After the May 2019 federal election, the government decided to remove water staff from the agriculture department and put them under infrastructure.
The shift was due to happen on December 1 last year.
But Federal Agriculture Department deputy secretary Malcolm Thompson was notified on November 28 the change wouldn't go ahead.
That was one day after staff were farewelled at an afternoon tea.
Water employees were told on November 29 the transfer had been canned.
Mr Thompson said the government aborted the change because of hardship surrounding the drought, particularly in the Murray-Darling Basin.
“The government had decided not to disrupt delivery of the important range of programs and the policy advice in the water division by moving that function,” he said.
The cancellation came amid intense political pressure, with many communities up in arms about the management of the river system.
Preparation for the transfer saw $171 000 spent on corporate strategy and governance, $121 000 on IT, $50 000 on finance and $23 000 on legal costs.
Department secretary Andrew Metcalfe said the vast majority of staff would have been doing something else if they weren't working on the planned shift.
“It's not as if they were additional costs that went beyond the normal budget,” Mr Metcalfe said.
Labor frontbencher Jenny McAllister suggested they could have been doing something useful.
“They might have been saving the Murray-Darling Basin — applying their efforts to that task,” she said.
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