3    Finance‑General

Agency Outline

The Finance‑General Division is administered by the Department of Treasury and Finance. Expenditure through Finance‑General generally reflects whole‑of‑government activities.

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.

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

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Treasurer

 

 

 

 

 

 

 

 

 

 

 

Output Group 1 - Debt Servicing and Management

 

 

 

 

 

1.1  Debt Servicing

  30)

  25)

  112)

  127)

  43)

1.2  Interest on Sundry Deposits

 1 695)

 1 944)

 2 762)

 3 160)

 2 688)

1.3  Debt Management

 8 390)

 8 062)

 7 727)

 7 384)

 7 033)

 

 10 115)

 10 031)

 10 601)

 10 671)

 9 764)

Output Group 2 - Employee Related Costs

 

 

 

 

 

2.1  Superannuation and Pensions1

 390 046)

 398 244)

 397 663)

 396 799)

 395 342)

 

 390 046)

 398 244)

 397 663)

 396 799)

 395 342)

Output Group 3 - Government Businesses

 

 

 

 

 

3.1  Forestry Tasmania

 6 000)

 6 000)

 6 000)

 6 000)

 6 000)

3.2  State Fire Commission

 2 836)

 2 836)

 2 836)

 2 836)

 2 836)

3.4  Government Businesses2

 1 824)

 1 814)

 1 504)

 1 493)

 1 493)

 

 10 660)

 10 650)

 10 340)

 10 329)

 10 329)

Output Group 4 - Miscellaneous

 

 

 

 

 

4.2  Treasurer's Reserve

 10 000)

 10 000)

 10 000)

 10 000)

 10 000)

4.3  Miscellaneous3

 23 272)

 9 647)

 18 897)

 17 427)

 17 427)

4.4  Payment to Australian Tax Office: GST   Administration4

 14 854)

 14 350)

 12 525)

 12 137)

 12 137)

4.5  Tasmanian Risk Management Fund

 60 141)

 56 338)

 58 653)

 61 201)

 63 880)

4.6  Fleet Management Services

 14 972)

 15 473)

 15 671)

 15 888)

 15 716)

4.7  Property Management Services5

 22 308)

 26 700)

 27 245)

 28 294)

 28 822)

4.8  Infrastructure Investment Project Planning

 2 000)

 2 000)

 2 000)

 2 000)

 2 000)

 

 147 547)

 134 508)

 144 991)

 146 947)

 149 982)

 

 

 

 

 

 

Grants and Subsidies

 488 671)

 509 394)

 360 014)

 252 191)

 172 978)

 

 

 

 

 

 

Special Capital Investment Funds6

 32 739)

 18 470)

 9 949)

 1 278)

  970)

 

 

 

 

 

 

TOTAL

1 079 778)

1 081 297)

 933 558)

 818 215)

 739 365)

 

 

 

 

 

 

Notes:

1.   The increase in Superannuation and Pensions in 2016-17 reflects a revised actuarial estimate of expenditure. The decreases from 2016-17 reflect service cost changes due to estimated reductions in membership of the defined benefit scheme.

2.   The decrease in Government Businesses from 2017-18 reflects the finalisation of enterprise suitability funding provided to Tasmanian Irrigation Pty Ltd.

3.   The decrease in Miscellaneous in 2016-17 is primarily related to a decreased provision for duties related ex gratia payments for corporate reconstructions. The increase from 2017-18 reflects revised cash flow forecasts for the Mobile Radio Network upgrade.

4.   The decrease in Payment to Australian Tax Office: GST Administration from 2017-18 reflects the latest estimates based upon the Australian Government's projections contained within the Mid-Year Economic and Fiscal Outlook.

5.   The increase in Property Management Services is primarily due to estimated amortisation of capitalised fit-out as a result of occupancy of parliament square from December 2016 and the inclusion of revised outgoings expenditure associated with parliament square.

6.   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 $8.1 million in 2016-17 ($8.4 million in 2015-16) represents interest payments to the Australian Government on debt incurred under various Commonwealth‑State Housing Agreements.

Principal repayments by Housing Tasmania of $7.6 million in 2016-17 ($7.5 million in 2015-16) 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 2016-17, superannuation and pension expenses are estimated to total $398.2 million, an anticipated increase of $8.2 million in comparison with the budgeted cost in 2015-16 of $390 million. The 2016-17 estimate includes service costs of $110.3 million ($104.4 million in 2015-16) and nominal interest of $287.9 million ($285.6 million in 2015-16). The estimated value of the expense is based on the most recent actuarial assessment of the superannuation liability.

The estimated superannuation liability as at 30 June 2017 is $6 336.5 million (excluding the estimated Housing Tasmania pre‑July 1994 superannuation liability of $10.9 million as at 30 June 2017, the estimated Tasmanian Ambulance Services Superannuation Scheme liability of negative $2.7 million as at 30 June 2017 and the estimated State Fire Commission superannuation liability of $730 000 as at 30 June 2017). This is an increase of $869 million from the 2015‑16 estimate of the liability as at 30 June 2016 of $5 467.5 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 2016‑17 Budget provides funding of $4 million in 2016‑17 ($4 million in 2015‑16) and subsequent years for Forestry Tasmania to deliver its community service obligations related to roads, public recreation sites, forest education activities, non-commercial tourism, special species timber and the Warra Long Term Ecological Research site.

In addition, a Budget provision of $2 million has been made in 2016‑17 ($2 million in 2015‑16) 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 2016‑17 and subsequent years ($2.8 million in 2015-16). 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 Government Services Budget Paper No 2 Volume 2.

3.4 Government Businesses

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

Tasracing Pty Ltd

An amount of $1.5 million is being provided in 2016-17 ($1.5 million in 2015-16) 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.

Tasmanian Irrigation Pty Ltd - Transition Readiness

A key role for Tasmanian Irrigation Pty Ltd going forward involves maximising the extra value that the irrigation schemes are capable of delivering and transitioning to a sustainable business model that provides an effective service to its customers and community stakeholders. To assist Tasmanian Irrigation transition into a value‑adding and sustainable business, the Government has provided $300 000 in 2016‑17 ($300 000 in 2015-16).


 

Output Group 4:  Miscellaneous

4.2 Treasurer's Reserve

An amount of $10 million has been provided in the Treasurer's Reserve in 2016-17 ($10 million in 2015-16) to meet expenditure that could not reasonably be foreseen at the time of developing the 2016-17 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, a provision for duty related ex gratia payments where there are corporate reconstruction transactions that do not result in a change of ownership and government business enterprise reviews.

Mobile Radio Network

An amount of $5.3 million is provided 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. This represents an increase of $3.3 million from 2015-16, as a result of revised cash flows for the project.

Government Business Reviews and Energy Security Taskforce

Funding of $1.5 million has been provided in 2016-17 and 2017-18 to provide for costs relating to Government business reviews including the continuing reviews into Forestry Tasmania and the Retirement Benefits Fund and to fund the establishment of the Energy Security Taskforce to review energy security arrangements in Tasmania. Further information on the Energy Security Taskforce can be found in 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 2016-17 is estimated at $14.4 million ($14.9 million in 2015-16).

4.5 Tasmanian Risk Management Fund

The estimated expenses of $56.3 million in 2016-17 ($60.1 million in 2015-16) represent anticipated administration and claims costs. Expenditure estimates for the Fund reflect the most recent actuarial advice. The decrease in 2016-17 expenditure estimates since the 2015-16 Budget primarily reflects a lower reinsurance expense based on the prior year actual outcome and a reduction in property claims estimates.


 

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 2016-17 of $15.5 million ($15 million in 2015-16) include motor vehicle registration expenses of $1.1 million ($1.1 million in 2015‑16) and estimated depreciation on motor vehicles of $14.4 million ($13.9 million in 2015‑16).

Consistent with the Government's commitment to reducing costs, fleet numbers have continued to decline. Government fleet cost saving strategies implemented by agencies have resulted in a continued reduction of the fleet size to 2 354 vehicles as at 31 March 2016, compared to 2 389 vehicles as at 31 March 2015 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 $26.7 million in 2016-17 ($22.3 million in 2015-16). As a result of the occupancy of parliament square from December 2016, depreciation will increase to $2.4 million ($544 000 in 2015-16) due to the amortisation of fit-out, while rental and other occupancy costs have been revised to $3.8 million ($1.5 million in 2015-16).

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 commenced the second stage of centralised property management with a review of 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 2016‑17 ($2 million in 2015-16) and subsequent years for the early planning stages of major infrastructure projects as part of Structured Infrastructure Investment Review Process.


 

Special Capital Investment Funds

Within Finance‑General, funds are held for investment in economic and social infrastructure. This section provides a description of the funds, the balance of each Fund and the projects to be funded in 2016‑17 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.

Given the significant period of time since the establishment of the funds, and the small quantity of funding remaining in some funds, Treasury will consider the closure of the remaining funds during 2016‑17.

Hospitals Capital Fund

The Hospitals Capital Fund was established in 2007‑08 to provide capital funding for hospitals across the State. In 2016‑17, a total amount of $1.4 million has been allocated for Mersey Hospital Upgrades. It is expected that the Fund will be fully expended in 2016‑17.

Table 3.2:          Hospitals Capital Fund

 

Estimated

Total

Cost

2016‑17

 

Budget

2017‑18

Forward

Estimate

2018‑19

Forward

Estimate

2019‑20

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

1 397

....

....

....

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

1 397

....

....

....

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Health

 

 

 

 

 

Mersey Hospital Upgrades

1 900

1 397

....

....

....

TOTAL OUTFLOWS

)

1 397

....

....

....

 

 

 

 

 

 

Closing Balance

)

....

....

....

....

 

 

 

 

 

 

 


 

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 2016‑17, it is anticipated that $3.3 million will be expended from the Housing Fund on public housing projects.

Further detail on Housing Fund expenditure in 2016‑17 and Tasmania's Affordable Housing Strategy 2015‑2025 is provided in chapter 4 of this Budget Paper.

Table 3.3:          Housing Fund

 

Estimated

Total

Cost

2016‑17

 

Budget

2017‑18

Forward

Estimate

2018‑19

Forward

Estimate

2019‑20

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

7 290

3 947

2 711

1 433

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

7 290

3 947

2 711

1 433

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Human Services

 

 

 

 

 

Housing Fund

60 000

3 343

1 236

1 278

970

TOTAL OUTFLOWS

 

3 343

1 236

1 278

970

 

 

 

 

 

 

Closing Balance

)

3 947

2 711

1 433

463

 

 

 

 

 

 

 


 

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 2016‑17 are provided in chapter 4 of this Budget Paper.

Table 3.4:          Infrastructure Tasmania Fund

 

Estimated

Total

Cost

2016‑17

 

Budget

2017‑18

Forward

Estimate

2018‑19

Forward

Estimate

2019‑20

Forward

Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Balance Brought Forward

 

23 036

9 306

593

593

 

 

 

 

 

 

TOTAL SOURCE OF FUNDS

 

23 036

9 306

593

593

 

 

 

 

 

 

OUTFLOWS

 

 

 

 

 

Department of Health and Human Services

 

 

 

 

 

Minister for Health

 

 

 

 

 

Health Infrastructure

67 410

13 730

8 713

....

....

TOTAL OUTFLOWS

 

13 730

8 713

....

....

 

 

 

 

 

 

Closing Balance1

)

9 306

593

593

593

 

 

 

 

 

 

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.

Infrastructure Tasmania Fund Projects

In 2016-17, Health Infrastructure expenditure of $13.7 million for infrastructure upgrades will include:

·       Glenorchy - Tier Three Community Health Services Facility ($10 million); and

·       Kingston - Tier Three Community Health Services Facility ($3.8 million).

 

 


 

Detailed Budget Statements

Table 3.5:          Statement of Comprehensive Income - Administered

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Revenue and other income from transactions

 

 

 

 

 

Appropriation revenue ‑ recurrent1

 527 016)

 539 730)

 527 341)

 535 651)

 544 639)

Grants2

3 017 224)

3 161 796)

3 056 324)

3 071 290)

3 077 528)

Taxation3

 927 172)

 951 018)

 967 131)

 994 192)

1 021 844)

Sales of goods and services

 89 993)

 87 706)

 89 599)

 93 013)

 95 636)

Interest

 17 934)

 18 555)

 18 672)

 15 254)

 14 474)

Dividend, tax and rate equivalent income4

 213 402)

 263 751)

 261 478)

 191 150)

 182 242)

Other revenue

 107 583)

 101 782)

 103 082)

 106 430)

 106 430)

Total revenue and other income from transactions

4 900 324)

5 124 338)

5 023 627)

5 006 980)

5 042 793)

 

 

 

 

 

 

Expenses from transactions

 

 

 

 

 

Employee benefits5

 390 046)

 397 779)

 397 463)

 396 599)

 395 142)

Depreciation and amortisation

 14 343)

 16 730)

 18 145)

 18 348)

 18 177)

Supplies and consumables

 110 864)

 111 989)

 110 578)

 112 304)

 115 514)

Grants and subsidies6

 554 215)

 544 598)

 396 601)

 280 093)

 200 568)

Borrowing costs

 10 310)

 10 201)

 10 771)

 10 871)

 9 964)

Transfers to the Consolidated Fund

3 969 497)

4 169 634)

4 301 697)

4 368 088)

4 284 772)

Total expenses from transactions

5 049 275)

5 250 931)

5 235 255)

5 186 303)

5 024 137)

 

 

 

 

 

 

Net result from transactions (net operating balance)

(148 951)

(126 593)

(211 628)

(179 323)

 18 656)

 

 

 

 

 

 

Other economic flows included in net result

 

 

 

 

 

Net gain/(loss) on non-financial assets

....)

(1)

(1)

....)

....)

Movement in investments in GBEs and SOCs7

 58 945)

 19 497)

(52 206)

(14 096)

 81 176)

Other gains/(losses) from other economic flows8

(29 282)

(15 659)

 9 407)

(1 352)

(6 641)

Total other economic flows included in net result

 29 663)

 3 837)

(42 800)

(15 448)

 74 535)

 

 

 

 

 

 

Net result

(119 288)

(122 756)

(254 428)

(194 771)

 93 191)


 

Table 3.5:            Statement of Comprehensive Income - Administered (continued)

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

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

(119 290)

(122 758)

(254 430)

(194 773)

 93 189)

 

 

 

 

 

 

Notes:

1.   Explanations for significant variances can be found in Table 3.6 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 increase in Employee benefits is based upon the latest actuarial estimate of superannuation expenditure.

6.   The variation in Grants and subsidies from 2016-17 to 2017-18 reflects the timing of receipt of road infrastructure funding from the Australian Government. The variation from 2018-19 reflects the finalisation in 2017-18 of Australian Government Funding for the redevelopment of the Royal Hobart Hospital.

7.   Movement in investment 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.

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

 


 

Table 3.6:          Revenue from Appropriation by Output

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Treasurer

 

 

 

 

 

 

 

 

 

 

 

Output Group 1 - Debt Servicing and Management

 

 

 

 

 

1.1  Debt Servicing

  34)

  25)

  25)

  112)

  128)

1.2  Interest on Sundry Deposits

 6 361)

 6 645)

 9 108)

 9 921)

 9 019)

 

 6 395)

 6 670)

 9 133)

 10 033)

 9 147)

Output Group 2 - Employee Related Costs

 

 

 

 

 

2.1  Superannuation and Pensions1

  241)

  706)

  441)

  441)

  441)

2.3  Provision for 27th Pay

 6 707)

 6 707)

 6 707)

 6 707)

 6 707)

 

 6 948)

 7 413)

 7 148)

 7 148)

 7 148)

Output Group 3 - Government Businesses

 

 

 

 

 

3.1  Forestry Tasmania

 6 000)

 6 000)

 6 000)

 6 000)

 6 000)

3.2  State Fire Commission

 2 836)

 2 836)

 2 836)

 2 836)

 2 836)

3.4  Government Businesses2

 17 824)

 21 314)

 13 504)

 13 493)

 5 993)

 

 26 660)

 30 150)

 22 340)

 22 329)

 14 829)

Output Group 4 - Miscellaneous

 

 

 

 

 

4.3  Miscellaneous3

 23 272)

 9 647)

 18 897)

 17 427)

 17 427)

4.4  Payment to Australian Tax Office: GST  Administration

 14 854)

 14 350)

 12 525)

 12 137)

 12 137)

4.7  Property Management Services4

 16 164)

 33 001)

 9 659)

 8 528)

 8 447)

4.8  Infrastructure Investment Project Planning

 2 000)

 2 000)

 2 000)

 2 000)

 2 000)

 

 56 290)

 58 998)

 43 081)

 40 092)

 40 011)

 

 

 

 

 

 

Grants and Subsidies5

 147 003)

 141 470)

 137 584)

 134 008)

 138 518)

 

 

 

 

 

 

Finance-General

 

 

 

 

 

Total Recurrent Services

 243 296)

 244 701)

 219 286)

 213 610)

 209 653)

 

 243 296)

 244 701)

 219 286)

 213 610)

 209 653)

 


 

Table 3.6:          Revenue from Appropriation by Output (continued)

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

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

 16 488)

 16 736)

 17 166)

 17 607)

 18 060)

Payments under the Retirement Benefits (Parliamentary Superannuation) Regulations 2012

 1 276)

 1 070)

 1 050)

 1 025)

 1 018)

Superannuation Benefits Payable under the Governor of Tasmania Act 1982

  126)

  115)

  118)

  120)

  122)

Superannuation Benefits Payable under the Judges' Contributory Pensions Act 1968

 2 136)

 2 134)

 2 181)

 2 221)

 2 258)

Superannuation Benefits Payable under the Retirements Benefits Act 1993

 253 443)

 264 703)

 277 263)

 290 785)

 303 241)

Superannuation Benefits Payable under the Solicitor‑General Act 1983

  251)

  271)

  277)

  283)

  287)

 

 283 720)

 295 029)

 308 055)

 322 041)

 334 986)

 

 

 

 

 

 

Total Revenue from Appropriation

 527 016)

 539 730)

 527 341)

 535 651)

 544 639)

 

 

 

 

 

 

Administered Revenue from Appropriation

 527 016)

 539 730)

 527 341)

 535 651)

 544 639)

 

 527 016)

 539 730)

 527 341)

 535 651)

 544 639)

 

 

 

 

 

 

Notes:

1.   The increase in Superannuation and Pensions in 2016-17 reflects a carry forward of $265 000 from 2015-16 to 2016‑17 for costs associated with the reform of public sector superannuation in Tasmania.

2.   The increase in the Government Businesses Output for 2016-17 reflects additional equity funding of $4.5 million for four years provided to Metro Tasmania Pty Ltd to implement the Metro Bus Fleet Initiative. Further information on this initiative can be found in chapter 10 of this Budget Paper. The decrease from 2017-18 is due to the ceasing of equity funding provided to the Tasmanian Ports Corporation Pty Ltd in the 2014-15 Budget for essential remedial works on port infrastructure.

3.   The decrease in Miscellaneous in 2016-17 is primarily related to a reduction in duties related ex gratia payments for corporate reconstructions. The increase from 2017-18 reflects revised cash flow forecasts for the Mobile Radio Network upgrade.

4.   The increase in 2016-17 for the Property Management Services Output is primarily related to fit-out costs for parliament square, as the project moves from the construction to fit-out stage. The fit-out of parliament square is expected to be completed by early 2017.

5.   The decrease in the Grants and Subsidies Output in 2016-17 is due to the finalisation of headworks support to TasWater Pty Ltd.

 


 

Table 3.7:          Administered Expenses

 

2015-16]

)

Budget)

2016-17]

)

Budget)

2017-18] 

Forward)

Estimate)

2018-19]

Forward)

Estimate)

2019-20]

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Grants and Subsidies

 

 

 

 

 

TT-Line Pensioner Concession Subsidy1

  475)

  230)

  250)

  270)

  290)

Energy Retailer Concession2

 37 196)

 39 364)

 40 858)

 42 409)

 44 020)

First Home Builder Assistance3

 11 300)

 11 300)

 6 840)

 3 720)

 3 720)

Local Government: Grants

 71 666)

 71 298)

 73 845)

 76 447)

 79 153)

Management of Australian Government Funding4

 313 582)

 341 735)

 205 234)

 100 544)

 16 366)

Natural Disaster Relief Scheme

 1 138)

 1 000)

  532)

  532)

  532)

Other Grants and Subsidies

....)

  529)

  30)

  32)

  34)

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

 16 488)

 16 736)

 17 166)

 17 607)

 18 060)

Payroll Tax Assistance5

 4 300)

 1 685)

 1 000)

 1 000)

 1 000)

Tasmanian Forestry Agreement6

 18 398)

 16 225)

 4 800)

....)

....)

Water and Sewerage Concessions and Subsidies7

 14 128)

 9 292)

 9 459)

 9 630)

 9 803)

 

 488 671)

 509 394)

 360 014)

 252 191)

 172 978)

 

 

 

 

 

 

Transfers to the Consolidated Fund

3 969 497)

4 169 634)

4 301 697)

4 368 088)

4 284 772)

 

 

 

 

 

 

Other Administered Expenses

 591 107)

 571 903)

 573 544)

 566 024)

 566 387)

 

 

 

 

 

 

Total Administered Expenses

5 049 275)

5 250 931)

5 235 255)

5 186 303)

5 024 137)

 

 

 

 

 

 

Notes:

1.   The budget for the TT-Line Pensioner Concession Subsidy has been reduced in 2016-17 to better reflect actual expenditure in previous years.

2.   This Concession shields concession customers from increases in retail electricity prices. The increase in the cost of the concession makes an allowance for increases in electricity costs approved by the Tasmanian Economic Regulator.

3.   From 1 July 2016 to 30 June 2017 the Government has increased the First Home Owner Grant from $10 000 to $20 000. The reduction in expenditure from 2017-18 reflects the winding down of previous schemes and a lower number of claims made against previous schemes.

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. The variation from 2016-17 to 2017-18 reflects the timing of receipt of road infrastructure funding from the Australian Government. The movement from 2018‑19 reflects the finalisation of Australian Government Funding for the redevelopment of the Royal Hobart Hospital.

5.   The decrease in Payroll Tax Assistance from 2016-17 is due to the Employee Incentive Payroll Tax Rebate ceasing on 30 June 2016, with final payments and claims to be made by 31 December 2016.

6.   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.

7.   The decrease in Water and Sewerage Concessions and Subsidies from 2016-17 reflects the finalisation of headworks support provided in the 2014-15 Budget.


 

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. This item was previously titled Australian Government Contribution for Extension of Pensioner Concessions, as funding was provided by the Australian Government. The funding is now entirely provided by the State Government, and the new item name reflects that this is a payment from the State Government to TT-Line Company Pty Ltd. The reduction in the budget for the concession in 2016‑17 better reflects historical expenditure and no change has been made to concession arrangements to pensioners.

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 Energy Retailer Concession in comparison to the 2015-16 Budget is primarily related to increases in the Annual electricity concession. The increase in the cost of the concession makes an allowance for increases in electricity costs approved by the Tasmanian Energy Regulator. As a result of these changes compared to the 2015‑16 Budget, the Annual electricity concession increases by $1.8 million in 2016-17, $3 million in 2017-18, $4.3 million in 2018-19 and $5.9 million in 2019-20.

First Home Builder Assistance

From 1 July 2016 until 30 June 2017, the Government has increased the First Home Owner Grant from $10 000 to $20 000, which is expected to support ongoing demand for new homes by first home buyers. Arrangements will be implemented to ensure there is no disadvantage to first home builders that became eligible for the grant in the period 1 January 2016 to 30 June 2016.

Local Government Grants

Local Government Grants are comprised of two components: general purpose funding and identified local road funds. Under the Australian Local Government (Financial Assistance) Act 1995, the Australian Government provides funds to the states for on‑passing as general purpose grants to local government.

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 $1 million has been included in the 2016-17 Budget as a result of an expected increase in claims by councils as a result of the 2016 Tasmanian Bushfires ($532 000 in 2015-16), 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 Bushfire emergency.

Payments under the 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.

Jobs Package Payroll Tax Rebate

The fourth Employee Incentive Scheme Payroll Tax Rebate (EISPR4) was introduced as part of the Government's Job Creation Package in the 2014-15 Budget. EISPR4 provides a payroll tax rebate of up to two years for private sector employers who created additional eligible positions in Tasmania from 30 June 2014 to 30 June 2015. The additional positions are to be maintained until at least 30 June 2016. The final date for claims and payments is 31 December 2016.

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 Forests Agreement

The Government is continuing to administer funding committed to the Tasmanian Forests Agreement by the State and Australian Government. It includes funding committed to Forestry Tasmania under the Grant Deed Tasmanian Forests Intergovernmental Agreement ‑ State Funding to Forestry Tasmania to support rescheduled harvesting and plantation management.

The 2016-17 Budget does not include any future funding from the Australian Government.

Water and Sewerage Concessions

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


 

Table 3.8:          Statement of Financial Position as at 30 June - Administered

 

2016)

 

Budget)

2017)

 

Budget)

2018)

Forward)

Estimate)

2019)

Forward)

Estimate)

2020)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Assets

 

 

 

 

 

Financial assets

 

 

 

 

 

Cash and deposits

 877 491)

 872 167)

 757 142)

 754 086)

 752 987)

Investments

 190 016)

 178 560)

 170 289)

 161 880)

 153 369)

Receivables

 77 463)

 80 067)

 80 067)

 80 067)

 80 067)

Equity investments1

4 515 047)

4 482 849)

4 474 143)

4 500 797)

4 586 473)

Other financial assets2

 639 178)

 820 290)

 834 489)

 855 343)

 869 787)

 

6 299 195)

6 433 933)

6 316 130)

6 352 173)

6 442 683)

Non-Financial Assets

 

 

 

 

 

Assets held for sale

  820)

 1 014)

 1 014)

 1 014)

 1 014)

Property, plant and equipment3

 94 346)

 127 534)

 123 453)

 118 310)

 113 220)

Other assets4

  811)

 5 066)

 5 066)

 5 066)

 5 066)

 

 95 977)

 133 614)

 129 533)

 124 390)

 119 300)

 

 

 

 

 

 

Total Assets

6 395 172)

6 567 547)

6 445 663)

6 476 563)

6 561 983)

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Payables

 10 924)

 14 777)

 14 671)

 14 468)

 14 098)

Interest bearing liabilities5

 978 263)

 991 642)

 999 990)

1 115 983)

1 013 697)

Superannuation6

5 467 462)

6 336 520)

6 452 853)

6 554 777)

6 642 752)

Other liabilities7

 213 042)

 216 319)

 224 290)

 232 249)

 239 161)

Total Liabilities

6 669 691)

7 559 258)

7 691 804)

7 917 477)

7 909 708)

 

 

 

 

 

 

Net Assets (liabilities)

(274 519)

(991 711)

(1 246 141)

(1 440 914)

(1 347 725)

 

 

 

 

 

 

Equity

 

 

 

 

 

Reserves

 11 901)

 22 384)

 22 384)

 22 384)

 22 384)

Accumulated funds

(286 420)

(1 014 095)

(1 268 525)

(1 463 298)

(1 370 109)

Total Equity

(274 519)

(991 711)

(1 246 141)

(1 440 914)

(1 347 725)

 

 

 

 

 

 

Notes:

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

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

3.   The increase in Property, plant and equipment primarily reflects the capitalisation of leasehold improvements for the parliament square project.

4.   The increase in Other assets reflects an opening balance adjustment for prepaid rent and insurance as at 30 June 2016.

5.   Interest bearing liabilities as at 30 June 2017 consists of Australian Government borrowings of $173.3 million incurred under various Commonwealth-State Housing Agreements, estimated borrowings of $417.7 million through Tascorp and deposits of $400.6 million held on behalf of agencies in the Special Deposits and Trust Fund.

6.   The increase 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.

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

Table 3.9:          Statement of Cash Flows - Administered

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

Cash inflows

 

 

 

 

 

Appropriation receipts - recurrent

 527 016)

 539 730)

 527 341)

 535 651)

 544 639)

Grants

3 017 224)

3 161 796)

3 056 324)

3 071 290)

3 077 528)

Taxation

 927 185)

 943 229)

 966 887)

 994 014)

1 021 724)

Sales of goods and services

 89 993)

 87 706)

 89 599)

 93 013)

 95 636)

GST receipts

 13 500)

 13 500)

 13 500)

 13 500)

 13 500)

Interest received

 17 979)

 18 695)

 18 662)

 15 317)

 14 502)

Dividends received

 225 010)

 234 243)

 264 657)

 176 764)

 167 907)

Other cash receipts

 107 583)

 101 782)

 103 082)

 106 430)

 106 430)

Total cash inflows

4 925 490)

5 100 681)

5 040 052)

5 005 979)

5 041 866)

 

 

 

 

 

 

Cash outflows

 

 

 

 

 

Superannuation

(257 473)

(268 534)

(281 130)

(294 675)

(307 167)

Borrowing costs

(10 369)

(10 204)

(10 625)

(10 822)

(10 082)

GST payments

(13 500)

(13 500)

(13 500)

(13 500)

(13 500)

Grants and subsidies

(554 215)

(544 598)

(396 601)

(280 093)

(200 568)

Transfers to the Consolidated Fund

(3 969 497)

(4 169 634)

(4 301 697)

(4 368 088)

(4 284 772)

Supplies and consumables

(110 864)

(111 989)

(110 578)

(112 304)

(115 514)

Total cash outflows

(4 915 918)

(5 118 459)

(5 114 131)

(5 079 482)

(4 931 603)

 

 

 

 

 

 

Net cash from (used by) operating activities

 9 572)

(17 778)

(74 079)

(73 503)

 110 263)

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Payments for acquisition of non-financial assets

(37 015)

(50 637)

(28 025)

(27 529)

(27 329)

Proceeds from the disposal of non-financial assets

 15 108)

 13 893)

 13 959)

 14 323)

 14 241)

Equity injections and cashflows from restructuring

(51 366)

(58 550)

(43 500)

(40 750)

(4 500)

Net advances paid

 11 646)

 8 112)

 8 272)

 8 410)

 8 512)

Net cash from (used by) investing activities

(61 627)

(87 182)

(49 294)

(45 546)

(9 076)


 

Table 3.9:          Statement of Cash Flows ‑ Administered (continued)

 

2015-16)

 

Budget)

2016-17)

 

Budget)

2017-18)

Forward)

Estimate)

2018-19)

Forward)

Estimate)

2019-20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

Net borrowings

(193 043)

(55 394)

 8 348)

 115 993)

(102 286)

Net cash from (used by) financing activities

(193 043)

(55 394)

 8 348)

 115 993)

(102 286)

Net increase (decrease) in cash and cash equivalents held

(245 098)

(160 354)

(115 025)

(3 056)

(1 099)

 

 

 

 

 

 

Cash and deposits at the beginning of the reporting period

1 122 589)

1 032 521)

 872 167)

 757 142)

 754 086)

Cash and deposits at the end of the reporting   period

 877 491)

 872 167)

 757 142)

 754 086)

 752 987)