DEPARTMENT of Treasury
Objectives
The Department of Treasury provides strategic financial and economic policy advice to the Government with the aim of promoting the Territory’s financial position and economic management.
Treasury plays a leading role in promoting accountability and transparency in the delivery of services to the community.  This is achieved through sound financial policies, management practices and analysis.
2006-07 Priorities
Strategic and operational issues to be pursued in 2006‑07 include:
•	assisting the Government to maintain the Territory’s AAA credit rating through sound and sustainable economic and financial management;
•	managing the ACT’s input into the Commonwealth Grants Commission’s (CGC) Update of Revenue Sharing Relativities 2006 and the Commission’s 2010 Methodology Review;
•	analysing and implementing potential changes required by the proposed harmonisation of Generally Accepted Accounting Principles (GAAP) and Government Financial Statistics (GFS), which is likely to be adopted from 1 July 2007;
•	coordinating the preparation of the Government’s budget and reporting on financial outcomes;
•	continuing to improve the Territory’s financial management framework; 
•	implementing financing and managing options for the Government’s vehicle fleet;
•	implementing arrangements to strengthen whole of government capital planning and asset management processes;
•	implementing the Government’s revenue initiatives;
•	undertaking efficiency reviews of government programs; 
•	representing the ACT in the development of Council of Australian Governments National Reform Agenda and implementing the Territory’s commitments to national competition policy; and
•	strengthening the Territory’s Regulatory Impact Statement processes.

Business and Corporate Strategies
Treasury will assist the Government to implement financially and economically sustainable policies and programs.
In accordance with its business, risk management and human resource plans, Treasury will:
•	identify the most effective and efficient use of available resources through analysing programs and expenditure proposals;
•	strengthen collaborative relationships with Government departments, external organisations and other agencies through negotiation, consultation, best practice governance arrangements and effective service delivery; and
•	build Treasury’s capabilities through effective leadership, staff retention and recruitment policies, and personal and professional development practices.
Estimated Employment Levels
	2005‑06
Est. Outcome	2006‑07
Budget	
			
Staffing (Headcount)	2271	156	
Note:
1.	Excluding Procurement Solutions the staffing headcount for Treasury is estimated to be 149.

Output Classes
	Total Cost1	Government Payment for Outputs	
	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	
Output Class: 
Financial and Economic Management	43,134	53,013	28,965	49,686	
Output 1.1: Economic Management	4,300	4,996	4,274	4,959	
Note:
1.	Total cost includes depreciation of $2.302 million in 2005‑06 and $1.014 million in 2006‑07.
Output Description
This output covers a range of services including: economic policy advice, regulatory reform advice, analysis of major projects, intergovernmental financial relations, insurance policy advice and oversight of the Territory’s investments and debt.
The key outputs to be delivered in 2006‑07 include:
•	monitoring and advising on the state of the ACT economy;
•	participating in national economic reform forums;
•	coordinating ACT Government involvement with the Commonwealth Grants Commission comprising:
–	an annual submission to the CGC update of general revenue sharing relativities; and
–	on-going submissions, representations and participation in the CGC's major review of general revenue sharing relativities to apply from 2010‑11 onwards.
•	monitoring GST revenues and participation in the GST administration sub-groups;
•	providing recommendations to the ACT Government outlining the financing options for the passenger and light commercial vehicle fleet from 1 July 2006;
•	implementing financial and fleet management options for the passenger and light commercial vehicle fleet as determined by the ACT Government;
•	liaising with credit rating agencies; and
•	advising on major projects.

Output Classes cont.
	Total Cost	Government Payment for Outputs	
	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	
Output 1.2: Financial Management	18,556	35,804	12,148	33,773	
Output Description
Provision of analysis, monitoring and reporting on financial performance to assist the Government to achieve its policy objectives.  Financial Management will provide for:
•	the preparation and presentation of the Government’s annual budget and annual financial statements;
•	quarterly whole of government consolidated management and capital works reports;
•	reports to external agencies including the Loan Council, the Australian Bureau of Statistics and the Commonwealth Grants Commission;
•	reviews of government programs and functions; and
•	advice on the structure and operation of Government Business Enterprises.

	Total Cost	Government Payment for Outputs	
	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	
Output 1.3:  Revenue Management	11,415	12,213	10,215	10,954	
Output Description
This output provides for the administration of the ACT Government’s taxation revenue.  It also includes the provision of policy advice on taxation matters.
The key outputs to be delivered in 2006‑07 include:
•	collecting an estimated $737 million in taxation revenue;
•	providing high quality and timely advice to assist taxpayers meet their obligations;
•	processing 220 objections and reviews of decision;
•	processing 2,000 Stamp Duty Homebuyer Concessions; and
•	processing 2,000 First Home Owner Grant applications.

Output to cease after 2005‑06	Total Cost	Government Payment for Outputs	
	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	2005‑06
Est. Outcome
$’000	2006‑07
Budget
$’000	
					
Output: Procurement Support Services1	8,863	n/a	2,328	n/a	
Note:
1.	This output and associated accountability indicators has been transferred to the Shared Services Centre from 1 July 2006 and reported under Output 1.2 Procurement Support Services.

Strategic Indicators
In the 2006‑07 Budget the Government has decided to base its budget reporting on the Government Finance Statistics (GFS) standard.  The strategic indicators for Treasury have been revised to take account of key measures reported in the GFS system.

Strategic Indicator 1
Achieving a budget operating surplus
The Government’s objective is to achieve an operating surplus: temporary deficits must only occur if they are offset by surpluses at other times.  An important element of the Government’s strategy in the 2006‑07 Budget is to move the ACT away from its traditional reliance on land sales revenue to finance the operating budget.
In the short term, land sales will continue to be important in balancing the budget, and the Government’s intermediate objective is therefore to achieve an operating budget surplus after land sales receipts have been included.  However, the Government’s ultimate objective is to achieve an operating surplus without land sales receipts.
Detailed information for this indicator is included in Budget Paper No. 3.

Strategic Indicator 2
Maintaining a AAA credit rating
Standard and Poor’s assess the Territory’s credit rating each year.  The Territory currently has the highest possible credit rating - a AAA credit rating.  
Treasury assists the Government to maintain this credit rating through the provision of sound policy advice.

Strategic Indicator 3
Maintain net financial liabilities within the range of AAA rated jurisdictions
Net financial liabilities are a broad measure of general government sector liabilities, including net debt and superannuation liabilities.  The ACT has a strong balance sheet, and the Government’s objective is to maintain this position relative to AAA rated jurisdictions.
Detailed information for this indicator is included in Budget Paper No. 3.

Accountability Indicators
	2005‑06
Targets	2005‑06
Est. Outcome	2006‑07
Targets	
1.1: Economic Management	
				
a.	Briefings on the ACT Economy	120	120	120	
				
b.	Submission to CGC Annual Update	1	1	1	
				
c.	Submissions to the CGC Major Review	3	3	3	
				
d.	Submission to credit rating agency	1	1	1	
				
1.2: Financial Management	
				
a.	Budget	1	1	1	
				
b.	Annual Financial Reports	1	1	1	
				
c.	Quarterly Reports	4	4	4	
				
d.	Expenditure Capacity Reviews2	3	1	1	
	
1.3: Revenue Management	
				
a.	Debt Management — level of outstanding debt as a percentage of Treasury tax revenue	2%	2%	2%	
				
b.	Compliance revenue per inspector	$300,000	$307,165	$320,000	
				
1.4: Procurement Solutions1				
				
a.	Proportion of Government funded annual Capital Works Program supported with project procurement services	60%	62%	n/a	
				
b.	Quality Management Systems Compliance with ISO 9001:2000 – number of category 1 non‑compliance findings	<2	<2	n/a	
				
Note:
1.	This output and associated accountability indicators will be transferred to the Shared Services Centre from 1 July 2006 and repeated under Output 2.1 Procurement Support Services
2.	The variance in the 2005‑06 estimated outcome from the original target is a result of the Government undertaking the Strategic and Functional Review that superseded the planned expenditure capacity reviews.

Changes to Appropriation
Changes to Appropriation - Departmental						
 	2005-06	2006-07	2007-08	2008-09	2009-10	
Government Payment for Outputs	Est. Outc.	Budget	Estimate	Estimate	Estimate	
 	$'000	$'000	$'000	$'000	$'000	
						
2005-06 Budget	40,116 	31,500 	25,954 	26,417 	26,417 	
						
2006-07 Budget Policy Adjustments						
Return of Sustainable Infrastructure Fund	(1,685)	0 	0 	0 	0 	
Return of Social Plan Evaluation Framework	(350)	0 	0 	0 	0 	
Transfer of Procurement Solutions to the Shared Services Centre	0 	(2,173)	(2,392)	(2,499)	(2,609)	
Transfer of Gambling and Racing from the Department of Economic Development	0 	116 	117 	119 	121 	
Transfer of Compulsory Third Party Insurance from the Department of Territory and Municipal Services	0 	136 	139 	141 	144 	
Supporting Economic and Financial Policy Advice	0 	1,000 	1,025 	1,051 	1,077 	
Restructure Fund	0 	14,500	4,500 	1,500 	500 	
Reducing General Procurement	0 	(96)	(196)	(201)	(206)	
Reducing Motor Vehicle Expenses	0 	(24)	(33)	(43)	(44)	
Consolidating Human Resources and Finance Functions	0 	(27)	(64)	(65)	(66)	
Consolidating Information Technology Services	0 	(309)	(311)	(313)	(314)	
Rationalising Boards and Committees	0 	(65)	(130)	(130)	(130)	
Streamlined Grants Administration	0 	(23)	(29)	(29)	(29)	
2006-07 Budget Technical Adjustments						
Revised Indexation Parameters	0 	0 	0 	0 	462 	
Increased Notional Superannuation Contribution Rates	0 	1,551 	1,603 	1,620 	1,638 	
Revised Commonwealth Specific Purpose Payments	(16)	(100)	(103)	(105)	(108)	
Rollover - Restructure Fund	(8,200)	3,200	5,000	0 	0 	
Rollover - Budget and Finance System Project	(500)	500 	0 	0 	0 	
Rollover - Sustainable Infrastructure Fund	(400)		0 	0 	0 	
						
2006-07 Budget	28,965 	49,686 	35,080 	27,463 	26,853 	

Changes to Appropriation - Territorial						
 	2005-06	2006-07	2007-08	2008-09	2009-10	
Payment for Expenses on Behalf of Territory	Est. Outc.	Budget	Estimate	Estimate	Estimate	
 	$'000	$'000	$'000	$'000	$'000	
						
2005-06 Budget	38,156 	38,648 	37,348 	37,355 	37,355 	
						
2006-07 Budget Policy Adjustments						
Transfer of Gambling and Racing from the Department of Economic Development	0 	8,262 	8,514 	8,578 	8,818 	
Reclassification of Appropriation direct to Authority - EPIC	0 	(321)	(328)	(335)	(335)	
2006-07 Budget Technical Adjustments						
Reclassification of Appropriation direct to Authority - ACTEW	27 	(9,407)	(9,600)	(9,600)	(9,600)	
						
2006-07 Budget	38,183 	37,182 	35,934 	35,998 	36,238 	
 	 	 	 	 	 	
Changes to Appropriation - Departmental						
 	2005-06	2006-07	2007-08	2008-09	2009-10	
Capital Injections	Est. Outc.	Budget	Estimate	Estimate	Estimate	
 	$'000	$'000	$'000	$'000	$'000	
						
2005-06 Budget	24,500 	0 	0 	0 	0 	
						
2006-07 Budget Technical Adjustments						
General Savings	(700)					
Rollover - Rhodium Asset Solutions	(800)	800 	0 	0 	0 	

Reclassification of Appropriation direct to Authority - Rhodium	0 	(800)	0 	0 	0 	
						
2006-07 Budget	23,000 	0 	0 	0 	0 	
 	 	 	 	 	 	
Changes to Appropriation - Territorial						
 	2005-06	2006-07	2007-08	2008-09	2008-09	
Capital Injections	Est. Outc.	Budget	Estimate	Estimate	Estimate	
 	$'000	$'000	$'000	$'000	$'000	
						
2005-06 Budget	450	450	450	450	450	
						
2006-07 Budget Technical Adjustments						
Reclassification of Appropriation direct to Authority - EPIC	 - 	(450)	(450)	(450)	(450)	
						
2006-07 Budget	450	 - 	 - 	 - 	 - 	

Commonwealth Grants
The major Commonwealth grants for which Treasury has responsibility are:
Name of Grant	Activities Funded by Grant	2006‑07
Estimate
$'000	
			
Assistance for Water and Sewerage	Assistance in meeting the additional cost for water and sewerage arising from Canberra's role as the national capital.	9,444	
Financial Assistance Grants for Local Government	Financial assistance in relation to the operation of local governing bodies.	35,045	
ACT National Capital Influences	Compensation for the effect of national capital influences on the costs of providing municipal services.	23,486	
GST Revenue Grants	GST revenue provided to the ACT by the Australian Government.	758,300	

Total
		
826,275	

Department of Treasury	
Operating Statement	
  2005-06			  2005-06	   2006-07		  2007-08	  2008-09	  2009-10		
    Budget			Est.Outcome	   Budget	   Var	  Estimate	   Estimate	  Estimate		
    $'000			   $'000	   $'000	    %	   $'000	    $'000	   $'000		
		Income								
		Revenue								
40,116		Government Payment for Outputs	28,965	49,686	72	35,080	27,463	26,853		
56		User Charges - Non ACT Government	56	56	-	56	56	56		
4,284		User Charges - ACT Government	4,284	0	-100	0	0	0		
706		Interest	1,250	0	-100	0	0	0		
500		Resources Received free of charge	500	500	-	500	500	500		
45,662		Total Revenue	35,055	50,242	43	35,636	28,019	27,409		
		Gains								
0		Total Gains	0	0	-	0	0	0		
45,662		Total Income	35,055	50,242	43	35,636	28,019	27,409		
		Expenses								
33,188		Employee Expenses	15,753	12,688	-19	12,875	13,017	13,146		
2,223		Superannuation Expenses	2,194	3,017	38	3,061	3,095	3,127		
11,795		Supplies and Services	11,521	10,412	-10	10,072	10,048	10,273		
2,302		Depreciation and Amortisation	2,302	1,014	-56	267	217	217		
2,912		Grants and Purchased Services	11,364	25,882	128	9,811	1,804	810		
52,420		Total Ordinary Expenses	43,134	53,013	23	36,086	28,181	27,573		
-6,758		Operating Result	-8,079	-2,771	66	-450	-162	-164		

Department of Treasury	
Balance Sheet	
    Budget			Est.Outcome	   Planned		   Planned	   Planned	   Planned		
as at 30/6/06			as at 30/6/06	as at 30/6/07	   Var	as at 30/6/08	as at 30/6/09	as at 30/6/10		
   $'000			   $'000	    $'000	    %	    $'000	    $'000	    $'000		
		Current Assets								
1,406		Cash	2,928	1,572	-46	525	221	221		
2,519		Receivables	4,928	835	-83	835	835	835		
25,624		Investments	34,331	0	-100	0	0	0		
773		Other	663	663	-	663	663	663		
30,322		Total Current Assets	42,850	3,070	-93	2,023	1,719	1,719		
		Non Current Assets								
407		Property, Plant and Equipment	382	242	-37	135	135	135		
874		Intangibles	909	35	-96	675	629	412		
851		Capital Works in Progress	0	907	#	171	0	0		
2,132		Total Non Current Assets	1,291	1,184	-8	981	764	547		
32,454		TOTAL ASSETS	44,141	4,254	-90	3,004	2,483	2,266		
		Current Liabilities								
10,410		Payables	10,376	1,476	-86	1,527	1,578	1,629		
2,392		Employee Benefits	2,411	1,761	-27	1,821	1,883	1,946		
10,482		Other	20,107	0	-100	0	0	0		
23,284		Total Current Liabilities	32,894	3,237	-90	3,348	3,461	3,575		
		Non Current Liabilities								
2,236		Employee Benefits	2,222	1,643	-26	1,644	1,644	1,644		
2,236		Total Non Current Liabilities	2,222	1,643	-26	1,644	1,644	1,644		
25,520		TOTAL LIABILITIES	35,116	4,880	-86	4,992	5,105	5,219		
6,934		NET ASSETS	9,025	-626	-107	-1,988	-2,622	-2,953		
		REPRESENTED BY FUNDS EMPLOYED								
6,934		Accumulated Funds	9,025	-626	-107	-1,988	-2,622	-2,953		
6,934		TOTAL FUNDS EMPLOYED	9,025	-626	-107	-1,988	-2,622	-2,953		

Department of Treasury	
Cash Flow Statement	
  2005-06			  2005-06	   2006-07		  2007-08	  2008-09	  2009-10		
    Budget			Est.Outcome	   Budget	   Var	  Estimate	   Estimate	  Estimate		
    $'000			   $'000	   $'000	    %	   $'000	    $'000	   $'000		
		CASH FLOWS FROM OPERATING ACTIVITIES								
		Receipts								
40,116		Cash from Government for Outputs	28,965	49,686	72	35,080	27,463	26,853		
87,583		User Charges	87,583	56	-100	56	56	56		
706		Interest Received	1,250	0	-100	0	0	0		
18,293		Other Revenue	18,205	1,321	-93	1,091	1,061	1,058		
146,698		Operating Receipts	136,003	51,063	-62	36,227	28,580	27,967		
		Payments								
35,295		Related to Employees	17,950	15,712	-12	15,853	16,029	16,188		
11,224		Related to Supplies and Services	12,113	9,746	-20	9,436	9,410	9,633		
2,912		Grants and Purchased Services	11,364	25,882	128	9,811	1,804	810		
101,640		Other	101,633	1,528	-98	1,198	1,169	1,169		
151,071		Operating Payments	143,060	52,868	-63	36,298	28,412	27,800		
-4,373		NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES	-7,057	-1,805	74	-71	168	167		
		CASH FLOWS FROM INVESTING ACTIVITIES								
		Receipts								
0		Proceeds from Sale of Property, Plant & Equipment	174	0	-100	0	0	0		
0		Investing Receipts	174	0	-100	0	0	0		
		Payments								
851		Purchase of Land and Intangibles	0	907	#	64	0	0		
24,500		Capital Payments to Government Agencies	23,000	0	-100	0	0	0		
25,351		Investing Payments	23,000	907	-96	64	0	0		
-25,351		NET CASH INFLOW/(OUTFLOW) FROM INVESTING ACTIVITIES	-22,826	-907	96	-64	0	0		
		CASH FLOWS FROM FINANCING ACTIVITIES								
		Receipts								
24,500		Capital Injection from Government	23,000	0	-100	0	0	0		
0		Receipt of Transferred Cash Balances	662	0	-100	0	0	0		
24,500		Financing Receipts	23,662	0	-100	0	0	0		
		Payments								
0		Distributions to Government	0	6,670	#	912	472	167		
0		Payments of Transferred Cash Balances	0	26,305	#	0	0	0		
0		Financing Payments	0	32,975	#	912	472	167		
24,500		NET CASH INFLOW/(OUTFLOW) FROM FINANCING ACTIVITIES	23,662	-32,975	-239	-912	-472	-167		
-5,224		NET INCREASE/(DECREASE) IN CASH HELD	-6,221	-35,687	-474	-1,047	-304	0		
32,254		CASH AT BEGINNING OF REPORTING PERIOD	43,480	37,259	-14	1,572	525	221		
27,030		CASH AT THE END OF THE REPORTING PERIOD	37,259	1,572	-96	525	221	221		

Department of Treasury	
Statement of Changes in Equity	
    Budget			Est.Outcome	   Planned		   Planned	   Planned	   Planned		
as at 30/6/06			as at 30/6/06	as at 30/6/07	   Var	as at 30/6/08	as at 30/6/09	as at 30/6/10		
   $'000			   $'000	    $'000	    %	    $'000	    $'000	    $'000		
13,692		Opening Balance	17,489	9,025	-48	-626	-1,988	-2,622		
		Accumulated Funds								
-6,758		Operating Result for the Period	-8,079	-2,771	66	-450	-162	-164		
		Reserves								
-6,758		Total Income And Expense For The Period	-8,079	-2,771	66	-450	-162	-164		
		Transactions Involving Equity Holders Affecting Accumulated Funds								
0		Capital (Distributions)	0	-6,670	#	-912	-472	-167		
0		Inc/Dec in Net Assets due to Admin Restructure	-385	-210	45	0	0	0		
6,934		Closing Balance	9,025	-626	-107	-1,988	-2,622	-2,953		
Notes to the Budget Statements
Significant variations are as follows:
Operating Statement
•	government payment for outputs: 
–	the decrease of $11.151 million in the 2005‑06 estimated outcome from the original budget is mainly due to the rollover of the Restructure Fund ($8.2 million), the Budget and Finance Systems project ($0.5 million), Sustainable Infrastructure funding ($0.4 million) and the return to budget of unused funding ($2.035 million) of which $1.685 million relates to the Sustainable Infrastructure Fund and $0.350 million for the Social Plan Evaluation Framework;
–	the increase of $20.721 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to increased funding for the Restructure Fund ($19.6 million), increased notional superannuation contribution rates ($1.551 million), additional funding for the supporting Economic and Financial Policy Advice Initiative ($1 million), and the rollover of funding for the Budget and Finance Systems project ($0.5 million), partially offset by the transfer of Procurement Solutions to the Shared Services Centre ($2.173 million);
•	user charges – ACT Government:  the decrease of $4.284 million in the 2006‑07 Budget from the 2005‑06 estimated outcome reflects the transfer of Procurement Solutions’ contract services and project management fees to the Shared Services Centre;
•	
interest:
–	the increase of $0.544 million in the 2005‑06 estimated outcome from the original budget is mainly due to additional interest earned from higher levels of cash and investment holdings due to the unspent Restructure Fund and Sustainable Infrastructure Fund balances throughout 2005‑06;
–	the decrease of $1.250 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is due to the implementation of cash management reforms;
•	employee expenses:
–	the decrease of $17.435 million in the 2005‑06 estimated outcome from the original budget is mainly due to the reclassification of Restructure Fund payments from employee expenses to grants and purchased services;
–	the decrease of $3.065 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to the transfer of Procurement Solutions ($4.172 million), partially offset by increased employee expenses associated with strengthening Treasury’s strategic capability ($0.8 million);
•	superannuation expenses:  the increase of $0.823 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to increased notional superannuation contribution rates ($1.551 million) and costs associated with strengthening Treasury’s strategic capability ($0.176 million).  These are partially offset by the transfer of Procurement Solutions to the Shared Services Centre ($0.979 million);
•	supplies and services: 
–	the decrease of $0.274 million in the 2005‑06 estimated outcome from the original budget is due to the rollover of the Budget and Finance System project ($0.740 million) and the return of the Social Plan Evaluation Framework funding ($0.350 million).  These are partially offset by increased administrative expenses incurred by Procurement Solutions ($0.605 million), together with the reclassification of employee expenses to supplies and services as a result of consolidating information technology services ($0.211 million);
–	the decrease of $1.109 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to the impact of consolidating information technology services ($0.309 million) and procurement services ($1.107 million) in the Shared Services Centre.  These are partially offset by the rollover of the Budget and Finance Systems project ($0.5 million);
•	depreciation:  the decrease of $1.288 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is due to the Oracle system being fully depreciated in 2005‑06; and
•	grants and purchased services:
–	the increase of $8.452 million in the 2005‑06 estimated outcome from the original budget is primarily due to the Restructure Fund expenses ($17.250 million) being reclassified from employee expenses to grants and purchased services, offset by the rollover of the Restructure Fund ($8.2 million) and the Sustainable Infrastructure  Fund ($0.4 million); and
–	the increase of $14.518 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is largely related to expenditure associated with the Restructure Fund ($16.521 million), partially offset by one‑off Sustainable Infrastructure expenditure occurring in 2005‑06 ($1.915 million).
Balance Sheet
•	cash and current investments:  
–	the increase of $10.229 million in the 2005‑06 estimated outcome from the original budget is mainly due to unspent cash for the Restructure Fund and prepayments for capital works managed by Procurement Solutions;
–	the decrease of $35.687 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is primarily due to the transfer of Procurement Solutions to the Shared Services Centre ($26.305 million), the introduction of cash management reforms ($6.670 million), which take effect from 1 July 2006, and the budgeted Restructure Fund expenditure ($1.871 million);
•	capital works in progress:  the decrease of $0.851 million in the 2005‑06 estimated outcome from the original budget and the increase of $0.907 million in  the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly related to delays in the development of the Rating and Tax Compliance and Online Revenue Systems; and
•	total liabilities:  
–	the increase of $9.596 million in the 2005‑06 estimated outcome from the original budget is largely due to revised estimates of project revenue paid in advance by agencies to Procurement Solutions;
–	the decrease of $30.236 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is primarily due to the transfer of Procurement Solutions to the Shared Services Centre.
Statement of Changes in Equity
•	increase/decrease in net assets from administrative restructuring:  the decrease in 2006‑07 Budget from the 2005‑06 estimated outcome is primarily due to the transfer of Procurement Solutions to the Shared Services Centre; and
•	capital distribution:  the distribution of $6.670 million in 2006‑07 Budget from the 2005‑06 estimated outcome reflects the implementation of cash management reforms effective from 1 July 2006.

Department of Treasury	
Statement of Income and Expenses on Behalf of the Territory	
  2005-06			  2005-06	   2006-07		  2007-08	  2008-09	  2009-10		
    Budget			Est.Outcome	   Budget	   Var	  Estimate	   Estimate	  Estimate		
    $'000			   $'000	   $'000	    %	   $'000	    $'000	   $'000		
		Income								
		Revenue								
38,156		Payment for Expenses on behalf of Territory	38,183	37,182	-3	35,934	35,998	36,238		
685,174		Taxes Fees and Fines	671,475	737,310	10	785,087	846,204	905,239		
0		User Charges - Non ACT Government	0	4,725	#	9,801	10,163	10,539		
0		User Charges - ACT Government	0	17,270	#	20,916	21,284	21,542		
800,196		Grants from the Commonwealth	797,075	826,275	4	866,322	906,538	946,870		
0		Interest	0	10	#	21	21	21		
182,648		Dividend Revenue	144,869	94,113	-35	94,458	114,511	121,778		
230		Other Revenue	230	7,776	3,281	8,002	8,236	8,476		
1,706,404		Total Revenue	1,651,832	1,724,661	4	1,820,541	1,942,955	2,050,703		
		Gains								
0		Total Gains	0	0	-	0	0	0		
1,706,404		Total Income	1,651,832	1,724,661	4	1,820,541	1,942,955	2,050,703		
		Expenses								
9,600		Supplies and Services	9,600	9,800	2	9,800	9,800	9,800		
28,363		Grants and Purchased Services	28,363	26,411	-7	25,141	25,205	25,445		
5,307		Other Expenses	5,307	4,822	-9	4,838	4,855	4,872		
1,663,134		Transfer Expenses	1,608,562	1,683,628	5	1,780,762	1,903,095	2,010,586		
1,706,404		Total Ordinary Expenses	1,651,832	1,724,661	4	1,820,541	1,942,955	2,050,703		
0		Operating Result	0	0	-	0	0	0		

Department of Treasury	
Statement of Assets and Liabilities on Behalf of the Territory	
    Budget			Est.Outcome	   Planned		   Planned	   Planned	   Planned		
as at 30/6/06			as at 30/6/06	as at 30/6/07	   Var	as at 30/6/08	as at 30/6/09	as at 30/6/10		
   $'000			   $'000	    $'000	    %	    $'000	    $'000	    $'000		
		Current Assets								
3,273		Cash	2,954	3,058	4	3,076	3,076	3,076		
76,109		Receivables	62,265	64,089	3	65,418	66,458	67,301		
0		Investments	0	193	#	193	193	193		
79,382		Total Current Assets	65,219	67,340	3	68,687	69,727	70,570		
		Non Current Assets								
2,000		Investments	0	0	-	0	0	0		
2,000		Total Non Current Assets	0	0	-	0	0	0		
81,382		TOTAL ASSETS	65,219	67,340	3	68,687	69,727	70,570		
		Current Liabilities								
72,955		Payables	55,912	58,033	4	59,509	60,678	61,650		
7,770		Other	9,307	9,307	-	9,178	9,049	8,920		
80,725		Total Current Liabilities	65,219	67,340	3	68,687	69,727	70,570		
80,725		TOTAL LIABILITIES	65,219	67,340	3	68,687	69,727	70,570		
657		NET ASSETS	0	0	-	0	0	0		
		REPRESENTED BY FUNDS EMPLOYED								
657		Accumulated Funds	0	0	-	0	0	0		
657		TOTAL FUNDS EMPLOYED	0	0	-	0	0	0		

Department of Treasury	
Budgeted Statement of Cashflows on Behalf of the Territory	
  2005-06			  2005-06	   2006-07		  2007-08	  2008-09	  2009-10		
    Budget			Est.Outcome	   Budget	   Var	  Estimate	   Estimate	  Estimate		
    $'000			   $'000	   $'000	    %	   $'000	    $'000	   $'000		
		CASH FLOWS FROM OPERATING ACTIVITIES								
		Receipts								
37,843		Cash from Government for EBT	37,870	37,182	-2	35,934	35,998	36,238		
313		Cash from Government - CSO Payments	313	0	-100	0	0	0		
684,666		Taxes, Fees and Fines	665,538	712,857	5	765,415	817,672	881,825		
0		User Charges	0	12,475	#	25,701	26,363	27,139		
0		Interest Received	0	10	#	21	21	21		
800,396		Grants Received from the Commonwealth	797,075	826,275	4	866,322	906,538	946,870		
590		Other Revenue	590	11,378	#	15,086	15,569	16,067		
1,523,808		Operating Receipts	1,501,386	1,600,177	7	1,708,479	1,802,161	1,908,160		
		Payments								
9,600		Related to Supplies and Services	9,600	9,800	2	9,800	9,800	9,800		
28,363		Grants and Purchased Services	28,363	26,411	-7	25,141	25,205	25,445		
580		Other	580	580	-	580	580	580		
1,674,226		Territory Receipts to Government	1,618,782	1,655,625	2	1,766,060	1,880,038	1,993,261		
1,712,769		Operating Payments	1,657,325	1,692,416	2	1,801,581	1,915,623	2,029,086		
-188,961		NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES	-155,939	-92,239	-41	-93,102	-113,462	-120,926		
		CASH FLOWS FROM INVESTING ACTIVITIES								
		Receipts								
189,008		Dividends	155,986	92,298	-41	93,120	113,462	120,926		
189,008		Investing Receipts	155,986	92,298	-41	93,120	113,462	120,926		
		Payments								
450		Capital Payments to Government Agencies	450	0	-100	0	0	0		
450		Investing Payments	450	0	-100	0	0	0		
188,558		NET CASH INFLOW/(OUTFLOW) FROM INVESTING ACTIVITIES	155,536	92,298	-41	93,120	113,462	120,926		
		CASH FLOWS FROM FINANCING ACTIVITIES								
		Receipts								
450		Capital Injection from Government	450	0	-100	0	0	0		
0		Receipt of Transferred Cash Balances	0	238	#	0	0	0		
450		Financing Receipts	450	238	-47	0	0	0		
450		NET CASH INFLOW/(OUTFLOW) FROM FINANCING ACTIVITIES	450	238	-47	0	0	0		
47		NET INCREASE/(DECREASE) IN CASH HELD	47	297	532	18	0	0		
3,226		CASH AT BEGINNING OF REPORTING PERIOD	2,907	2,954	2	3,251	3,269	3,269		
3,273		CASH AT THE END OF THE REPORTING PERIOD	2,954	3,251	10	3,269	3,269	3,269		

Department of Treasury	
Statement of Changes in Equity on Behalf of the Territory	
    Budget			Est.Outcome	   Planned		   Planned	   Planned	   Planned		
as at 30/6/06			as at 30/6/06	as at 30/6/07	   Var	as at 30/6/08	as at 30/6/09	as at 30/6/10		
   $'000			   $'000	    $'000	    %	    $'000	    $'000	    $'000		
657		Opening Balance	0	0	-	0	0	0		
		Accumulated Funds								
0		Operating Result for the Period	0	0	-	0	0	0		
		Reserves								
657		Closing Balance	0	0	-	0	0	0		
Notes to the Budget Statements
The Department of Treasury’s territorial financial statements include taxes, fees and fines collected on behalf of the Territory.  A detailed explanation of the movement in taxes, fees and fines for 2005-06 is provided in Budget Paper 3, Part 5.2 – Revenue 2005-06 and Forward Estimates.  An explanation of the movement from the original 2004-05 budget to the estimated outcome is detailed in Budget Paper 3, Part 3 – 2005-06 Estimated Outcome.
Significant variations are as follows:
Statement of Income and Expenses on Behalf of the Territory
•	payment for expenses on behalf of the Territory:  the decrease of $1.001 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to a decrease resulting from the removal of Water and Sewage funding ($9.453 million), which will be directly appropriated to ACTEW as a result of changes made to the Financial Management Act 1996 (FMA), partially offset by increases resulting from the transfer of the Racing and Development Fund (RDF) ($7.231 million) from the Department of Economic Development as a result the July 2006 Administrative Arrangement Order (AAO), together with an increase in payments for the RDF ($1.031 million); 
•	user charges:  the increase of $7.967 million in the 2006‑07 Budget from the 2005‑06 estimated outcome reflects new revenue initiative: rent for utility infrastructure ($7.967 million);
•	taxes, fees and fines:
–	the decrease of $13.699 million in the 2005‑06 estimated outcome from the original budget is mainly due to decreased revenue resulting from payroll tax being less than originally budgeted ($12.178 million), although higher than 2004‑05, fewer duties received from unlisted shares/marketable securities ($5.516 million), and a decline in duties for motor vehicle transfers ($1.671 million).  These decreases are partially offset by revenue increases from an abnormally large receipt in ‘duty on leases’ ($4.933 million) and conveyances ($1.712 million).
–	the increase of $79.863 million in the 2006‑07 Budget from the 2005‑06 estimated outcome reflects expected growth of the payroll tax base ($18.106 million), budgeted increases in: general rates ($16.573 million) resulting from new initiatives; land tax ($5.678 million) due to increases in Average Unimproved Values (AUV); the introduction of a Fire and Emergency Service levy ($20.5 million); further revenue increases for the Ambulance Service Levy ($2.492 million) resulting from new initiatives; water fee ($14.028 million); and an increase in income tax equivalents ($11.306 million) due to the improved performance of ACT owned agencies.  These increases are partially offset by reductions in conveyancing revenue ($5.416 million) and lease duties ($4.863 million).
•	grants from the Commonwealth:  the decrease of $3.121 million in the 2005‑06 estimated outcome from the original budget is due to a decrease in the GST Revenue grant ($3.4 million), slightly offset by the increase in competition payments ($0.2 million).  The increase of $29.2 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to an increase in the GST Revenue grant ($40.3 million) and Finance Assistance to Local Government Functions ($1.129 million), partially offset by discontinued funding for Competition Payments ($12.8 million);
•	other revenue:  the increase of $7.546 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is attributable to the turnover tax received from ACTTAB as a result of the July 2006 AAO;
•	dividends:  the decrease of $37.779 million in the 2005‑06 estimated outcome from the original budget is largely due to the decrease in the dividend from Land Development Agency ($38 million).  The decrease of $50.756 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is due to expected decreases in dividend revenue from the Land Development Agency ($55.403 million) and ACTTAB ($1.499 million).  These decreases are partially offset by an anticipated increase in dividend revenue from ACTEW ($6.147 million);
•	supplies and services:  the increase of $0.2 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is due to anticipated increases to ATO GST administrative costs;
•	grants and purchased services:  the decrease of $1.952 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is due to the removal of the Water and Sewage payment to ACTEW ($9.453 million) and EPIC’s CSO payment ($0.321 million), which are to be directly appropriated to Statutory Authorities from 1 July 2006 as a result of change in Financial Management Act 1996 (FMA).  These decreases are largely offset by the inclusion of a Racing and Development Fund payment ($6.480 million) as a result of the July 2006 AAO, together with ACTTAB ($1.031 million); and
•	transfer expenses:  the decrease of $54.572 million in the 2005‑06 estimated outcome from the original budget results from decreased revenue received for dividends, taxes, fees and fines, and from the Commonwealth.  The increase of $75.066 million in the 2006‑07 Budget from the 2005‑06 estimated outcome relates to increased revenues from user charges, taxes, fees and fines, and also from the Commonwealth, partly offset by decreased dividends.  Funds received by the Territory are transferred to the Central Financing Unit.
Statement of Assets and Liabilities on Behalf of the Territory
•	cash and current investments:  the decrease of $2.319 million in the 2005‑06 estimated outcome from the original budget is mainly due to the transfer of the investment with Canberra Business Development Fund to the Department of Economic Development as a result of the 4 November 2004 AAO.  The increase of $0.297 million in the 2006‑07 Budget from the 2005‑06 estimated outcome largely relates to the transfer of the Racing and Development Fund from the Department of Economic Development to Treasury $0.241 million as a result of the July 2006 AAO;
•	current receivables:  the decrease of $13.844 million in the 2005‑06 estimated outcome from the original budget and the increase of $1.824 million in the 2006‑07 Budget from the 2005‑06 estimated outcome is mainly due to decreased estimates at year end for dividend and tax accruals; and
•	current liabilities:  the decrease of $15.506 million in the 2005‑06 estimated outcome from the original budget and the increase of $2.121 million in the 2006‑07 Budget from the 2005‑06 estimated outcome mainly relates to the accrued transfer of revenue to the Central Financing Unit.