Media Release

19/2008
30 May 2008

Australian Government Monthly Financial Statements
March and April 2008

KEY POINTS

The underlying cash balance for the 2007-08 year to 30 April 2008 was a surplus of $16,487 million.
The fiscal balance for the 2007-08 year to 30 April 2008 was a surplus of $26,236 million.

AGGREGATES	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
Revenue	219778	36765	256543	303831
Expenses	205420	23780	229200	281070
Net operating balance	14359	12985	27344	22762
Net capital investment	919	188	1107	2318
Fiscal balance	13440	12797	26236	20443
Underlying cash balance	5859	10628	16487	16815
Headline cash balance	8067	13354	21422	25380
Total assets	227068	12173	239240	239484
Total liabilities	206069	637	206706	209776
Net worth	20998	11536	32535	29709
Net debt	-27666	-7509	-35175	-42639

The Australian Government monthly financial statements for 2007-08 have been re-designed to provide Government Finance Statistics (GFS) information only, whilst past statements included an AAS based set of statements, all analysis and commentary was on a GFS basis.

As a result of a change in accounting policy by the Australian Government which was included in the Consolidated Financial Statements 2006-07 published on 20 December 2007, these statements now include GST as an Australian Government tax with associated payments to the States and Territories treated as a grant expense.

The 2008-09 Budget adopted a new accounting standard, AASB1049, which harmonises the two standards used in government reporting, GFS and Australian Accounting Standards (AAS). To ensure consistency across the 2007-08 financial year, the monthly financial statements will only reflect this change from 1 July 2008. The primary difference between GFS and AASB1049 is due to the accounting treatment of Defence Weapons Platforms (DWP). Under GFS, DWP are treated as expenses rather than assets, whilst under AASB1049 DWP are treated as assets.

Care needs to be taken when comparing monthly or cumulative data across years and to full year estimates. Revenues and expenses do vary from month-to-month. The accrual framework, including the timing of payments and policy decisions, can have a large impact on fiscal aggregates from one year to the next and on year-to-date outcomes.

FISCAL OUTCOMES

Underlying Cash Balance

The main components of the underlying cash balance are cash from operations and cash movements in the net investment in non-financial assets.

The underlying cash balance for the year to 30 April 2008 was a surplus of $16,487 million. This underlying cash balance is $2.5 billion higher than the 2008-09 Budget pro rata. The difference reflects a number of individual variations including the following:

Movements in underlying cash receipts:

Lower interest receipts compared to pro rata Budget estimates.

Movements in underlying cash payments:

Higher payments compared to pro rata Budget estimates for:

Education grants due to the timing of higher education payments.

Fiscal Balance

The fiscal balance for the year to 30 April 2008 was a surplus of $26,236 million. This fiscal balance is $9,200 million higher than the 2008-09 Budget pro rata estimate.

FINANCIAL OUTCOMES

Revenues and Expenses

GFS Expenses are $5,025 million lower when compared with a pro rata of the 2008-09 Budget estimate whilst GFS Revenue is $3,351 million higher when compared with a pro rata of the 2008-09 Budget estimate.

The main reason for the lower expenses are due to the timing of payments to suppliers and personal benefit payments, whilst higher revenue is due to the seasonality of revenue collections.

Assets and Liabilities

The net worth balance within the General Government sector is a positive net asset position of
$32,535 million at 30 April 2008.

Lindsay Tanner MP Minister for Finance and Deregulation 30 May 2008	I J Watt Secretary to the Department of Finance and Deregulation 30 May 2008
Contact: Lindsay Tanner MP’s Office: Nardia Dazkiw - (02) 6277 7400 Department of Finance and Deregulation: Emma McDonald - (02) 6215 2383

Australian Government General Government Sector – INCOME STATEMENT

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
GFS revenue
Taxation revenue	206,392	35,295	241,687	286,382
Sales of goods and services	3,958	561	4,519	5,369
Interest income	3,709	540	4,249	5,195
Dividend income	2,582	197	2,779	2,904
Other	3,137	173	3,310	3,982
Total GFS revenue	219,778	36,765	256,543	303,831
GFS expenses
Gross operating expenses
Depreciation	1,916	174	2,090	2,117
Superannuation	1,973	202	2,176	2,765
Salaries and wages	11,024	1,091	12,115	14,958
Payment for supply of goods and services	40,079	5,083	45,163	56,307
Other operating expenses	2,893	315	3,209	3,895
Total gross operating expenses	57,886	6,867	64,753	80,043
Nominal superannuation interest expense	4,504	500	5,005	6,210
Other interest expenses	3,064	396	3,460	4,118
Current transfers
Grant expenses	66,836	8,416	75,252	94,691
Subsidy expenses	5,492	553	6,045	7,222
Personal benefit payments in cash	62,314	6,462	68,775	86,170
Total current transfers	134,642	15,431	150,073	188,083
Capital transfers	5,324	586	5,909	2,617
Total GFS expenses	205,420	23,780	229,200	281,070
Net operating balance	14,359	12,985	27,344	22,762
Net acquisition of non-financial assets
Purchases of non-financial assets	2,434	287	2,721	3,492
less Sales of non-financial assets	157	39	196	248
less Depreciation	1,916	174	2,090	2,117
plus Change in inventories	423	106	529	807
plus Other movements in non-financial assets	135	8	143	384
Total net acquisition of non-financial assets	919	188	1,107	2,318
Net lending/fiscal balance	13,440	12,797	26,236	20,443

Australian Government General Government Sector – BALANCE SHEET

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 30-Jun-08 $m
GFS assets
Financial assets
Cash and deposits	1,541	461	1,928
Advances paid	22,121	17,645	24,811
Investments, loans and placements	68,590	82,793	82,251
Other non-equity assets	43,114	44,501	29,838
Equity	43,101	44,317	45,108
Total financial assets	178,467	189,717	183,937
Non-financial assets
Land	6,895	7,332	6,946
Buildings	16,881	17,202	17,014
Plant, equipment and infrastructure	10,230	10,367	10,979
Inventories	3,382	3,368	6,355
Heritage and cultural assets	8,225	8,274	8,249
Other non-financial assets	2,986	2,981	6,004
Total non-financial assets	48,600	49,523	55,547
Total GFS assets	227,068	239,240	239,484
GFS liabilities
Deposits held	308	284	263
Government securities	58,425	58,351	59,195
Loans	5,445	6,676	6,538
Other borrowings	408	414	356
Superannuation liability	105,568	105,880	108,114
Other employee entitlements and provisions	8,600	8,472	8,545
Other non-equity liabilities	27,315	26,630	26,764
Total GFS liabilities	206,069	206,706	209,776
Net worth	20,998	32,535	29,709
Net financial worth	-27,602	-16,989	-25,838
Net debt	-27,666	-35,175	-42,639

Australian Government General Government Sector – CASH FLOW STATEMENT

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
Cash receipts from operating activities
Taxes received	198,352	33,839	232,191	278,536
Receipts from sales of goods and services	3,897	584	4,481	5,340
Interest receipts	2,447	1,032	3,480	5,102
Dividends	2,109	508	2,617	2,904
Other receipts	2,733	178	2,911	3,486
Total operating receipts	209,538	36,142	245,679	295,368
Cash payments for operating activities
Payments for goods and services	-39,215	-4,678	-43,893	-56,413
Grants and subsidies paid	-77,236	-9,310	-86,546	-101,480
Interest paid	-2,739	-525	-3,264	-3,788
Personal benefit payments	-62,995	-7,240	-70,235	-85,768
Salaries, wages and other entitlements	-14,442	-1,614	-16,056	-20,140
Other payments for operating activities	-3,450	279	-3,171	-3,651
Total operating payments	-200,075	-23,089	-223,164	-271,240
Net cash flows from operating activities	9,463	13,053	22,516	24,127
Cash flows from investments in non-financial assets
Sales of non-financial assets	162	39	201	254
Purchases of non-financial assets	-1,725	-1,235	-2,960	-3,818
Net cash flows from investments in non-financial assets	-1,563	-1,196	-2,759	-3,564
Net cash flows from investments in financial assets for policy purposes	247	1,519	1,766	4,848
Cash flows from investments in financial assets for liquidity purposes
Increase in investments	-8,807	-14,635	-23,443	-26,332
Net cash flows from investments in financial assets for liquidity purposes	-8,807	-14,635	-23,443	-26,332
Cash flows from financing activities
Borrowing (net)	1,197	477	1,674	1,807
Deposits received (net)	47	-24	24	0
Other financing (net)	-196	-275	-471	-115
Net cash flows from financing activities	1,048	179	1,227	1,693
Net increase/decrease in cash held	388	-1,080	-693	772
Net cash from operating activities and investments in non-financial assets	7,900	11,857	19,757	20,564
Finance leases and similar arrangements	-79	-21	-101	-32
GFS cash surplus(+)/deficit(-)	7,820	11,835	19,656	20,532
less Future Fund earnings	1,961	1,208	3,168	3,717
Equals underlying cash balance	5,859	10,628	16,487	16,815
plus net cash flows from investments in financial assets for policy purposes	247	1,519	1,766	4,848
plus Future Fund earnings	1,961	1,208	3,168	3,717
Equals headline cash balance	8,067	13,354	21,422	25,380

Australian Government General Government Sector – STATEMENT OF OTHER ECONOMIC FLOWS

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
Opening net worth	2,689	2,689	2,689
Opening net worth adjustments(a)	8,291	8,291	39,853
Adjusted opening net worth	10,980	10,980	42,542
Change in net worth from operating transactions	14,359	27,344	22,762
Change in net worth from other economic flows
Revaluation of equity(b)	159	385	-1,994
Net writedowns of assets (including bad and doubtful debts)	-4,476	-4,211	-3,117
Assets recognised for the first time	-95	-95	235
Actuarial revaluations	0	0	-1,423
Net foreign exchange gains	-410	83	202
Net swap interest received	-102	-126	-178
Market valuation of debt	-733	-497	-662
Other economic revaluations(c)	1,318	-1,329	-28,658
Total other economic flows	-4,340	-5,789	-35,595
Closing net worth	20,998	32,535	29,709

*These numbers are budget estimates presented on a GFS basis, consistent with the 2007-08 Budget. They differ from the figures presented in the 2008-09 Budget which were based on the new harmonised ABS GFS and accounting standard (AASB 1049) for the first time.
(a) Change in net worth arising from a change in 06-07 outcomes.
(b) Revaluations of equity reflects changes in the market valuation of commercial entities. This line also reflects any equity revaluations at the point of disposal or sale.
(c) Largely reflects revaluation of assets and liabilities.

Australian Government General Government Sector – INCOME STATEMENT BY FUNCTION

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
GFS Expenses by Purpose
General Public Services	14,166	1,312	15,478	16,631
Defence	13,077	1,803	14,880	17,885
Public Order and Safety	2,734	234	2,969	3,788
Education	16,020	1,205	17,225	18,620
Health	31,939	3,957	35,896	44,455
Social Security and Welfare	70,565	7,675	78,240	97,230
Housing and Community Amenities	2,047	178	2,225	3,083
Recreation and Culture	1,895	217	2,112	2,826
Fuel and Energy	3,695	409	4,104	5,103
Agriculture, Forestry and Fishing	2,637	370	3,007	4,085
Mining and Mineral Resources (other than fuels); Manufacturing and Construction	1,192	18	1,209	1,846
Transport and Communication	2,796	430	3,226	4,486
Other Economic Affairs	4,377	577	4,954	6,467
Other Purposes
Public Debt Interest	2,638	294	2,932	3,538
Nominal Superannuation Interest	1,532	170	1,703	6,210
General Purpose Inter-Government Transactions	33,647	5,009	38,656	45,493
Natural Disaster Relief	439	-60	378	99
Contingency Reserve (a)	24	-17	7	-776
Total GFS Expenses	205,420	23,780	229,200	281,070

NOTES:

The framework used as a basis for these statements and notes is generally consistent with the requirements of GFS. The Financial Management and Accountability Act 1997 requires monthly financial statements to be consistent with the Budget estimates, accordingly, and pursuant to the Charter of Budget Honesty Act 1998, this presentation covers the General Government sector on a GFS basis.

With the introduction of Business Activity Statements and Instalment Activity Statements in 2000-2001, taxpayers provide information on payments associated with several types of tax when lodging the statement and paying the aggregate net tax amount. Thus, while total tax collections are known with certainty at the end of each month, the distribution across the relevant heads of revenue cannot be finalised until all statements are received and processed. The outcomes for some revenue items provided in this statement are thus estimates, in accordance with the best judgement of the Taxation Commissioner, and subject to revision. The taxation revenue items not affected are: Petroleum Resource Rent Tax, Excise duty, Customs duty, Other Taxes and Individuals Refunds.

The sum of the revenue accrued in the month and the revisions to prior periods equals the revenue reported in the Statement of Revenue and Expenses.

Note 1: Income Tax

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
INDIVIDUALS AND OTHER WITHHOLDING TAX
Gross income tax withholding	85,896	9,929	95,825	114,610
Gross other individuals	17,483	5,033	22,516	30,130
Less refunds	16,441	854	17,295	19,640
Total individuals and other withholding tax	86,938	14,109	101,046	125,100
OTHER SOURCES
Companies	47,724	11,465	59,189	66,480
Superannuation funds (a)	9,525	1,454	10,979	11,710
Petroleum Resource Rent Tax	1,472	328	1,800	1,840
Fringe Benefits tax (b)	2,627	844	3,471	3,900
Total income tax from other sources	61,347	14,092	75,439	83,930
Total income tax	148,285	28,200	176,485	209,030

Note 2: Indirect Tax

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
Excise duty	18,140	1,376	19,515	23,390
Customs duty	4,559	484	5,043	5,990
Other indirect tax (including GST)	35,408	5,235	40,643	47,972
Total indirect tax revenue	58,107	7,094	65,201	77,352

Note 3: Goods and Services Tax

	ACTUAL 2007-2008 YTD March $m	ACTUAL 2007-2008 April $m	ACTUAL 2007-2008 YTD April $m	BUDGET ESTIMATE 2007-2008 FULL YEAR* $m
GST Revenue (a)	32,697	4,922	37,619	44,370

*These numbers are budget estimates presented on a GFS basis, consistent with the 2007-08 Budget. They differ from the figures presented in the 2008-09 Budget which were based on the new harmonised ABS GFS and accounting standard (AASB 1049) for the first time.
(a) GST revenue is presented in this note on an accrual basis. This differs from GST cash receipts, on which payments to the States and Territories are based.

NOTE:

Style Conventions

Figures in tables and generally in the text have been rounded. Discrepancies in tables between totals and sums of components are due to rounding.

International Monetary Fund (IMF) Special Data Dissemination Standards (SDDS)

In accordance with the IMF's SDDS, quarter ahead notice of the date of release of the data on central government operations, which is contained in the Australian Government Financial Statements, is given on the IMF's Data Dissemination Bulletin Board at http//dsbb.imf.org.
Monthly and quarterly data on debt guaranteed by the Australian Government (central government) that meet the coverage and timeliness requirements of the SDDS are published on the AOFM website at http://www.aofm.gov.au/content/borrowing/commonwealth.asp?NavID=32. In accordance with the IMF SDDS, the approximate date of release of the data on debt guaranteed by the Australian Government (central government), is given on the IMF's Data Dissemination Advance Release Calender http://dsbb.imf.org.