Antipodean Advisory · Michael's fun fact
The rising cost of the Department of Finance
The Department of Finance helps oversee government expenditure and the management of taxpayers' money. Over five years, its own average staffing rose 50.4%, annual employee costs rose 61.0%, and total departmental expenses rose 161.0%.
These increases demand a clear account of the additional results delivered. [1, 2]
Five-year cost comparison
| Measure | 2020–21 | 2025–26 | Increase | Change |
|---|---|---|---|---|
| Average staffing level | 1,249 | 1,879 | 630 positions | 50.4% |
| Employee costs | $169.9m | $273.6m | $103.7m | 61.0% |
| Supplier expenses | $185.8m | $232.3m | $46.5m | 25.0% |
| Total departmental expenses | $1,126.0m | $2,938.3m | $1,812.4m | 161.0% |
| Expenses excluding insurance claims and non-financial asset write-downs | $440.5m | $653.2m | $212.7m | 48.3% |
Staffing is the annual average full-time equivalent workforce. Financial figures are actual expenses rather than approved budgets and are not adjusted for inflation. Employee and supplier costs form part of total expenses. The final row is a calculated comparison, not an official Finance performance measure. [1, 2]
The employee bill is $103.7 million higher each year, equivalent to approximately $8.6 million more a month.
Comcover insurance claims increased from $651.7 million to $1,821.0 million. Non-financial asset write-downs and impairments increased from $33.8 million to $464.1 million.
These explain much of the headline expense increase; excluding both categories at each endpoint, remaining expenses still rose 48.3%. [1, 2]
Head of the department and remuneration
Matt Yannopoulos PSM commenced as Secretary on 29 September 2025, with a five-year appointment.
The office carries an annual remuneration package of $932,120, effective 1 July 2026. This is the assigned package, rather than cash base salary alone.
He led the department for only part of the comparison period. [3, 4]
Public charter and taxpayer expectations
Finance's stated purpose centres on advice, frameworks and services that achieve value in the management of public resources.
Its responsibilities support the efficient, effective, economical and ethical use of public money. [5]
- Expenditure discipline: Rigorous scrutiny of spending proposals, costs and financial risks.
- Reliable budget information: Timely reporting that explains assumptions, revisions and emerging pressures.
- Value for money: Effective procurement and grants frameworks, and responsible management of public assets.
- Financial transparency: Clear disclosure of taxpayer exposure through expenditure, equity investments, loans and guarantees.
- Demonstrated efficiency: Published measures of service quality, realised savings and productivity in Finance's own operations.
Public interest scorecard
Assessment covering 2021–2026. Scores and weights are editorial judgements informed by the evidence cited. They are not official Finance or ANAO ratings.
| Responsibility | Score | Result | Assessment |
|---|---|---|---|
| Own expenditure discipline and demonstrated productivity | 8/25 | Poor | Staffing rose 50.4%, employee costs 61.0%, and expenses excluding insurance claims and write-downs 48.3%. The evidence reviewed does not establish proportionate productivity improvements. [1, 2] |
| Budget administration and financial reporting | 16/20 | Good | Finance reported achieving financial reporting and cash-management targets in 2025–26. One budget-update target was partly achieved. This assesses administrative delivery, not overall fiscal control. [2] |
| Procurement stewardship and reform | 14/20 | Good | The ANAO confirmed implementation of the sampled procurement-reporting recommendation, improving disclosure of how many suppliers were invited to compete. This is credit for a specific reform. [6] |
| Full disclosure of deficits, financing and taxpayer exposure | 7/15 | Mixed | Equity investments, loans and guarantees create financing needs or taxpayer risks not fully captured in the underlying cash deficit. The ANAO identifies gaps in visibility and financial sustainability benchmarks. [7, 8] |
| Property management and assurance | 5/10 | Mixed | The property operating-expense savings target was achieved. Another property-services result could not be reported because reliable, verified data was unavailable. [2] |
| Shared digital and parliamentary services | 6/10 | Mixed | ICT targets were achieved, while shared-service and some parliamentary payment targets were only partly achieved. [2] |
Weights total 100. Ratings reflect the percentage of available points: below 40% Poor; 40–69% Mixed; 70–89% Good; 90–100% Excellent. The productivity category assesses demonstrated value against rising costs. The score is not an estimate of waste or a measured productivity decline.
Deficit reporting and financing outside the underlying balance
Government equity investments and loans can require borrowing without being counted as ordinary expenditure in the underlying cash deficit.
Guarantees create contingent exposure. These arrangements are often outside the underlying cash balance, rather than literally off the balance sheet.
The Parliamentary Budget Office warns against relying on the underlying cash balance alone to assess fiscal health. [8]
| 2026–27 Budget measure | Forecast deficit |
|---|---|
| Underlying cash balance | $31.5 billion |
| Headline cash balance | $64.1 billion |
| Difference | $32.6 billion |
The headline cash deficit is more than twice the underlying deficit.
The difference includes financing transactions and should not all be described as hidden expenditure.
Nevertheless, focusing on the smaller measure understates the overall cash financing requirement. These are full-year Budget forecasts, not year-to-date actuals. [9]
What full financial accountability should show
Finance should prominently reconcile the underlying deficit with the headline cash balance, debt and financial risks.
For material equity investments and loans, reporting should explain funding committed, expected returns, valuation changes and potential losses.
Transactions outside the underlying deficit still have consequences for taxpayers. The ANAO identifies limited visibility over the increasing use of alternative financing arrangements. [7, 8]
A smaller reported underlying deficit is not evidence of stronger fiscal control when substantial financing requirements and risks sit outside that measure.
Key conclusion
Accurate reports and timely payments are basic administrative requirements. They do not establish expenditure discipline, sound fiscal management or improved productivity.
An additional 630 full-time equivalent positions, a $103.7 million increase in annual employee costs, and 48.3% growth in expenses excluding insurance claims and asset write-downs demand a clear account of what taxpayers received in return. [1, 2]
Ministers determine spending policy, but Finance remains accountable for its expenditure advice, financial frameworks, risk oversight and administration.
Its specific reporting, systems and procurement improvements should be recognised without presenting administrative delivery as proof of overall fiscal control.
The standard should be independently verified savings, transparent fiscal risks and measurable improvements in results — not a larger bureaucracy presented as evidence of better government.
Sources and references
- Department of Finance Annual Report 2020–21. Departmental financial statements and actual average staffing levels by outcome.
- Department of Finance Annual Report 2025–26. Departmental financial statements, staffing and annual performance statements.
- Department of Finance – Secretary biography. Biography and commencement date.
- Department of the Prime Minister and Cabinet – Secretaries Instrument of Assignment. Remuneration package effective 1 July 2026.
- Department of Finance Corporate Plan 2025–26. Purpose, activities and performance framework.
- Australian National Audit Office – Implementation of Procurement Reforms. Digital Transformation Agency and Department of Finance.
- Australian National Audit Office – Finance portfolio overview. Audit focus, financial sustainability benchmarks and alternative financing.
- Parliamentary Budget Office – Alternative financing of government policies.
- Department of Finance – September 2026 Monthly Financial Statements. Full-year 2026–27 Budget estimates.
Calculations use unrounded source figures where available; displayed amounts are rounded. Staffing totals are the sum of actual average staffing levels across the three departmental outcomes. This article distinguishes reported facts from editorial assessment.