Media Release

66/2009
16 October 2009

Australian Government Monthly Financial Statements
July and August 2009

KEY POINTS

The underlying cash balance for the 2009-10 year to 31 August 2009 was a deficit of $3,581 million.
The fiscal balance for the 2009-10 year to 31 August 2009 was a deficit of $290 million.

AGGREGATES	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE 2009-2010 FULL YEAR* $m
Revenue	29,934	23,086	53,021	290,612
Expenses	26,982	25,889	52,871	338,213
Net operating balance	2,952	-2,802	149	-47,601
Net capital investment	480	-41	439	5,545
Fiscal balance	2,471	-2,761	-290	-53,145
Underlying cash balance	982	-4,563	-3,581	-57,593
Headline cash balance	486	-4,072	-3,586	-59,751
Total assets	316,388		322,839	304,864
Total liabilities	289,664		298,778	343,541
Net worth	26,724		24,061	-38,676
Net debt	-12,895		-10,638	53,700

*As published in the 2009-10 Budget.

The Australian Government monthly financial statements for 2009-10 have been prepared on a basis consistent with 2009-10 Budget as required under section 54 of the Financial Management and Accountability Act 1997. The statements are based on the Australian Bureau of Statistics (ABS) Government Finance Statistics (GFS) except where Australian Accounting Standards (AAS) provide a better conceptual treatment for specific items. Departures will be limited to complying with either ABS GFS or AAS.

Care needs to be taken when comparing monthly or cumulative data across years and to full year estimates. Revenues and expenses 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 underlying cash balance includes cash from operations and net cash provided by investing activities in non-financial assets but excludes the cash earnings for the Future Fund.

The underlying cash balance for the year to 31 August 2009 was a deficit of $3,581 million. The difference between the pro rata Budget estimate ($9,599 million) and the August underlying cash balance primarily reflects the timing of dividends.

Fiscal Balance

The fiscal balance for the year to 31 August 2009 was a deficit of $290 million. The pro rata Budget estimate of the fiscal balance for 2009-10 is a deficit of $8,858 million.

FINANCIAL OUTCOMES

Revenues and Expenses

Expenses are $3,498 million lower and revenue is $4,585 million higher when compared with the pro rata Budget estimate for 2009-10.

The main driver of lower expenses is grants, whilst higher revenue is primarily due to the timing of dividends.

Assets and Liabilities

The net worth balance of the General Government sector is a positive net asset position of $24,061 million at 31 August 2009.

Lindsay Tanner MP Minister for Finance and Deregulation 16 October 2009	David Tune Secretary to the Department of Finance and Deregulation 16 October 2009
Contact: Lindsay Tanner MP’s Office: Nardia Dazkiw - (02) 6277 7400 Department of Finance and Deregulation: Davina Cassell - (02) 6215 3557

Australian Government General Government Sector – INCOME STATEMENT

	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE* 2009-2010 FULL YEAR $m
Revenue
Taxation revenue	28,636	15,053	43,689	267,727
Sales of goods and services	518	700	1,219	7,483
Interest income	195	498	693	4,697
Dividend income	16	6,334	6,350	6,413
Other	569	501	1,070	4,292
Total revenue	29,934	23,086	53,021	290,612
Expenses
Gross operating expenses
Wages and salaries(a)	1,377	1,337	2,714	17,069
Superannuation	316	168	484	3,384
Depreciation and amortisation	439	478	917	5,634
Payment for supply of goods and services	4,988	5,106	10,094	63,229
Other operating expenses	465	411	876	4,571
Total gross operating expenses	7,585	7,500	15,085	93,887
Superannuation interest expense	554	204	759	6,792
Interest expenses	517	579	1,096	7,556
Current transfers
Current grants	7,185	6,679	13,864	102,185
Subsidy expenses	639	775	1,415	8,121
Personal benefits	8,870	8,490	17,360	99,579
Total current transfers	16,694	15,944	32,638	209,885
Capital transfers
Mutually agreed write-downs	182	158	341	1,657
Other capital grants	1,450	1,502	2,952	18,434
Total capital transfers	1,632	1,660	3,292	20,091
Total expenses	26,982	25,889	52,871	338,213
Net operating balance	2,952	-2,802	149	-47,601
Other economic flows
Revaluation of equity (b)	3,203	954	4,157	2,044
Net write-downs of assets (including bad and doubtful debts)	-227	-389	-616	-3,903
Assets recognised for the first time	11	60	71	293
Actuarial revaluations	0	0	0	-1
Net foreign exchange gains	369	244	613	-5
Net swap interest received	8	7	15	187
Market valuation of debt	654	-433	221	147
Other economic revaluations(c)	33	-303	-270	-595
Total other economic flows	4,052	140	4,191	-1,832
Comprehensive result -
Total change in net worth	7,003	-2,663	4,341	-49,432
Net operating balance	2,952	-2,802	149	-47,601
Net acquisition of non-financial assets
Purchases of non-financial assets	1,152	427	1,579	11,305
less Sales of non-financial assets	23	8	31	619
less Depreciation	439	478	917	5,634
plus Change in inventories	-185	-12	-197	425
plus Other movements in non-financial assets	-24	30	6	68
Total net acquisition of non-financial assets	480	-41	439	5,545
Fiscal balance (Net lending/borrowing)(d)	2,471	-2,761	-290	-53,145

*As published in the 2009-10 Budget.
(a) Consistent with ABS GFS classification, other employee related expenses are reported under other operating expenses.
(b) Revaluations of equity reflects changes in the market valuation of investments. This line also reflects any equity revaluations at the point of disposal or sale.
(c) Largely reflects other revaluation of assets and liabilities.
(d) The term fiscal balance is not used by the ABS.

Australian Government General Government Sector - BALANCE SHEET

	ACTUAL as at 31 July 2009 $m	ACTUAL as at 31 August 2009 $m	BUDGET ESTIMATE* as at 30 June 2010 $m
Assets
Financial assets
Cash and deposits	657	921	1,282
Advances paid	21,562	21,550	23,873
Investments, loans and placements	109,862	116,538	100,415
Other receivables	35,402	36,491	36,626
Equity investments
Investments in other public sector entities	28,769	29,606	20,177
Equity accounted investments	391	391	224
Investments - shares	26,146	23,979	24,976
Total financial assets	222,789	229,476	207,572
Non-financial assets
Land	8,382	8,393	7,568
Buildings	19,477	19,521	20,227
Plant, equipment and infrastructure	44,632	44,285	47,856
Inventories	6,070	6,033	6,921
Intangibles	3,084	3,203	3,752
Investment property	-16	-16	143
Biological assets	31	31	30
Heritage and cultural assets	9,050	9,055	8,376
Assets held for sale	112	111	545
Other non-financial assets	2,775	2,750	1,874
Total non-financial assets	93,599	93,364	97,292
Total assets	316,388	322,839	304,864
Liabilities
Interest bearing liabilities
Deposits held	434	396	339
Government securities	110,367	115,169	169,907
Loans	7,477	11,907	8,173
Other borrowing	907	898	851
Total interest bearing liabilities	119,186	128,370	179,270
Provisions and payables
Superannuation liability	124,747	124,698	122,423
Other employee liabilities	9,571	9,757	9,725
Suppliers payable	2,679	2,984	3,639
Personal benefits payable	12,844	13,187	12,490
Subsidies payable	1,632	1,599	1,659
Grants payable	5,720	5,507	6,511
Other provisions and payables	13,284	12,677	7,824
Total provisions and payables	170,478	170,408	164,271
Total liabilities	289,664	298,778	343,541
Net worth(a)	26,724	24,061	-38,676
Net financial worth(b)	-66,875	-69,302	-135,968
Net financial liabilities(c)	95,644	98,909	156,145
Net debt(d)(e)	-12,895	-10,638	53,700

*As published in the 2009-10 Budget.
(a) Net worth is calculated as total assets minus total liabilities.
(b) Net financial worth equals total financial assets minus total liabilities. That is, it excludes non-financial assets.
(c) Net financial liabilities equals total liabilities less financial assets other than investments in other public sector entities.
(d) Net debt equals the sum of deposits held, advances received, government securities loans and other borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.
(e) The net debt estimates include the expected impact of the Future Fund rebalancing its portfolio allocation by increasing its holding of equities, which are not included in the calculation of net debt.

Australian Government General Government Sector - CASH FLOW STATEMENT (a)

	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE* 2009-2010 FULL YEAR $m
Cash receipts from operating activities
Taxes received	28,311	14,089	42,400	259,436
Receipts from sales of goods and services	591	669	1,260	7,480
Interest receipts	224	436	660	4,426
Dividends and income tax equivalents	50	5,578	5,628	5,663
Other receipts	1,434	362	1,796	4,360
Total operating receipts	30,611	21,133	51,744	281,364
Cash payments for operating activities
Payments for employees	-1,956	-1,984	-3,940	-23,127
Payments for goods and services	-6,477	-4,497	-10,974	-62,201
Grants and subsidies paid	-10,663	-9,230	-19,893	-127,722
Interest paid	61	-473	-411	-5,890
Personal benefit payments	-9,823	-8,263	-18,085	-102,368
Other payments	-216	-275	-491	-4,305
Total operating payments	-29,073	-24,721	-53,794	-325,613
Net cash flows from operating activities	1,538	-3,588	-2,050	-44,249
Cash flows from investments in non-financial assets
Sales of non-financial assets	24	8	32	619
Purchases of non-financial assets	-447	-549	-996	-11,030
Net cash flows from investments in non-financial assets	-423	-541	-964	-10,411
Net cash flows from investments in financial assets for policy purposes	-628	57	-572	-5,089
Cash flows from investments in financial assets for liquidity purposes
Increase in investments	-4,728	-4,425	-9,153	1,761
Net cash flows from investments in financial assets for liquidity purposes	-4,728	-4,425	-9,153	1,761
Cash flows from financing activities
Borrowing (net)	3,194	4,443	7,637	58,424
Other financing (net)	213	4,318	4,531	-693
Net cash flows from financing activities	3,407	8,761	12,168	57,731
Net increase/(decrease) in cash held	-835	264	-571	-257
Net cash flows from operating activities and investments in non-financial assets (Surplus(+)/deficit(-))	1,115	-4,129	-3,014	-54,660
Finance leases and similar arrangements (b)	0	0	0	-1
GFS cash surplus(+)/deficit(-)	1,115	-4,129	-3,014	-54,661
less Future Fund earnings	133	434	567	2,931
Equals underlying cash balance (c)	982	-4,563	-3,581	-57,593
plus net cash flows from investments in financial assets for policy purposes	-628	57	-572	-5,089
plus Future Fund earnings	133	434	567	2,931
Equals headline cash balance	486	-4,072	-3,586	-59,751

**As published in the 2009-10 Budget.
(a) A positive number denotes a cash inflow; a negative sign denotes a cash outflow.
(b) The acquisition of assets under finance leases decreases the underlying cash balance.The disposal of assets previously held under finance leases increases the underlying cash.
(c) The term underlying cash balance is not used by the ABS.

Australian Government General Government Sector - EXPENSES BY FUNCTION

	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE* 2009-2010 FULL YEAR $m
Expenses by Purpose
General Public Services	1,286	773	2,059	17,755
Defence	1,647	1,879	3,526	20,952
Public Order and Safety	382	112	494	3,901
Education	3,000	2,260	5,260	35,222
Health	4,214	4,301	8,515	51,223
Social Security and Welfare	9,984	9,364	19,348	110,994
Housing and Community Amenities	229	574	803	9,089
Recreation and Culture	244	224	468	3,099
Fuel and Energy	531	738	1,269	8,403
Agriculture, Forestry and Fishing	135	164	299	3,407
Mining and Mineral Resources (other than fuels); Manufacturing and Construction	133	195	328	1,681
Transport and Communication	119	486	605	5,482
Other Economic Affairs	623	314	937	8,183
Other Purposes
Public Debt Interest	430	455	885	6,264
Nominal Superannuation Interest	554	204	759	6,792
General Purpose Inter-Government Transactions	3,472	3,755	7,226	44,086
Natural Disaster Relief	0	91	91	91
Contingency Reserve (a)	0	0	0	1,589
Total Expenses	26,982	25,889	52,871	338,213

*As published in the 2009-10 Budget.
(a) Asset sale related expenses are treated as a component of the contingency reserve.

NOTES:

The framework used as a basis for these statements and notes is generally consistent with the requirements of ABS 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 based on the same conceptual framework as the Budget i.e. the Australian Government’s interpretation of AASB 1049.

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 Business Activity 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 Income Statement.

Note 1: Income Tax

	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE* 2009-2010 FULL YEAR* $m
INDIVIDUALS AND OTHER WITHHOLDING TAX
Gross income tax withholding	9,925	10,033	19,959	119,000
Gross other individuals	3,985	2,798	6,784	28,350
Less refunds	4,947	5,332	10,279	24,640
Total individuals and other withholding tax	8,964	7,499	16,464	122,710
OTHER SOURCES
Companies	9,995	682	10,677	54,980
Superannuation funds (a)	1,295	289	1,583	7,990
Petroleum Resource Rent Tax	39	175	214	1,720
Fringe Benefits tax (b)	749	69	818	3,460
Total income tax from other sources	12,077	1,214	13,292	68,150
Total income tax	21,041	8,714	29,755	190,860

*As published in the 2009-10 Budget.
(a) Includes superannuation contributions surcharge.
(b) Negative collections indicate refunds exceed collections.

Note 2: Indirect Tax

	ACTUAL 2009-2010 July $m	ACTUAL 2009-2010 August $m	ACTUAL 2009-2010 YTD August $m	BUDGET ESTIMATE* 2009-2010 FULL YEAR* $m
Excise duty	1,876	2,193	4,068	23,850
Customs duty	515	475	990	5,770
Goods and services tax	4,759	3,472	8,231	43,630
Other indirect tax (including GST)	445	200	645	3,617
Total indirect tax revenue	7,594	6,339	13,934	76,867