Accountable Officer’s and Chief Finance and Accounting Officer’s declaration The attached financial statements for the Department of Environment and Primary Industries have been prepared in accordance with Standing Directions 4.2 of the Financial Management Act 1994, applicable Financial Reporting Directions, Australian Accounting Standards including Interpretations, and other mandatory professional reporting requirements. We further state that, in our opinion, the information set out in the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement and accompanying notes, presents fairly the financial transactions during the year ended 30 June 2013 and financial position of the department at 30 June 2013. At the time of signing, we are not aware of any circumstance which would render any particulars included in the financial statements to be misleading or inaccurate. We authorise the attached financial statements for issue on 4 September 2013.

Adam Fennessy Matthew Clancy

Secretary Executive Director Finance and Planning Department of Environment and Primary Industries Department of Environment and Primary Industries Melbourne Melbourne 4 September 2013 4 September 2013

180 Department of Environment and Primary Industries 2013 Annual Report

INDEPENDENT AUDITOR’S REPORT

To the Secretary, Department of Environment and Primary Industries

7KH)LQDQFLDO5HSRUW The accompanying financial report for the year ended 30 June 2013 of the Department of Environment and Primary Industries which comprises the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement, notes comprising a summary of significant accounting policies and other explanatory information, and the accountable officer's and chief finance and accounting officer's declaration has been audited.

7KHSecretary’s 5HVSRQVLELOLW\IRUWKH)LQDQFLDO5HSRUW The Secretary of the Department of Environment and Primary Industries is responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards, and the financial reporting requirements of the )LQDQFLDO0DQDJHPHQW $FW, and for such internal control as the Secretary determines is necessary to enable the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility As required by the $XGLW$FW, my responsibility is to express an opinion on the financial report based on the audit, which has been conducted in accordance with Australian Auditing Standards. Those standards require compliance with relevant ethical requirements relating to audit engagements and that the audit be planned and performed to obtain reasonable assurance about whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The audit procedures selected depend on judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, consideration is given to the internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by the Secretary, as well as evaluating the overall presentation of the financial report. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

$XGLWLQJLQWKH3XEOLF,QWHUHVW

Department of Environment and Primary Industries 2013 Annual Report 181

Independent Auditor’s Report (continued)

,QGHSHQGHQFH The Auditor-General’s independence is established by the &RQVWLWXWLRQ$FW. The Auditor- General is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. In conducting the audit, the Auditor-General, his staff and delegates complied with all applicable independence requirements of the Australian accounting profession.

2SLQLRQ In my opinion, the financial report presents fairly, in all material respects, the financial position of the Department of Environment and Primary Industries as at 30 June 2013 and of its financial performance and its cash flows for the year then ended in accordance with applicable Australian Accounting Standards, and the financial reporting requirements of the )LQDQFLDO 0DQDJHPHQW$FW.

0DWWHUV5HODWLQJWRWKH(OHFWURQLF3XEOLFDWLRQRIWKH$XGLWHG)LQDQFLDO5HSRUW This auditor’s report relates to the financial report of the Department of Environment and Primary Industries for the year ended 30 June 2013 included both in the Department of Environment and Primary Industries’ annual report and on the website. The Secretary is responsible for the integrity of the Department of Environment and Primary Industries’ website. I have not been engaged to report on the integrity of the Department of Environment and Primary Industries’ website. The auditor’s report refers only to the subject matter described above. It does not provide an opinion on any other information which may have been hyperlinked to/from this report. If users of the financial report are concerned with the inherent risks arising from publication on a website, they are advised to refer to the hard copy of the audited financial report to confirm the information contained in the website version of the financial report.

MELBOURNE John Doyle 9 September 2013 $XGLWRU*HQHUDO

2 $XGLWLQJin the 3XEOLF,QWHUHVW

182 Department of Environment and Primary Industries 2013 Annual Report Appendices

Appendix 1 Disclosure index The annual report is prepared in accordance with all relevant Victorian legislation and pronouncements. This index has been prepared to facilitate identification of the department’s compliance with statutory disclosure requirements.

Legislation Requirement Page reference

Ministerial Directions Report of Operations – FRD Guidance

Charter and purpose

FRD 22D Manner of establishment and the relevant Ministers Page 4

FRD 22D Objectives, functions, powers and duties Page 10

FRD 22D Nature and range of services provided Page 10

Management and structure

FRD 22D Organisational structure Page 12

Financial and other information

FRD 8B Budget portfolio outcomes Page 185

FRD 10 Disclosure index Page 183

FRD 12A Disclosure of major contracts Page 82

FRD 15B Executive officer disclosures Page 32

FRD 22D, SD 4.2(k) Operational and budgetary objectives and performance against objectives Page 49

FRD 22D Employment and conduct principles Page 26

FRD 22D Occupational health and safety policy Page 24

FRD 22D Summary of the financial results for the year Page 22

FRD 22D Significant changes in financial position during the year Page 22

FRD 22D Major changes or factors affecting performance Page 22

FRD 22D Subsequent events Page 109

FRD 22D Application and operation of Freedom of Information Act 1982 Page 83

FRD 22D Compliance with building and maintenance provisions of Building Act 1993 Page 85

FRD 22D Statement on National Competition Policy Page 85

FRD 22D Application and operation of the Protected Disclosure Act 2012 Page 84

FRD 22D Details of consultancies over $10,000 Page 82

FRD 22D Details of consultancies under $10,000 Page 82

FRD 22D Statement of availability of other information Page 90

FRD 24C Reporting of office-based environmental impacts Page 38

Department of Environment and Primary Industries 2013 Annual Report 183 FRD 25A Victorian Industry Participation Policy disclosures Page 82

FRD 29 Workforce data disclosures Page 28

SD 4.5.5 Risk management compliance attestation Page 8

SD 4.5.5.1 Ministerial Standing Direction 4.5.5.1 compliance attestation Page 9

SD 4.2(g) Specific information requirements Page 2–90

SD 4.2(j) Sign-off requirements inside cover

Financial report

Financial statements required under Part 7 of FMA

SD 4.2(a) Statement of changes in equity Page 94

SD 4.2(b) Operating statement Page 92

SD 4.2(b) Balance sheet Page 93

SD 4.2(b) Cash flow statement Page 95

Other requirements under Standing Directions 4.2

SD 4.2(c) Compliance with Australian accounting standards and other authoritative pronouncements Page 97

SD 4.2(c) Compliance with Ministerial Directions Page 97

SD 4.2(d) Rounding of amounts Page 99

SD 4.2(c) Accountable Officer’s declaration Page 180

SD 4.2(f) Compliance with Model Financial Report Page 97

Other disclosures as required by FRDs in notes to the financial statements

FRD 9A Departmental disclosure of administered assets and liabilities by activity Page 119

FRD 11 Disclosure of ex-gratia payments Page 160

FRD 13 Disclosure of parliamentary appropriations Page 159

FRD 21B Disclosures of responsible persons, executive officers and other personnel (contractors Page 171 with significant management responsibilities) in the financial report

FRD 102 Inventories Page 135

FRD 103D Non-current physical assets Page 135

FRD 104 Foreign currency Page 153

FRD 106 Impairment of assets Page 104

FRD 109 Intangible assets Page 140

FRD 107 Investment properties Page 103

FRD 110 Cash flow statements Page 95

FRD 112C Defined benefit superannuation obligations Page 145

FRD 113 Investments in subsidiaries, jointly controlled entities and associates Page 134

FRD 114A Financial instruments – general government entities and public non-financial corporations Page 149

FRD 119 Contribution by owners Page 94

Legislation

Building Act 1993 Page 85

Carers Recognition Act 2012 Page 84

Financial Management Act 1994 Page 97

Freedom of Information Act 1982 Page 83

Protected Disclosure Act 2012 Page 84

Victorian Industry Participation Policy Act 2003 Page 82

Water Act 1989 Page 85

Water Industry Act 1994 Page 199

184 Department of Environment and Primary Industries 2013 Annual Report Appendix 2 Budget portfolio outcomes The budget portfolio outcomes statements provide a comparison between the actual financial information of general government sector entities within the portfolio and the forecast financial information published in Budget Paper No. 5 Statement of Finances 2012–13 (BP5). The budget portfolio outcomes comprise the comprehensive operating statement, balance sheet, cash flow statement, statement of changes in equity and administered item statements. The budget portfolio outcomes have been prepared on a consolidated basis for selected general government entities within the portfolio. Financial transactions and balances are classified as either controlled or administered as agreed with the Treasurer in the context of the published statements in BP5. The following budget portfolio outcomes statements are not subject to audit by the Victorian Auditor-General’s Office. They are not prepared on the same basis as the department’s financial statements as they include the consolidated financial information of the Commissioner for Environmental Sustainability, the Victorian Environmental Water Holder and the Environment Protection Authority in addition to that of the department.

Comprehensive operating statement for the year ended 30 June 2013

2012–13 2012–13 Actual Budget Variance Controlled $ million $ million % Income from transactions Output appropriations 1,045.2 1,020.7 2.4 Interest 9.5 9.8 (3.4) Sales of goods and services 43.8 50.3 (12.9) Grants 37.4 37.1 0.9 Fair value of assets and services received free of charge 5.0 - - or for nominal consideration Other income 332.7 332.0 (0.3) Total income from transactions 1,473.6 1,449.9 1.6 Expenses from transactions Employee benefits 313.7 295.5 6.2 Depreciation 50.9 55.3 (7.9) Interest expense 2.0 1.8 12.4 Grants and other transfers 558.5 550.8 1.4 Capital asset charge 76.6 76.6 - Other operating expenses 398.6 405.0 (1.6) Total expenses from transactions 1,400.3 1,385.0 1.1 Net result from transactions (net operating balance) 73.3 64.9 13.0 Other economic flows included in net result Net gain on non-financial assets 10.2 5.7 79.4 Net gain/(loss) on financial instruments and statutory receivables/payables 4.0 (0.6) 769.8 Other gains from other economic flows1 210.2 - NA Total other economic flows included in net result 224.4 5.1 4,299.4 Net result 297.7 70.0 325.2 Other economic flows – other comprehensive income Items that will not be classified to net result Changes in physical asset revaluation reserve 0.1 0 NA Total other economic flows – other comprehensive income 0.1 0 NA Comprehensive result 297.8 70.0 325.4 Note: 1. The variation in other gains from other economic flows reflects the independent valuation of Crown land on river frontages that was recognised for the first time in 2012–13.

Department of Environment and Primary Industries 2013 Annual Report 185 Balance sheet as at 30 June 2013

2012–13 2012–13 Actual Budget Variance Controlled $ million $ million %

Financial assets

Cash and deposits1 289.5 199.5 45.1

Receivables 267.7 265.3 0.9

Other financial assets 263.1 242.8 8.4

Total financial assets 820.3 707.6 0.2

Non-financial assets

Inventories 12.9 13.7 (5.8)

Non-financial assets classified as held for sale including disposal group 0.6 0.7 (14.3) assets

Property, plant and equipment 7,346.2 7,572.8 (3.0)

Intangible assets2 28.7 63.7 (54.9)

Other 10.1 9.5 6.3

Total non-financial assets 7,398.5 7,660.4 (3.4)

Total assets 8,218.8 8,368.0 (1.8)

Liabilities

Payables 127.0 101.3 25.4

Borrowings3 28.9 9.3 210.8

Provisions 141.5 163.2 (13.3)

Total liabilities 297.4 273.8 0.1

Net assets 7,921.4 8,094.2 0

Equity

Accumulated surplus/(deficit) 346.7 206.7 67.7

Reserves 5,648.5 5,674.2 (0.5)

Contributed capital 1,926.2 2,213.2 (13.0)

Total equity 7,921.4 8,094.1 (2.1)

Notes: 1. The variation in cash and deposits reflects the higher than budgeted cash balances in the trust fund, including the Melbourne Strategic Assessment, Minor Asset Replacement, Stores Suspense and Parks and Reserves Trust Accounts. 2. The variation in intangible assets is principally due to the transfer of biological assets to the Department of Primary Industries. The remainder of the variation is due to the impairment of the department’s electronic conveyancing software following the transfer of the associated intellectual property to National E-Conveyancing Limited. 3. The variation in borrowing is a result of the expansion in the department’s motor vehicle fleet undertaken through the VicFleet finance lease facility.

186 Department of Environment and Primary Industries 2013 Annual Report Cash flow statement for the year ended 30 June 2013

2012–13 2012–13 Actual Budget Variance Controlled $ million $ million %

Cash flows from operating activities

Receipts

Receipts from government 1,049.0 1,025.7 2.3

Receipts from other entities 390.4 393.3 (0.7)

Interest received 8.9 9.8 (9.2)

Other receipts 0 0.2 (100.0)

Total receipts 1,448.3 1,432.1 1.1

Payments

Payments of grants and other transfers (541.7) (550.8) (1.7)

Payments to suppliers and employees (703.9) (697.9) 0.9

Capital asset charge (76.6) (76.6) -

Interest and other costs of finance paid (2.0) (1.6) 25.0

Total payments (1,324.2) (1,326.9) (0.2)

Net cash flows from operating activities1 124.1 105.2 18.0

Cash flow used in investing activities

Net investment (134.5) (42.2) 218.7

Payments for non-financial assets (43.4) (129.9) (66.6)

Proceeds from sale of non-financial assets 0.8 5.7 (86.0)

Net cash flow used in investing activities (177.1) (166.3) 6.5

Cash flows from financing activities

Owner contributions by State Government 32.6 68.8 (52.6)

Net borrowings 68.1 (14.4) (572.9)

Net cash flows from financing activities 100.7 54.5 84.8

Net increase/(decrease) in cash and cash equivalents 47.7 (6.6) (822.7)

Cash and cash equivalents at the beginning of the financial year 6.8 206.1 (96.7)

Cash and cash equivalents at the end of the financial year 54.5 199.5 (72.7)

Note: 1. These movements reflect the variations explained in the controlled comprehensive operating statement and balance sheet.

Department of Environment and Primary Industries 2013 Annual Report 187 Statement of changes in equity for the year ended 30 June 2013

2012–13 2012–13 Actual Budget Variance Controlled $ million $ million %

Opening accumulated surplus/(deficit) 48.9 53.2 (8.1)

Net result 297.8 70.0 325.4

Closing accumulated surplus/(deficit) 346.7 123.2 181.4

Opening contributions by owners 1,920.3 2,144.4 (10.5)

Net transactions with owners in their capacity as owners 5.9 68.8 (91.4)

Closing contributions by owners 1,926.2 2,213.2 (13.0)

Opening physical asset revaluation reserve 5,644.9 5,674.2 (0.5)

Other reserve 0 83.5 (100.0)

Other comprehensive income 3.6 0 NA

Closing physical asset revaluation reserve 5,648.5 5,757.7 (1.9)

Total equity 7,921.4 8,094.1 (2.1)

Note: 1. These movements reflect the variations explained in the departmental controlled comprehensive operating statement and balance sheet.

188 Department of Environment and Primary Industries 2013 Annual Report Administered items statement for the year ended 30 June 2013

2012–13 2012–13 Actual Budget Variance $ million $ million %

Appropriations – Payments made on behalf of the state 447.4 458.8 (2.5)

Fair value of assets and services received free of charge 16.1 0 NA or for nominal consideration

Sales of goods and services 701.7 713.0 (1.6)

Grants1 27.5 22.3 23.3

Interest 302.5 299.9 0.9

Other income1 105.2 144.3 (27.1)

Total administered income from transactions 1,600.4 1,638.3 (2.3)

Expenses on behalf of the state 399.8 437.3 (8.6)

Grants and other transfers2 50.3 30.9 62.8

Payments into the consolidated fund 1,087.0 874.8 24.3

Total administered expenses from transactions 1,537.1 1,343.0 14.5

Net result from transactions 63.3 295.3 (78.6)

Net gain/(loss) on non-financial assets 21.1 24.5 (13.9)

Net gain/(loss) on financial instruments and statutory (0.3) (0.1) 200.0 receivables/payables

Total other economic flows included in net result 20.8 24.4 (14.8)

Net result 84.1 319.7 (73.7)

Total other economic flows – other comprehensive income 0 0 0

Comprehensive result 84.1 319.7 (73.7)

Administered assets

Cash and deposits 1.4 1.4 0

Receivables 4,206.7 4,172.7 0.8

Other financial assets 0.1 0.1 0

Other 11.9 26.9 (55.6)

Property, plant and equipment3 693.1 566.4 22.4

Intangible assets4 104.1 119.3 (12.7)

Total administered assets 5,017.3 4,886.8 2.6

Administered liabilities

Payables 111.8 86.5 29.2

Borrowings 4,316.0 4,121.5 4.7

Total administered liabilities 4,427.8 4,208.0 5.2

Net assets 589.5 678.8 13.1

Notes: 1. Income from the Melbourne metropolitan water retail corporations for the G-MW Connections project has been reclassified from other income to sales of goods and services. 2. The variation in grants and other transfers represents the change in the value of resources provided free of charge since the estimates. 3. The variation in property, plant and equipment reflects Victoria’s share of the increase in value of the Murray-Darling Basin Authority’s infrastructure assets. 4. The variation in intangible assets represents Victoria’s share of the impairment of the Murray-Darling Basin Authority’s Living Murray Initiative assets.

Department of Environment and Primary Industries 2013 Annual Report 189 k ts for the department and the broader Victorian public sector, Victorian public sector, ts for the department and broader was used for restoring existing assets to their intended condition. As such, $9.5 million was used for restoring to output funding complete the works required. asset funding was transferred take up of fencing by private land owners along river frontages and undertook structural take up of fencing by private land owners along river frontages The variation in the asset component water. works to deliver and manage environmental of the overall proportion to the type of activity undertaken, with an increased relates rather than asset. River Red Gums strategy being output nature, assets that were damaged in the 2010–11 floods. As work primarily involved assets that were the of existing assets to their intended conditions, Parks Victoria transferred restoring the actual Additionally, asset funding to output complete the works required. insurance was damage on the assets was less than originally estimated and therefore not required. The increase primarily relates to additional enhancements of the Fireweb system. to additional enhancements of the Fireweb primarily relates The increase restoring of existing bridges to their intended condition, which was output in nature. of existing bridges to their intended condition, which was output in nature. restoring this. to output funding reflect As such, $7.2 million asset funding was transferred primarily asset in nature, there was a small percentage of output expenditure. As such of output expenditure. was a small percentage there primarily asset in nature, to output funding complete the works $200,000 asset funding was transferred required.

between Variation Variation actual and original TEI Reason for variance $m BP4) Actual TEI (as reflected in reflected (BP4) available on the Department of Treasury and Finance’s website. This publication also contains information and Finance’s (BP4) available on the Department of Treasury $m BP4) TEI (as Original reflected in reflected date Actual State Capital Program completion date Original June 2013 June 2013 148.711 139.196 9.515 assets, $9.5 million Trust to upgrades of Victorian Water While $139.2 million related June 2013 June 2013 6.510 3.008 -3.502 new parks and facilitated the voluntary The overall River Red Gums strategy introduced June 2012 June 2013 45.698 5.319 -40.379 of existing par and renewal to the Parks Victoria repair The variation primarily relates June 2012 June 2013 2.073 1.014 -1.059 was completed under budget. The land acquisition program June 2012 June 2013 8.040 8.170 0.130 June 2012 June 2013 60.000 52.839 7.161 of bridges, $7.2 million was used for to the replacement While $52.8 million related June 2013 June 2013 13.874 13.874 - June 2013 June 2013 29.420 29.220 -0.200 was of work done. Although the project to the nature The variation primarily relates completion Victorian Water Trust assets – Trust Victorian Water various) upgrades (non-metro River Red Gums various) (non-metro Restoring and re-opening Restoring and re-opening parks (statewide) Victoria’s National reserve – land acquisition National reserve various) (metro Increased planned burning Increased 2012–13 (statewide) (a) Fire protection access – protection Fire bridge replacement various) (non-metro Business Systems Reform Project Business Systems Reform Project (metro) Barwon Water Shell Recycling Barwon Water – construction (Barwon) Project Project name Project on the department’s and its related portfolio agencies’ asset investment programs, as set out in the table below. portfolio agencies’ asset investment programs, and its related on the department’s please refer to the most recent Budget Paper No. 4 to the most recent please refer Appendix 3 Capital projects capital projec For information on recent portfolio entities manage a number of capital projects. The department and its related

190 Department of Environment and Primary Industries 2013 Annual Report Appendix 4 Disclosure of grants and Effective Water Management and Supply $ transfer payments Foscari Holdings Pty Ltd 162,920.00 DEPI has provided assistance through the payments of Western Region Water Corporation 146,418.55 grants and transfer payments to certain companies and organisations. Financial assistance provided in 2012–13 was Stockland Development Pty Ltd 145,000.00 as follows: Coliban Region Water Corporation 121,679.61 Effective Water Management and Supply $ Centre for Education and Research in 112,500.00 Goulburn-Murray Rural Water Corporation 86,274,491.48 Environmental Strategies Goulburn Broken Catchment Management 34,543,870.36 Wannon Region Water Corporation 111,991.84 Authority Parks Victoria 102,000.00 East Gippsland Catchment Management 7,905,163.63 Brimbank City Council 101,330.00 Authority Goulburn Valley Region Water Authority 100,783.50 North Central Catchment Management 5,410,016.01 Authority Monash University 89,500.30 West Gippsland Catchment Management 4,771,845.45 Yorta Yorta Traditional Owner Land 89,031.82 Authority Management Board Corangamite Catchment Management 4,075,954.55 North East Region Water Corporation 71,011.91 Authority East Gippsland Region Water Corporation 65,818.88 Mallee Catchment Management Authority 3,841,299.73 Ferristex Pty Ltd 60,000.00 Murray-Darling Basin Authority 3,500,000.00 Central Gippsland Region Water Corporation 59,830.52 North East Catchment Management Authority 2,683,316.82 Central Highlands Region Water Corporation 50,092.50 Department of Primary Industries 2,586,000.00 Mansfield Shire Council 50,000.00 Department of Justice 2,271,971.00 Moorabool Shire Council 49,500.00 Wimmera Catchment Management Authority 1,636,523.49 He and Eve Pty Ltd 33,750.00 Glenelg Hopkins Catchment Management 1,620,957.96 Stonnington City Council 30,000.00 Authority City of Greater Geelong 25,000.00 Melbourne Water Corporation 1,105,000.00 Moonee Valley City Council 25,000.00 Department of Sustainability, Environment, 982,499.00 South Gippsland Region Water Corporation 24,319.06 Water, Population and Communities Loddon Shire Council 22,621.18 Southern Rural Water 919,213.83 William Angliss Institute of TAFE 21,000.00 Yarra Valley Water Ltd 854,837.29 Murray Darling Association Inc 15,000.00 City of Melbourne 755,000.00 City of Casey 12,500.00 South East Water Ltd 666,494.85 Other (recipients each receiving less than 7,511.90 eWater Ltd 645,000.00 $5,000) Bureau of Meteorology 610,000.00 174,195,121.73 Environment Protection Authority 500,000.00 Knox City Council 500,000.00 Barwon Region Water Corporation 497,617.41 Natural Resources $ Mildura Development Corporation 455,000.00 Goulburn Broken Catchment Management 7,016,934.81 Authority Banyule City Council 435,900.01 North Central Catchment Management 6,795,022.81 La Trobe University 385,000.00 Authority City West Water Ltd 361,182.11 Department of Primary Industries 5,859,000.00 Fleming’s Nurseries Pty Ltd 350,000.00 Corangamite Catchment Management 5,686,146.81 Lower Murray Urban and Rural Water 282,644.07 Authority Corporation Glenelg Hopkins Catchment Management 5,681,923.81 CRC for Water Sensitive Cities Ltd 270,890.00 Authority Growth Areas Authority 232,500.00 Mallee Catchment Management Authority 5,478,495.81 The University of Melbourne 195,246.36 West Gippsland Catchment Management 5,153,367.56 Authority Westernport Region Water Corporation 163,574.75

Department of Environment and Primary Industries 2013 Annual Report 191 Natural Resources $ Natural Resources $ Port Phillip and Westernport Catchment 5,149,096.81 Ovens Landcare Network 50,000.00 Management Authority Parks Victoria 50,000.00 North East Catchment Management Authority 4,911,393.81 Pentland Hills Landcare Group Inc 50,000.00 Wimmera Catchment Management Authority 4,531,748.81 Southern Dandenongs Landcare Group 50,000.00 East Gippsland Catchment Management 4,175,875.81 Surf Coast and Inland Plains Network 50,000.00 Authority Tarragal Landcare Group 50,000.00 Trust for Nature (Victoria) 460,207.00 Upper Deep Creek Landcare Network 49,900.00 Goulburn Murray Landcare Network Inc 312,500.00 Upper Murray Landcare Network 49,888.00 State Chemistry Laboratory 220,000.00 Friends of the Helmeted Honeyeater Inc 49,000.00 Deakin University 211,000.00 Nillumbik Shire Council 48,714.00 East Gippsland Landcare Network Inc 187,500.00 Leigh Catchment Group 46,511.00 The University of Melbourne 150,000.00 Western Melbourne Catchments Network Inc 45,000.00 Hindmarsh Landcare Network 114,187.50 Southern Otway Landcare Network Inc 44,750.00 Birdlife Australia 76,000.00 Mornington Peninsula Shire Council 43,750.00 Lexton Landcare Group Inc 62,500.00 Friends of Willow Park 42,811.00 Bass Coast Landcare Network Inc 62,500.00 Woady Yaloak Catchment Group 41,470.00 Beyond Bolac CAG 62,500.00 Landcare Australia Ltd 40,000.00 Blampied-Kooroocheang Landcare Group 62,500.00 Upper Hopkins Land Management Group 39,737.00 Cardinia Environment Coalition Inc 62,500.00 Mid Loddon Sub-Catchment Management 17,037.50 Connecting Country (Mt Alexander Region) Inc 62,500.00 Group Far East Victoria Landcare Inc 62,500.00 Mandurang Strathfieldsaye Landcare Network 16,900.00 Hamilton to Coleraine Railway Line Landcare 62,500.00 Warrnambool City Council 14,488.00 Group Otway Community College 12,500.00 Heytesbury District Landcare Network 62,500.00 64,789,034.35 Horsham Rural City Council 62,500.00 Hughes Creek Catchment Collaborative 62,500.00 Public Land $ Kowree Farm Tree Group Inc 62,500.00 Zoological Parks and Gardens Board 15,206,000.00 Loddon Plains Landcare Network 62,500.00 Royal Botanic Gardens Board 14,296,392.00 Murrayville Landcare Group 62,500.00 Shire of Campaspe 2,398,397.00 Southwest Goulburn Landcare Inc 62,500.00 Kingston City Council 2,199,094.45 Upper Campaspe Combined Landcare Groups 62,500.00 Mount Baw Baw Alpine Resort Management 1,089,090.91 Upper Mt Emu Creek Landcare Network 62,500.00 Board Yarrilinks Inc 62,500.00 VicRoads 1,000,000.00 Bellarine Landcare Group Inc 60,620.00 Shrine of Remembrance 856,000.00 Basalt to Bay Landcare Network 60,489.00 Treasury Corporation of Victoria 651,349.68 Kara Kara Conservation Management 60,107.50 Network Inc Phillip Island Nature Park Board of 620,247.45 Management Buloke and Northern Grampians Landcare 56,952.50 Network Lake Mountain Alpine Resort Management 509,545.45 Board Panyyabyr Landcare Group 51,995.00 Parks Victoria 411,490.00 Snowy River Interstate Landcare Committee 51,012.50 Geelong Landcare Network 50,000.00 Great Ocean Road Coast Committee 282,470.71 of Management Kiewa Catchment Landcare Group Inc 50,000.00 Indigo Shire Council 279,160.00 Lismore Land Protection Group 50,000.00 Hobsons Bay City Council 238,477.69 Mid Ovens Landcare Group 50,000.00 National Trust of Australia (Victoria) 225,193.00 Mitta Valley Landcare Group Inc 50,000.00

192 Department of Environment and Primary Industries 2013 Annual Report Public Land $ Public Land $

Moyne Shire Council 214,290.00 Chiltern Park Recreation Reserve Committee 25,900.00 of Management City of Whittlesea 200,000.00 Somers Foreshore Committee 25,524.61 Melbourne Water Corporation 200,000.00 of Management Lang Lang Foreshore Reserve Committee 181,927.27 Sunshine Reserve Conservation and 25,411.67 of Management Fireguard Group City of Port Phillip 181,193.79 Port Campbell Community Group Inc 25,000.00 Department of Justice 177,000.00 Costerfield Public Hall and Tennis Reserve 24,000.00 Bayside City Council 155,652.68 Committee of Management

Falls Creek Alpine Resort Management Board 144,090.91 Fishcare Victoria Inc 22,727.27

San Remo Foreshore Reserve Committee 135,000.00 Kuuyang Maar Aboriginal Corporation 22,727.27 of Management Shoreham Foreshore Reserve Committee 22,727.27 Barwon Coast Committee of Management 117,246.71 of Management

Buloke Shire Council 91,087.58 Muckatah Recreation Reserve Incorporated 22,612.00

Bellarine Bayside Foreshore Committee 75,865.22 East Gippsland Shire Council 22,471.79 of Management Inc Mount Eliza Association for Environmental 22,165.00 Frankston City Council 73,187.08 Care Inc

Mount Hotham Alpine Resort Management 65,000.00 Balcombe Estuary Rehabilitation Group Inc 21,954.95 Board Sandy Point Foreshore Committee 21,909.84 Mount Alexander Shire Council 64,641.92 of Management

Mornington Peninsula Shire Council 60,396.84 Friends of the Bluff 20,000.00

North Central Catchment Management 58,000.00 Angair Inc 19,982.50 Authority Surf Coast and Inland Plains Network 19,265.00 Warrnambool City Council 52,040.51 Point Danger Committee of Management 19,000.00 Bass Recreation Reserve Committee 51,363.64 Dromana Foreshore Committee of 18,906.55 of Management Management Inc Parklands Albury Wodonga 50,719.91 Jan Juc Coast Action Group 17,940.00 Knox City Council 50,000.00 Friends of the Hooded Plover (Mornington 16,500.00 Gippsland Plains Conservation Management 49,991.50 Peninsula) Inc Network Lake Bolac Foreshore Committee Inc 16,032.90 Towong Shire Council 45,650.00 Merricks Beach Foreshore Committee of 15,880.97 Bass Coast Landcare Network Inc 43,670.00 Management

Romsey Mechanics Institute 40,500.00 Wyndham City Council 15,681.00

Ardmona Recreation Reserve Committee of 33,500.00 Southern Otway Landcare Network Inc 15,000.00 Management Tourism Victoria 15,000.00 Surf Coast Shire 32,390.38 Wesley Hill Public Hall Inc 15,000.00 City of Greater Geelong 31,380.89 Friends of Flinders Coastline Inc 14,432.00 Ferny Creek Recreation Reserve 30,000.00 Mornington Environmental Association 14,364.00 Walwa Tourist Park Inc Committee of 29,000.00 Macedon Ranges Shire Council 13,934.00 Management South Gippsland Conservation Society Inc 13,420.00 Inverloch Recreation Reserve Committee Inc 27,819.82 Princetown Landcare Group 13,244.00 Bass Coast Shire Council 27,819.53 Cape Paterson Residents and Ratepayers 12,600.00 Nelson Coastcare Inc 26,750.00 Association Inc Whitecliffs – Camerons Bight Foreshore 26,184.67 Hordern Vale-Glen Aire Recreation Reserve 12,000.00 Reserves Committee of Management Committee

Department of Environment and Primary Industries 2013 Annual Report 193 Public Land $ Public Land $

Barwon Heads Golf Club Inc 11,800.00 Friends of Mud Islands Inc 5,000.00

Otway Coast Committee 11,637.67 Lake Tyers Coast Action Inc 5,000.00

Maffra and Districts Landcare Network 11,285.00 Mitta Mitta Swimming Pool Reserve 5,000.00 Committee Inc Cardinia Environment Coalition Inc 10,870.00 Stanley Recreation Reserve 5,000.00 Torquay Coast Action Group 10,791.00 Other (recipients each receiving less than 584.32 City of Kingston 10,114.39 $5,000) Gilson College 10,000.00 44,022,337.38 Rutherglen Park and Recreation Reserve 9,900.00 Committee of Management

Mount Macedon Memorial Cross Reserve Inc 9,361.00 Forests and Parks $

Glenelg Shire Council 8,500.00 Parks Victoria 145,602,629.74

Greater Shepparton City Council 8,448.06 Mount Baw Baw Alpine Resort Management 2,600,000.00 Board Sea Lake Recreation Reserve Committee 8,240.00 of Management University of Melbourne 1,907,000.00

Earthcare St Kilda Inc 8,087.00 Lake Mountain Alpine Resort Management 1,473,744.12 Board Capel Sound Foreshores Committee 8,049.70 of Management Inc Department of Transport 823,000.00

Mortlake Racecourse Reserve Committee 8,000.00 Gunaikurnai Land and Waters Aboriginal 509,388.00 of Management Corporation

Friends of Beware Reef Inc 7,791.00 Yorta Yorta Traditional Owner Land 302,830.00 Management Board Nandaly Public Hall and Recreation Reserves 7,722.00 Committee Shire of Yarra Ranges 250,000.00

Lancefield Mechanics Institute Committee 7,500.00 Towong Shire Council 234,000.00 of Management Gunaikurnai Traditional Owner Land 186,027.61 Balnarring Foreshore Parks and Reserves 7,455.80 Management Board

Friends of Venus Bay Peninsula 7,400.00 Gunditj Mirring Traditional Owners Aboriginal 150,000.00 Corporation Nyah District Memorial Hall Committee 7,238.00 of Management Barengi Gadjin Land Council 144,778.00

Port Fairy Golf Club Inc 7,000.00 City of Casey 99,431.82

Far East Victoria Landcare Inc 6,292.00 Nillumbik Shire Council 79,525.35

Friends of Otway National Park 6,160.00 Cardinia Shire Council 60,000.00

McCrae Homestead Coastal Group 6,050.00 Mornington Peninsula Shire Council 36,363.64

East Gippsland Landcare Network Inc 6,034.80 Tourism Victoria 30,000.00

Leongatha Recreation Reserve Committee 6,000.00 Department of Justice 23,000.00 of Management Wyndham City Council 11,443.00 Carlisle River Public Hall Committee 5,906.00 Other (recipients each receiving less than 2,595.06 Borough of Queenscliffe 5,899.46 $5,000)

Harmers Haven Residents and Ratepayers 5,717.27 154,525,756.34 Group

Phillip Island Conservation Society 5,660.00

Bancoora Surf Lifesaving Club 5,659.13

Port Fairy to Warrnambool Rail Trail 5,600.00 Committee

Cardinia Shire Council 5,000.00

Creswick Theatre Company Inc 5,000.00

194 Department of Environment and Primary Industries 2013 Annual Report Land and Fire Management $ Biodiversity $

Parks Victoria 13,041,662.39 Grant Flynn 75,990.91

VicRoads 1,500,000.00 Connecting Country (Mt Alexander Region) Inc 75,000.00

University of Melbourne 1,256,636.36 Landcare Laharum 75,000.00

Department of Justice 1,029,395.58 Moreland Energy Foundation Ltd 75,000.00

Bushfire CRC Limited 402,340.00 Mornington Peninsula and Western Port 75,000.00 Biosphere Reserve Foundation Ltd North East Catchment Management 160,000.00 Authority National Trust of Australia (Victoria) 75,000.00

West Gippsland Catchment Management 140,000.00 Yarram Yarram Landcare Network 75,000.00 Authority Harston Community Landcare Group 73,325.00 Wandiligong Preservation Society Inc 49,857.20 Mount Rothwell Biodiversity Pty Ltd 70,824.71 Alpine Shire Council 6,324.00 Sustainable Living in the Mallee 64,200.00 Allans Flat Reserve Committee of 5,000.00 Greta Valley Landcare Group 59,615.00 Management Inc David K Hung 59,195.46 17,591,215.53 Wandobah Pastoral 59,115.91

Biodiversity $ Glen Goulburn 56,795.00

Parks Victoria 1,168,380.80 Vicsuper Ecosystems Services Pty Ltd 51,989.65

Nargundy Pty Ltd 830,980.91 Merri Creek Management Committee Inc 51,182.99

Goulburn Broken Catchment Management 594,120.00 Rutherglen Landcare Group 50,300.00 Authority Kiewa Catchment Landcare Group Inc 49,182.00 Department of Primary Industries 442,500.00 Emu Plains Racecourse and Recreation 47,450.00 Nillumbik Shire Council 310,000.00 Reserve Committee of Management

South Gippsland Landcare Network Inc 225,000.00 Mount Elephant Community Management 46,302.00

Tania Kirby 224,764.79 Honeysuckle Recreation Environment Project 46,272.50

Greenhouse Balanced 158,075.07 J Alden and PJ Morison 45,182.27

Parklands Albury Wodonga 157,978.34 Crib Point Stony Point Parks and Foreshore 44,900.00 Cardinia Shire Council 150,000.00 Committee Management

Upper Ovens Valley Landcare Group 149,650.00 Stephen Watson 44,669.28

Conservation Volunteers Australia 141,510.00 Wurundjeri Tribe Land Compensation and 42,505.00 Cultural Heritage Council Inc East Gippsland Landcare Network Inc 125,250.00 Leigh Catchment Group 34,508.00 Bland Dairies 114,400.01 Ballarat Environment Network Inc 34,039.00 Euroa Environment Group Inc 100,000.00 Bellarine Landcare Group Inc 31,860.00 North Central Catchment Management 99,066.44 Authority Phillip Island Nature Park 31,380.00

Kerang and District Health 89,840.00 RL and SN Gundry 30,000.00

Greening Australia – Victoria 89,588.00 Regent Honeyeater Project Inc 30,000.00

Friends of Merri Creek Inc 86,297.84 Terricks Rural Investments Unit Trust 30,000.00

Strathbogie Ranges Conservation 85,000.00 David and Ruth Marnie 28,400.00 Management Network Inc Bentleigh West Primary School 28,320.00

Johns Hill Landcare Group 84,925.00 Moonee Valley City Council 27,198.00

Dunkeld Pastoral Co Pty Ltd 82,981.14 BA and SJ Fechner 27,068.06

K and K Hooke 81,195.45 DW and SR McGillivray 26,626.50

Michelle Eustice 77,695.20 Habitat Restoration Fund 26,000.00

Lismore Land Protection Group 77,590.00 Lake Cartcarrong Management Committee Inc 24,136.00

Department of Environment and Primary Industries 2013 Annual Report 195 Biodiversity $ Biodiversity $

Friends of Leadbeater’s Possum Inc 23,252.00 Heytesbury District Landcare Network 10,000.00

Project Platypus Inc 22,500.00 Hobsons Bay City Council 10,000.00

Gippsland Plains Conservation Management 20,000.00 Indigo Shire Council 10,000.00 Network Kulkyne Way Landcare Group 10,000.00 Rokewood Cemetery Trust 19,937.00 Latrobe Catchment Landcare Network 10,000.00 Ashbourne Landcare Group 19,662.19 Latrobe City Council 10,000.00 Wattle Flat Pootilla Landcare Group 19,535.00 Manton and Stony Creeks Landcare Group 10,000.00 Manangatang Landcare Group 19,480.00 McKenzies Hill Action and Landcare Group 10,000.00 Christmas Hills Landcare Group 19,048.00 Murrindindi Shire Council 10,000.00 Wallan Environment Group 18,630.00 Nature Glenelg Trust 10,000.00 Australasian Native Orchid Society (Victorian 17,868.00 Nelson Reserves Committee of Management 10,000.00 Group) Inc Newstead Landcare Group 10,000.00 Gray Barnaby and Carrington Michal 17,673.61 Northern Plains Conservation Management 10,000.00 Joseph Perri 17,130.00 Network Inc Sharkey Farming Trust 16,363.64 Nyah West Landcare Group Inc 10,000.00 Baynton Sidonia Landcare Group 15,980.00 St Thomas More Primary School 10,000.00 Wilhelm Veit 15,450.00 Teesdale Grassy Woodlands Committee of 10,000.00 Zoological Parks and Gardens Board 15,382.73 Management

Friends of the Maribyrnong Valley Inc 15,337.00 Wedderburn College 10,000.00

Garryowen Banool Pty Ltd 15,000.00 Wedderburn Conservation Management 10,000.00 Network Anne Lyon 14,685.91 Williamstown High School 10,000.00 Flinders Christian Community College Inc 14,500.00 Wonthaggi Seed Bank Inc 10,000.00 Lyndale Park 14,250.00 Lalbert Landcare Group 9,996.00 CJ Lewis and SE Lewis 13,404.03 Yarra Road Primary School 9,994.00 JP Simpson 13,250.00 Culgoa and District Landcare Group 9,985.10 Upper Murray Landcare Network 13,056.00 Loddon Plains Landcare Network 9,980.00 Blampied–Kooroocheang Landcare Group 12,638.36 Berriwillock Landcare Group 9,971.60 Upper Barwon Landcare Network Inc 12,370.00 Friends of Dandenong Valley Parklands 9,950.00 Whitehorse City Council 12,181.00 Friends of Iramoo 9,950.00 Round the Bend Conservation Cooperative Ltd 11,264.00 Ringwood Heights Primary School 9,950.00 JA Michelson and RJ Michelson 10,500.28 Upper Goulburn Landcare Network 9,950.00 GJ McNaughton Pastoral Co 10,218.18 Barongarook Landcare Group 9,944.00 Luther College 10,023.00 Port Fairy Consolidated School 9,910.00 Balcombe and Moorooduc Landcare Group 10,000.00 Eltham East Primary School 9,900.00 Barengi Gadjin Land Council 10,000.00 Aquinas College 9,700.00 Benambra Dinner Plain Omeo Landcare Group 10,000.00 Lancefield Park Recreation Reserves Inc 9,690.00 Bendigo Mountain Bike Club Inc 10,000.00 Birchip Landcare Group 9,659.00 Camperdown–Timboon Rail Trail Management 10,000.00 Committee Inc Southern Dandenongs Landcare Group 9,635.00

East Gippsland Rainforest Conservation 10,000.00 Peter J and Brenda V Flynn 9,374.30 Management Network Bullengarook Landcare Group 9,280.00 Euroa Arboretum Inc 10,000.00 Alvie Tree Planters 9,275.00 Goomalibee Landcare 10,000.00

196 Department of Environment and Primary Industries 2013 Annual Report Biodiversity $ Biodiversity $

Corangamite Catchment Management 9,262.00 Other (recipients each receiving less than 197,927.62 Authority $5,000)

Montrose Environmental Group Inc 9,250.00 9,062,176.64

Koetong Landcare Group 9,243.00 Land Administration and Property Australasian Native Orchid Society (Geelong 9,203.50 Information $ Group) Commissioner for Environmental 100,000.00 Post Office Hill Action Group 9,100.00 Sustainability

Wangaratta Urban Landcare Group 8,920.00 University of Melbourne 53,000.00

Sharp Transport 8,915.08 Dius Computing Pty Ltd 50,000.00

Mount Eliza Association for Environmental 8,913.63 Dialog Information Technology 15,189.62 Care Inc 218,189.62 Rhyll Coast Action Inc 8,510.00

Williamstown Primary School 8,500.00 Environmental Policy and Climate Change $ Conservation Ecology Centre 8,385.00 City of Casey 12,000,000.00 Friends of Westgate Park 8,000.00 Sustainability Victoria 5,571,903.00 KT and C Coogan 7,797.05 Environment Protection Authority 3,050,627.95 Mornington Peninsula Shire Council 7,722.00 University of Melbourne 1,033,636.36 Jenny Cerins 7,552.00 National Association of Charitable Recycling 750,000.00 Mornington Railway Preservation Society 7,198.00 Organisations Inc Colac Otway Shire 370,000.00 Friends of Ralph Illidge Sanctuary Inc 7,150.00 National Environment Protection Council 257,549.60 Darebin Creek Management Committee Inc 7,050.00 City of Greater Geelong 205,000.00 Ultima Lions Club 6,944.00 Indigo Shire Council 170,000.00 Burke Road Billabong Committee of 6,930.00 Management Inc Department of Primary Industries 136,363.64 Horsham Rural City Council 123,000.00 JS and A Dickins 6,900.00 City of Greater Bendigo 115,000.00 Merricks Beach Foreshore Committee of 6,800.00 Management South Gippsland Shire Council 104,739.00

Moorabool Catchment Landcare Group 6,666.60 Greater Shepparton City Council 100,000.00

Advance Penshurst Inc 6,590.00 Moira Shire Council 97,000.00 Manningham City Council 85,000.00 FTLA Avoca and District Landcare 6,430.00 Pyrenees Shire Council 85,000.00 Bellarine Bayside Foreshore Committee of 6,000.00 Management Inc Commissioner for Environmental Sustainability 70,222.73

Warrnambool Coastcare Landcare Group Inc 5,680.00 City of Boroondara 70,000.00

Mid Loddon Sub-Catchment Management 5,576.00 City of Melbourne 68,000.00 Group City of Maribyrnong 60,000.00 Surf Coast Shire 5,500.00 Corangamite Catchment Management 60,000.00 Authority Newham and District Landcare Group 5,331.00 Mildura Rural City Council 55,000.00 Yarriambiack Creek Development Committee 5,310.00 Association of Bayside Municipalities 50,000.00 Friends of Campbells Creek 5,285.00 Moreland City Council 50,000.00 JC and NT Smith 5,200.00 Melbourne Waste Management Group 49,000.00 Ross Creek Landcare Group 5,200.00 Ararat Rural City Council 45,240.00 Dowling Forest Cemetery Trust 5,149.00 Warrnambool City Council 45,000.00 Angair Inc 5,100.00 City of Ballarat 40,000.00 Wyanda Lublink 5,000.00 Knox City Council 40,000.00

Department of Environment and Primary Industries 2013 Annual Report 197 Environmental Policy and Climate Change $ Mitchell Shire Council 40,000.00 Macedon Ranges Shire Council 36,000.00 Shire of Campaspe 35,000.00 Murrindindi Shire Council 30,000.00 Southern Grampians Shire Council 30,000.00 Wyndham City Council 29,090.91 Borough of Queenscliffe 25,000.00 Alpine Shire Council 20,000.00 Bass Coast Shire Council 20,000.00 Baw Baw Shire Council 20,000.00 Cardinia Shire Council 20,000.00 Corangamite Shire Council 20,000.00 Glenelg Shire Council 20,000.00 Moorabool Shire Council 20,000.00 Moyne Shire Council 20,000.00 Rural City of Wangaratta 20,000.00 Victorian Local Governance Association 20,000.00 Yarriambiack Shire Council 18,181.82 Buloke Shire Council 15,000.00 Nillumbik Shire Council 15,000.00 Glenelg Hopkins Catchment Management 12,000.00 Authority Peter Smith and Janice Mentiplay-Smith 10,279.97 West Gippsland Catchment Management 10,065.00 Authority Benalla Rural City Council 10,000.00 Mt Alexander Shire Council 10,000.00 Northern Grampians Shire Council 10,000.00 Surf Coast Shire 10,000.00 Swan Hill Rural City Council 10,000.00 AM and JM Fraser 9,706.40 SL Jackson Contracting Pty Ltd 8,500.00 K and William L Stothers 8,187.50 Penny Vine 6,250.00 Peter Douglas Robinson 6,052.00 Alistair Douglas Kemp 5,800.00 Garryowen Banool Pty Ltd 5,760.00 Gannawarra Shire Council 5,000.00 Mansfield Shire Council 5,000.00 Other (recipients each receiving less 20,201.56 than $5,000) 25,593,357.44 Total grants and other expense transfers 489,997,189.03

198 Department of Environment and Primary Industries 2013 Annual Report Appendix 5 Environmental contributions Legislation was passed in September 2004 requiring water authorities to make an environmental contribution to fund initiatives that promote the sustainable management of water or address adverse water-related environmental impacts, equivalent to 5 per cent of urban authorities’ revenues and 2 per cent of rural water authorities’ revenues. In June 2012 the Victorian Government established a third tranche of the environmental contribution, which commenced on 1 July 2012 and will cease on 30 June 2016. This tranche will generate around $406.9 million over the four years to fund initiatives consistent with the purposes set out in legislation. Section 195 of the Water Industry Act 1994 requires the department to report on the details of expenditure funded by environmental contributions by water supply authorities in its annual report. The table below displays expenditure in 2012–13 funded by Environmental Contributions – including $2.156 million of Environmental Contributions tranche 2 (EC2) expenditure, which was rephased to align with revised project timelines.

2012–13 Expenditure Program title $’000

Output

Living Melbourne, Living Victoria 1,000.0

Securing priority waterways: regional on-ground works 8,446.9

Management of environmental entitlements and on-ground delivery 6,385.8

Demonstrating waterway health outcomes 964.9

Surface water monitoring and data management 2,187.6

Groundwater monitoring of the State Observation Bore Network 1,649.3

Improving modelling for water resource management and transitioning to the national hydrologic platform 1,471.0

Maintaining Capability in Groundwater management 919.7

Manage Risks to Water Availability 839.3

Water user entitlement refinement and market development 795.6

Enhancing the Victorian Water Register 599.6

Integrated water analysis and reporting 350.0

Simplifying the bulk water entitlements framework 317.9

Improved integrity in water savings assessment and management 300.0

Water law review 1,100.0

Coordination of Murray-Darling Basin Plan activities within the department 298.0

Linking farms and catchments to modernisation II (whole farm planning in the GMID) 2,000.0

Groundwater management (EC2) 166.1

Large scale river restoration (EC2) 1,000.0

Improved accounting of water resources (EC2) 310.9

Asset

Small towns water quality (EC2) 678.8

Total Environmental Contribution 31,781.5

Department of Environment and Primary Industries 2013 Annual Report 199 Appendix 6 Acronmyns AAS Australian Accounting Standards Units of measure AIIMS Australasian Inter-service Incident Management L Litre System G Gigalitre ARI Arthur Rylah Institute for Environmental Research ML Megalitre CFA Country Fire Authority Ha Hectare CMA Catchment Management Authority CSC Customer Service Centre DEPI Department of Environment and Primary Industries DPC Department of Premier and Cabinet DPCD Department of Planning and Community Development DPI Department of Primary Industries DSDBI Department of State Development Business and Innovation DSE Department of Sustainability and Environment DTF Department of Treasury and Finance DTPLI Department of Transport, Planning and Local Infrastructure EMS Environmental Management System EPA Environment Protection Authority EWR Environmental Water Reserve FMCF Financial Management Compliance Framework FOI Freedom of Information FRD Financial Reporting Directive FTE Full time Equivalent ISO International Organisation for Standardisation MFB Metropolitan Fire Brigade MW Melbourne Water NA Not Applicable NEO Networked Emergency Organisation OHS Occupational Health and Safety OLV Office of Living Victoria PFF Project Firefighter PPP Public Private Partnership PV Parks Victoria SCC State Coordination Centre SES State Emergency Service SGV Surveyor-General Victoria SV Sustainability Victoria VBRC Victorian Bushfires Royal Commission VGV Valuer-General Victoria VGPB Victorian Government Purchasing Board VIPP Victorian Industry Participation Policy

200 Department of Environment and Primary Industries 2013 Annual Report Published by the Victorian Government Department of Environment and Primary Industries Melbourne, September 2013 © The State of Victoria Department of Environment and Primary Industries Melbourne 2013. This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968. Authorised by the Victorian Government, 8 Nicholson Street, East Melbourne. Print managed by Finsbury Green. Printed on recycled paper. ISSN 2202–719X (print) IBSN 2202–7203 (online) For more information contact the DEPI Customer Service Centre 136 186. Disclaimer This publication may be of assistance to you but the State of Victoria and its employees do not guarantee that the publication is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or other consequence which may arise from you relying on any information in this publication. Accessibility If you would like to receive this publication in an accessible format, such as large print or audio, please telephone 136 186, or email [email protected] Deaf, hearing impaired or speech impaired? Call us via the National Relay Service on 133 677 or visit www.relayservice.com.au This document is also available in PDF format on the internet at www.depi.vic.gov.au Department of Environment and Primary Industries of Environment Primary and Department

Department of Environment and Grampians Primary Industries 402–406 Mair Street, Ballarat 3350 Customer Service Centre 136 186 Phone (03) 5336 6856 [email protected] Fax (03) 5336 6885 visit www.depi.vic.gov.au Hume Head office 89 Sydney Road, Benalla 3672 8 Nicholson Street, East Melbourne 3002 Phone (03) 5761 1611 Phone 136 186 Fax (03) 5761 1628 Fax (03) 9637 8100 Loddon Mallee Regional head office locations: Corner Midland Highway and Taylor Street, Epsom 3551 Barwon South West Phone (03) 5430 4444 Corner Fenwick and Little Malop Streets, Fax (03) 5448 4982 Geelong 3220 Phone (03) 5226 4667 Port Phillip Fax (03) 5226 4725 8 Nicholson Street, East Melbourne 3002 Phone 136 186

Gippsland Fax (03) 9637 8999 2013 Report Annual 71 Hotham Street, Traralgon 3844 Phone (03) 5172 2111 Fax (03) 5172 2100

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