Appendix 4 Budget Presentation and Accounting Issues

This Appendix provides a summary of presentation and accounting issues that have been taken into account in the preparation of the 2016‑17 Budget Papers. These are:

       agency restructures; and

       the timing of Australian Government 2016‑17 Budget Estimates.

This Appendix also provides information on Budget Paper assumptions, conventions and the structure of the Tasmanian public sector. Specific issues relating to the presentation of agency information are detailed in chapter 1 of Government Services Budget Paper No 2.

Agency Restructures

The following changes have been reflected in the 2016‑17 Budget, and are effective from 1 July 2016. Consistent with the practice that has been adopted in prior years, the comparative financial information for restructured agencies for 2015‑16 is provided on the basis of the new agency structure.

Department of Justice

       Output 4.3 Supervision of Poppy and Hemp Crops within the Department of Justice has been transferred to Output 2.3 Supervision of Poppy and Hemp Crops within the Department of Primary Industries, Parks, Water and Environment in accordance with reforms to the regulation of the Poppy industry. Responsibility for the Poppy Advisory and Control Board has been transferred from the Attorney-General and Minister for Justice to the Minister for Primary Industries and Water.

       As at 1 November 2015 the Crown's civil litigation functions were transferred from the Office of the Director of Public Prosecutions to the Office of the Solicitor-General within the Department of Justice. It is noted that while the transfer of functions commenced on 1 November 2015, the Budget transfer takes place from 1 July 2016.

       The former Output 1.7 Anti-Discrimination Commissioner has been renamed Equal Opportunity Tasmania.


 

       A new Output 4.3 Planning Policy and Reform has been created within the Department. This Output has been created to separate the planning policy functions from statutory assessment functions. Statutory functions remain with Output 4.1 Tasmanian Planning Commission, and policy functions will be undertaken by the new Output 4.3 Planning and Policy Reform.

       The addition of the Building and Construction Portfolio to the Department of Justice has resulted in the transfer of some Outputs between portfolios. Output 1.10 Workers Rehabilitation and Compensation Tribunal, Output 3.5 Building and Occupational Licensing Services and Output 4.1 WorkSafe Tasmania have been transferred from the Treasurer to the Minister for Building and Construction. Output 3.4 Consumer Services has been transferred from the Attorney-General and Minister for Justice to the Minister for Building and Construction.

Department of Primary Industries, Parks, Water and Environment

       The former Output Group 5 Policy has been consolidated into the Department's corporate overhead cost pool which is spread across all of the Department's outputs. The 2015‑16 Budget estimate will be reported as Output Group 9 for the 2016-17 Budget in order to report the 2015-16 Budget allocation.

       The former Output Group 9 Racing Regulation and Policy becomes Output Group 5 but otherwise remains unchanged.

       The Poppy Advisory and Control Board was transferred from the Department of Justice to the Department of Primary Industries, Parks, Water and Environment and has become Output 2.3 Supervision of Poppy and Hemp Crops within Output Group 2 Primary Industries.

Australian Government 2016‑17 Budget Estimates

Estimates presented in this Budget Paper were required to be finalised prior to the release of the Australian Government's 2016‑17 Budget on 3 May 2016. As a result, estimates of Specific Purpose Payments and some National Partnership Payments (or data based on these estimates) may differ from those published in the Australian Government's 2016‑17 Budget. Some other jurisdictions have timed the presentation of their annual Budget to be able to better take into account Australian Government Budget data in the Budget estimates that are presented to parliament. Any changes between Australian Government Budget data and that used within original Budget estimates will be reflected in the data presented in the annual Revised Estimates Report.

 


 

Assumptions Underlying the 2016-17 Budget and Forward Estimates

Revenue

Revenue estimates are prepared on the basis of a number of assumptions and use information provided to the Department of Treasury and Finance (Treasury) by various entities, including the Australian Government, government agencies, Government Business Enterprises and State‑owned Companies. The 2016‑17 Budget and Forward Estimates for revenue are prepared on the following basis:

       Grants are based on agreements with the Australian Government. It is assumed that, unless otherwise stated, Specific Purpose Payments will be indexed as advised by the Australian Government;

       all General Purpose Payments, including GST revenue, received from the Australian Government can be used at the State's discretion;

       Taxation revenue for the Forward Estimates utilises economic forecasts prepared by Treasury. Taxation estimates reflect changes in tax policy up to and including any changes announced in the Budget;

       Interest income is estimated by Treasury and reflects anticipated cash holdings within the Public Account and forecast interest rates; and

       Sales of goods and services; Fines, Fees and charges; and Other revenue are based on the best estimates of those agencies which provide the goods or services, or which actively manage the particular revenue item.

Expenses

The 2016‑17 Budget and Forward Estimates for expenses are prepared on the following basis:

       projections over the Forward Estimates reflect the level and timing of expenditure anticipated by agencies;

       borrowing costs are estimated by Treasury and reflect anticipated borrowings within the Public Account and forecast interest rates;

       the Forward Estimates are premised on the provision of future public sector wage outcomes of a maximum of two per cent per annum reflecting the total cost of salary increases, allowances and any other employment conditions for all industrial agreements;

       indexation of general operating expenses is provided at 2.5 per cent over the Forward Estimates period;

       funding provided to the Department of Health and Human Services for medical and pharmaceutical supplies is indexed at a rate of 4 per cent per annum; and

       agencies are fully funded for expected changes in Administered Items.


 

Actual Outcomes

Actual revenue and expenditure can, for a wide range of reasons, vary from original Budget estimates. Information on actual revenue and expenditure is provided in the Preliminary Outcomes Report, the Treasurer's Annual Financial Report, Agency Annual Reports and Quarterly Reports published during the Budget year. A revised estimates report is required to be published by the 15 February each year which includes updated estimates for the Budget and Forward Estimates period.

Budget Paper Conventions

The information provided in the Budget Papers has been prepared taking into account the following conventions.

       Figures in tables and in the text have been rounded. Discrepancies in tables between totals and sums of component items reflect rounding. Percentage changes in all tables are based on the underlying unrounded amounts.

       The notation used in the Budget Papers is as follows:

na

not available, or not applicable

.

zero, or rounded to zero

$'000

$ thousand

$m

$ million

Classification of the Tasmanian Public Sector

The Tasmanian Public Sector comprises several different types of entities. These are classified according to the sectors comprising the Uniform Presentation Framework, namely General Government, Public Non‑Financial Corporations (PNFC) or Public Financial Corporations (PFC) Sectors.

The General Government Sector (GGS) comprises those agencies of government, where the primary function is to provide public services. These services are mainly non-market in nature, for the collective consumption of the community, or involve the transfer or redistribution of income. GGS services are financed mainly through taxes and other compulsory levies. This Sector includes government departments and a number of entities that operate outside the Public Account including the Inland Fisheries Service, Marine and Safety Tasmania, the Royal Tasmanian Botanical Gardens and the State Fire Commission.

The PNFC Sector comprises entities that cover the majority of their expenses from revenue from the sales of goods and services and which are mainly market, non-regulatory and non-financial in nature. This Sector includes the State-owned Companies and Government Business Enterprises. These entities have a variety of functions and responsibilities, are established in varying ways and also have different relationships with the Budget.

The PFC Sector comprises two organisations in Tasmania, the Tasmanian Public Finance Corporation and the Motor Accidents Insurance Board. These entities perform central bank functions or have the authority to incur financial liabilities and acquire financial assets in the market on their own account.

The following provides a breakdown of the Tasmanian Public Sector entities by sector.

General Government Sector

Department of Education

Department of Health and Human Services

Department of Justice

Department of Police, Fire and Emergency Management

Department of Premier and Cabinet (including Ministerial and Parliamentary Support)

Department of Primary Industries, Parks, Water and Environment

Department of State Growth

Department of Treasury and Finance (including Finance-General)

House of Assembly

Inland Fisheries Service

Integrity Commission

Legislative Council

Legislature-General

Marine and Safety Tasmania

Office of the Director of Public Prosecutions

Office of the Governor

Office of the Ombudsman

Royal Tasmanian Botanical Gardens

State Fire Commission

Tasmanian Audit Office

Tasmanian Health Service

TasTAFE

Tourism Tasmania


 

Public Non-Financial Corporations Sector

Aurora Energy Pty Ltd

Forestry Tasmania

Hydro Tasmania

Macquarie Point Development Corporation

Metro Tasmania Pty Ltd

Port Arthur Historic Site Management Authority

Private Forests Tasmania

Public Trustee

Tasmanian Irrigation Pty Ltd

Tasmanian Ports Corporation Pty Ltd

Tasmanian Railway Pty Ltd

Tasmanian Networks Pty Ltd

Tasracing Pty Ltd

TT-Line Company Pty Ltd

Public Financial Corporations Sector

Motor Accidents Insurance Board

Tasmanian Public Finance Corporation