Commonwealth Grants Commission

Date

Section 1: Agency overview and resources

1.1 Strategic direction statement

The Commonwealth Grants Commission (the Commission) operates under the Commonwealth Grants Commission Act 1973. It is a statutory authority whose role is to provide advice to the Australian Government in response to terms of reference.

The main subject on which the advice is sought is the allocation among the States of the goods and services tax (GST) revenue. Terms of reference for these inquiries are decided by the Australian Government in consultation with the States. The reports are considered at a meeting of the Council on Federal Financial Relations.

From time to time, the Commission is also asked to report on the finances of Australia's external territories, local government matters and the financing of services for Indigenous people. Terms of reference for those inquiries are developed by relevant Australian Government agencies and the reports are considered by their Ministers.

1.2 Agency resource statement

Table 1.1 shows the total resources for the Commission.

Table 1.1: Commonwealth Grants Commission resource statement — Budget estimates for 2014­15 as at Budget May 2014
  Estimate of
prior year
amounts
available in
2014‑15
$'000
+ Proposed
at Budget
2014‑15
$'000
= Total
estimated
2014‑15
$'000
Actual
available
appropriation
2013‑14
$'000
Ordinary annual services            
Departmental appropriation            
Prior year departmental appropriation 2,200 3 -   2,200 -
Departmental appropriation2 -   6,399 1 6,399 6,461
Total net resourcing for the Commission 2,200   6,399   8,599 6,461

1. Appropriation Bill (No. 1) 2014‑15.

2. Includes $0.1 million in 2014‑15 for the departmental capital budget (also refer to Table 3.2.5).

3. Estimated adjusted balance carried forward from previous year.

1.3 Budget measures

Budget measures relating to the Commission are summarised below.

Table 1.2: Commonwealth Grants Commission 2014‑15 Budget measures
  Programme 2013‑14
$'000
2014‑15
$'000
2015‑16
$'000
2016‑17
$'000
2017‑18
$'000
Expense measures            
Efficiency Dividend - temporary increase in the rate1 1.1 - (66) (147) (229) (229)
Efficiency Dividend - a further temporary increase of 0.25 per cent 1.1 - (16) (32) (48) (48)
Public Service efficiencies2 1.1 (2) (9) (20) (27) (27)
Reforms to APS management and efficient procurement of agency software1 1.1 (2) (8) (19) (27) (27)
Total expense measures   (4) (99) (218) (331) (331)

1. This measure was included in the Economic Statement 2013 and has not previously appeared in a portfolio statement.

2. This measure was included in Budget Paper No. 2, Budget Measures 2013‑14 and has not previously appeared in a portfolio statement.

Prepared on a Government Finance Statistics (fiscal) basis.

Section 2: Outcomes and planned performance

2.1 Outcomes and performance information

Government outcomes are the intended results, impacts or consequences of actions by the Government on the Australian community. Commonwealth programmes are the primary vehicle by which government agencies achieve the intended results of their outcome statements. Agencies are required to identify the programmes which contribute to Government outcomes over the budget and forward years.

The Commission's outcome is described below, specifying the strategy, programme objective, programme deliverables and programme key performance indicators used to assess and monitor the performance of the Commission.

Outcome 1: Informed Government decisions on fiscal equalisation between the States and Territories through advice and recommendations on the distribution of GST revenue and health care grants

Note: Recent terms of reference for the Commission have not required advice and recommendations on health care grants.

Outcome 1 strategy

The Commission's strategy is based on its role to provide advice to the Australian Government in response to terms of reference. Five‑yearly reviews of the methods used to calculate the recommended State shares of GST revenue is the major activity associated with this outcome. The last five‑year review was completed in February 2010. Between these reviews the shares are updated annually using the most recent data. The last update was completed in February 2014.

The Commission will continue with this strategy in the current budget year and the forward years.

Outcome expense statement

Table 2.1 provides an overview of the total expenses for Outcome 1.

Table 2.1: Budgeted expenses for Outcome 1
Outcome 1: Informed Government decisions on fiscal equalisation between the States and Territories through advice and recommendations on the distribution of GST revenue and health care grants 2013‑14 Estimated actual expenses
$'000
2014‑15 Estimated expenses
$'000
     
Programme 1.1: Commonwealth Grants Commission    
Departmental expenses    
Departmental appropriation 6,398 6,336
Expenses not requiring appropriation in the budget year 107 108
Total expenses for Outcome 1 6,505 6,444
     
  2013‑14 2014‑15
Average staffing level (number) 40 40

Contributions to Outcome 1

Programme 1.1: Commonwealth Grants Commission
Programme objective

The Commission makes recommendations which are considered by Government on the distribution of the GST pool.

Programme expenses

There are no significant changes to estimates across the forward years.

Table 2.2: Programme expenses
  2013‑14
Revised
budget
$'000
2014‑15
Budget
$'000
2015‑16
Forward
year 1
$'000
2016‑17
Forward
year 2
$'000
2017‑18
Forward
year 3
$'000
Annual departmental expenses          
Departmental items 6,505 6,444 6,370 6,296 6,343
Total departmental expenses 6,505 6,444 6,370 6,296 6,343
Programme deliverables

The Commission makes recommendations to Government on the distribution of the GST pool.

Completion of the Report on GST Revenue Sharing Relativities — 2014 Update for consideration by the Council on Federal Financial Relations.

Programme key performance indicators

The major effectiveness indicators are the quality of the Commission's research, the accuracy of its calculations and the acceptance of the results it presents to government.

Section 3: Explanatory tables and budgeted financial statements

Section 3 presents explanatory tables and budgeted financial statements which provide a comprehensive snapshot of agency finances for the budget year 2014‑15. It explains how budget plans are incorporated into the financial statements and provides further details of the reconciliation between appropriations, programme expenses and special accounts.

3.1 Explanatory tables

3.1.1 Movement of administered funds between years

The Commission does not have any administered funds.

3.1.2 Special accounts

The Commission does not have any special accounts.

3.1.3 Australian Government Indigenous expenditure

The Commission does not have any Australian Government Indigenous expenditure.

3.2 Budgeted financial statements

3.2.1 Differences in agency resourcing and financial statements

There are no material differences between the resource information presented in the Budget Papers and Portfolio Budget Statements as a result of differences between Australian Accounting Standards and Government Finance Statistics.

3.2.2 Analysis of budgeted financial statements

The financial statements have been prepared on an Australian Accounting Standards basis.

The Commission normally receives a relatively steady level of funding and its workload and expenses vary over a five year cycle.

3.2.3 Budgeted financial statements tables

Table 3.2.1: Comprehensive income statement (showing net cost of services) (for the period ended 30 June)
  Estimated actual 2013‑14
$'000
Budget estimate 2014‑15
$'000
Forward estimate 2015‑16
$'000
Forward estimate 2016‑17
$'000
Forward estimate 2017‑18
$'000
EXPENSES          
Employee benefits 5,200 5,300 5,400 5,500 5,500
Supplier 1,226 1,064 889 731 780
Depreciation and amortisation 79 80 81 65 63
Total expenses 6,505 6,444 6,370 6,296 6,343
LESS:          
OWN-SOURCE INCOME          
Revenue          
Sale of goods and rendering of services - - - - -
Total revenue - - - - -
Gains          
Other gains 28 28 28 28 28
Total gains 28 28 28 28 28
Total own-source income 28 28 28 28 28
Net cost of (contribution by) services 6,477 6,416 6,342 6,268 6,315
Appropriation revenue 6,398 6,336 6,261 6,203 6,252
           
Surplus (deficit) attributable to the Australian Government (79) (80) (81) (65) (63)
Note: Impact of Net Cash Appropriation Arrangements  
  2013‑14
$'000
2014‑15
$'000
2015‑16
$'000
2016‑17
$'000
2017‑18
$'000
Total Comprehensive Income (loss) less depreciation/amortisation expenses previously funded through revenue appropriations - - - - -
plus depreciation/amortisation expenses previously funded through revenue appropriations (79) (80) (81) (65) (63)
Total Comprehensive Income (loss) - as per the Statement of Comprehensive Income (79) (80) (81) (65) (63)

Prepared on Australian Accounting Standards basis.

Table 3.2.2: Budgeted departmental balance sheet (as at 30 June)
  Estimated
actual
2013‑14
$'000
Budget
estimate
2014‑15
$'000
Forward
estimate
2015‑16
$'000
Forward
estimate
2016‑17
$'000
Forward
estimate
2017‑18
$'000
ASSETS          
Financial assets          
Cash and equivalents 107 107 107 107 107
Trade and other receivables 2,214 2,214 2,214 2,214 2,214
Total financial assets 2,321 2,321 2,321 2,321 2,321
Non-financial assets          
Infrastructure, plant and equipment 355 338 321 319 319
Other 53 53 53 53 53
Total non-financial assets 408 391 374 372 372
Total assets 2,729 2,712 2,695 2,693 2,693
LIABILITIES          
Provisions          
Employees 1,476 1,476 1,476 1,476 1,476
Other 216 216 216 216 216
Total provisions 1,692 1,692 1,692 1,692 1,692
Payables          
Suppliers 160 160 160 160 160
Total payables 160 160 160 160 160
Total liabilities 1,852 1,852 1,852 1,852 1,852
Net assets 877 860 843 841 841
EQUITY          
Contributed equity 642 705 769 832 895
Reserves 343 343 343 343 343
Retained surpluses or accumulated deficits (108) (188) (269) (334) (397)
Total equity 877 860 843 841 841
Current assets 2,374 2,374 2,374 2,374 2,374
Non-current assets 355 338 321 319 319
Current liabilities 1,181 1,181 1,181 1,181 1,181
Non-current liabilities 671 671 671 671 671

Prepared on Australian Accounting Standards basis.

Table 3.2.3: Budgeted departmental statement of cash flows (for the period ended 30 June)
  Estimated
actual
2013‑14
$'000
Budget
estimate
2014‑15
$'000
Forward
estimate
2015‑16
$'000
Forward
estimate
2016‑17
$'000
Forward
estimate
2017‑18
$'000
OPERATING ACTIVITIES          
Cash received          
Goods and services - - - - -
Appropriations 12,579 6,336 6,261 6,203 6,252
Total cash received 12,579 6,336 6,261 6,203 6,252
Cash used          
Employees 5,200 5,300 5,400 5,500 5,500
Suppliers 7,379 1,036 861 703 752
Total cash used 12,579 6,336 6,261 6,203 6,252
Net cash from or (used by) operating activities - - - - -
INVESTING ACTIVITIES          
Cash used          
Purchase of property, plant and equipment 63 63 64 63 63
Total cash used 63 63 64 63 63
Net cash from or (used by) investing activities (63) (63) (64) (63) (63)
FINANCING ACTIVITIES          
Cash received          
Contributed equity 63 63 64 63 63
Total cash received 63 63 64 63 63
Net cash from or (used by) financing activities 63 63 64 63 63
Net increase or (decrease) in cash held - - - - -
Cash at the beginning of the reporting period 107 107 107 107 107
Cash at the end of the reporting period 107 107 107 107 107

Prepared on Australian Accounting Standards basis.

Table 3.2.4: Departmental statement of changes in equity — summary of movement (Budget year 2014­15)
  Retained surpluses
$'000
Asset revaluation reserve
$'000
Other reserves
$'000
Contributed equity/ capital
$'000
Total equity
$'000
Opening balance as at 1 July 2014          
Balance carried forward from previous period (108) 343 - 642 877
Adjusted opening balance (108) 343 - 642 877
Comprehensive income          
Surplus (deficit) for the period (80) - - - (80)
Total comprehensive income recognised directly in equity (80) - - - (80)
Transactions with owners          
Contributions by owners          
Appropriation (departmental capital budget) - - - 63 63
Total transactions with owners - - - 63 63
Estimated closing balance as at 30 June 2015 (188) 343 - 705 860

Prepared on Australian Accounting Standards basis.

Table 3.2.5: Departmental capital budget (DCB) statement
  Estimated
actual
2013‑14
$'000
Budget
estimate
2014‑15
$'000
Forward
estimate
2015‑16
$'000
Forward
estimate
2016‑17
$'000
Forward
estimate
2017‑18
$'000
NEW CAPITAL APPROPRIATIONS          
Capital budget - Bill 1 - DCB 63 63 64 63 63
Total new capital appropriations 63 63 64 63 63
Provided for:          
Purchase of non-financial assets 63 63 64 63 63
Total Items 63 63 64 63 63
PURCHASE OF NON-FINANCIAL ASSETS          
Funded by capital appropriation - DCB 63 63 64 63 63
TOTAL 63 63 64 63 63
RECONCILIATION OF CASH USED TO ACQUIRE ASSETS TO ASSET MOVEMENT TABLE          
Total purchases 63 63 64 63 63
Total cash used to acquire assets 63 63 64 63 63

Prepared on Australian Accounting Standards basis.

Table 3.2.6: Statement of asset movements — departmental
  Buildings
$'000
Other infrastructure, plant & equipment
$'000
Intangibles
$'000
L&B, IP&E held for sale
$'000
Total
$'000
As at 1 July 2014          
Gross book value - 834 - - 834
Accumulated depreciation/amortisation and impairment - 479 - - 479
Opening net book balance - 355 - - 355
Capital asset additions          
Estimated expenditure on new or replacement assets          
By purchase - appropriation ordinary annual services - 63 - - 63
Total additions - 63 - - 63
Other movements          
Depreciation/amortisation expense - 80 - - 80
Total other movements - 80 - - 80
As at 30 June 2015          
Gross book value - 897 - - 897
Accumulated depreciation/amortisation and impairment - 559 - - 559
Closing net book balance - 338 - - 338

Prepared on Australian Accounting Standards basis.