Financial performance

The Bureau reported an operating surplus of $11.607 million, excluding depreciation for 2018–19, against a budgeted operating surplus of $7.130 million. This surplus is largely due to external revenue used for capital assets. After including depreciation, the operating result was a deficit of $82.089 million in 2018–19, compared to a deficit of $81.010 million in 2017–18. The Bureau’s operating results show deficits as its depreciation and amortisation expenditure is shown in its operating statements, while its departmental capital budget for asset replacement is treated as an equity contribution and is shown in its balance sheet.

Revenue

Total revenue for the Bureau for 2018–19 was $324.855 million. This is an increase of $12.134 million compared to the 2017–18 year.

The Bureau’s Australian Government appropriation was $231.658 million in 2018–19, which was $1.269 million higher than the 2017–18 year.

Changes in appropriation funding are largely associated with:

• funding associated with the 2017–18 Budget measure—Improved Security and Resilience;
• funding associated with the 2018–19 Budget measure—Improved Security and Resilience— Tranche 2;
• funding associated with the 2018–19 Additional Estimate Budget measure—Assistance for Farmers and Farm Communities in Drought; and
• increased funding for economic parameter adjustments offset by efficiency dividends.

The Australian Government appropriation contributed 71.3 per cent of the Bureau of Meteorology’s total operating revenue. The remaining funds were derived from ‘own-source income’ and ‘other income’ totalling $93.197 million—an increase of $10.865 million compared to the 2017–18 year.

Sources of revenue

Expenditure

The Bureau’s operating expenditure for 2018–19 was $406.944 million—an increase of $13.213 million (3.4 per cent) compared with the 2017–18 year. This increase was due to higher expenditure across employee, supplier and depreciation and amortisation expenses compared to the 2017–18 year.

Employee costs represented 45.9 per cent of the Bureau’s total costs.

Supplier costs were $123.110 million (30.3 per cent of total expenses), and included:

• observations consumables;
• lease costs associated with premises and other goods and services;
• costs associated with service delivery; and
• communication, software and other information technology (IT) costs.

Depreciation and amortisation was $93.696 million (23.0 per cent of total expenses).

Total Resources

Bureau expenditure

Significant non-compliance

During 2018–19 there were no significant non-compliant breaches of the finance law under section 19(1)(e) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

Asset management

The Bureau managed an asset base valued at $773.516 million. Of this, $570.335 million related to fixed and intangible assets.

The Bureau’s asset investment and replacement program was monitored throughout the year at the Program level, and via monthly Executive meetings, to ensure optimal delivery and use of available resources.

During 2018–19, the Bureau invested $112.070 million in asset acquisition and construction to support its service delivery to Australia, including:

• implementing forecasting guidance improvement and verification streamlining, building the new weather webpage, numerical weather prediction models and global atmosphere watch systems;
• upgrading observing systems such as automatic weather stations, balloon sites across multiple locations, construction of new Wimmera radar in Victoria, Willis Island remediation works and upgrading radars in Melbourne, Esperance, Albany and Geraldton; and
• facility construction and refurbishment including construction of the Brisbane operations hub, Queensland State Office relocation, and refurbishment of levels 7 and 8 at the Melbourne Office.

Bureau of Meteorology Assets

Procurement

Value for money is the core principle underpinning all procurement. The Bureau’s Accountable Authority Instructions provide internal control of procurement within the agency, and are aligned with the PGPA Act, the Commonwealth Procurement Rules and broader Australian Government policy.

No contracts of $100 000 or more (inclusive of GST) were let during 2018–19 that did not provide for the Auditor-General to have access to the contractor’s premises.

For details of standard clauses that provide the Australian National Audit Office (ANAO) with access to contractors’ information, refer to: https://www.finance.gov.au/procurement/clausebank/ audit-and-access/

No contracts in excess of $10 000 (inclusive of GST) or standing offers were exempted by the accountable authority from being published on AusTender on the basis that they would disclose exempt matters under the Freedom of Information Act 1982.

Information on procurements expected to be undertaken in 2019–20 is in Bureau’s annual procurement plan, available from the AusTender website (www.tenders.gov.au).

Procurement initiatives to support small business and Indigenous-owned businesses

The Bureau supports small business participation in the Australian Government procurement market. Small-to-medium enterprises and small enterprise participation statistics are available on the Department of Finance website at

https://www.finance.gov.au/procurement/statistics-on-commonwealth-purchasing-contracts/

The Bureau recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website (www.treasury.gov.au).

Bureau support for small business includes using the Commonwealth Contracting Suite for low-risk procurements valued under $1000 000.

The Bureau supports the goals of the Australian Government’s Indigenous Procurement Policy and achieved its Indigenous procurement target for 2018–19. More information is available on the Department of the Prime Minister and Cabinet’s website (www.pmc.gov.au).

Consultants

The selection and engagement of consultants was conducted in accordance with the PGPA Act, Commonwealth Procurement Rules and internal policy and procedures.

During 2018–19, the Bureau entered into 23 new consultancy contracts with a total expenditure of $3279 272 (inclusive of GST). In addition, one ongoing consultancy contract was active during the period, with expenditure of $733 156.

The main categories of purpose for which consultants were engaged were legal services, audit services and management advisory services.

Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website (www.tenders.gov.au).

Advertising and market research

Under section 311A of the Commonwealth Electoral Act 1918, the Bureau is required to disclose payments of advertising and market research.

Advertising and market research over the reporting threshold of $13 200 (GST inclusive) were undertaken to the value of $58 754 and $85 377 respectively, in 2018–19. Details are provided below.

The Bureau did not undertake any polling, direct mail or advertising campaigns during 2018–19.