More than 40 Australian federal departments and agencies collectively exceeded their staffing budgets by approximately $5.6 million per day in the last financial year, according to annual reports. These agencies spent more than $2 billion above their employee-cost estimates.
The Department of Home Affairs recorded the largest overspend, with employee expenses totaling $2.23 billion, which was $275 million above its budget. The National Disability Insurance Agency followed with an overspend of $224.6 million, and the Department of Climate Change, Energy, the Environment and Water was $197.6 million over its forecast.
Other significant overspends included the Department of Agriculture, Fisheries and Forestry ($157.1 million) and the Department of Employment and Workplace Relations ($135.1 million). The Health, Disability and Ageing department also exceeded its staffing budget by $129 million.
These figures emerge as Treasurer Jim Chalmers and Finance Minister Katy Gallagher face pressure to control spending before the upcoming Mid-Year Economic and Fiscal Outlook. Finance Minister Katy Gallagher acknowledged on Sunday that "the pressures on the budget are real" and are increasing, identifying the National Disability Insurance Scheme, healthcare, aged care, defense spending, and interest payments on government debt as primary drivers of increased expenditure.
Despite the mounting budget strain, Gallagher rejected suggestions that reining in spending had become too difficult, emphasizing the need to acknowledge the current economic environment. Ministers are reportedly working intensively to identify savings across government departments, with no area being explicitly exempt from scrutiny.
Conversely, a few agencies reported underspending on staff. The Australian Taxation Office spent $76.8 million less than budgeted, and the Department of Social Services underspent by $35.1 million.
The employee-cost overruns occurred as federal tax collections continued to rise. Personal income tax receipts, in particular, surged by $28.5 billion in 2025-26 alone, reaching approximately $346 billion, partly attributed to bracket creep and overall economic growth.