Our financial overview

The EPA’s net result for 2021–22 was a loss of $2.1 million, $7.7 million lower than the $5.6 million positive net operating result originally estimated as part of the 2021–22 State budget process. The decrease was mainly due to additional expenses incurred and the timing of programs delivered.

In 2021–22 our expenses and revenue have both increased compared to the previous year. The main reason for the increase was the project work conducted in response to floods and bushfires throughout NSW.

The table shows the EPA’s approved budgets over the last five years.

Managing operational risks: funding

The EPA receives government funding as well as income derived from fees paid by the regulated community. Inadequate funding could reduce the EPA’s ability to achieve its objectives. The EPA manages this risk through:

• a robust budget submission and reporting system with frequent monitoring in place
• budget allocations linked to strategic priorities
• enhanced tracking of waste flows to better monitor and collect fees derived from the waste levy.

Where our money came from

The EPA receives government funding as a grant from DPE. Revenue is also derived from other NSW agencies as well as from environmental licensing and administration fees paid by regulated industries.

Our total revenue for 2021–22 was $279.5 million, a decrease of $88.8 million on our approved budget of $368.3 million. The decrease was largely due to lower grant revenue with timing delays in major projects by $88.5 million.

Our total revenue for 2021–22 was 29% higher ($63.5 million) than the $216.0 million reported for
2020–21. The increase was due to the increase in grants received, including grants for major disaster project work conducted during the year ($64.2 million).

EPA revenue sources over the last 5 years

The EPA also collects revenue on behalf of the Crown from waste and environment levies. This annual revenue is paid to the NSW Treasury. Greater detail is provided in the Financial statements section of this report, under note 23 – Administered assets, liabilities and income.

How we spent our money

In 2021–22, most EPA expenditure – about 39% of the total – was for employee-related expenses, with the rest used for grant programs and operating expenditure. We paid $79.0 million in grants to various entities for a range of purposes. Greater detail is provided in Appendix H.

In 2021–22 total expenditure was $281.8 million, a decrease of $80.9 million on our original budget of $362.7 million. The variance was largely due to:

• $59.1 million in other operating expenses including lower spend than budget on clean-up related to flood events
• $11.4 million in grant expenses due to lower spend than budget on waste-related projects
• $10.0 million relating to employee-related expenses, including some delayed recruitment and lower employee leave provision expense.

We reported a $69.1 million (32%) increase in expenditure this year compared to the previous year (see expenditure table below).

EPA expenditure over the last 5 years

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