Australian Government General Government Sector Monthly Financial Statements December 2017

Senator the Hon Mathias Cormann
Minister for Finance
Leader of the Government in the Senate

MC 05/18
Friday, 2 February 2018

Australian Government General Government Sector Monthly Financial Statements December 2017

KEY POINTS

The underlying cash balance for the 2017-18 financial year to 31 December 2017 was a deficit of $21,948 million.
The fiscal balance for the 2017-18 financial year to 31 December 2017 was a deficit of $15,993 million.

AGGREGATES	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO Profile 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Revenue	37,215	212,630	211,302	448,702
Expenses	38,221	228,815	230,072	466,937
Net operating balance	-1,006	-16,185	-18,769	-18,235
Net capital investment	693	-193	-657	193
Fiscal balance	-1,699	-15,993	-18,113	-18,428
Receipts(a)	38,189	209,089	207,046	437,075
less Payments(b)	38,846	228,644	228,836	457,606
less Net Future Fund earnings	471	2,393	2,073	3,076
Underlying cash balance(c)	-1,128	-21,948	-23,864	-23,608
Headline cash balance	-459	-25,058	-27,990	-39,573
Total assets		522,383		537,962
Total liabilities		926,931		848,622
Net worth(d)		-404,547		-310,660
Net debt(e)		350,245		343,778

_{*As published in the 2017-18 MYEFO.

(a) Cash receipts for operating activities and sales of non-financial assets.

(b) Cash payments for operating activities, purchases of non-financial assets and net acquisition of assets under finance leases.

(c) Excludes net Future Fund earnings. Consistent with Budget documents, the net adjustment for the Future Fund is shown separately.

(d) Net worth is calculated as total assets minus total liabilities.

(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.}

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 December 2017 monthly financial statements are based on the 2017-18 Mid-Year Economic and Fiscal Outlook published in December 2017.

FISCAL OUTCOMES

Underlying Cash Balance

The underlying cash balance for the financial year to 31 December 2017 was a deficit of $21,948 million, which is $1,916 million lower than the 2017-18 MYEFO profile deficit of $23,864 million.

Receipts
Total receipts were $2,043 million higher than the 2017-18 MYEFO profile.
Payments
Total payments were $192 million lower than the 2017-18 MYEFO profile.

Net Operating Balance

The net operating balance for the year to 31 December 2017 was a deficit of $16,185 million, which is $2,584 million lower than the 2017-18 MYEFO profile deficit of $18,769 million. The difference primarily results from higher than expected revenue and lower expenses.

Fiscal Balance

The fiscal balance for the year to 31 December 2017 was a deficit of $15,993 million, which is $2,120 million lower than the 2017-18 MYEFO profile deficit of $18,113 million. As with the net operating balance, the difference primarily results from higher than expected revenue and lower expenses.

Assets and Liabilities

As at 31 December 2017:

Net worth is negative $404,547 million;
Net debt is $350,245 million; and
Net financial liabilities are $596,245 million.

Senator the Hon Mathias Cormann Minister for Finance	Rosemary Huxtable PSM Secretary Department of Finance
Media Contact
Karen Wu	0428 350 139

Australian Government general government sector operating statement

	Note	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO Profile 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Revenue
Taxation revenue	1, 2	35,620	199,149	197,692	421,508
Sales of goods and services		703	4,753	4,811	10,491
Interest income		83	1,841	1,792	3,580
Dividend income		449	2,163	1,822	3,112
Other		359	4,724	5,186	10,012
Total revenue		37,215	212,630	211,302	448,702
Expenses
Gross operating expenses
Wages and salaries(a)		1,510	9,611	9,874	20,083
Superannuation		289	3,336	3,639	7,748
Depreciation and amortisation		706	4,284	4,780	9,507
Supply of goods and services		9,153	50,589	50,237	104,308
Other operating expenses(a)		427	3,209	2,986	5,832
Total gross operating expenses		12,085	71,030	71,516	147,478
Superannuation interest expense		837	4,992	4,882	9,240
Interest expenses		1,446	8,799	8,834	18,027
Current transfers
Current grants		11,399	68,535	68,689	140,142
Subsidy expenses		1,022	5,838	5,801	11,869
Personal benefits		10,976	66,393	66,202	128,483
Total current transfers		23,397	140,766	140,692	280,495
Capital transfers
Mutually agreed write-downs		95	1,383	1,377	1,913
Other capital grants		360	1,845	1,728	9,784
Total capital transfers		455	3,228	3,105	11,697
Total expenses	3	38,221	228,815	229,028	466,937
Net operating balance		-1,006	-16,185	-17,726	-18,235
Other economic flows
- included in operating result
Net write-downs of assets (including bad and doubtful debts)		-478	-3,692	-3,149	-7,852
Assets recognised for the first time		22	144	102	204
Actuarial revaluations		1	4	-5	8
Net foreign exchange gains		1,081	530	2	-64
Net swap interest received		-46	158	204	250
Market valuation of debt		3,322	2,004	-2,476	-1,303
Other gains/(losses)		3,683	3,814	2,241	7,443
Total other economic flows - included in operating result		7,586	2,962	-3,081	-1,314
Operating Result(b)		6,580	-13,223	-21,851	-19,549
Non-owner movements in equity
Revaluation of equity investments(c)		-273	-395	0	-6,231
Actuarial revaluations		0	0	0	-2,274
Other economic revaluations(d)		138	-812	5	-302
Total other economic flows - included in equity		-135	-1,207	5	-8,807
Comprehensive result - Total change in net worth		6,445	-14,430	-20,802	-28,355
Net operating balance		-1,006	-16,185	-17,726	-18,235
Net acquisition of non-financial assets
Purchases of non-financial assets		1,377	6,116	5,751	12,993
less Sales of non-financial assets		96	1,851	1,743	3,699
less Depreciation		706	4,284	4,780	9,507
plus Change in inventories		113	-164	130	405
plus Other movements in non-financial assets		4	-10	-15	1
Total net acquisition of non-financial assets		693	-193	-657	193
Fiscal balance (Net lending/borrowing)(e)		-1,699	-15,993	-17,069	-18,428

_{*As published in the 2017-18 MYEFO.

(a) Consistent with Australian Bureau of Statistics' (ABS) Government Finance Statistics (GFS) classification, other employee related expenses are reported under other operating expenses. Total employee expenses equal wages and salaries plus other operating expenses.

(b) Operating result under Australian Accounting Standards.

(c) Reflects changes in the market valuation of investments and any revaluations at the point of disposal or sale.

(d) Largely reflects other revaluation of assets and liabilities.

(e) The term fiscal balance is not used by the ABS.}

Australian Government general government sector balance sheet

	ACTUAL as at 31 December 2017 $m	MYEFO ESTIMATE* as at 30 June 2018 $m
Assets
Financial assets
Cash and deposits	6,429	4,400
Advances paid	48,987	63,049
Investments, loans and placements	171,984	186,430
Other receivables	51,730	53,945
Equity investments
Investments in other public sector entities	51,757	46,725
Equity accounted investments	66	200
Investments - shares	51,490	42,546
Total financial assets	382,442	397,295
Non-financial assets
Land	11,045	10,882
Buildings	25,475	26,280
Plant, equipment and infrastructure	75,449	74,670
Inventories	8,336	8,538
Intangibles	7,565	8,381
Investment property	159	113
Biological assets	48	54
Heritage and cultural assets	11,617	11,601
Assets held for sale	196	86
Other non-financial assets	50	61
Total non-financial assets	139,941	140,666
Total assets	522,383	537,962
Liabilities
Interest bearing liabilities
Deposits held	214	218
Government securities	560,001	580,340
Loans	15,756	15,518
Other borrowing	1,673	1,582
Total interest bearing liabilities	577,645	597,658
Provisions and payables
Superannuation liability(a)	283,703	181,257
Other employee liabilities	18,437	18,600
Suppliers payables	5,189	8,015
Personal benefits payables	2,931	2,993
Subsidies payables	436	554
Grants payables	2,415	3,350
Other payables	3,017	2,183
Provisions	33,157	34,012
Total provisions and payables	349,286	250,964
Total liabilities	926,931	848,622
Net worth(b)	-404,547	-310,660
Net financial worth(c)	-544,488	-451,326
Net financial liabilities(d)	596,245	498,052
Net debt(e)	350,245	343,778

_{*As published in the 2017-18 MYEFO.

(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, that best matches each individual scheme's liability duration, 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^(a)

	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO Profile 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Cash receipts from operating activities
Taxes received	35,814	194,355	192,794	409,350
Receipts from sales of goods and services	730	4,629	4,625	10,609
Interest receipts	258	1,869	1,715	3,249
Dividends and income tax equivalents	395	3,268	2,898	4,174
Other receipts	897	4,829	4,961	8,305
Total operating receipts	38,094	208,950	206,992	435,686
Cash payments for operating activities
Payments for employees	-1,413	-13,234	-13,531	-28,917
Payments for goods and services	-9,870	-51,343	-51,515	-101,030
Grants and subsidies paid	-12,845	-77,749	-77,851	-162,144
Interest paid	-464	-8,211	-8,420	-16,623
Personal benefit payments	-11,839	-68,786	-68,642	-130,231
Other payments	-1,046	-3,549	-3,332	-5,498
Total operating payments	-37,477	-222,872	-223,291	-444,443
Net cash flows from operating activities	617	-13,922	-16,299	-8,757
Cash flows from investments in non-financial assets
Sales of non-financial assets	95	139	54	1,389
Purchases of non-financial assets	-1,369	-5,681	-5,545	-13,163
Net cash flows from investments in non-financial assets	-1,274	-5,542	-5,492	-11,774
Net cash flows from investments in financial assets for policy purposes	198	-5,503	-6,200	-19,042
Cash flows from investments in financial assets for liquidity purposes
Increase in investments	-1,996	12,556	10,889	8,165
Net cash flows from investments in financial assets for liquidity purposes	-1,996	12,556	10,889	8,165
Cash flows from financing activities
Borrowing (net)	2,904	15,710	17,474	33,746
Other financing (net)	-645	-1,490	-1,112	-3,076
Net cash flows from financing activities	2,259	14,220	16,363	30,669
Net increase/(decrease) in cash held	-196	1,809	-739	-739
GFS cash surplus(+)/deficit(-)(b)(c)	-657	-19,464	-21,791	-20,531
less Finance leases and similar arrangements(d)	0	91	0	0
less Net Future Fund earnings	471	2,393	2,073	3,076
Equals underlying cash balance(e)	-1,128	-21,948	-23,864	-23,608
plus Net cash flows from investments in financial assets for policy purposes	198	-5,503	-6,200	-19,042
plus Net Future Fund earnings	471	2,393	2,073	3,076
Equals headline cash balance	-459	-25,058	-27,990	-39,573

_{*As published in the 2017-18 MYEFO.

(a) A positive number denotes a cash inflow; a negative sign denotes a cash outflow.

(b) Due to the implementation of the 2015 ABS GFS Manual in the 2017-18 Budget, finance leases are no longer deducted in the derivation of the GFS cash surplus/deficit.

(c) GFS cash surplus/deficit equals net cash flows from operating activities and investments in non-financial assets.

(d) The acquisition of assets under finance leases worsens the underlying cash balance. The disposal of assets previously held under finance leases improves the underlying cash balance.

(e) The term underlying cash balance is not used by the Australian Bureau of Statistics.}

Note 1: Income Tax

	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO Profile 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Individuals and other withholding taxes
Gross income tax withholding	15,801	95,826	95,672	190,600
Gross other individuals	1,248	19,195	19,131	47,800
less Refunds	1,109	21,903	21,994	29,200
Total individuals and other withholding taxation	15,940	93,118	92,809	209,200
Fringe benefits tax	21	1,922	1,906	4,080
Company tax	9,094	39,990	39,974	83,800
Superannuation fund taxes	2,342	7,730	7,381	10,570
Petroleum resource rent tax	24	599	570	1,030
Total income taxation revenue	27,422	143,358	142,640	308,680

_{*As published in the 2017-18 MYEFO.}

Note 2: Indirect Tax

	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO Profile 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Goods and services tax	3,863	33,046	32,554	65,560
Wine equalisation tax	106	435	427	920
Luxury car tax	89	383	344	680
Excise duty	1,960	11,504	11,352	22,350
Customs duty	1,620	6,882	6,848	14,800
Other indirect tax	560	3,540	3,527	8,518
Total indirect taxation revenue	8,199	55,791	55,052	112,828

_{*As published in the 2017-18 MYEFO.}

Note 3: Total expenses by function

	ACTUAL 2017-2018 December $m	ACTUAL 2017-2018 YTD December $m	MYEFO ESTIMATE* 2017-2018 FULL YEAR $m
Expenses by function
General public services	1,388	10,922	24,371
Defence	2,362	14,397	31,022
Public order and safety	284	2,431	5,249
Education	1,800	16,160	33,793
Health	5,890	37,890	75,942
Social security and welfare	15,253	83,627	163,953
Housing and community amenities	335	2,089	5,383
Recreation and culture	289	1,727	3,731
Fuel and energy	630	3,395	7,393
Agriculture, Forestry and Fishing	118	1,083	3,027
Mining, manufacturing and construction	291	1,769	3,557
Transport and communication	1,350	2,890	9,389
Other economic affairs	699	4,971	10,106
Other purposes
Public debt interest	1,441	8,432	16,959
Nominal superannuation interest	837	4,992	9,240
General purpose inter-government transactions	5,253	32,040	64,347
Natural disaster relief	0	0	12
Contingency reserve	0	0	-538
Total expenses	38,221	228,815	466,937

_{*As published in the 2017-18 MYEFO.}

NOTES:

Australian Accounting Standard 1049

The Australian Government monthly financial statements have been prepared on a basis consistent with the Budget as required under section 47 of the Public Governance, Performance and Accountability Act 2013. The statements are prepared in accordance with the Australian Accounting Standards Board 1049 – Whole of Government and General Government Sector Financial Reporting (AASB 1049), which require treatment 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.

Taxation revenue

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 therefore estimates, in accordance with the best judgement of the Commissioner of Taxation, and subject to revision. The taxation revenue items not affected are: petroleum resource rent tax, excise duty, customs duty, other taxes and individuals refunds.

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 Special Data Dissemination Standards

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 (SDDS). Under these standards the timeframe for releasing the monthly financial statements is by the end of the following month. Australia applies a special flexibility option which allows it to publish late the last and first month of a financial year.

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 Calendar 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 Australian Office of Financial Management website at http://aofm.gov.au/cgs-quarterly/.

Electronic access to monthly financial statements

The Australian Government general government sector monthly financial statements and the historical series are available in electronic format at:

http://data.gov.au/dataset/australian-government-general-government-sector-monthly-financial-statements-tables-and-data.

Australian Government General Government Sector Monthly Financial Statements December 2017