Document
Index
Budget Paper 1
Budget Statement 4
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The introduction of accrual budgeting with an output and outcomes framework further intensifies the Commonwealth's focus on responsible financial management and accountability. Consolidated financial statement projections for the general government sector are presented for the first time in the 1999-2000 Budget.
The Commonwealth's operating result before abnormals is expected to
improve further in 1999-2000 (see Chart 1). The estimated operating result for 1999-2000
is a surplus of $5.7 billion, an improvement of $2.5 billion from the
operating surplus of $3.2 billion expected in 1998-99. This improvement reflects a
6.2 per cent increase in revenue, partly offset by a 4.6 per cent
increase in expenses.
After including abnormal and extraordinary items, an operating surplus of
$16.7 billion is expected in 1999-2000. Movements in abnormal items over the forward
estimates period are largely due to the Government's asset sales programme, particularly
the proposed sale of the Government's remaining share in Telstra.
Statement 5 contains detailed descriptions of expenses and Statement 6 contains
detailed descriptions of revenues. Budget Paper No 2 contains detailed descriptions of
individual budget measures.
Chart 1: Operating Result
Table 1: Operating Result Estimates
| Estimates | Projections | ||||
| 1998-99 | 1999-00 | 2000-01 | 2001-02 | 2002-03 | |
| $m | $m | $m | $m | $m | |
| Revenue | |||||
| Total taxation | 140847 | 147779 | 139223 | 142465 | 150723 |
| Total non-taxation | 12502 | 15050 | 11271 | 11294 | 12343 |
| Total | 153349 | 162828 | 150494 | 153759 | 163065 |
| Expenses | 150183 | 157111 | 143776 | 148357 | 151432 |
| Operating result | 3166 | 5717 | 6718 | 5402 | 11633 |
The consolidated financial position of the general government sector is expected to
improve in 1999-2000 with an increase in net assets of $16.8 billion, or
20.8 per cent, relative to the expected outcome for 1998-99. This improvement
will reduce the excess of liabilities over assets to $63.8 billion by
30 June 2000. Unlike private profit making enterprises, governments are able to
record negative net asset positions as they have access to a guaranteed stream of revenue
to service current and future liabilities.
The Commonwealth's net asset position is expected to improve substantially over the budget
and forward estimates period (see Chart 2). It is expected that the negative net
assets position will be further reduced to $11.5 billion, or 1.6 per cent of GDP,
by 2002-03.
Table 2: Balance Sheet Estimates
| Estimates | Projections | ||||
| 1998-99 | 1999-00 | 2000-01 | 2001-02 | 2002-03 | |
| $m | $m | $m | $m | $m | |
| A ssets | |||||
| Financial | 52958 | 49248 | 53794 | 50180 | 47537 |
| Non-financial | 53520 | 54889 | 55789 | 56662 | 57666 |
| Total assets | 106478 | 104137 | 109583 | 106842 | 105203 |
| Liabilities | |||||
| Debt | 96688 | 75651 | 73960 | 51403 | 22009 |
| Provisions and payables | 90342 | 92273 | 92664 | 93708 | 94670 |
| Total liabilities | 187030 | 167924 | 166624 | 145111 | 116679 |
| Net assets | -80551 | -63787 | -57041 | -38269 | -11476 |
| Equity | -80551 | -63787 | -57041 | -38269 | -11476 |
Chart 2: Balance Sheet Aggregates
Panel A: Assets and Liabilities
Panel B: Net Assets
| New Agency Banking Arrangements As part of the introduction of an accrual framework, the Department of Finance and Administration is introducing agency banking arrangements which will apply from 1 July 1999. These apply to agencies covered by the Financial Management and Accountability Act 1997 (ie Departments of State, Parliamentary Departments and prescribed FMA agencies) and will allow agencies to manage departmental resources, including cash, in a more business-like manner. To encourage better cash management agencies will receive the benefit of being able to retain interest on departmental account balances. Agencies will be responsible for establishing their own bank accounts, processing their payments and receipts, maintaining detailed transactional records and meeting bank fees and charges associated with operating their bank accounts. |
