Media Release

Senator the Hon Penny Wong
Minister for Finance and Deregulation

242/2011
9 December 2011

Australian Government Monthly Financial Statements
September 2011

KEY POINTS

The underlying cash balance for the 2011-12 financial year to 30 September 2011 was a deficit of $22,559 million.
The fiscal balance for the 2011-12 financial year to 30 September 2011 was a deficit of $22,467 million.

AGGREGATES	ACTUAL 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	Budget Profile 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Revenue	16,083	69,879	71,153	349,961
Expenses	31,335	92,476	91,826	365,817
Net operating balance	-15,252	-22,598	-20,672	-15,857
Net capital investment	-681	-130	753	4,405
Fiscal balance	-14,571	-22,467	-21,425	-20,262
Underlying Cash Receipts	13,382	67,679	70,067	339,459
Underlying Cash Payments	26,615	90,238	90,845	362,078
Underlying cash balance(a)	-13,233	-22,559	-20,777	-22,618
Headline cash balance	-12,843	-23,041	-22,788	-31,903
Total assets		312,550		345,173
Total liabilities		442,514		432,705
Net worth(b)		-129,964		-87,532
Net debt(c)		118,355		106,646

*As published in the 2011-12 Budget.
(a) Excludes Future Fund earnings.
(b) Net worth is calculated as total assets minus total liabilities.
(c) Net debt equals the sum of deposits held, government securities, loans and other borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.

Care needs to be taken when comparing monthly or cumulative data across years and to full year estimates as revenues and expenses vary from month to month.

Comparators for the September 2011 Monthly Financial Statements are based on the 2011-12 Budget published in May 2011. The 2011-12 Mid-Year Economic and Fiscal Outlook profiles will be used as comparators from the November 2011 Monthly Financial Statements onwards.

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 30 September 2011 was a deficit of $22,559 million, compared to the Budget profile of the underlying cash balance deficit of $20,777 million. The difference of $1,782 million primarily relates to the timing of other receipts and taxation receipts, offset by higher dividends and income tax equivalents and lower purchases of non-financial assets.

Fiscal Balance

The fiscal balance for the year to 30 September 2011 was a deficit of $22,467 million. The Budget profile of the fiscal balance for 2011-12 is a deficit of $21,425 million. The difference of $1,042 million primarily relates to lower taxation revenue, lower interest income and higher gross operating expenses, offset by lower net acquisition of non-financial assets.

FINANCIAL OUTCOMES

Revenues and Expenses

Total revenue was $1,275 million lower than the Budget profile estimate for 2011-12 due to lower indirect taxation revenue and interest income received during September.

Total expenses were $651 million higher when compared with the Budget profile estimate for 2011-12 due to higher than anticipated supply of goods and services.

Assets and Liabilities

The net worth of the General Government sector is a negative net asset position of $129,964 million at 30 September 2011.

Senator Penny Wong Minister for Finance and Deregulation 9 December 2011	David Tune Secretary to the Department of Finance and Deregulation 9 Decembe2011
Contact: Senator Penny Wong's Office: Laura Anderson - (02) 6277 7400 Department of Finance and Deregulation: Lauren Alcantara - (02) 6215 3557

Australian Government General Government Sector – INCOME STATEMENT

	ACTUAL 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Revenue
Taxation revenue	14,482	65,159	329,247
Sales of goods and services	694	1,933	8,050
Interest income	292	877	5,735
Dividend income	118	342	1,328
Other	498	1,567	5,601
Total revenue	16,083	69,879	349,961
Expenses
Gross operating expenses
Wages and salaries(a)	1,541	4,614	19,232
Superannuation	271	1,020	3,508
Depreciation and amortisation	458	1,539	5,636
Supply of goods and services	6,516	17,567	69,993
Other operating expenses(a)	469	1,310	4,498
Total gross operating expenses	9,255	26,051	102,866
Superannuation interest expense	612	1,835	7,575
Interest expenses	1,064	3,139	13,095
Current transfers
Current grants	9,564	26,636	112,995
Subsidy expenses	812	2,430	9,300
Personal benefits	8,977	29,391	107,931
Total current transfers	19,354	58,458	230,226
Capital transfers
Mutually agreed write-downs	172	623	2,197
Other capital grants	878	2,372	9,858
Total capital transfers	1,051	2,994	12,055
Total expenses	31,335	92,476	365,817
Net operating balance	-15,252	-22,598	-15,857
Other economic flows
Gain/loss on equity and on sale of assets(b)	920	-1,027	2,897
Net write-downs of assets(including bad and doubtful debts)	-146	-553	-6,567
Assets recognised for the first time	17	84	583
Net foreign exchange gains	-3,111	-2,669	2
Market valuation of debt	0	-7,339	-266
Other economic revaluations(c)	-1,224	-476	-56
Total other economic flows	-3,544	-11,980	-3,406
Comprehensive result - Total change in net worth	-18,796	-34,578	-19,263
Net operating balance	-15,252	-22,598	-15,857
Net acquisition of non-financial assets
Purchases of non-financial assets	-217	1,463	10,561
less Sales of non-financial assets	51	90	1,361
less Depreciation	458	1,539	5,636
plus Change in inventories	48	-10	579
plus Other movements in non-financial assets	-4	45	264
Total net acquisition of non-financial assets	-681	-130	4,405
Fiscal balance (Net lending/borrowing)(d)	-14,571	-22,467	-20,262

*As published in the 2011-12 Budget.
(a) Consistent with ABS GFS classification, other employee related expenses are reported under other operating expenses. Total employee expenses equal wages and salaries plus other operating expenses.
(b) Reflects changes in the market valuation of investments and any 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 30 September 2011 $m	BUDGET ESTIMATE* as at 30 June 2012 $m
Assets
Financial assets
Cash and deposits	2,369	2,000
Advances paid	26,491	29,501
Investments, loans and placements	92,060	110,443
Other receivables	37,022	34,847
Equity investments
Investments in other public sector entities	22,021	26,277
Equity accounted investments	357	279
Investments - shares	26,385	28,746
Total financial assets	206,704	232,092
Non-financial assets
Land	8,584	8,438
Buildings	22,503	23,127
Plant, equipment and infrastructure	50,498	53,379
Inventories	6,880	6,978
Intangibles	4,534	5,330
Investment property	514	349
Biological assets	101	35
Heritage and cultural assets	9,458	9,435
Assets held for sale	136	91
Other non-financial assets	2,638	5,920
Total non-financial assets	105,846	113,080
Total assets	312,550	345,173
Liabilities
Interest bearing liabilities
Deposits held	302	232
Government securities	228,749	234,885
Loans	9,402	12,694
Other borrowing	821	780
Total interest bearing liabilities	239,274	248,590
Provisions and payables
Superannuation liability(a)	146,355	133,965
Other employee liabilities	11,157	11,209
Suppliers payable	5,253	4,352
Personal benefits provisions and payable	11,693	12,420
Subsidies provisions and payable	2,196	2,385
Grants provisions and payable	13,851	8,063
Other provisions and payables	12,736	11,722
Total provisions and payables	203,240	184,115
Total liabilities	442,514	432,705
Net worth(b)	-129,964	-87,532
Net financial worth(c)	-235,810	-200,613
Net financial liabilities(d)	257,831	226,889
Net debt(e)	118,355	106,646

*As published in the 2011-12 Budget.
(a) For budget reporting purposes, a discount rate applied by actuaries in preparing Long Term Cost Reports is used to value the superannuation liability. This reduces the volatility in reported liabilities that would occur from year to year if the long-term government bond rate were used. Consistent with Australian Accounting Standards, the long-term government bond rate as at 30 June is used to calculate the superannuation liability for the purpose of actuals reporting.
(b) Net worth is calculated as total assets minus total liabilities.
(c) Net financial worth equals total financial assets minus total liabilities.
(d) Net financial liabilities equals total liabilities less financial assets other than investments in other public sector entities.
(e) Net debt equals the sum of deposits held, government securities, loans and other borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.

Australian Government General Government Sector - CASH FLOW STATEMENT

	ACTUAL 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Cash receipts from operating activities
Taxes received	13,825	64,130	321,103
Receipts from sales of goods and services	377	1,724	7,996
Interest receipts	547	1,145	5,297
Dividends and income tax equivalents	138	771	1,422
Other receipts	-1,142	889	5,211
Total operating receipts	13,744	68,659	341,029
Cash payments for operating activities
Payments for employees	-2,857	-6,668	-25,786
Payments for goods and services	-5,907	-19,792	-70,308
Grants and subsidies paid	-8,703	-30,345	-132,428
Interest paid	-267	-1,018	-10,833
Personal benefit payments	-8,852	-30,348	-107,848
Other payments	144	-790	-4,272
Total operating payments	-26,441	-88,960	-351,474
Net cash flows from operating activities	-12,697	-20,301	-10,445
Cash flows from investments in non-financial assets
Sales of non-financial assets	51	90	1,361
Purchases of non-financial assets	-173	-1,276	-10,487
Net cash flows from investments in non-financial assets	-121	-1,187	-9,126
Net cash flows from investments in financial assets for policy purposes	-24	-1,552	-12,216
Cash flows from investments in financial assets for liquidity purposes
Increase in investments	6,164	6,089	-4,012
Net cash flows from investments in financial assets for liquidity purposes	6,164	6,089	-4,012
Cash flows from financing activities
Borrowing (net)	7,513	16,944	36,693
Other financing (net)	-13	-102	-893
Net cash flows from financing activities	7,500	16,843	35,800
Net increase/(decrease) in cash held	822	-108	2
Net cash flows from operating activities and investments in non-financial assets (Surplus(+)/deficit(-))	-12,818	-21,488	-19,571
Finance leases and similar arrangements(b)	-1	-2	-117
GFS cash surplus(+)/deficit(-)	-12,819	-21,489	-19,687
less Future Fund earnings	414	1,070	2,931
Equals underlying cash balance(c)	-13,233	-22,559	-22,618
plus Net cash flows from investments in financial assets for policy purposes	-24	-1,552	-12,216
plus Future Fund earnings	414	1,070	2,931
Equals headline cash balance	-12,843	-23,041	-31,903

*As published in the 2011-12 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 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Expenses by function
General public services	1,292	5,095	20,887
Defence	1,772	4,933	21,277
Public order and safety	282	872	3,969
Education	3,801	9,175	29,870
Health	4,540	14,235	59,858
Social security and welfare	10,903	33,552	121,907
Housing and community amenities	330	1,101	4,647
Recreation and culture	432	728	3,397
Fuel and energy	504	1,456	6,302
Agriculture, forestry and fishing	165	425	3,444
Mining, manufacturing and construction	238	493	2,014
Transport and communication	450	1,192	6,919
Other economic affairs	855	2,362	9,385
Other purposes
Public debt interest	919	2,729	11,632
Nominal superannuation interest	612	1,835	7,575
General purpose inter-government transactions	4,240	12,283	51,152
Natural disaster relief	0	10	479
Contingency reserve	0	0	1,103
Total expenses	31,336	92,476	365,817

*As published in the 2011-12 Budget.

NOTES:

The Australian Government monthly financial statements have been prepared on a basis consistent with the 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 are limited to complying with either ABS GFS or AAS.

In response to the report titled ‘Review of Operation Sunlight: Overhauling Budgetary Transparency’, the Australian Government has improved the transparency and accountability of the Monthly Financial Statements by reporting against a profile of expected revenue and expenses. This allows for a more accurate commentary and account for seasonality or patterns of revenue and expenses.

The Government is committed to releasing the Monthly Financial Statements in a timely fashion and will endeavour to do so in accordance with International Monetary Fund (IMF) Special Data Dissemination Standards. Under these standards the timeframe for releasing the Monthly Financial Statements is by the end of the following month. The exception is the July Monthly Financial Statements, for which the IMF has given Australia special dispensation to release before 30 September.

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 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Individuals and other withholding taxes
Gross income tax withholding	12,253	35,618	144,930
Gross other individuals	1,035	6,484	33,360
less Refunds	3,601	13,245	27,400
Total individuals and other withholding taxation	9,687	28,857	150,890
Company tax	438	13,264	74,600
Superannuation funds	-110	2,207	9,330
Petroleum resource rent tax	18	438	2,050
Fringe benefits tax	-77	708	3,760
Total income taxation revenue	9,956	45,474	240,630

*As published in the 2011-12 Budget.

Note 2: Indirect Tax

	ACTUAL 2011-2012 September $m	ACTUAL 2011-2012 YTD September $m	BUDGET ESTIMATE* 2011-2012 FULL YEAR $m
Goods and services tax	1,805	11,057	50,630
Wine equalisation tax	50	160	760
Luxury car tax	37	111	510
Excise duty	1,948	6,223	26,330
Customs duty	519	1,573	7,520
Other indirect tax	167	561	2,867
Total indirect taxation revenue	4,526	19,686	88,617