AMSA has implemented internal controls to ensure costs recovered for regulatory charging activity outputs are measured correctly and are collected on time. In adherence with legislative obligations, an officer of Australian Border Force may detain a vessel at any Australian port for any unpaid and outstanding levies. The vessel can only be released after payment is received. This process ensures the existence of any unpaid levies are consistently at a very low level.
An assessment of regulatory charging activities was conducted using Department of Finance’s Charging Risk Assessment. AMSA considers the risk to remain low to medium, given no anticipated changes (other than indexation) to current activities in 2022-23. Identified risks, accompanying mitigation strategies and controls, are provided in Table 7 with additional details provided in AMSA’s Corporate Plan PDF6.75 MB.
Table 7: Risks and mitigation strategies associated with regulatory charging
| Risk identified | Inherent risk | Mitigation strategy and controls | Residual risk |
|---|---|---|---|
| Funding risk to levies Levies are collected based on tonnage proxies predominately from the number of arriving international commercial vessels, with most levies (67%) sourced from iron ore and coal bulk cargo. Economic factors, such as COVID-19 disruptions or a trade dispute, may adversely reduce AMSA’s levy revenue as the number of international vessels arriving at Australian ports decrease. Tonnage (and revenue) may drop quickly in reaction to economic pressures. In the short-to-medium timeframe, our regulatory service delivery (and associated costs) will remain similar (sticky); as revenue decrease, it may not be enough to cover expenditure. | High |
| Medium |
| Secure funding for National System National System regulatory-based activities are funded by a combination of government budget appropriations and jurisdiction contributions. An Independent Review Panel have been commissioned to review funding for functions commencing in January 2022 and expected to report to the Australian Government in December 2022. The final report will include recommendations of future funding and charging arrangements and will be considered as part of the 2023-24 Commonwealth Budget Process. AMSA must work with the Department of Infrastructure and the Government to ensure sufficient funding for the National System regulatory activities to avoid shortfalls. | Severe |
| Medium |
| Ensure regulated industry are operating to appropriate standards Failure as a regulator to prevent an incident or fatality in relation to compliance and enforcement arrangements. | High |
| Medium |
| Reserves not enough to fund a major pollution incident clean-up A major environmental emergency pollution incident resulting in clean-up costs exceeding retained earning reserves, damaging reputation, and forcing AMSA to seek special appropriation funding from government. | High |
| Low |
| Inflated or escalating costs Escalating costs to provide regulatory activities to principal stakeholders and costs that may be beyond that deemed efficient. Business processes may not be efficient or effective in the delivery of regulatory charging activities, with corporate overheads unnecessarily large. This may have negative long-term impacts on AMSA’s budget or result in industry paying more in the recovery of costs than required – cost efficiency is an Australian Government cost recovery obligation. | High |
| Low |
| Key performance indicators Not effective in measuring progress of specific activities, not maintained as an ongoing and reportable measurement. Difficult to assess AMSA’s effectiveness in the delivery of services and progress achieving policy outcomes to acceptable standards of industry. | Medium |
| Low |