3 Finance‑General

Agency Outline

The Finance‑General Division is administered by the Department of Treasury and Finance.

The major activities transacted through Finance‑General include the management of the Government's financial assets and liabilities, meeting the Government's pension and other superannuation commitments, administration of the Tasmanian Risk Management Fund, management of the Government's light vehicle fleet and property portfolio and payments to government businesses.

Finance-General also includes funding to assist with the replacement of the Spirits of Tasmania (I and II) within the TT-Line Vessel Replacement Fund and funding for the transformation and replacement of critical agency ICT infrastructure.

Certain provisions have been made in the Special Deposits and Trust Fund to meet future liabilities of the Government, including a provision within the Tasmanian Risk Management Fund for workers' compensation and other insurable risks in respect of inner‑Budget agencies. Information on the Government's superannuation liabilities and administration of the Tasmanian Risk Management Fund is provided in chapter 7 of The Budget Budget Paper No 1.

Output Information

Outputs of Finance‑General are provided under the following Output Groups:

       Output Group 1 ‑ Debt Servicing and Management;

       Output Group 2 ‑ Employee Related Costs;

       Output Group 3 ‑ Government Businesses; and

       Output Group 4 ‑ Miscellaneous.

Table 3.1 provides an Output Group Expense Summary for Finance‑General.


 

Table 3.1: Output Group Expense Summary

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Treasurer

 

 

 

 

 

 

 

 

 

 

 

Output Group 1 - Debt Servicing and Management

 

 

 

 

 

1.1 Debt Servicing

25)

49)

77)

31)

28)

1.2 Interest on Sundry Deposits1

1 944)

1 566)

1 559)

2 120)

2 694)

1.3 Debt Management

8 062)

7 727)

7 384)

7 033)

6 677)

 

10 031)

9 342)

9 020)

9 184)

9 399)

Output Group 2 - Employee Related Costs

 

 

 

 

 

2.1 Superannuation and Pensions2

398 244)

373 734)

374 015)

372 877)

370 825)

 

398 244)

373 734)

374 015)

372 877)

370 825)

Output Group 3 - Government Businesses

 

 

 

 

 

3.1 Forestry Tasmania3

6 000)

2 000)

2 000)

2 000)

2 000)

3.2 State Fire Commission

2 836)

2 836)

2 836)

2 836)

2 836)

3.4 Government Businesses4

1 814)

1 504)

1 493)

1 493)

1 493)

 

10 650)

6 340)

6 329)

6 329)

6 329)

Output Group 4 - Miscellaneous

 

 

 

 

 

4.2 Treasurer's Reserve

10 000)

10 000)

10 000)

10 000)

10 000)

4.3 Miscellaneous5

9 647)

35 891)

40 279)

56 279)

56 279)

4.4 Payment to Australian Tax Office: GST Administration6

14 350)

13 289)

12 661)

9 951)

9 951)

4.5 Tasmanian Risk Management Fund7

56 338)

69 432)

60 255)

61 694)

64 809)

4.6 Fleet Management Services

15 473)

14 872)

14 746)

14 654)

14 598)

4.7 Property Management Services

26 700)

27 509)

27 434)

27 894)

28 570)

4.8 Infrastructure Investment Project Planning

2 000)

2 000)

2 000)

2 000)

2 000)

 

134 508)

172 993)

167 375)

182 472)

186 207)

 

 

 

 

 

 

Grants and Subsidies

509 394)

488 923)

395 609)

234 953)

194 186)

 

 

 

 

 

 

Capital Investment Program

)

583)

583)

 

 

 

 

 

 

Special Capital Investment Funds8

18 470)

13 428)

2 964)

970)

897)

 

 

 

 

 

 

TOTAL

1 081 297)

1 064 760)

955 312)

807 368)

768 426)

 

 

 

 

 

 

Notes:

1.   The variations in Interest on Sundry Deposits are primarily due to anticipated variations in interest rates over the period.

2.   The decrease in Superannuation and Pensions in 2017-18 reflects a revised actuarial estimate of expenditure and savings due to the implementation of a revised model for defined benefit scheme operating expenses.

3.   The decrease in Forestry Tasmania reflects the transfer of funding for community service obligations of $4 million to the Department of State Growth.

4.   The decrease in Government Businesses in 2017-18 reflects the finalisation, in 2016‑17, of the enterprise suitability funding provided to Tasmanian Irrigation Pty Ltd.

5.   The increase in Miscellaneous from 2017-18 primarily relates to the establishment of a Health Funding Provision and revised cash flows for the Mobile Radio Network.

6.   GST Administration costs have decreased from 2017-18 onwards reflecting the implementation of more efficient processes by the ATO. The further decrease from 2019-20 reflects the end of the GST Voluntary Compliance program from 1 July 2019.

7.   The increase in Tasmanian Risk Management Fund is due to higher medical claim costs and property claim costs related to the 2016 June flood event and a major fire claim at the Peacock Centre.

8.   The decrease in Special Capital Investment Funds reflects the winding down of these funds. Further details are provided in the Special Capital Investment Funds section of this chapter.

Output Group 1: Debt Servicing and Management

1.1 Debt Servicing

This Output provides for the interest cost on the end of year borrowing.

1.2 Interest on Sundry Deposits

This Output provides for the payment of interest on balances held in certain accounts in the Special Deposits and Trust Fund.

1.3 Debt Management

This Output reflects transactions associated with the repayment of Australian Government debt relating to housing activities.

The expense of $7.7 million in 2017-18 ($8.1 million in 2016-17) represents interest payments to the Australian Government on debt incurred under various Commonwealth‑State Housing Agreements.

Principal repayments by Housing Tasmania of $7.8 million in 2017-18 ($7.6 million in 2016‑17) are capital transactions and are therefore not included in the expenses of Output 1.3, or in the expenses reported in the Statement of Comprehensive Income, but are reflected within Interest bearing liabilities in the Statement of Financial Position and included under Cash flows from investing activities in the Statement of Cash Flows.

Output Group 2: Employee Related Costs

2.1 Superannuation and Pensions

This Output meets the Government's share of pension and superannuation costs.

In 2017-18, superannuation and pension expenses are estimated to total $373.7 million, an anticipated decrease of $24.5 million in comparison with the budgeted cost in 2016-17 of $398.2 million. The 2017-18 estimate includes service costs of $88.1 million ($110.3 million in 2016-17) which reflects estimated savings relating to the implementation of a revised model for defined benefit scheme operating expenses and nominal interest of $285.6 million ($287.9 million in 2016-17). The estimated value of the expense is based on the most recent actuarial assessment of the superannuation liability.


 

As part of the reform of public sector superannuation, the Government has established the Superannuation Commission from 1 April 2017 to replace the Retirement Benefits Fund Board and be responsible for the management of the defined benefit schemes. In conjunction with that important reform, the Government has implemented a more efficient and transparent model for defined benefit scheme operating expenses, whereby these costs are now directly funded by the Government, through the Department of Treasury and Finance, as part of the annual Budget development process, rather than being incurred at the RBF Board's discretion and charged directly against the Plan Assets. The average annual operating expenses incurred by the RBF Board over the past six years (being the two most recent triennial review periods) was $19.4 million, while the average annual cost for the new funding arrangement is $16.9 million across the Budget and Forward Estimates period, resulting in an estimated saving of $2.5 million per annum, without impact on the level of service offered to members. This change has a direct impact by reducing the superannuation service costs as noted above.

The estimated superannuation liability as at 30 June 2018 is $6 263.5 million (excluding the estimated Housing Tasmania pre‑July 1994 superannuation liability of $10 million as at 30 June 2018, the estimated Tasmanian Ambulance Services Superannuation Scheme liability of negative $6.3 million as at 30 June 2018 and the estimated State Fire Commission superannuation liability of negative $812 000 as at 30 June 2018). This is a decrease of $73 million from the 2016-17 estimate of the liability as at 30 June 2017 of $6 336.5 million. The estimated value reflects the most recent actuarial assessment of the liability. Further information in relation to the General Government superannuation liability can be found in chapter 7 of The Budget Budget Paper No 1.

Output Group 3: Government Businesses

3.1 Forestry Tasmania

The 2017-18 Budget provides funding of $2 million in 2017‑18 ($2 million in 2016‑17) and subsequent years for Forestry Tasmania to maintain its fire fighting capacity and assist with fighting wild fires.

3.2 State Fire Commission

A provision of $2.8 million has been made for the State Fire Commission in 2017-18 and subsequent years ($2.8 million in 2016-17). Of this amount, a provision of $790 000 has been made for the Bushfire Mitigation Program and $240 000 has been appropriated as a contingent provision for funding excess fire fighting costs. This represents base additional funding for bushfire fighting costs. Due to the uncertain nature of these costs from year to year, it is established practice that additional funding is provided as required in response to the actual costs incurred by the Commission. The remaining $1.8 million represents the State Government's annual funding contribution to the Commission in accordance with section 101 of the Fire Service Act 1979. Further information in relation to the State Fire Commission can be found in chapter 24 of this Budget Paper.

3.4 Government Businesses

This Output provides for expenses arising from the Government's ownership interests in Government businesses.

An amount of $1.5 million is being provided in 2017-18 in accordance with the Government's agreement to reimburse Tasracing Pty Ltd for the costs (including principal where necessary) associated with Tasracing's borrowings with the Tasmanian Public Finance Corporation, where Tasracing cannot meet those costs.

Output Group 4: Miscellaneous

4.2 Treasurer's Reserve

An amount of $10 million has been provided in the Treasurer's Reserve in 2017-18 ($10 million in 2016-17) to meet expenditure that could not reasonably be foreseen at the time of developing the 2017-18 Budget and which is essential for efficient financial management.

4.3 Miscellaneous

Items of expenditure under this Output relate to various miscellaneous payments, including the Mobile Radio Network, Government Business Reviews, allocated Digital Transformation Project expenditure and Health Funding.

Mobile Radio Network

An amount of $8 million is provided in 2017-18 ($5.3 million in 2016‑17) for the funding of the whole‑of‑government Mobile Radio Network upgrade administered by the Department of Police, Fire and Emergency Management. The increase is a result of revised cash flows for the Project.

Structural Reviews and Energy Security Taskforce

Funding of $2.5 million has been provided in 2017-18 to provide for costs associated with the Energy Security Taskforce's review of energy security arrangements, together with other structural reviews, including the review of the wholesale electricity pricing framework to:

       analyse whether the Wholesale Contract Regulatory Instrument is operating as intended according to its original design;

       determine whether the regulatory arrangements are producing any sub-optimal outcomes;

       investigate the potential to reduce the impact of mainland wholesale price volatility on Tasmanian wholesale prices; and

       provide options to Government regarding potential changes to the Tasmanian wholesale electricity market.

Digital Transformation Projects

Funding of $300 000 has been allocated to the CYS Client Information System Project and $150 000 to the Justice Connect Project to commence detailed design work. These projects will progress through the Structured Infrastructure Investment Review Process to finalise full project costs, which will be met from the Digital Transformation Priority Expenditure Program.

Health Funding

The 2017‑18 Budget and Forward Estimates includes a provision for additional funding for hospital services of $100 million. For information on the initiatives to be undertaken with this funding refer to chapter 4 of this Budget Paper.

Tasmanian Cycling Tourism Strategy

As part of the Government's T21 Visitor Economy plans, a Cycle Tourism Strategy is being developed. Funding of $6 million is available to support the Government's Strategy which will be released in 2017-18. For information on this funding refer to chapter 10 of this Budget Paper.

4.4 Payment to Australian Taxation Office: GST Administration

Under the Intergovernmental Agreement (IGA), the states and territories meet the costs of the Australian Taxation Office in administering the goods and services tax. The states and territories share the GST administration costs on a per capita basis. Tasmania's contribution to collection and compliance costs for 2017‑18 is estimated at $13.3 million ($14.4 million in 2016‑17).

4.5 Tasmanian Risk Management Fund

The estimated expenses of $69.4 million in 2017-18 ($56.3 million in 2016‑17) represent anticipated claim and administration costs. Claim expenditure estimates for the Fund reflect the most recent actuarial advice. The increase in 2017‑18 primarily reflects higher estimated claim costs for property and medical liability. In particular, property claim costs are expected to increase significantly in 2017‑18 due to claims arising from the June 2016 flood event and a major fire claim at the Peacock Centre. Some of these costs are expected to be recovered through the Industrial Special Risks Insurance Policy (purchased in the external market to cover catastrophic risk for State-owned assets) and the Natural Disaster Relief and Recovery Arrangements.

4.6 Fleet Management Services

All direct transactions associated with whole‑of‑government light vehicle fleet management activities are recorded in the Government Car Fleet Account within the Special Deposits and Trust Fund. Revenue in the Government Car Fleet Account is derived from the sale of vehicles and receipts from the Government's Fleet Manager of lease, registration and insurance payments by agencies, net of the fleet management fee.

Estimated expenses for this Output in 2017-18 of $14.9 million ($15.5 million in 2016-17) include motor vehicle registration expenses of $1.1 million ($1.1 million in 2016‑17) and estimated depreciation on motor vehicles of $13.8 million ($14.4 million in 2016‑17).

Consistent with the Government's commitment to reducing costs, fleet saving strategies implemented by agencies have resulted in a reduction of the fleet size to 2 384 vehicles as at 31 March 2017, compared to 2 501 vehicles as at 31 March 2014 and a continuation of the downward trend in total monthly operating costs of the fleet.


 

4.7 Property Management Services

It is estimated that expenditure for Property Management Services will amount to $27.5 million in 2017-18 ($26.7 million in 2016-17). As a result of the occupancy of parliament square from the first quarter of 2017‑18, depreciation will increase to an estimated $3.7 million ($2.4 million in 2016-17) due to the amortisation of fit‑out, while rental and other occupancy costs will be $4.2 million ($3.8 million in 2016-17).

The first stage of the implementation of centralised management and coordination of major office accommodation leases for Government within the Hobart CBD, has been fully implemented. This strategic approach to major leases is enabling more efficient and effective management of the Government's leased office accommodation in the Hobart CBD. Treasury has made significant progress on the second stage of centralised property management to consolidate major office accommodation leases in Launceston. Treasury is working with agencies to ensure that all leases are reviewed leading up to expiry to achieve the best use of office space and optimise whole‑of‑government outcomes in relation to more efficient and effective management of the Government's leased office accommodation.

4.8 Infrastructure Investment Project Planning

The Infrastructure Investment Project Planning Output provides funding of $2 million in 2017‑18 ($2 million in 2016-17) and subsequent years for the early planning stages of major infrastructure projects as part of the Structured Infrastructure Investment Review Process.

 


 

Special Capital Investment Funds

Within Finance‑General, some specifically identified funds are held for investment in economic and social infrastructure. This section provides a description and the balance of each Fund and the projects to be funded in 2017‑18 and over the Forward Estimates period. Further detail on capital expenditure from the Special Capital Investment Funds is provided in chapter 6 of The Budget Budget Paper No 1.

Hospitals Capital Fund

The Hospitals Capital Fund was established in 2007‑08 to provide capital funding for hospitals across the State. In 2017‑18, a total amount of $1.4 million has been allocated for Mersey Hospital Upgrades. It should be noted that this funding is separate and additional to the new funding for Mersey Community Hospital Capital Upgrades provided to the Department of Health and Human Services in this Budget.

Table 3.2: Hospitals Capital Fund

 

Estimated

Total

Cost

2017-18

 

Budget

2018-19

Forward

Estimate

2019-20

Forward

Estimate

2020-21

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

1 368

8

8

8

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

1 368

8

8

8

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Health

 

 

 

 

 

Mersey Hospital Upgrades

1 900

1 360

....

....

....

TOTAL OUTFLOWS

)

1 360

....

....

....

 

 

 

 

 

 

Closing Balance

)

8

8

8

8

 

 

 

 

 

 

 


 

Housing Fund

The Housing Fund was established in 2007‑08, with an allocation of $60 million for the purpose of increasing the supply of public housing. In 2017‑18, it is anticipated that $1.2 million will be expended from the Housing Fund on public housing projects.

Further detail on Housing Fund expenditure in 2017‑18 is provided in chapter 4 of this Budget Paper.

Table 3.3: Housing Fund

 

Estimated

Total

Cost

2017-18

 

Budget

2018-19

Forward

Estimate

2019-20

Forward

Estimate

2020-21

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

4 381

3 145

1 867

897

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

4 381

3 145

1 867

897

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Human Services

 

 

 

 

 

Housing Fund

60 000

1 236

1 278

970

897

TOTAL OUTFLOWS

 

1 236

1 278

970

897

 

 

 

 

 

 

Closing Balance

)

3 145

1 867

897

.

 

 

 

 

 

 


 

Infrastructure Tasmania Fund

The Infrastructure Tasmania Fund (ITF) was established in 2007‑08, with proceeds of $312.9 million from the divestment of government businesses, to fund major capital projects. During 2007‑08, $80 million was transferred from the ITF to the Water Infrastructure Fund administered by the Department of Primary Industries, Parks, Water and Environment and $25 million was transferred to the former Urban Renewal and Heritage Fund.

Details of projects to be funded from the ITF in 2017‑18 are provided in chapter 4 of this Budget Paper.

Table 3.4: Infrastructure Tasmania Fund

 

Estimated

Total

Cost

2017-18

 

Budget

2018-19

Forward

Estimate

2019-20

Forward

Estimate

2020-21

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

13 326

2 494

808

808

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

13 326

2 494

808

808

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Health

 

 

 

 

 

Health Infrastructure

67 410

10 832

1 686

....

....

TOTAL OUTFLOWS

 

10 832

1 686

....

....

 

 

 

 

 

 

Closing Balance1

)

2 494

808

808

808

 

 

 

 

 

 

Note:

1.   The allocation of the residual funds will be considered as part of future Budgets based upon funding required for the completion of the ITF projects.


 

Capital Investment Program

Table 3.5 provides financial information for Finance‑General's Capital Investment Program (CIP). Further information on these key deliverables is provided in chapter 6 of The Budget Budget Paper No 1 and in chapter 11 (Digital Transformation Priority Expenditure Program and Launceston Government Office Accommodation); chapter 7 (Project Unify); and chapter 4 (Repatriation Hospital Capital).

Table 3.5: Capital Investment Program

 

Estimated)

Total)

Cost)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Treasurer

 

 

 

 

 

Digital Transformation Priority Expenditure Program

50 000)

10 000)

10 000)

15 000)

15 000)

Launceston Government Office Accommodation

7 000)

3 500)

3 500)

....)

....)

Digital Transformation - Project Unify

11 888)

7 218)

4 670)

....)

....)

Repatriation Hospital Capital

7 000)

7 000)

....)

....)

....)

 

 

 

 

 

 

Total CIP Allocations

 

27 718)

18 170)

15 000)

15 000)

 

 

 

 

 

 


 

Detailed Budget Statements

Table 3.6: Statement of Comprehensive Income - Administered

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Revenue and other income from transactions

 

 

 

 

 

Appropriation revenue - recurrent1

539 730)

599 360)

599 305)

612 152)

621 862)

Appropriation revenue - works and services1

....)

27 718)

18 170)

15 000)

15 000)

Grants2

3 161 796)

3 259 251)

3 237 972)

3 230 231)

3 234 226)

Taxation3

951 018)

1 021 245)

1 036 040)

1 057 397)

1 079 504)

Sales of goods and services

87 706)

90 362)

97 169)

99 560)

100 339)

Interest

18 555)

21 353)

18 967)

17 607)

19 265)

Dividend, tax and rate equivalent income4

263 751)

358 418)

338 189)

370 088)

390 441)

Other revenue

101 782)

109 723)

106 430)

106 430)

106 430)

Total revenue and other income from transactions

5 124 338)

5 487 430)

5 452 242)

5 508 465)

5 567 067)

 

 

 

 

 

 

Expenses from transactions

 

 

 

 

 

Employee benefits5

397 779)

373 534)

373 815)

372 677)

370 625)

Depreciation and amortisation

16 730)

17 510)

17 486)

17 967)

17 900)

Supplies and consumables6

111 989)

136 664)

112 284)

110 487)

114 289)

Grants and subsidies7

544 598)

527 540)

442 507)

296 853)

256 013)

Borrowing costs

10 201)

9 512)

9 220)

9 384)

9 599)

Transfers to the Consolidated Fund

4 169 634)

4 654 131)

4 718 563)

4 719 787)

4 712 889)

Total expenses from transactions

5 250 931)

5 718 891)

5 673 875)

5 527 155)

5 481 315)

 

 

 

 

 

 

Net result from transactions (net operating balance)

(126 593)

(231 461)

(221 633)

(18 690)

85 752)

 

 

 

 

 

 

Other economic flows included in net result

 

 

 

 

 

Net gain/(loss) on non-financial assets

(1)

2 291)

1 674)

2 127)

2 244)

Movement in investments in GBEs and SOCs8

19 497)

(104 198)

11 210)

37 367)

50 157)

Other gains/(losses) from other economic flows9

(15 659)

15 683)

(5 202)

(994)

(2 206)

Total other economic flows included in net result

3 837)

(86 224)

7 682)

38 500)

50 195)

 

 

 

 

 

 

Net result

(122 756)

(317 685)

(213 951)

19 810)

135 947)


 

Table 3.6: Statement of Comprehensive Income - Administered (continued)

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

Other economic flows - other non-owner changes in equity

 

 

 

 

 

Other movements taken directly to equity

(2)

(2)

(2)

(2)

(2)

Total other economic flows - other non-owner changes in equity

(2)

(2)

(2)

(2)

(2)

 

 

 

 

 

 

Comprehensive result

(122 758)

(317 687)

(213 953)

19 808)

135 945)

 

 

 

 

 

 

Notes:

1.   Explanations for significant variances and further information can be found in Table 3.7 Revenue from Appropriation by Output.

2.   Grants represents funding from the Australian Government in the form of GST receipts, National Partnership Payments and Specific Purpose Payments. Further information on Australian Government Funding can be found in chapter 5 of The Budget Budget Paper No 1.

3.   Further information regarding Taxation can be found in chapter 5 of The Budget Budget Paper No 1.

4.   Further information on Dividend, tax and rate equivalent income can be found in chapter 5 of The Budget Budget Paper No 1.

5.   The decrease in Employee benefits in 2017-18 reflects the latest actuarial estimate of superannuation expenditure and savings due to the implementation of a revised model for defined benefit scheme operating expenses.

6.   The increase in Supplies and consumables in 2017-18 reflects higher expenditure within the Tasmanian Risk Management Fund and an estimated increase in payments to councils as a result of the 2016 June flood event.

7.   The decrease in Grants and subsidies from 2017-18 primarily reflects the timing of cash flows and the finalisation of a number of programs funded by the Australian Government.

8.   Movement in investments in GBEs and SOCs represents the estimated change in the value of net assets of government businesses, excluding any equity contributions, between 1 July and 30 June each year.

9.   Other gains/(losses) from other economic flows represents the estimated change in deferred tax assets and liabilities held by government businesses.


 

Table 3.7: Revenue from Appropriation by Output

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Treasurer

 

 

 

 

 

 

 

 

 

 

 

Output Group 1 - Debt Servicing and Management

 

 

 

 

 

1.1 Debt Servicing

25)

12)

49)

77)

31)

1.2 Interest on Sundry Deposits

6 645)

5 600)

5 798)

7 623)

9 306)

 

6 670)

5 612)

5 847)

7 700)

9 337)

Output Group 2 - Employee Related Costs

 

 

 

 

 

2.1 Superannuation and Pensions

706)

441)

441)

441)

441)

2.3 Provision for 27th Pay

6 707)

6 707)

6 707)

6 707)

6 707)

 

7 413)

7 148)

7 148)

7 148)

7 148)

Output Group 3 - Government Businesses

 

 

 

 

 

3.1 Forestry Tasmania

6 000)

2 000)

2 000)

2 000)

2 000)

3.2 State Fire Commission

2 836)

2 836)

2 836)

2 836)

2 836)

3.4 Government Businesses1

21 314)

23 504)

23 493)

15 993)

11 493)

 

30 150)

28 340)

28 329)

20 829)

16 329)

Output Group 4 - Miscellaneous

 

 

 

 

 

4.3 Miscellaneous

9 647)

35 891)

40 279)

56 279)

56 279)

4.4 Payment to Australian Tax Office: GST Administration

14 350)

13 289)

12 661)

9 951)

9 951)

4.7 Property Management Services

33 001)

11 394)

10 338)

8 529)

8 601)

4.8 Infrastructure Investment Project Planning

2 000)

2 000)

2 000)

2 000)

2 000)

 

58 998)

62 574)

65 278)

76 759)

76 831)

 

 

 

 

 

 

Grants and Subsidies

141 470)

185 276)

170 933)

165 891)

165 721)

 

 

 

 

 

 

Capital Investment Program

....)

27 718)

18 170)

15 000)

15 000)

 

 

 

 

 

 

Finance-General

 

 

 

 

 

Total Recurrent Services

244 701)

288 950)

277 535)

278 327)

275 366)

Total Works and Services

....)

27 718)

18 170)

15 000)

15 000)

 

244 701)

316 668)

295 705)

293 327)

290 366)

 

 

 

 

 

 


 

Table 3.7: Revenue from Appropriation by Output (continued)

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Reserved by Law

 

 

 

 

 

Appropriation to the Treasurer's Reserve (Public Account Act 1986)

10 000)

10 000)

10 000)

10 000)

10 000)

Payments to Municipalities under the Local Government (Rates and Charges Remissions) Act 1991

16 736)

17 355)

17 963)

18 593)

19 244)

Payments under the Retirement Benefits (Parliamentary Superannuation) Regulations 2012

1 070)

1 016)

1 009)

1 002)

995)

Superannuation Benefits Payable under the Governor of Tasmania Act 1982

115)

112)

114)

114)

115)

Superannuation Benefits Payable under the Judges' Contributory Pensions Act 1968

2 134)

2 096)

2 117)

2 132)

2 141)

Superannuation Benefits Payable under the Retirements Benefits Act 1993

264 703)

279 564)

290 298)

301 713)

313 729)

Superannuation Benefits Payable under the Solicitor‑General Act 1983

271)

267)

269)

271)

272)

 

295 029)

310 410)

321 770)

333 825)

346 496)

 

 

 

 

 

 

Total Revenue from Appropriation

539 730)

627 078)

617 475)

627 152)

636 862)

 

 

 

 

 

 

Administered Revenue from Appropriation

539 730)

627 078)

617 475)

627 152)

636 862)

 

539 730)

627 078)

617 475)

627 152)

636 862)

 

 

 

 

 

 

Note:

1. This appropriation includes equity funding for Tasmanian Irrigation Pty Ltd of $17.5 million in 2017-18 and 2018-19 and Metro Tasmania Pty Ltd of $4.5 million in 2017-18, 2018-19 and 2019-20; and an appropriation of $10 million in 2019‑20 and 2020‑21 to the TT‑Line Vessel Replacement Fund.


 

Table 3.8: Administered Expenses

 

2016-17]

)

Budget)

2017-18]

)

Budget)

2018-19]

Forward)

Estimate)

2019-20]

Forward)

Estimate)

2020-21]

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Grants and Subsidies

 

 

 

 

 

Energy Retailer Concession

39 364)

40 980)

41 882)

42 803)

43 745)

First Home Builder Assistance1

11 300)

13 440)

7 080)

3 480)

3 480)

Launceston Flood Levee2

....)

1 000)

....)

....)

....)

Local Government Grants3

71 298)

77 213)

100 253)

102 308)

104 852)

Management of Australian Government Funding4

341 735)

280 494)

206 681)

50 435)

9 187)

Natural Disaster Relief Scheme5

1 000)

12 731)

532)

532)

532)

Other Grants and Subsidies6

529)

26 030)

3 532)

34)

34)

Payments under Local Government (Rates and Charges Remissions) Act 1991

16 736)

17 355)

17 963)

18 593)

19 244)

Payroll Tax Assistance

1 685)

4 215)

7 761)

6 655)

2 823)

Tasmanian Forestry Agreement7

16 225)

5 768)

....)

....)

....)

TT-Line Pensioner Concession Subsidy

230)

285)

295)

310)

310)

Water and Sewerage Concessions and Subsidies

9 292)

9 412)

9 630)

9 803)

9 979)

Total Grants and Subsidies

509 394)

488 923)

395 609)

234 953)

194 186)

 

 

 

 

 

 

Transfer to the Consolidated Fund

4 169 634)

4 654 131)

4 718 563)

4 719 787)

4 712 889)

 

 

 

 

 

 

Other Administered Expenses

571 903)

575 837)

559 703)

572 415)

574 240)

 

 

 

 

 

 

Total Administered Expenses

5 250 931)

5 718 891)

5 673 875)

5 527 155)

5 481 315)

 

 

 

 

 

 

Notes:

1.   From 1 July 2017 to 30 June 2018, the Government has extended the availability of the First Home Owner Grant of $20 000. The estimated cash flows reflect the extension of the scheme, the winding down of previous schemes and a lower number of claims made against those schemes.

2.   Funding of $1 million has been provided to the Launceston City Council as part of the Launceston Flood Risk Management Project.

3.   The increase in 2017-18 primarily reflects the extension of the Accelerated Local Government Capital Program and City Deal Launceston. Further information about these initiatives is provided in chapter 11 of this Budget Paper. The increase in Local Government Grants from 2018-19 primarily reflects payments to councils as part of the Government's commitment to transfer responsibility for TasWater from local councils to the State Government.

4.   The variation in Management of Australian Government Funding is primarily related to the timing of the receipt of grant funding from the Australian Government and the payment of grants.

5.   The increase in Natural Disaster Relief Scheme in 2017-18 is due an increase in the estimated costs associated with the 2016 June flood event.

6.   The increase in Other Grants and Subsidies in 2017‑18 primarily reflects funding to be provided to Copper Mines of Tasmania to support the re-opening of the Mt Lyell Copper Mine and energy rebates to be provided to Tasmanian businesses.

7.   The decrease in the Tasmanian Forestry Agreement in 2017-18 reflects the conclusion of programs under the National Partnership Agreement on the Implementation of the Tasmanian Forests Intergovernmental Agreement 2013.


 

Energy Retailer Concession

In accordance with the Electricity Supply Industry Act 1995, the Government has entered into a Community Service Obligation Agreement with Aurora Energy Pty Ltd to provide a range of concessions to eligible low income households and pensioners to assist them in meeting the costs of electricity provided by Aurora Energy Pty Ltd. The increase in the Energy Retailer Concession over the Budget and Forward Estimates period reflects expected increases in the number of households in receipt of the annual electricity concession and changes in electricity prices.

First Home Builder Assistance

From 1 July 2017 until 30 June 2018, the Government has extended the First Home Owner Grant of $20 000, which is expected to support ongoing demand for newly constructed homes by first home buyers.

Local Government Grants

Local Government Grants includes funding under the Australian Local Government (Financial Assistance) Act 1995, whereby the Australian Government provides funds to the states for on‑passing as general purpose grants to local government. This funding includes general purpose funding and identified local road funding.

Local Government Grants includes payments to councils as part of the Government's commitment to transfer responsibility for TasWater from local councils to the State Government.

This Budget also includes funding provided by the Government for the Accelerated Local Government Capital Program to support expanded investment in infrastructure by local government authorities, particularly in rural and regional areas, through the provision of targeted loan interest rebates.

Natural Disaster Relief Scheme

A Tasmanian Natural Disaster Relief Scheme, administered by the Department of Premier and Cabinet, is funded within Finance‑General. This Scheme provides for payments to local government authorities that face the eligible costs of restoring or replacing essential public assets, which have been damaged as a direct result of a disaster, to a pre‑disaster standard. Disasters for which relief is available are determined at the national level and include any one of, or a combination of, the following natural hazards: bushfire; earthquake; flood; storm; cyclone; storm surge; landslide; tsunami; meteorite strike or tornado.

A provision of $12.7 million has been included in the 2017‑18 Budget as a result of an expected increase in claims by councils as a result of the 2016 June flood event ($1 million in 2016‑17 related to 2016 Tasmanian Bushfires), and $532 000 over the Forward Estimates period, for payments that may be made under the Natural Disaster Relief Scheme.

A claim is to be made to the Australian Government under the provisions of the Natural Disaster Relief and Recovery Arrangements in relation to the 2016 June flood event.

Other Grants and Subsidies

Other Grants and Subsidies includes $9.5 million for Copper Mines of Tasmania over two years and $20 million for Energy Rebates for Business. Further information is provided in chapter 10 of this Budget Paper.


 

Payments under Local Government (Rates and Charges Remissions) Act 1991

In accordance with the provisions of the Local Government (Rates and Charges Remissions) Act 1991, the pensioner rates remission scheme provides a remission of 30 per cent off council rates and charges, up to a defined maximum annual amount for eligible pensioners. The maximum remission is indexed annually to ensure that rate relief increases in line with inflation.

Payroll Tax Assistance

The purpose of this grant is to provide financial assistance to organisations, subject to various eligibility criteria being met. Some organisations receive assistance by way of grants equivalent to their payroll tax liability and are entitled to assistance when their payroll expenditure exceeds the threshold limit, currently $1.25 million per annum.

Payroll Tax Rebate (Trainees, Apprentices and Youth)

Funding of $17 million is provided over the Budget and Forward Estimates period for a targeted Payroll Tax Rebate for Trainees, Apprentices and Youth employees. Expenditure is expected to gradually increase in 2017‑18 as eligible employees commence and eligible employers commence claiming the rebate. The majority of claims are expected to be received in 2018‑19 and 2019‑20, before reducing in 2020‑21 as the period of the rebate available gradually scales back.

Qantas Airways Limited

The Government is continuing its financial assistance package to Qantas, including payroll tax relief of $1 million per annum for nine years from 2015‑16, ending with a final reimbursement of $250 000 in 2024‑25. This payroll tax relief is part of a broader agreement with Qantas to secure existing Qantas Contact Centre positions and, through the consolidation of Australia‑wide operations, provides for increased employment at the Hobart Contact Centre.

Tasmanian Forestry Agreement

The Government is continuing to administer funding committed to the Tasmanian Forestry Agreement by the State and Australian Government. The 2017-18 Budget does not include any future funding from the State or Australian Government.

TT-Line Pensioner Concession Subsidy

The Government provides a subsidy to TT-Line Company Pty Ltd for the additional cost of providing concession arrangements to pensioners following an extension by the Australian Government, from 1 April 1993, of eligibility for the Pensioner Concession Card.

Water and Sewerage Concessions and Subsidies

Under the Water and Sewerage Industry (Community Service Obligation) Act 2009, concessions are made available to eligible low income households and pensioners to assist them in meeting the cost of services provided by TasWater. Payments are made to TasWater which passes the benefit on to eligible concession card holders as lower service charges.

Table 3.9: Statement of Financial Position as at 30 June - Administered

 

2017)

 

Budget)

2018)

 

Budget)

2019)

Forward)

Estimate)

2020)

Forward)

Estimate)

2021)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Assets

 

 

 

 

 

Financial assets

 

 

 

 

 

Cash and deposits

872 167)

1 094 397)

1 032 061)

1 048 651)

1 063 700)

Investments

178 560)

170 629)

161 881)

153 370)

144 754)

Receivables

80 067)

87 611)

87 611)

87 611)

87 611)

Equity investments1

4 482 849)

5 654 024)

5 715 605)

5 757 472)

5 807 629)

Other financial assets2

820 290)

797 243)

849 906)

886 037)

899 893)

 

6 433 933)

7 803 904)

7 847 064)

7 933 141)

8 003 587)

Non-financial assets

 

 

 

 

 

Assets held for sale

1 014)

912)

912)

912)

912)

Property, plant and equipment

127 534)

138 662)

140 480)

137 533)

135 074)

Infrastructure

....)

17 218)

31 888)

46 888)

61 888)

Other assets

5 066)

1 080)

1 080)

1 080)

1 080)

 

133 614)

157 872)

174 360)

186 413)

198 954)

 

 

 

 

 

 

Total assets

6 567 547)

7 961 776)

8 021 424)

8 119 554)

8 202 541)

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Payables

14 777)

13 394)

13 168)

12 911)

12 701)

Interest bearing liabilities3

991 642)

1 152 117)

1 338 218)

1 342 681)

1 229 889)

Superannuation4

6 336 520)

6 263 508)

6 343 275)

6 410 479)

6 463 611)

Other liabilities5

216 319)

256 984)

264 943)

271 855)

278 767)

Total liabilities

7 559 258)

7 686 003)

7 959 604)

8 037 926)

7 984 968)

 

 

 

 

 

 

Net assets (liabilities)

(991 711)

275 773)

61 820)

81 628)

217 573)

 

 

 

 

 

 

Equity

 

 

 

 

 

Reserves

22 384)

22 384)

22 384)

22 384)

22 384)

Accumulated funds

(1 014 095)

253 389)

39 436)

59 244)

195 189)

Total equity

(991 711)

275 773)

61 820)

81 628)

217 573)

 

 

 

 

 

 

Notes:

1.   Equity investments represents the Government's equity interest in government businesses measured as the consolidated value of their net assets.

2.   The movement in Other financial assets represents the estimated movement of deferred tax assets and liabilities held by government businesses.

3.   Interest bearing liabilities as at 30 June 2018 consists of Australian Government borrowings of $165.5 million incurred under various Commonwealth-State Housing Agreements, estimated end of year borrowings of $499.1 million through Tascorp and deposits of $487.5 million held on behalf of agencies in the Special Deposits and Trust Fund.

4.   The decrease in the Superannuation liability reflects the most recent actuarial estimates of the liability. Further information on Superannuation is included in chapter 7 of The Budget Budget Paper No 1.

5.   Other liabilities is principally comprised of the Tasmanian Risk Management Fund's liabilities. Further information on the TRMF is included in chapter 7 of The Budget Budget Paper No 1.

Table 3.10: Statement of Cash Flows - Administered

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

Cash inflows

 

 

 

 

 

Appropriation receipts - recurrent

539 730)

599 360)

599 305)

612 152)

621 862)

Appropriation receipts - capital

....)

27 718)

18 170)

15 000)

15 000)

Grants

3 161 796)

3 259 251)

3 237 972)

3 230 231)

3 234 226)

Taxation

943 229)

1 022 300)

1 035 618)

1 058 288)

1 079 780)

Sales of goods and services

87 706)

90 362)

97 169)

99 560)

100 339)

GST receipts

13 500)

13 500)

13 500)

13 500)

13 500)

Interest received

18 695)

21 298)

18 849)

17 684)

19 277)

Dividends received

234 243)

372 420)

288 569)

338 653)

380 749)

Other cash receipts

101 782)

109 723)

106 430)

106 430)

106 430)

Total cash inflows

5 100 681)

5 515 932)

5 415 582)

5 491 498)

5 571 163)

 

 

 

 

 

 

Cash outflows

 

 

 

 

 

Superannuation

(268 534)

(283 296)

(294 048)

(305 473)

(317 493)

Borrowing costs

(10 204)

(9 486)

(9 194)

(9 389)

(9 557)

GST payments

(13 500)

(13 500)

(13 500)

(13 500)

(13 500)

Grants and subsidies

(544 598)

(527 540)

(442 507)

(296 853)

(256 013)

Transfers to the Consolidated Fund

(4 169 634)

(4 654 131)

(4 718 563)

(4 719 787)

(4 712 889)

Supplies and consumables

(111 989)

(136 664)

(112 284)

(110 487)

(114 289)

Total cash outflows

(5 118 459)

(5 624 617)

(5 590 096)

(5 455 489)

(5 423 741)

 

 

 

 

 

 

Net cash from (used by) operating activities

(17 778)

(108 685)

(174 514)

36 009)

147 422)

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Payments for acquisition of non-financial assets

(50 637)

(58 938)

(48 298)

(44 262)

(44 683)

Proceeds from the disposal of non-financial assets

13 893)

16 251)

15 997)

16 368)

16 485)

Equity injections and cash flows from restructuring

(58 550)

(54 779)

(50 371)

(4 500)

....)

Net advances paid

8 112)

8 642)

8 749)

8 512)

8 617)

Net cash from (used by) investing activities

(87 182)

(88 824)

(73 923)

(23 882)

(19 581)

 

 

 

 

 

 


 

Table 3.10: Statement of Cash Flows - Administered (continued)

 

2016-17)

 

Budget)

2017-18)

 

Budget)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

2020-21)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

Net borrowings

(55 394)

124 970)

186 101)

4 463)

(112 792)

Net cash from (used by) financing activities

(55 394)

124 970)

186 101)

4 463)

(112 792)

Net increase (decrease) in cash and cash equivalents held

(160 354)

(72 539)

(62 336)

16 590)

15 049)

 

 

 

 

 

 

Cash and deposits at the beginning of the reporting period

1 032 521)

1 166 936)

1 094 397)

1 032 061)

1 048 651)

Cash and deposits at the end of the reporting period

872 167)

1 094 397)

1 032 061)

1 048 651)

1 063 700)