Asset management, risk and pricing policies

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Asset management

Treasury performs the duties of building owner for the Government office accommodation portfolio through the Statutory Maintenance and Office Works Program.

This program provides funding to enable the necessary maintenance activities required by the Building Code of Australia, and through other legislation such as the Workplace Health and Safety Act 1995 and the Building Act 2000. Existing statutory maintenance contracts provide for routine and remedial maintenance and security on the Government office portfolio managed by Treasury.

The Office Works Program represents a funding allocation for consultancy investigations and landlord works for the buildings within the Government office portfolio managed by Treasury. Projects completed during 2008–09, or which are continuing under this Program include:

Franklin Square Offices, Hobart – carpet replacement, painting and minor works	$160 000
10 Murray Street, Hobart – concrete corrosion	$90 000
34 Davey Street, Hobart - kitchen and bathroom amenities upgrade	$80 000
St John Street Public Buildings, Launceston - roof reticulation and roof access upgrades	$90 000

Given the Government’s policy to divest most of its office portfolio, careful consideration is given to each new project to ensure that overcapitalisation does not occur. The majority of works are those considered essential in accordance with the Building Code of Australia, Occupational Health, Safety and Welfare requirements or tenant leasing commitments; or value-adding works and works to maintain the integrity of a building’s fabric until sale.

The financial statements for 2008–09 contain full details of the Department’s asset management policies as notes to the statements. Departmental assets are valued in accordance with the Department’s accounting policies and procedures. These values are disclosed in the statements, together with appropriate notes on valuation methods. Details of Treasury’s assets are recorded in the asset module of the Department’s finance system. This provides a direct link between the Department’s asset register and the general ledger, thus enhancing financial reporting.

Risk policy

Risk management involves identifying those factors that may impact on the Department’s ability to achieve its objectives and setting in place the strategies that will help to manage those factors. The Department’s Audit and Risk Management Committee has responsibility for the oversight of risk management within Treasury. A business-risk review completed in 2006 and updated in 2009, provides the framework for Treasury’s internal audit program and for the identification of risk-mitigation activities by business units. A key component of managing risk is comprehensive disaster recovery and business continuity planning. An overarching business continuity strategy and recovery plan, developed in 2006–07, complements the comprehensive information system disaster recovery and business continuity plan maintained since 2003.

The Tasmanian Risk Management Fund is the Tasmanian Government’s self-insurance fund. It was established on 1 January 1999 to provide a whole-of-government approach to funding and managing the specific identified insurable risks of inner-Budget agencies. The Department of Treasury and Finance is responsible for the management of the fund, chairs the Risk Management Fund Steering Committee and reports to the Treasurer on policy issues. The services of a Fund Administration Agent are retained on a contract basis for claims administration, provision of advice in relation to claims management and for the placement of insurance as required.

Pricing policy

Treasury has some limited activities for which the pricing of goods and services is required. In accordance with the Government’s policy on fees and charges, the Department’s normal practice is to adopt a model based on full cost-recovery.

The Department levies fees and charges in accordance with the provisions of ten Acts:

Liquor Licensing Act 1990

Gaming Control Act 1993

Duties Act 2001

Land Tax Act 2000

Retirement Benefits Act 1993

Electricity Supply Industry Act 1995

Government Prices Oversight Act 1995

Gas Act 2000

Gas Pipelines Act 2000

Water and Sewerage Industry Act 2008

Treasury maintains a Fees and Charges Manual that provides information on the fees and charges for which the Department is responsible. Fees and charges are reviewed regularly and most are exempt from GST, in accordance with A New Tax System (Goods and Services Tax) (Exempt Taxes, Fees and Charges) Determination 2001 (No. 4).

Those fees and charges that are subject to the Fee Units Act 1997 were revised and gazetted in accordance with the provisions of that legislation on 31 March 2009.