IS
Joint Departmental Information Centre Level 5. 1 Macaithur St EAST MELBOURNE VIC 3002 Ph: 03 96515660 Fax: 03 96515659 email: [email protected]
A
XST"1 '
-•iZf :
-Ü '
^¡¿zz 'S »
OsöHtiiiiHßeOte Annual Report 1999-2000 o
o
^prosperous QrOnofigyglDfiSEnEBB
u n financialSñd management
DepartmentPiTreasurylandlliinance'Annual lî^gijifliinnïtftiiïiîi DepartmentlofiTreasury fiTïïïlfgiiTïïïïaa Statë!ofiVictoriâ>2000 i ijarf^TiriTi il ictetìiwìih ^RTW^gaOìDUIBOI <'l'M'lit--KlgGÎB(g3ii'iïr'i i
St 1325Î1775 Published 0ctober#2000
AddressTenquiries
QSSâlâi) CMacarthunStree t miimiîîiiaailiB 1@ÊBfiBî0 General government financial liabilities 2000-01 Budget Estimate (per cent of Gross State Product) Source: 2000-01 Budget Paper No. 2. Ratings by Moody's 1999-00 2000-01 2001-02 2002-03 Tas SA Vic Vic Vic NSW WA Qld 1998 1998 1999 2000 2004 1998 1998 1998 0 200 400 600 800 1000 1200 1400 Restoring Victoria's triple-A rating A substantial Budget surplus Victoria's standing in the international credit markets was In the 2000-01 State Budget the Department forecast an restored in 1999-2000 when international ratings agency, operating surplus of $592 million and predicted budget Moody's, announced It was upgrading Victoria's credit rating to surpluses averaging $450 million over the forward estimates triple-A. It followed an earlier announcement from Standard and period. The substantial Budget surplus will ensure that the Poor's that It would maintain Victoria's triple-A rating. Victoria Is Government's target of an operating surplus of at least only the fourth jurisdiction to regain a lost triple-A credit rating $100 million per year is still achievable In the event of a from Moody's - the other three being Ontario (Canada), Western moderate economic downturn. Australia and Norway. ... a range of new initiatives were implemented in 1999-2000 and important foundations have been laid for the realisation of other long-term policy objectives f» f HBHHB ¥ 1 i Kls^B Vic. JOINT DEPT INFO. CENTRE ' our history 2 5 JAN 2GGÎ •Ì K i LEVEL 3, 1 IVIACARTHUR STREET E. MELBOURNE VIC. 3002 Stems Qdu^hi/ 17 1999-2000 performance financial statements 81 appendices The Department of Treasury and Finance can trace its origins to the earliest days of the settlement t f that became the State of Victoria"/The Treasury is one of Victoria's oldest institutions, predating the Parliament of Victoria by more than a decade. .- • „„„. -- .. r A branch of the Colonial Treasury was opened in Melbourne in 1839. The first Government representative sent to Port Phillip,"Captain William Lonsdale, was appointed sub-Treasurer in the following year. He hadasteff of three and managed an annual budget of £1,812 10s 8d. The Treasury played a vital part intrie establishment of the local economy, collecting revenue from land sales and customs duty.iLateryt became the principal agency responsible for the sale and safe storage of gold extracted from V|cToria|smines in the second-half of the nineteenth century. Today, the Department continues to playa crucial role in building the foundations for Victoria's • r future, by managing the State's finances and promoting economic growth for all Victorians. The year in review Our vision and mission Vision: a prosperous future for all Victorians. Following the State Election in October 1999, the Department expanded its vision statement to align it with the new Government's priorities. To fulfil this vision, the Department's energy and resources are directed at'providing policy advice to the Government that will ultimately Increase the living standards of all Victorians. Mission: to provide leadership in economic, financial and resource management. The Department's role is to ensure that the Government and the State of Victoria benefit from the highest standard of economic, financial and resource management. As a central Government agency, the Department plays an important role In advising the Government on how to achieve its policy outcomes through the distribution of resources within a framework of financial responsibility. Achievements The following highlights provide a snapshot of initiatives completed by the Department during 1999-2000 that contributed to Government outcomes of a substantial budget surplus, a transparent and accountable financial system, economic growth for the whole State, and value for money services. • A State Budget surplus of $592 million for 2000-01 31 • A world-first financial accountability framework • A mechanism to monitor Government spending - the Expenditure Review Committee • A public-private partnership policy to deliver better services to the Victorian community • A better approach to gambling regulation based on community consultation • Restoration of common law rights for seriously Injured workers • Year 2000 readiness of 99 per cent across the Victorian public sector • Implementation of Commonwealth tax changes while protecting the State's budget position • Successful completion of Victorian public transport franchising • A live webcast of the Treasurer's Budget Speech in Parliament - an Australian first The year in review continued Economic and financial report card Victoria's economic and financial position is strong and foundations have been laid for the State's long-term economic growth. The Department has made a major contribution to sustaining this position by providing sound economic and financial advice to the Government. Victorian net interstate migration (persons) Gross State Product (per cent change on previous year) 10 000 - 5 000 0 .1 6 - -5 000- 4 ... -10 000- 3 - -15 000 - 2 - -20 000 - 1 - -25 000 - -30 000 - Victoria is the place to be Strong economic growth to continue Victoria's annual population growth has trebled since 1994 and Following exceptionally strong growth in the late 1990s, Victorian is now above the national growth rate for the first time since the Gross State Product is expected to grow by at least 3 per cent early 1970s. People continue to move to Victoria, with a net per year until 2003-04. 5 350 people migrating from interstate in 1999. Victorian international non-gold Improved regional employment growth merchandise exports ($ billion) 5- o 1997-98 H 1998-99 • 1999-00 Victorian exports growing strongly Promoting growth across the whole State Victorian exports, which account for 12 per cent of GSP, grew In the year to August 2000, employment in country Victoria has strongly In 1999-2000. Growth occurred in all major markets grown by 4.7 per cent compared with 3.5 per cent in Melbourne and commodity groups. The volume of international (three-month average data). The regional unemployment rate merchandise exports rose 9.3 per cent in trend terms through averaged 7.3 per cent In the three months to August, compared the year ending June 2000 and the value of Victorian exports to with 5.6 per cent in metropolitan Melbourne. Asia grew by 30 per cent in the first half of 2000. The year in review continued Secretary's Report As an organisation, the Department of Treasury and Finance In assisting the Government with its first Budget, the Department also facilitated the implementation prides itself on agility and professional service. The financial of the Government's election commitments. The Department developed a financial strategy, year 1999-2000 provided the Department with an unsurpassed based on responsible financial management, which included a commitment to maintaining an opportunity to display these qualities. The election of the Bracks annual Budget surplus of at least $100 million. Government at the end of October 1999, following a two-month period of caretaker Government,1 resulted in a range of new Consulting the community initiatives. Many of these have already been fully implemented, The restoration of common law rights to seriously injured workers was a Government election while important foundations have been laid for the realisation of commitment. During the year the Department established a working party consisting of other long-term policy objectives. business, union, legal and insurance representatives to develop recommendations for reinstating common law to the Victorian Workers' Compensation scheme. Following a period Enhancing financial accountability of consultation, the recommendations of the Common Law Working Party were incorporated Maintaining a substantial operating surplus and a commitment to... in the Accident Compensation (Common Law and Benefits) Act 2000 that was passed in the open, transparent and accountable government are central to the Autumn Session of Parliament. Government's agenda. The Department developed and Another Government election commitment implemented by the Department was the creation of implemented a new financial accountability framework, involving a stronger regulatory environment for the gaming industry. A consultation process on responsible new financial practices and financial responsibility legislation gaming was completed by May 2000 and elicited over 200 written responses from industry, local The Audit (Amendment) Act 1999 and the Financial Management government, community groups and members of the public. In addition, the Gambling Legislation (Financial Responsibility) Act 2000 were passed in Spring 1999. (Responsible Gambling) Act 2000 was passed in May. Key elements of the legislation include: Another significant community consultation project that commenced In 1999-2000 was the • < quarterly Budget Sector financial reports and a half-yearly establishment of the Essential Services Ombudsman. When fully implemented, this initiative Budget update; - will result in legislation to protect the rights of energy and water customers. • «twice-yearly statements of the Government's financial policy objectives; and Managing the State's risks In mid-1999 the Commonwealth, States and Territories signed a revised Intergovernmental • independent review of the Budget by the Auditor-General. •; Agreement on the Reform of Commonwealth-State Financial Relations. Under the Agreement The Department also played a major role in establishing the - | the States had to fulfil a number of obligations by 1 July 2000. Expenditure Review Committee (ERC), a Cabinet Committee that - J The Department developed legislation to enable taxation and other amendments required monitors Government spending. The ERC was set up in October' by the Intergovernmental Agreement. Legislation included the National Taxation Reform 1999, almost immediately after the Government was sworn into*'- (Consequential Provisions) Act 2000, the National Taxation Reform (Further Consequential office, and is an example of the Department's agile response to ~~ Provisions) Act 2000 and the First Home Owner Grant Act 2000. implementing the Government's election commitments. \ The Department also developed key principles and provided advisory services to all departments on the implementation of the Goods and Services Tax. GST preparedness within the Responsible financial management Department and Its portfolio entities was high due to extensive staff training and appropriate Thè first Budget of the Bracks Government, tabled in Parliament preparation of financial systems. Ongoing and new contracts were also successfully negotiated „on 2 May 2000; also set a number, of.precedents for the to ensure maximum extraction of embedded tax savings. ; Department. Changes to Vne1 Financial Management Act, resulting : sfrom the new financial responsibility legislation; required the j The Department was also responsible for implementing and managing the State Government's ; Budget to" be based on generally accepted accounting principles : Year 2000 strategy. By 1 January 2000,99.86 per cent of the critical systems and processes and subject to the independent scrutiny of the Auditor-General, : monitored by the Department's VICT0RY2000+ reporting tool had been confirmed ready, and a world first. Further, the Treasurer's Budget Speech was the first ^ 99.46 per cent of contingency plans had been completed. These represent exceptionally high of any Australian Parliament to be broadcast live on the Internet ' readiness rates by any standard. The highly successful strategy assured that no significant Year 2000-related Incidents affecting the operation of the Victorian Government were reported on or after 1 January 2000. Management of the State's legal defence arising from the Longford gas explosion in September 1998 continued. The progress of the litigation is dependent on the Court, with the first trial expected to start around April 2001. The year in review continued Providing strategic advice and implementing policy International recognition As usual, the Department provided advice to the Government on Victoria's standing in the international credit markets was fully a large range of taxation, budget, legal and commercial issues. restored in 1999-2000 when international ratings agency, Particularly important was the development of a framework for Moody's, announced that it was upgrading Victoria's credit rating private-public partnerships, which culminated in the launch of to trlple-A. It followed an earlier announcement from Standard the Partnerships Victoria policy in June 2000. Partnerships and Poor's that it would maintain Victoria's trlple-A rating. Victoria is a framework for providing public infrastructure and In March 2000 the Department was notified that the Victorian related ancillary services to the community using an optimal Government had received international recognition for the mix of public and private sector providers. process supporting the sale of the Victorian public transport The policy aims to maximise the level of infrastructure spending system. The Euromoney publication, Privatisation International, and deliver significantly improved services to the community, awarded the Victorian Government Best Private Sale in Australasia, maximise social and economic returns from Government and on an international basis, Transport Deal of the Year in 1999. expenditure and promote growth and employment opportunities across Victoria. The first Partnerships Victoria project, the Internal initiatives upgrading of the Victorian County Court, was announced on In order to ensure its capacity to meet the Government's 9 June 2000. requirements, the Department focused on a number of Internal The need to protect electricity and gas consumers during the initiatives, including placing a greater emphasis on people introduction of full retail «intestability in 2001 required management and Information technology, implementing the amendments to the existing legislation. The current Tariff Order Management Reform Program and improving communication expires at the end of the year, but the Electricity industry Acts - with stakeholders. (Amendment) Act 2000 guarantees that consumers will continue The manner in which the Department responded to the 9l to be protected as full contestabilityJs implemented. challenges posed by the shift in strategic direction of the The Office of the Regulator-General (ORG) conducted its Government is a tribute to the agility and commitment to five-yearly review of electricity distribution prices and services professional service of the Department's people. I would like to standards. The Department played a key role in preparing the put on the record my appreciation of that day-in, day-out Government's submission, with evidence pointing to considerable commitment of my colleagues, and the leadership of the downward pressure on electricity, prices. The ORG'S draft Treasurer and Ministers for Finance, Gaming and WorkCover. determination, released in May, indicated a capacity to reduce householders' annual electricity bills by an average of $35 to $65. In February, the Department was involved in a major effort to restore the reliability and security of the Victorian electricity network following a period of involuntary load shedding on 3 February 2000. Ian Little A combination of hot weather, industrial action and unscheduled Secretary, Department of Treasury and Finance outages in generation drove demand for electricity above the October 2000 available supply. The Department helped the Government to impose restrictions on electricity consumption, and successfully return the network to a safe operating condition. The Government has made a commitment to restore 28 per cent of the Snowy River's original flow. During 1999-2000, negotiations with the Commonwealth and New South Wales Governments sought to set the amount of flow to be restored. The final level will be determined as part of the corporatisation of the Snowy Hydro-Electric Authority. On 6 October 2000 the Government announced an agreement with New South Wales to restore 28 per cent of environmental flows to the Snowy River over the long term. Final agreement with the Commonwealth will not be possible until their environmental impact statement process has been completed. The manner in which the Department responded to the shift in strategic direction is a tribute to the agility and commitment to professional service of our people. f¡j¡¡¡íl The Department plays a leading role in financial, economic and resource management to support the Government in delivering a financially responsible and socially progressive policy platform. The Department ¡ür Senior management The Department is managed by the Senior Executive Group Ian Little was appointed Secretary to the Department of Treasury and Finance in 1998. (SEG), which is led by the Secretary and comprises the head ; Ian joined the Department in 1994 after six years with ANZ where he was Group Chief of each of the Department's five divisions. SEG has significant Economist. Prior to this Ian spent seven years at the Reserve Bank of Australia as Deputy public and private sector management experience in the areas Head of the Finance Section and Head of the Forecasting Section. Ian holds a Bachelor of of economics, finance, people management and technology. Economics (Honours) from Monash University and Master of Science (Economics) from the London School of Economics. Grant Hehir Is Deputy Secretary, Budget and Financial Management. Grant joined the Department In 1998 after eight years with the Commonwealth Department of Finance and Administration as General Manager Accrual Budgeting and General Manager Budget. Grant is responsible for assisting the Government to achieve its fiscal policy objectives, including delivery of the State Budget and Annual Financial Report. He also oversees the implementation of major management reforms to enhance the quality of public sector resource management, focusing on output management and related reforms. Grant holds a Bachelor of Economics (Honours) from the University of New England. Brett Rowse is Deputy Secretary, Economic and Financial Policy. Brett recently joined the SEG after three years as a Director with the Department and sixteen years in the Commonwealth departments of Treasury and Finance. Brett's areas of expertise Include Commonwealth-State financial relations, taxation and economic policy. Brett is responsible for managing the provision 110 of economic and financial advice to the Government in relation to longer-term economic and 11 social objectives. He has a Bachelor of Economics from the University of Adelaide. Warren Hodgson is Deputy Secretary, Commercial Policy and Projects. Warren has recently joined the Department after holding senior positions In several large non-government organisations. He has extensive experience managing a variety of businesses and projects. Warren is responsible for managing the provision of commercial advice and activities on behalf of the Government. His qualifications include a Bachelor of Science (Metallurgy) and a Diploma of Metallurgical Sciences from the University of Auckland. Laurinda Gardner Is Executive Director, Strategic Management. Laurinda joined the Department in 1998 after holding senior management roles In town planning, strategic planning and corporate services for local and State government. Laurinda is responsible for managing corporate planning, human resources, Ministerial and legal services and corporate communication services, to enhance the Department's ability to deliver policy advice and services to Government. She holds a Bachelor of Arts (Honours) from the University of Melbourne. Adam Todhunter is Executive Director, Corporate Services Centre (CSC) and Chief Information Officer. Prior to joining CSC, Adam was Executive Director of the Year 2000 Risk Management Unit, which managed the Victorian whole-of-governmentYear 2000 reporting program. Adam Is responsible for managing the provision of corporate financial, administrative and Information Technology and Telecommunications services to the Department of Treasury and Finance and the Department of Premier and Cabinet. He has a Graduate Diploma In Applied Information Systems with distinction from the Royal Melbourne Institute of Technology. Senior Management (from left to right): Brett Rowse. Ian Little. Adam Todhunter, Senior Executives Chloe Munro, John Perham and Deborah Clark left the Department during Grant Helm: Laurinda Gardner and Warren Hodgson. 1999-2000. The Department continued Our principles During 1999-2000, the Department was responsible for: • providing economic, financial and commercial advice and Information to the Government; • implementing specific economic and financial policies of the Government; • contributing to public understanding of economic and financial matters; • providing advice on appropriate interventions to achieve the Government's policy objectives; • providing strategic leadership in economic and financial reform across the public sector; and • ensuring effective management of the State's financial position. The Department of Treasury and Finance and Its Secretary are Our role responsible to the Treasurer, the Minister for Finance, the Minister for Gaming and the Minister for WorkCover. As a central agency within the Victorian Government, the Department plays a leading role in economic, financial and Reporting to the Minister for Industrial Relations ceased In March resource management to support the Government in delivering a 2000 with the transfer of all Industrial relations responsibilities to 112 131 financially responsible and socially progressive policy platform. the Department of State and Regional Development. The Department has overall responsibility for formulating and Prior to last year's Election, the reporting framework included the implementing the Government's longer-term economic and Treasurer, Minister for Finance and Minister for Gaming. budgetary objectives, which are to achieve economic growth for Five divisions carry out the Department's functions: all regions of the State and increase the living standards of all Victorians. It produces the State Budget each financial year, and • Budget and Financial Management; monitors the State's financial accounting, control and reporting • Commercial Policy and Projects; obligations to ensure they are met. • Economic and Financial Policy; • Strategic Management; and • Corporate Services Centre. From lett to tight: Michael V/oolston, Stephen Rimimr and Knan Curry: Wat- Teng Landman and Tony Kelly: Gary Workman and Karen MacDonald: Shelagn Hooijey and Emma Williams; Tayler Brooks. Maralyn Bengsrl and Jess Mohamed: Emily Single- Our people 'Our DTF, Our Say' The Department's performance in financial, economic and iln 2000, the Department conducted a staff survey called 'Our V«, H*. ^„f. £ \ t S I , resource management depends directly on the capabilities of DIF Our Say'f to measure the organisational climate The survey its 444 employees. The Senior Executive Group is committed : results were compared with appropriate industry standards and to ensuring that the Department selects, develops, retains and showed that the Department is performing well above public and rewards its employees, and continues to improve Its approach : private sector,benchmarksM^mm^.,, . *SASm• v- . ^as-t to people management. Information on the composition of the i »'is Department's workforce is provided in Appendix 4. |The survey enabled the Department to measure the impact of its 2 : HR Strategy and to identify areas for improvement that were 1 The Department manages employees through its Human : subsequently addressed in Branch and Divisional Business Plans . Resources (HR) Strategy, which provides a clear statement of for 2000-01. its philosophy on people management, and a framework for undertaking new and existing human resources activities. ' National award for our Graduate Recruitment Scheme The principles behind the HR Strategy - agility and professional ; Each year, the Department recruits graduates as part of the " service - are essential for ensuring that the Department can Victorian Public Service Graduate Recruitment Scheme. meet current and future business needs and challenges. Graduate recruitment plays an important role in introducing - The objectives of the HR Strategy are: »talent and skills to meet the Department's resourcing needs. • to know the capabilities and skills we need; : In 2000, the Department was awarded.the National Award for • Excellence in Graduate Recruitment Literature by the Australian - • to select and retain the people we need; ! Association of Graduate Employers. • to develop our people; and Ten graduates from the 1999 Scheme rejoined the Department r • to reward and recognise our people. this year, and sixteen new economics,«accounting and generalistip graduates entered placements in the"Department in February. ;;:- Important people management Initiatives occurring during the year included: • Manager-Once-Removed Program: to engage employees in career discussions with their manager's manager. • Flexible Work Practices: to ensure employees have an adequate work/life balance. • Upward Appraisal Process: to provide employee feedback to managers. • Employee Assistance Program: to provide a confidential advisory service for all employees. • Occupational Health and Safety Initiatives: to provide compulsory tailored training to all managers, employees and OH&S representatives. The Department continued Organisational structure The organisational chart shows the divisional and branch structure of the Department at 30 June 2000. Information on the functions and services of each division is provided in Appendix 2. I _ {M^OHDEipI&D Kcommercial'Koltcyl Economic'and SxßsQIä ebuepdsüö f-'inancinl Policy fiftfifira I i , J Business Management • • Commercial y Economic and Soi • Corporate^'"" Corporate Administrative' - Policy Services Budget Coordination • Governance Communication and Development •Financial and Economics • Cori Corporate Financial J; • Industry! fAnalysis Services Financial Management ^.ivíra Ì&4 À f • i Procurement!!4 ' Systems s Insurance ana Regulation Serv Corporate IT & T Services • Projectsaste™ r • JH Financial Policy and ••• • NlReveniiRevenu!e Policy Compliance • Property/ 114 policy 15 Financial Reporting and • Resources i Control -¿.Finance and « Portfolio Analysis T- Restructures 4 This Annual Report details the work of the Department ofv Following the Election in 1999 the Department reviewed its : Treasury and Finance in 1999-2000. Key initiatives relating t structure in order to ensure that it could fully support the J to the Department's main agenciesthe Office of the i n»1-1 * Government in implementing its election commitments. ^Regulator:General (ORG); the State Revenue Office (SF - and the Victorian Casino and Gaming Authority (VCGA Changes to the Department's structure that took place during ~ are also referred to in the narrative section. the year are listed below. The accompanying financial statements of this Annual Report incorporate the Department of .Treasury and Fin Budget and Financial Management Division J and the SRO.i For,financial statements for,the ORG ar • The Division was renamed Financial Management and ' the VCGA, please see their respective Annual Ri Industrial Relations to reflect the incorporation of the new industrial relations portfolio following the Election. The Department's portfolio also includes a number of other ^statutory authorities and government business enterpi • An Industrial Relations division was established within the that are not directly budget funded but are accountab Department of State and Regional Development (DSRD) in one of the portfolio Ministers (see Appendix 1). This report I?1 March 2000 and Industrial Relations and Public Sector does not account for the activities of those authorities Employee Relations responsibilities were transferred to DSRD. - . or enterprises • Following this transfer, the Division was again named Budget and Financial Management. • The Taxation Compliance function within the Financial Policy and Compliance branch was created to manage the State's new obligations under the GST. Commercial Policy and Projects Division Improving communication • Public transport franchising was completed and ongoing The Department continued its focus on better communication management activities were transferred to the Department through the development of communication and consultation of Infrastructure. strategies for major projects. • The Outsourcing unit was wound up. During 1999-2000 major policy initiatives developed in consultation with business and the community Included • The Policy branch became part of the Economic and Financial Partnerships Victoria, the Review of State Business Taxes, Policy Division. establishment of the Essential Services Commission and Review • Water reform policy responsibilities were transferred to of Responsible Gaming Legislation. the Department of Natural Resources and Environment. OASIS: Managing internal projects effectively Economic and Financial Policy Division Significant improvements were made during the year to the • The Taxation and Revenue Policy and Intergovernment Organisation and Service Improvement Strategy (OASIS), which Financial Relations branches were merged to form the guides the Department's approach to Internal project Revenue Policy branch to reflect the Commonwealth's management. OASIS Incorporates protocols for planning Internal new tax changes. projects that have an impact on the Department's divisions. • The Economic and Social Policy branch was created to reflect the Government's Increased emphasis on economic and Implementing the Management Reform Program social policy. The Department made significant progress in Implementing Management Reform Program (MRP) strategies internally and • The Finance and Liability Management branch became part on behalf of the Victorian public sector. In September 1999, of the Commercial Policy and Projects Division. it conducted a self-assessment against the MRP evaluation There were no changes to the Strategic Management Division framework and the results were used to develop Improvements or to the Corporate Services Centre. in output and financial management. A review of the Department's outputs resulted In improvements Internal initiatives to output descriptions and performance measures. One of the Department's priorities during 1999-2000 was to implement internal initiatives to Improve service delivery and business management processes. In addition to establishing a good relationship with the new Government, the Department sought to develop and Improve Its processes in the areas of Information technology, communication, people management and resource management. A new IT&T Strategy The year 1999-2000 saw the completion of a three-year information technology planning cycle and the first stages In developing a new three-year Information Technology and Telecommunications (IT&T) Strategy to meet business needs. Substantial effort was invested In order to manage Year 2000 risks, maintain a stable network environment and achieve a common computer desktop across the Department. zM Each year the Department articulates W Government outcomes, which are the results the Government wants the Department to contribute to, or deliver. 1999-2000 Performance This section outlines the Department's performance The Department subsequently reviewed its objectives to ensure they were aligned with these new 1999-2000, and explains the Department's output-l Government outcomes. For the remaining seven months of the year the objectives were: planning process. • to assist the Government to implement its election commitments; and Our contribution to Government outcomes • to enhance core business services to Government. Each year, the Department of Treasury and Finance establishes \ The Department pursues its objectives through a range of initiatives, which are categorised as Government outcomes to reflect the strategic policy 'direction of i output groups for management purposes, and linked directly to the Department's outcomes. the current Government. These outcomes articulate the results , In 1999-2000, the Department's performance was measured against the following output the Government wants the Department to contribute to, or deliver.; groups as specified in the State Budget (1999-2000 Budget Estimates - Budget Paper No. 3): At the beginning of 1999-2000, the Government identified the I 1. Financial Management Services following outcomes for the Department: - 2. Risk Management Services • a sustainable budget surplus; 3. Resource Management Services • maximising value for taxpayers' dollars; 4. Strategic Policy Advice • keeping Victoria's economy competitive: and i 5. Regulatory Services • enhancing economic growth. 6. Taxation Management Services To achieve these outcomes, the Department's Business Plan 7. Privatisation Services for 1999-2000 articulated the following objectives: 8. Reform Services .•. to extract in full the promised benefits of reform;« The change of Government in October 1999 saw a move away from privatisation activities and l7| : ••to replenish the Department's'research and development the Privatisation Services output group was discontinued. locker'; and ; Í • to enhance core business services to Government. The relationship between the Department's output groups, the Government outcomes and the Government's four pillars. i On 20 October^ 999, following the State Election,« a new Government was sworn into office. Upon tskincj office, the Bracks Government articulated its 'four.pillars'. These were: • responsible financial management; »•spromoting growth across the whole State, • delivering improved services, and i • restoring democracy. |¡jji|„(í.,, /fSlïlltlï,£, • «Hi-â! '• outcomeTo align sitsel werf wite revieweh thesed policto becomey pillar:s the Department's • a substantial budget surplus; Delivering improved services • a transparent and accountable financial system: • economic growth for the whole State; and value for money services. 1999-2000 Performance continued Review of outputs Output performance During 1999-2000, the Department reviewed its output structure The Department delivered the majority of its major outputs within to align it with Government priorities. The Department's outputs performance specifications. However, some outputs were under now include performance measures that increase its accountability target largely due to the suspension of initiatives during the and transparency. caretaker period and reviews of Initiatives following the election of the current Government. A further imperative for restructuring was the delivery of the 1 per cent efficiency dividend and savings in executive numbers As a result, output initiatives of $35 million were carried forward required by the new Government. The new output structure was to 2000-01, including: approved by the Expenditure Review Committee and formed the • superannuation reform ($15.0 million); basis for the Department's activities for the remainder of the financial year. • full retail contestability In electricity ($5.0 million); Changes to the Department's output structure in 1999-2000 are • health reform ($1.3 million); shown in the table opposite. These mainly include the cessation • Snowy River Authority corporatisation ($2.0 million); of privatisation and outsourcing activities and the addition of new responsibilities in the area of industrial relations prior to its • post-privatisation energy interests ($1.3 million); and transfer to the Department of State and Regional Development In • public-private partnerships - new initiative ($2.0 million). March 2000. Explanations of changes to outputs are provided in this report in the performance section for each output group. The performance of each output group is explained in the following terms: Funding for each output was also reviewed to ensure that it reflected Government priorities. Additional funding was • contribution to Government outcomes; subsequently made available for: • key projects and initiatives undertaken during the year; • WorkCover policy advice ($0.5 million); • descriptions of performance and major variations, including • Statewide Industrial relations ($2 million); and both over and under achievements; • restoring environmental flows to the Snowy River ($2 million). • description of all outputs within the output groups; and The additional funding was obtained from discontinued outputs • output performance against performance measures set in (particularly those associated with the Privatisation Services 1999-2000 Budget Estimates - Budget Paper No. 3. output group), reductions in Senior Executive numbers and in Changes to the outputs the Department published in Budget restructuring activities. Paper No. 3, as a result of the new policy priorities of the Government, are also explained. The output groups are listed in the same order as in Budget Paper No. 3. Changes to the Department's output structure during 1999-2000 1999-2000 output groups and outputs Revised 1999-2000 output groups and outputs listed in Budget Paper No. 3 Financial Management Services ' ' Government Financial Accounting and Control Government Financial Accounting and Control Cash Management Services Cash Management Services Unclaimed Moneys Administration Unclaimed Moneys Administration Liabilities Management Services Liabilities Management Services Taxation Monitoring Services Taxation Monitoring Services Departmental Performance Analysis and Review Departmental Performance Analysis and Review üBE Performance Monitoring Services GBE Performance Monitoring Services [ffrskManagement Services ., - .H ' • - Risk Management Policy Advice and Prudential Supervision Risk Management Policy Advice and Prudential Supervision Infrastructure Project Policy Advice and Implementation Risk Management Advice and Services Year 2000 Compliance Year 2000 Compliance (completed March 2000) I " ' " ÍTNf"íS»ÍKer t-"/, [Resource Management Serviras ? Purchasing and Procurement Services Purchasing and Procurement Services Accommodation Services Accommodation Services Public Sector Employee Relations Services Transferred to Industrial Relations Services and then to DSRD in March 2000 Government Land and Property Services Government Land and Property Services Budget Development and Production Budget Development and Production Management of Motor Vehicle and Building Finance Leases Management of Motor Vehicle and Building Finance Leases ¡Stategic Policy Advice '.i . • .. Strategic Policy Advice Strategic Policy Advice WorkCover Policy Advice (new output reflecting transfer of responsibility to the Department) ppppjilii! Regulation of Gaming Regulation of Gaming Economic Regulatory Services Economic Regulatory Services Taxation Management Services • • Taxation Management Services jjfo Taxpayer/Customer Advice and Support Taxpayer/Customer Advice and Support Taxation Management Services to Government Taxation Management Services to Government • [Privatisation Services • ^Output group deleted " j Privatisation of GBEs Residual activities transferred to Reform Services under new output, Resolution of Privatisation and Outsourcing Activities Advice to Departments on Outsourcing Government Services Residual activities transferred to Reform Services under new output, Resolution of Privatisation and Outsourcing Activities Sale of Surplus Government Property Residual activities transferred to Resource Management Services under Government Land and Property Services r.~ -j. Reform Services - j Financial Management Reform Financial Management Reform Advice on Tax Reform Advice on Tax Reform Energy Industry Reform Industry Reform National Competition Policy and Related Reforms National Competition Policy Resolution of Privatisation and Outsourcing Activities (new output) Industrial Relations Services (new output group; subsequently transferred^1 r '•"* to DSRD in March 2000) .. Industrial Relations Services Public Sector Employee Relations Services 1999-2000 Performance continued ¡api: i HHC Output Group 1: Financial Management ¡ Services Contribution to Government outcomes: • a substantial Budget surplus • a transparent and accountable financial system. Financial Management Services provides financial accounting, reporting and control, and monitors the performance of Government departments, agencies and corporatised Government Business Enterprises (GBEs). Key projects and initiatives In addition to core business activities, several key projects were successfully implemented or progressed during 1999-2000. Changes to financial systems The introduction of the new Commonwealth taxation system, and the Goods and Services Tax (GST), demanded significant changes to whole-of-government financial systems and processes. A new accounting policy framework, and new manuals for Fringe Benefit Taxation, GST and Pay As You Go were Issued. Financial Management Act directions were largely completed by year end and issued in July 2000. Further details on the implementation of Commonwealth tax changes are provided in the sections relating to the Strategic Policy Advice and Reform Services output groups. Establishment of the Expenditure Review Committee The Department played a major role In establishing the Expenditure Review Committee of Cabinet and supporting the implementation of the Government's election commitments, in delivering the 2000-01 Budget and in making strategic resource management decisions. Output performance The majority of targets were met during 1999-2000. within the relevant target dates. With respect to corporate Performance was exceeded in the following areas: plans, four had to be resubmitted due to external factors, including the review of port prices by the Office of the • Cash Management Services produced an average daily balance Regulator-General, and two were received late In the financial of $8.0 million, well within the target of $10.0 million or less. year. Corporate plan reviews outstanding at 30 June 2000 • More unclaimed moneys claims were processed than have since been completed. expected, with 6 673 of these successful. This represents an • The Annual Financial Statements for 1998-99 were published additional 393 claims, or 6 per cent more claims than the 93 days after June 30,16 days after target due to the target of 6 280. The total number of claims received is based extended caretaker period following the Election. on public demand and can vary substantially from year to year. • The ambitious target of reducing Westpac Budget Sector bank • State Government net debt levels, estimated to be $5.5 billion accounts to less than 50 was not met. However, the number (excluding Infrastructure Reserve) at 30 June 2000, were of accounts was reduced by 148 to 67. In 2000-01 the approximately $500 million lower than forecast due to higher Department will continue to encourage departments to than expected levels of public account surpluses. reduce the number of unnecessary bank accounts. Performance was not met in the following areas: • The target of two whole-of-government Oracle Financial • Six GBEs were transferred to other departments, sold or Release 11 sites operational was not met as Oracle Financials merged leaving a total of 15 GBEs to be monitored. Quarterly Release 11 was not available for full production use. Controlled performance monitoring reviews were completed for all GBEs production was scheduled for availability from 1 July 2000. Deliverable Outputs - Financial Management Services ¡Outputs delivered Description Government Financial Accounting, Reporting and Control Reporting and monitoring of financial performance in the Victorian public sector. Cash Management Services Management of the dally cash requirements Including Investments and borrowings of the Public Account. Unclaimed Moneys Administration Administration of the Unclaimed Moneys Act 1962 and assessment and processing of claims. Liabilities Management Services Management of Government liabilities (debts, unfunded superannuation and contingent liabilities), the risks associated with State liabilities and the cost of State liabilities. Taxation Monitoring Services Management and monitoring of the various State-based taxes that provide revenue to the State. Departmental Performance Analysis and Review Advice to Ministers and the Expenditure Review Committee on: • departmental performance In relation to financial output and asset investment; • revenue to be paid for the provision of outputs; and • budget risks, service delivery and strategic issues. GBE Performance Monitoring Services 1999-2000 Performance continued Output Performance - Financial Management Services Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Government Financial Accounting, Reporting and Control Quantity The Department undertakes to deliver the following initiatives: • whole-of-government financial systems which meet Number 1 1 national tax reform requirements • whole-of-government Oracle Financial Release 11 Number 2 0 - sites operational Whole-of-government financial reports produced Number 7 8 Monthly financial management analysis for Treasurer Number 12 11 Quality Whole-of-government financial system functionally meets Per cent 100 100 national tax reform requirements Whole-of-government financial system available (up time) Per cent 95 95 Audit opinion on the annual financial statement Yes/no Yes Yes Coverage and accuracy of monthly financial Per cent 95 95 management analysis Timeliness Monthly whole-of-budget financial system Date < May 2000 < April 2000 functionally Implemented Whole-of-government financial system recovery time Time/hours <2 <2 Annual Financial Statement produced Working days from end of period 77 93 Whole-of-government financial reports produced Working days from end of period 15 15 Cash Management Services Quantity Departments to which cash management services are provided Number 9 9 Budget sector bank accounts Number <50 67 Quality Aggregate average daily Budget sector bank account balances $ million <10 8.9 managed to maximise short term Investments Timeliness Departments' cash requirements provided on time Yes/no Yes Yes Unclaimed Moneys Administration Quantity Successful claims processed Number 5 670 6 261 610 412 Unsuccessful claims processed Number Quality 95 95 Customer satisfaction survey Per cent Compliance with the objectives of the Unclaimed Moneys Act 1961: Yes Yes • byDTF Yes/no Yes Yes • by organisations Yes/no Timeliness Verified claims processed within target period for unclaimed Working days monies lodged after 1 October 1998 Output Performance - Financial Management Services continued Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Liabilities Management Services Quantity State liabilities including: • unfunded superannuation $ billion 12.4 12.3 • State Government net debt $ billion 6.1 5.5 • quantifiable contingent liabilities $ billion <1.5 0.813 • guarantee applications and indemnity claims Number 40 (average) 37 - Quality Growth In superannuation liabilities contained or reduced Per cent of GSP 7.9 7.7 General government net debt levels within target Per cent of GSP 3.1 2.8 Interest estimate within forecast range $ million <535 465 Timeliness Achieve targets within the framework agreed with Per cent 80 Not measured the Treasurer and Minister for Finance Taxation Monitoring Services Quantity Taxation revenue items monitored Number 22 22 Quality Contingency plans in place for major risks to revenue targets Per cent 100 100 Ministerial (Treasurer's) satisfaction Per cent 80 80 Timeliness Revenue analysis to customers within agreed timelines Per cent 80 90 Departmental Performance Analysis and Review Quantity Departments analysed and reviewed Number 9 8 Monthly financial analysis Number 12 12 Quarterly performance review analysis Number 4 4 Quality Ministerial satisfaction with the quality and usefulness of advice Per cent 80 100 Timeliness Analysis provided to agreed schedule Per cent 95 95 Government Business Enterprise (GBE) Performance Monitoring Services Quantity GBE plans and performance analysed and reviewed Number 21 15 Quality Analysis provided to agreed schedule Per cent 80 70 Timeliness Target dates met for GBE dividend payments Per cent 100 100 1999-2000 Performance continued Output Group 2: Risk Management Services Contribution to Government outcomes: • a substantial budget surplus • value for money services. Risk Management Services involves implementing the Government's risk management framework including Year 2000 readiness, regulation of prudential frameworks, and minimising the Government's exposure to any ongoing liabilities from private provision of infrastructure. Key projects and initiatives The delivery of Risk Management Services enables the Department to assure the Government that exposure to risk from major Infrastructure and other projects Is minimised. Risk management assurance has been critical during 1999-2000 as new Government policies are implemented. Partnerships Victoria The provision of public infrastructure and related ancillary services to the community using public and private sector ' 124 "251 providers was a new Government initiative in 1999-2000. A framework for public-private partnerships was developed, culminating in the launch of the Partnerships Victoria policy in June 2000. The policy seeks to maximise: • the level of infrastructure spending through responsible use of public and private sector resources to deliver improved services to the community; • social and economic returns from Government expenditure; and • growth and employment opportunities for the whole State. Whole-of-Government Year 2000 risk management » F In conjunction with the Department of Premier and Cabinet, the Department implemented the whole-of-government Year 2000 strategy. The strategy was highly successful and no significant issues were identified within the Victorian public sector following 1 January 2000. Activities under this initiative were completed in March 2000. From left to right Bernie Moylan, Glenn Maguire and John Fitzgerald. .!,:-,':.. " • i r '''' ••. * -TC Longford Class Action Output performance Work continued on the management of the State's legal defence The majority of targets were met during 1999-2000 with the arising from litigation by Esso following the Longford gas explosion exception of the following areas: in September 1998. Key activities included extensive document • Some delays in the remediation of the West Melbourne discovery, development of a defence and management of relations Gasworks site were experienced pending the need to seek between insurers and privatised entities. an alternative to the containment option being pursued. The progress of the litigation is driven by the timetable established Full remediation is now being progressed to discharge by the Court and Is outside the Department's control. While the the Environment Protection Authority notice on the site. Court has not yet scheduled a date, the trial Is expected to start The remediation works are targeted for completion in around April 2001. February 2001. Restoration of environmental flows to the Snowy River • Responsibility for the Spencer Street Authority was transferred The Government has made a commitment to restore 28 per cent to the Department of Infrastructure as a result of machinery of of the Snowy River's original flow. To achieve this, the government changes following the Election. Commonwealth Snowy Mountain Hydro-Electric Act 1958 • Four of the projected 12 monthly Year 2000 status reports needs to be amended as under the Act Victoria had agreed were provided to Cabinet. In quarters one and two, caretaker not to seek additional water releases into the river. conventions in place during the Election period precluded During 1999-2000, negotiations were conducted with the three of the reports from being provided. In quarter three, New South Wales and Commonwealth governments to reach only one report was provided before the early and successful an agreement about the outcome of the Snowy Water Inquiry completion of the project in March 2000. and address the level of environmental flows to be achieved • Ministerial satisfaction with advice on infrastructure project in the Snowy River following the corporatisation of the Snowy risk management was 70 per cent, and lower than the Mountains Hydro-Electric Authority. The Act will be repealed targeted figure of 80 per cent. The Government requested when corporatisation legislation is proclaimed. more timely advice on industrial relations and other issues that had an Impact on major projects. Deliverable Outputs - Risk Management Services [QütpütsgejjygrgS] Risk Management Policy Advice and Prudential Supervision Development and monitoring of prudential frameworks for effective management of public financial institutions, trustee companies and co-operative societies, and the provision of advice to Ministers on financial and risk management. Infrastructure Project Policy Advice and Implementation Risk management advice on infrastructure and other partnership models where a private sector Interest Is involved. The name of this output was changed to Risk Management Advice and Services to reflect a broader range of activities, such as those associated with the Longford class action. Year 2000 Risk Management • Management of whole-of-government Year 2000 business, asset management systems readiness and risk management processes. 1999-2000 Performance continued Output performance - Risk Management Services Output performance measures Unit of measure 1999-2000 1999-2000 (Measures and targets in italics are additional to those in BP3) Target Actual Risk Management and Prudential Supervision Services Quantity Asset value of public financial enterprises, public sector $ billion 50 50.9 superannuation funds, trustee companies and co-operative housing societies prudentlally supervised Provision of advice on Victorian WorkCover Authority's role Yes/no Yes Yes as regulator for occupational health and safety Quality No unforeseen events or risks with significant financial impacts Number 0 0 Contingency plans in place for all significant risks Yes/no Yes Yes Timeliness Ministerial satisfaction with the timely delivery of reports Per cent 80 80 Reports on public financial institutions Days 60 59 infrastructure Project Risk Management Services Quantity Former West Melbourne Gas Works Site remediated Number 1 0 Spencer Street Station Authority established Number 1 0 Financial risk management advice on identified Number 1 1 major infrastructure projects delivered Advice provided to water entities to manage risks associated Number 1 1 with new infrastructure projects with private sector involvement Quality Remediation of the former West Melbourne Gas Works Site Yes/no Yes Yes meets EPA requirements Ministerial satisfaction with the quality and usefulness of advice Per cent 80 70 Timeliness Ministerial satisfaction with the timely delivery of milestones Per cent 80 70 Year 2000 Risk Management Services Quantity Monthly reports delivered to Cabinet Number 12 4 Quality Meet Cabinet's reporting requirements and objectives Yes/no Yes Yes Timeliness Ministerial satisfaction with the timely delivery of reports Per cent 80 Not measured Output Group 3: Resource Management Services Contribution to Government outcomes: • a substantial budget surplus • value for money services. Resource Management Services administers Government resource processes including office accommodation, purchasing and procurement, land and property and public sector employee relations. In April 2000 the Sale of Surplus Government Property output was transferred from Privatisation Services to the Resource Management Services output group as a quantity measure under the existing Government Land and Property Services output. Public Sector Employee Relations was transferred to the Department of State and Regional Development In March 2000. Key projects and initiatives Improvement In Resource Management Services Is driven by two considerations: 1. efficiency and effectiveness In resource expenditure and asset management; and 2. maximising opportunities for all Victorian businesses to share In the benefits of expenditure. Key projects during the year focused on utilising technology more effectively In order to realise these aims. Review of Government purchasing arrangements The Department engaged an independent consultant to review the Government's purchasing and contracting framework. The review report, submitted to the Government In June 2000, made a range of recommendations in relation to probity, value for money (Including common use arrangements), waivers on competition, procurement policy observance and its application within the Victorian public sector, the use of electronic commerce for procurement, and support for local and regional suppliers. The review also addressed the role, policies and membership of the Victorian Government Purchasing Board. A response to the review's recommendations will be submitted to Cabinet In October 2000. From left to right: Kathryn Wylie and Patrick Ferguson; Christina Geidhart; Wayne Swingier and Michelle Fischetto. f- 1999-2000 Performance continued Electronic Commerce for Procurement Output performance The Department has a lead role in Implementing the Electronic The majority of targets were met during 1999-2000. Commerce for Procurement (EC4P) project, which aims to Performance was exceeded in the following areas: achieve cost savings by developing leading edge electronic • Dead Rent for Government-Owned Accommodation was commerce solutions for Government procurement activities. 1.2 per cent, exceeding the target of less than four per cent. The project will encourage an open electronic trading community Agreed accommodation availability for clients also exceeded and provide opportunities for new and existing businesses, and expectations with satisfaction at 100 per cent. will be rolled out to eight departments and to the Victoria Police by 30 June 2002. It Is estimated that EC4P will provide savings • Higher than targeted Ministerial and client satisfaction ratings to procurement expenditure of between 5 and 20 per cent. were achieved for Property Management, Government Land and Property Services and Development and Production of Key milestones for 1999-2000 included: the Budget. • establishing a panel of four service providers to facilitate • Sale of Surplus Government Property was exceeded due to the implementation of e-procurement solutions across the more land being sold than planned, with the target being Victorian Government; $60 million and the actual figure being $87 million. • developing Government procurement electronic commerce Performance was not met in the following areas: standards In conjunction with the Australian Procurement and Construction Council; and • The target to have two departments operating electronic commerce was not met due to delays caused by the extended • developing a pilot electronic commerce program. caretaker period and the review of Government purchasing. 2000-01 State Budget A pilot e-commerce program is now being conducted by the [28 A major deliverable for the Department each year is the Department of Natural Resources and Environment. 29l preparation and production of the State Budget. The 2000-01 • The results of an end user survey on the usefulness of State Budget, tabled in Parliament on 2 May 2000, was the first training and advice received on purchasing and procurement Budget of the Bracks Government. services were slightly less than anticipated, with an overall As well as helping to establish the Expenditure Review Committee, client satisfaction rate of 70.3 per cent against the target rate guide the Government in Budget deliberations and implement of 78 per cent. Feedback from the survey will be used to its election commitments, the Department provided analysis identify opportunities for improvement. of all departmental Budget submissions, which Included Implementation strategies for Initiatives detailed within Labor's • The performance of the Motor Vehicles Lease output was not Financial Statement, and produced the Budget Papers. measured for 1999-2000 due to the substantial number of amendments required as a result of GST implementation and The Department also organised communications activities for the FBT requirements. Changes to operating requirements have Budget process, including media and special Interest group now been introduced and the periodic assessment process briefings and a live Internet broadcast of the Treasurer's Budget has been reinstated for the first quarter of 2000-01. Speech. During the broadcast of the Treasurer's Speech, the Budget website received 3 984 hits, with an average audience of 250 viewers at any time. Deliverable Outputs - Resource Management Services [Outputs delivered Description ' Purchasing and Procurement Services Management and development of Victorian procurement and purchasing procedures and policies, and coordination of these matters with departments, agencies and the Victorian Government Purchasing Board. Accommodation Services Administration, coordination and management of office accommodation for Government departments. Public Sector Employee Relations Services Provision of employment relations for all public sector employees. The Department assumed responsibility for industrial relations after the change of Government in October 1999, before It was transferred to DSRD in March 2000. Government Land and Property Services Administration, coordination and management of Government lands and property and disposal of surplus government land and property. Budget Development and Production Development and coordination of Budget decision making framework, production and publication of the State Budget and budget-related documents. Management of Centrally Controlled Motor Vehicles Coordination and management of motor vehicles and building finance leases for and Buildings Finance Leases government departments. Output performance - Resource Management Services Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Purchasing and Procurement Services Quantity Extension of motor vehicle lease Number ! 500 8 500 Electronic commerce for procurement system Number 1 operating in departments Quality 6 6 Aggregate savings to Government $ million 78 End user survey on usefulness of the advice/training provided Per cent 70.3 Timeliness Ministerial satisfaction with the timely delivery of services Per cent 80 Accommodation Services Quantity Total area managed Metres square 361 000 423 000 Complete City Precinct Strategic Plan Number 1 1 Quality Property management - rated as satisfactory by clients Per cent 70 80 Dead rent - Government leased accommodation Per cent <2 2 Dead rent - Government owned accommodation Per cent <4 1.2 Timeliness Accommodation available for clients when agreed Per cent 90 100 1999-2000 Performance continued Output performance - Resource Management Services continued Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Public Sector Employee Relations Services Quantity Delivery of public sector employee relation services to Yes/no Yes Yes Government and client organisations Quality NA Ministerial satisfaction with the quality of advice and services Per cent Timeliness 80 NA Ministerial satisfaction with the timely delivery Per cent of advice and services Government Land and Property Services Quantity Delivery of research and advice on land and property issues Yes/no Yes Yes Sale of Surplus Government Property target achieved $ million 60 87 Quality 100 Ministerial satisfaction with the quality and usefulness of advice Per cent Timeliness Ministerial satisfaction with the timely delivery of advice Per cent 100 Budget Development and Production Quantity 1 Produce State Budget Number 130 31 Quality Ministerial advice and satisfaction with the quality of the advice Per cent 100 and the Budget Papers Timeliness Ministerial satisfaction with the timely delivery of advice Per cent 100 and the Budget Papers Management of Centrally Controlled Motor Vehicles and Buildings Finance Leases Quantity Number of buildings* Number 12 12 Number of vehicles Number 7 000 7 607 Quality User satisfaction with leasing companies: • Buildings Percent • Vehicles Per cent NA Timeliness User satisfaction with timing of vehicle leasing Per cent NA companies services * The original target tor Number of Buildings in the Management of Centrally Controlled Motor Vehicles and Buildings Finance Leases output was incorrectly stated as 14 in 1999-2000 Budget Estimates - Budget Paper No. 3. The correct figure Is 12. Output Group 4: Strategic Policy Advice Contribution to Government outcomes: • a substantial budget surplus • a transparent and accountable financial system • economic growth for the whole State • value for money services. Strategic Policy Advice provides policy advice to Government In relation to financial management, long-term economic and financial strategy, intergovernmental financial relations, Industry and GBE reform, budget and gaming, as well as conducting research on potential economic and health reforms. The Department assumed responsibility for WorkCover policy advice following the change of Government. A new output, WorkCover Policy Advice, was created for the delivery of advice to Ministers on WorkCover arrangements. Key projects and initiatives Key projects and Initiatives during 1999-2000 focused on implementing Commonwealth and State Government policy Initiatives. Implementation of Commonwealth tax changes - Tax policy The implementation of changes resulting from the new Commonwealth taxation system, in particular the introduction of the GST and the abolition of the wholesale sales tax, required extensive liaison with other States and the Commonwealth to agree on a policy position and framework. This culminated in the signing by the Commonwealth and all States and Territories in mid-1999 of the revised Intergovernmental Agreement on the Reform of Commonwealth-State Financial Relations, under which several obligations were placed on the States. Many of these changes required legislative amendments, which were prepared by the Department and Introduced in the Autumn Session of Parliament. The Department also successfully coordinated the Introduction of the GST across the Victorian public sector. Further details on the implementation of Commonwealth tax changes are detailed under the Financial Management Services and Reform Services output groups. From left to right. Elizabeth Bowteli-Lamer. Phillip Flynn and Stein Heigeby; Danielle Jolliffe. 1999-2000 Performance continued Restoration of Common Law Rights for Seriously Injured Workers The restoration of common law rights for seriously Injured workers was an election commitment of the new Government. In response to this commitment the Department established the Common Law Working Party to make recommendations on how common law could be reinstated to the Victorian Workers' Compensation scheme. The Working Party's recommendations were considered and incorporated in the Accident Compensation (Common Law and Benefits) Act 2000, which was passed in the Autumn Session. Other WorkCover related projects scheduled for completion in 1999-2000 have been extended into the following year due to the demands of the common law project. Responsible gaming A consultation paper on responsible gaming was released in March 2000 and received over 200 written responses, highlighting the extent of community interest in the issue. The Department drafted new responsible gaming legislation and the Gambling Legislation (Responsible Gambling) Act 2000 was passed in May 2000. [32 33| Output performance The change of Government and subsequent changes in policy direction fully stretched the Department's capacity to provide strategic policy advice. In addition to providing advice on specific Treasury and Finance issues, the Department played an important role In assessing the economic, financial and commercial viability of other departmental policies. The change of Government also required a number of output initiatives, including health reform and foundation research, to be suspended pending reviews of policy direction. Remaining output targets were met with the following exception: • Completion of the National Competition Policy review of gaming legislation and implementation of responsible gaming reforms are now expected In 2000-01. Deliverable Outputs - Strategic Policy Advice [Outputs delivered Description Strategic Policy Advice Provision of policy advice to Government on financial management, long term economic and financial strategy, intergovernmental financial relations, industry and GBE reform, budget and gaming, and research on potential future economic and health reforms. WorkCover Policy Advice Provision of strategic policy advice to Government on the State's WorkCover arrangements. Output performance - Strategic Policy Advice ¡Output performance measures Unit of measure 1999-2000 1999-2000 I UMeasures and targets in italics are additional to those in BP3) Target Actual Strategic Policy Advice Quantity In addition to providing ongoing advice and responding Number 5 1 to requests from Government throughout the year, the Department undertakes the following strategic Initiatives: • national tax reform Completed • health reform Delayed • gaming reform Delayed • deregulation of retail energy markets (transferred to DNRE) Ongoing • foundation research (including regulatory environment) Delayed Quality Ministerial satisfaction with the quality and usefulness of advice Per cent 80 82 Timeliness Ministerial satisfaction with the timely delivery Per cent 80 82 of strategic policy advice WarkCoverPolicyAdvice Quantity Capacity to provide strategic advice on WorkCover policy including the following key deliverables and projects: • reinstatement of common law rights Percent 100 100 • new arrangements for the delivery of Percent 100 75 occupational health and safety • regulatory regime for Major Hazard Facilities Percent 100 0 consistent with world's best practice Quality Ministerial satisfaction with the quality of advice and services Per cent 80 100 Timeliness Key deliverables and projects managed on time, Per cent 80 80 in line with planned and agreed project timetables 1999-2000 Performance continued Output Group 5: Regulatory Services Contribution to Government outcomes: • economic growth for the whole State. Regulatory Services monitors and regulates Victoria's gambling activities and provides economic regulation of certain industries to promote competitive conduct and ensure that users and consumers benefit from competition and efficiency. Key projects and initiatives Initiatives under Economic Regulatory Services are provided by the Office of the Regulator-General (ORG) and Initiatives under Regulation of Gaming are provided by the Victorian Casino and Gaming Authority (VCGA). Further information about the activities of the VCGA and the ORG can be obtained from each agency's Annual Report. Triennial review of Casino The second triennial review of the Casino Operator and licence was completed. VGCA reported its findings to the Minister for Gaming on 30 June 2000. Electricity distribution pricing review Competition in the electricity industry occurs in the generation and retail sectors, while the transmission and distribution sectors remain 'natural monopolies'. As such, charges to customers for accessing the transmission and distribution networks are determined on a five-yearly basis by the Office of the Regulator- General. The current pricing controls expire on 31 December 2000, and the ORG has conducted an extensive process of consultation in order to determine new distribution charges for 2001 -05. *fl SiRM ! On 31 May 2000 the ORG released its draft determination, which then became the basis for further consultation before the release of the ORG'S final determination in September 2000. Consumer protection for electricity users contestability. Although Increasing the Department's Since 1994 increasing numbers of Victorian electricity workload, the increase was a positive reflection of the level consumers have become contestable, which allows them to of competition in the industry. negotiate contracts to purchase electricity. Consumers yet to • Two inquiries on the regulation of ports were conducted, become contestable, including all domestic consumers, are exceeding the ORG'S target of one. guaranteed minimum customer service standards by the Supply and Sale Code that is due to expire on 31 December 2000 Performance was not met in the following areas: when the phased introduction of full retail contestability is due • There was a decrease In gaming licences determined (19 535 to commence. against a target of 20 730) due to the drop in demand for During 1999-2000 a consumer protection framework for full renewal of Special Employees Licences provided to those retail competition was developed. In January 2000 a consultation undertaking certain duties in gaming venues. The actual number paper entitled Minimum Standards Framework for Electricity Full of licences Issued includes 155 Premises Approvals and Retail Competition: Review of Existing Supply and Sale Code Modifications which were not included in the original target. Provisions was released by the ORG. This process helped inform • The number of gambling compliance activities was 1 049 less amendments to the Electricity Industry Act 1993, which passed than the target of 8 917 primarily as a result of changes in through Parliament in Autumn 2000. the method of counting casino operations incident reports. Output performance • The accuracy of compliance activities could not be measured until the VCGA's new performance reporting system and Most targets were met during 1999-2000. Performance was IT operating platform was introduced. exceeded in the following areas: • Three audits of compliance with electricity, gas and water • The ORG'S target figure for the issue of gas and electricity regulatory standards were conducted by the ORG, as opposed licences was substantially exceeded - the target was two and to the target figure of eight. This target was not met due 14 were issued. This increase was due to a significant to the increased workload associated with the electricity number of new entrants as the market moves towards full distribution price review. Deliverable Outputs - Regulatory Services ¡Outputs delivered Description | Economic Regulatory Services Regulation of utilities in Victoria. Regulation of Gaming Monitoring and regulation of gaming activities in Victoria. 1999-2000 Performance continued Output performance - Regulatory Services Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Economic Regulatory Services Quantity n addition to providing ongoing regulatory services, the following specific outputs will be delivered in 1999-2000: • Electricity distribution price review - Phase two Number 1 1 • Review electricity industry Y2K preparation for Number 1 1 mission critical services • Information campaign for full retail competition for Number 1 1 electricity In 2001 • Issue or amend electricity and gas licences Number 2 14 • Audits of compliance with electricity gas and water Number 8 3 regulatory standards • Information campaign for customers entering the Number 1 1 contestable gas market - Phase 1 - two tranches • Develop and issue regulatory guidelines Number 4 4 • Inquiry on ports being regulated beyond 2000 Number 1 2 • Analyse comparative performance of regulated industries Number 3 3 Quality All mission critical electricity services identified and Yes/no Yes Yes examined for Y2K preparation Timeliness Statutory reporting deadlines achieved Per cent 100 100 Electricity industry Y2K preparation report produced Date Sept 99 Sept 99 Regulatory of Gaming Quantity Licenses regulated Number 20 730 19 535 Compliance activities (audits, inspections, investigations, Number 8917 7 868 revenue verification, operator procedures and rule approvals)' Quality Accuracy of licence processing Per cent 95 94.75 Accuracy of compliance activities Per cent 95 Being developed Timeliness Licences - processed within target time Per cent 80 93,75 Compliance activities - performed within target time Per cent 95 Being developed Output Group 6: Taxation Management Services Contribution to Government outcomes: • a substantial budget surplus • value for money services. Taxation Management Services ensures customer needs are central to the design and delivery of the State's taxation service, and that there is timely delivery to Government of all due taxation using fair and cost effective taxation management services. Outputs under Taxation Management Services are provided by the State Revenue Office (SRO), which operates as a service agency for the Government under the 1999-2000 Framework Agreement between the Treasurer, the Secretary of the Department of Treasury and Finance, and the Commissioner of State Revenue. Further information about the SRO is available in its Annual Report. Key projects and initiatives In addition to the core business described above, a number of projects to enhance revenue collection and assessment activities were successfully progressed during 1999-2000. Information Technology Strategic Plan Implementation of the four major projects comprising SRO's Information Technology Strategic Plan (ITSP) commenced in 1999-2000. The four ITSP projects are: Core Systems Replacement: which involves the replacement of existing operating systems, known as 'e-sys development', • and will see SRO move from unsupported to more commonly available platforms. Release 1 Is scheduled for implementation on 27 April 2001. Infrastructure Redesign: which Involves purchase and Installation of an Oracle database and appropriate hardware for use by systems developers. The SRO has also implemented a new local area network Infrastructure. 1999-2000 Performance continued Telecommunications: which, in Stage 1 of the project, involves Due to the success of the program in 1998-99, more accurate the introduction of new phone systems and handsets, a 13-number data was obtained and It was continued In 1999-2000 on the in-house switchboard and an automatic fax back facility. Further expectation that it would generate $3.0 million in new revenue. developments will link the system to the local area network, The program concluded at 30 June 2000, at which time enabling customer information to be displayed at employee $14.5 million of new revenue had been assessed. workstations as customer calls are received. E-business: which aims at making the SRO website the Output performance preferred gateway for customers. The site has been redesigned The SRO met most of Its targets during 1999-2000. for customer focus, with alternative payment options such as Performance was exceeded in the following areas: BPay and Electronic Funds Transfer. Taxpayers can now lodge • Revenue generated from the Land Tax Data Matching project their annual returns online via the SRO website and by email. was greater than expectations ($5.9 million against $4.0 million First Home Owners Grant target) as activities uncovered a larger than anticipated number The First Home Owners Grant (FHOG) scheme was established of properties that had not been grouped or aggregated. to offset the effect of the GST on home ownership by providing • Customer satisfaction with education and compliance a grant to first home buyers purchasing or building after programs, public rulings and publications was consistently 1 July 2000. The SRO implemented the FHOG scheme in equal to or greater than the 95 per cent annual target. Victoria, and coordinated the implementation of the scheme on a national level. • In response to community need the SRO conducted an additional 21 education and compliance programs as part The project involved establishing a national database for all of a series on FHOG and payroll tax. States and Territories, and encouraging financial Institutions to [38 act as agents in meeting the 1 July 2000 deadline. The SRO will • Total revenue collections for the year were $5 939 million 39l compared with a Budget forecast of $5 273 million. This administer the scheme in 2000-01 and beyond. is 12.6 per cent above the forecast and outside the target Land Tax Data Matching Project of plus or minus 5 per cent. The positive result can be attributed mainly to an Increase in the number of pre-GST The Land Tax Data Matching Project was a new Initiative aimed transactions and above-average stamp duty collections. at linking all land tax records for related entities and individuals. Part 1 of the project was completed In 1999-2000 and involved Performance targets were not met in the following areas: the purchase of data matching software and the correct aggregation of land holdings for new land tax customers through • The target of 99 per cent of Section 97 certificates (issued to data cleansing and data matching of new land tax clients against show portion of land tax owing on a property) being issued the Victorian Electoral Roll and the Electronic White Pages. within five days was not achieved. The overall result of Stamp Duty Project 95.1 per cent for the year was partly due to the 85 per cent The Stamp Duty Project was initiated in 1999-2000 to identify result for the last quarter of the year and stemmed from the non-compliance in relation to changes In ownership of real significant increase in volume relating to increased activity In estate. The project resulted in the issuing of assessments the property market and the GST. Overall 158 648 certificates totalling $9.6 million. A number of anti-avoidance measures were issued against the estimated target of 140 000. have also been legislated as a result of the project, which has • The timeliness targets were set at 100 per cent for Refunds been extended and will continue for 2000-01. within 60 days (96.48 per cent achieved) and Timely handling Payroll Tax Data Matching Investigations Project of objections within 60 days (95.75 per cent achieved). The Payroll Tax Data Matching Investigations Project utilises Targets in 2000-01 Budget Estimates - Budget Paper No. 3 purpose-built technology developed by the SRO that will be are more realistic. adopted by other state revenue offices during 2000-01. Deliverable Outputs - Taxation Management Services |Outputs delivered Description Taxpayer customer advice and support Provision of taxation advice, support and determinations for Victorian taxpayers. Taxation management services to Government Management of taxation receipts and tax owed to the State. Output performance - Taxation Management Services Output performance measures Unit of measure 1999-2000 1999-2000 (Measures and targets in italics are additional to those in BP3) Target Actual Taxpayer Customer Advice and Support Services Quantity Land tax data compliance (revenue generated) $ million 4 5.9 Quality Customer satisfaction with education and compliance Per cent 95 96.32 programs provided Number of compliance and education programs Number 31 52 Customer satisfaction with public rulings and publications Per cent 95 95 Timeliness Section 97 certificates issued within 5 days Percent 99 95.1 Number of section 97 certificates Number 140 000 158 649 Refunds within 60 days Percent 100 96.48 Timely handling of objections within 60 days Percent 100 95.75 Number of objections Number 910 1 101 Taxation Management Services to Government Quantity Revenue targets achieved Percent ±5 12.6 Quality Ratio of outstanding debt to total revenue Per cent < 2 0.96 Accuracy of cashflow projection Per cent ±5 11.61 Timeliness Revenue received within two days of due date Per cent 90 97 Revenue banked on day of receipt Per cent 99 99 Meet Cabinet and Parliament timeframes for developing legislation Per cent 100 100 1999-2000 Performance continued Output Group 7: Privatisation Services Contribution to Government outcomes (under the previous Government): • value for taxpayers' dollars • a competitive economy • economic growth. Privatisation Services incorporated the implementation of Government policy in relation to Government Business Enterprises and the private provision of public sector goods and services. The change of Government in October 1999 saw a shift away from privatisation activities culminating in the cessation of the Privatisation Services output group. However, decreased activity in 1999-2000 had been already anticipated as a large number of privatisation projects were due for completion. Following its cessation, residual activities were transferred to a newly established output, Resolution of Privatisation and Outsourcing Activities, under the Reform Services output group. • l; ift 4 H" n: 1 •40 Residual activities under the Sale of Surplus Government Tf| ,. Property output were transferred to the Resource Management % Services output group under the Government Land and Property Services output. Key projects and initiatives Output performance Public transport franchising Most targets were met during 1999-2000. Since privatisation The franchising of public transport businesses was completed activities ceased following the change of Government, performance during the year following the transfer of Yarra Trams, Swanston was below target in the following areas: Trams, Bayside Trains, Hillside Trains and V/Line Passenger • ministerial satisfaction data was not obtained; and Trains to private sector operators In August 1999. • initiatives to assist Departments In relation to outsourcing Public transport franchising was the last major privatisation did not proceed. project to be finalised. The final step in the process was completed in September 1999 with the Probity Auditor certifying these franchising transactions. Output performance - Privatisation Services Output performance measures Unit of measure 1999-2000 1999-2000 Target Actual Privatisation of GBEs Quantity Publice transport reform and privatisation completed Number 1 1 Quality Probity standards met Yes/no Yes Yes Ministerial satisfaction with the quality and usefulness of advice Per cent 80 NA Minimise the extent to which ongoing liabilities Yes/no Yes Yes require intensive management Advice to Department on Outsourcing of Government Services Quantity The Department undertakes to deliver the Number 2 NA following key initiatives: • Provision of assistance to departments In implementation of outsourcing and private provisioning initiatives • Promotion of outsourcing through forums, publications and other activities Quality Ministerial satisfaction with the quality and usefulness of advice Per cent 80 NA Timeliness Ministerial satisfaction with the timely delivery of milestones Per cent 80 NA Sale of Surplus Government Property Quantity $ million 60 87 Sale target achieved Quality Percent 80 100 Ministerial satisfaction with the quality and usefulness of advice Percent 80 100 TimelinesMinisterial ssatisfactio n with the timely delivery of advice Output Group 8: Reform Services Contribution to Government outcomes: • a transparent and accountable financial system • economic growth for the whole State. Reform Services provides advice on developing and Implementing continuous improvements in financial management; arrangements to implement the GST; to reform certain Industries; on National Competition Policy; and on reforms to superannuation for the Victorian public sector. Key projects and initiatives Implementation of Commonwealth tax changes Preparations for introducing the new Commonwealth taxation system were completed successfully by the Department In 1999-2000. Changes to the tax system were Implemented on a whole-of-government basis, and Involved the development and application of key principles and control mechanisms, and provision of financial services to enable a common approach to taxation compliance across Victoria. Within the Department and Its portfolio entities, GST preparedness was high due to extensive training of staff and forward preparation of financial systems. Ongoing and new contracts were also negotiated to ensure the maximum extraction of embedded tax savings. Further details on the Implementation of Commonwealth tax changes are detailed in the sections relating to the Financial Management Services and Strategic Policy Advice output groups. Financial Accountability Framework A major project for 1999-2000 was establishing a new financial accountability framework, and the Department developed new financial practices and financial responsibility legislation. The Audit (Amendment) Act 1999 and the Financial Management (Financial Responsibility) Act 2000 set new standards in government accountability and transparency. These standards have already been applied to the preparation of the 2000-01 Budget based on generally accepted accounting principles and the independent scrutiny of the assumptions underlying the Budget by the Auditor-General. As a result of the ground- breaking Financial Responsibility Act, Budget sector flnancials will be reported on a quarterly basis and a whole-of-government report will be published every six months. From left to right: Michael Woolston, Stephen Rimmer and Kyran Curry. Management Reform Program National Competition Policy and related reforms The Management Reform Program (MRP) is a set of strategies In October 1999, responsibility for coordinating the implementation aimed at improving the efficiency and effectiveness of resource of National Competition Policy passed from the Department of management across the Victorian public sector. MRP aims to Premier and Cabinet to the Department of Treasury and Finance. achieve value for money in service delivery by aligning During 1999-2000, the Department secured the continuation of departmental activities and outputs with the Government's competition payments of $115 million per annum following the strategic priorities. It also provides departments with incentives June 2000 supplementary second tranche assessment by the for improving efficiency. National Competition Council. It also participated in a review of In addition to the changes to the Audit (Amendment) Act 1999 and the National Competition Policy Agreements, developed a revised the Financial Management (Financial Responsibility) Act 2000, a statement on Competitive Neutrality, and facilitated the work of communication strategy was developed, the quarterly certification departments on legislation reviews. process by which departments invoice the Government for revenue earned was reworked, and a self-administration Output performance evaluation framework for departments was developed. Most targets were met during 1999-2000, however performance was not met in the following areas: Establish the ESC and the ESO The establishment of the Essential Services Commission (ESC) • Three financial management reform policy proposals were and the Essential Services Ombudsman (ESO) were election developed, two short of the target of five. This was due to the commitments of the new Government. The ESC will regulate redirection of resources to meet the new Government's publicly and privately owned energy and water businesses, while priority to introduce legislative amendments to the Audit and the ESO will handle customer complaints and make rulings Financial Management Acts. relating to compensation in the utility industries. • One of the two target initiatives for provision of assistance to Preliminary analysis needed to establish the ESC and the ESO departments for private provisioning activities is still being was undertaken. In April 2000 an ESO consultation paper was progressed. A preferred bidder for the Berwick Community released and 51 submissions were received from industry and Hospital project is expected to be selected in 2000-01. consumer groups. This feedback will be taken Into account • The output expected under Superannuation Reform was when new legislation Is drafted, which is expected to be deferred to 2000-01 following delays caused by the extended introduced in 2000-01. caretaker period associated with the Election. Deliverable Outputs - Reform Services I Outputs delivered Description Financial Management Reform Provision of advice to the Government and the Treasurer to ensure ongoing improvements in the financial management of the Victorian public sector. Advice on Tax Reform Provision of advice to the Government and other departments on the implementation of changes flowing from the new Commonwealth Taxation system. Energy Industry Reform The name of this output group was changed to Industry Reform reflecting a reduced emphasis on privatisation of the energy industry while monitoring ongoing contracts. National Competition Policy and Related Reforms Provision of advice to develop and implement National Competition Policy and related reforms In Victoria. The name of this output group changed to National Competition Policy, reflecting a move away from privatising Government Business Enterprises (GBEs). Water Reform Provision of advice to Government on reforms to the water industry. This output was transferred to the Department of Natural Resources and Environment in April 2000. Superannuation Reform Provision of advice to develop and Implement reforms to superannuation for the Victorian public sector. Resolution of Privatisation and Outsourcing Activities A new output created to accommodate residual activities following the cessation of the Privatisation Services output group. The previous outputs Privatisation of GBEs and Advice to Departments on Outsourcing Government Services were transferred to this output. 1999-2000 Performance continued Output performance - Reform Services IOutput performance measures Unit of measure 1999-2000 1999-2000 Target Actual Financial Management Reform Quantity Major policy proposals developed Number 5 3 . Quality Policy papers endorsed Percent 100 100 Alignment of resource allocation processes to MRP Per cent 70 70 framework for this stage of the five-year program Resource managers in VPS agree MRP Is beneficial at this Per cent 80 60 TimelinesstagDelivere oyf withithes five-yean 'next rsteps progra' strategm y timetable Per cent 100 80 Advice on Tax Reform Quantity The Department undertakes to implement a national tax Number 1 1 reform package which Includes: • whole-of-government framework for compliance with national tax reform arrangements • advice on business tax reform • advice on reciprocal taxation and National Tax Equivalent Regime • advice on next priorities for Victorian tax reform [44 Quality 45| Ministerial satisfaction with the quality and usefulness of advice Per cent 80 80 Timeliness Ministerial satisfaction with the timely delivery of milestones Per cent 80 80 Industry Reform Quantity The Department undertakes to manage the State's post- Number 1 1 privatisation Interests: • Monitor and wind up the SECV and GASCOR shells, Including privatisation of GASCOR • Oversee remaining Gas Service Business privatisation • Prepare for corporatisation and sale of Victoria's share of the Snowy Mountains Hydro-Electric Scheme • Monitor and respond to findings of the Longford Royal Commission • Provide policy oversight for the security of winter gas supply Quality Significant benefits, risks and material options identified Percent 100 100 Relevant parties receive appropriate consultation Percent 100 100 Timeliness Ministerial satisfaction with the timely delivery of milestones Percent 80 80 Output performance - Reform Services continued Output performance measures Unit of measure 1999-2000 1999-2000 (Measures and targets in italics are additional to those in BP3) Target Actual National Competition Policy Quantity Programs for 1999-2000 will include: Number 1 0.85 • Legislative review • Continuing competitive neutrality complaints investigation and assessment Quality Ministerial satisfaction with the quality and usefulness of advice Per cent 80 80 Timeliness Ministerial satisfaction with the timely delivery of milestones Per cent 80 80 Water Reform* Quantity The Department undertakes to Implement the Government's Number 1 NA water reform program Quality Ministerial satisfaction with the quality and usefulness of advice Per cent 80 NA Timeliness Ministerial satisfaction with the timely delivery of milestones Per cent 80 NA Superannuation Reform Quantity mplement approved reforms Number 1 0 Quality Ministerial satisfaction with Implementation of reform Per cent 80 80 Timeliness Superannuation reform completed within target Date June 2000 Deferred Resolution of Privatisation and Outsourcing Activities Quantity All milestones within budget Yes/no Yes NA Sale of remaining transport businesses completed by Number 3 NA 31 January 2000 (Geelong Depot, the training facilities and scientific services) ** Probity standards met ** Yes/no Yes NA Outsourcing forums and activities wound down with Per cent 100 NA no residual activity remaining Provision of assistance to departments to implement private Number 2 1 provisioning initiatives Quality Ministerial satisfaction with the quality and usefulness of advice Per cent New output 80 The extent of ongoing liabilities requiring intensive Per cent 100 NA management (if any) is minimised Timeliness Key milestones met Per cent 100 NA * Water reform was transferred to the Department of Natural Resources and Environment. " Responsibility for sale of remaining transport businesses was transferred to the Department of Infrastucture. By providing advice to the Government on strategic resource management decisions, the Department continues to build the foundations of a prosperous future for ail Victorians. 1999-2000 Performance continued Financial performance Financial outcome Revenue from the provision of outputs The overall result of a deficit from operations of $696.5 million in, Output group 2000 1999 Change 1999-2000 is principally due to a review of the State's unfunded * Smillion Smillion Smillion superannuation liability. This regular triennial review resulted in < Strategic Policy Advice 19.5 18.2 1.3 a net increase in superannuation expenses and in the unfunded „ Financial Management Services 33.5 14.8 18.7 superannuation liability of $670.7 million (refer to Note 19 of the ,j Risk Management Services 16.0 21.6 (5.6) Financial Statements). V j Privatisation Services 29.2 98.6 (69.4) Reform Services 19.4 35.7 (16.3) Revenue received from Government for the production of h Resource Management Services 60.2 69.5 (9.3) outputs fell from $334.3 million in 1998-99 to $258.1 million • • Regulatory Services 14.6 13.6 1.0 in 1999-2000. This $76.2 million reduction in output revenue Taxation Management Services 65.7 62.3 3.4 is detailed in the table opposite, but mainly reflects the cessation of the Privatisation Services output group upon the election of Total 258.1 334.3 (76.2) the Bracks Government. ' Total operating expenditure, excluding budget sector superannuation expenses, fell from $416.2 million in 1998-99 to $336.7 million in 1999-2000. The decline essentially reflected reduced expenditure on contract services and consultancies, and was in line with the reduction in output revenue. The whole-of-government budget sector superannuation expense Increased by a net $670.7 million following the triennial actuarial revaluation of the superannuation portfolio and this cost comprised nearly all of the Department's $696.5 million annual deficit. Financial position The Department Is in a net liability position, mainly because the unfunded superannuation 146 liability of the entire budget sector is managed and recorded within the Department's accounts. 47 For the reasons mentioned above, the unfunded superannuation liability increased by $670.7 million in 1999-2000, Increasing the net liability position up from $10.7 billion on 30 June 1999 to $11.4 billion on 30 June 2000. Assets fell from $778.1 million to $673.4 million during 1999-2000, mainly reflecting a reduction in land and buildings of $41.4 million arising from the sale of Pentridge Prison and other properties during the year. Above left: Maralyn Bengert. Colin McCann: Greg Lavis. Rob Williams, Claire Gower. Jan Warren and Annette Glenlster. From left to right: Richard Snow, Alain Baillle, Tony Kelly and Wai-Teng Landman; Claire Gower and Colin McCann: Fans Ghaly, Ian Mitchell. Tony Cooper and My Huynh. Outlook for 2000-01 In 2000-01 the Department will continue to build foundations Core business for Victoria's future by providing high-quality and well researched In 2000-01 the Department will continue to deliver Its core advice to the Government on economic, financial and resource outputs, which include: management. By establishing a framework for the responsible • developing and producing the State Budget; management of the State's finances, the Department ensures the Government is in a position to make strategic resource • providing economic, financial and commercial policy advice; management decisions to provide a prosperous future for • managing Government lands and property; all Victorians. • collecting revenue; and The Department will continue to contribute to the Government outcomes of: • regulating Victoria's gaming, gas and electricity markets. • a substantial budget surplus; Improvement initiatives In order to continue providing the Government with exceptional • a transparent and accountable financial system; advice and service, the Department's internal initiatives include: • economic growth for the whole State; and • facilitate open communication with the Government on new • value for money services. research directions and policies; Major initiatives for 2000-01 • implement the Management Reform Program within the The Department has responsibility for several of the Government's Department; and major policy initiatives over the following year including: • advance Victorian Interests by building and maintaining • implementation of a whole-of-government public-private external relationships. partnership framework (Partnerships Victoria)-, These initiatives will continue to ensure that the Department has • establishment of an Essential Services Commission and a the capabilities and resources to implement Government policies. separate Ombudsman for energy and water consumers; • establishment of an open and transparent financial reporting framework; • working to ensure adequate environmental flows are restored to the Snowy River; • obtaining a better financial deal from the Commonwealth; and • Implementing MRP within the Department and on a whole-of- government basis. These Initiatives form a significant part of the Government's policy platform and underline the Importance of the Department's role in providing informed policy advice and strategic direction to the Government. Operating Statemnieinitt for the year ended 30 June 2000 T •ft , ÎESïïl - REVENUE GOVERNMENT REVENUE Provision of Outputs 25(a) 258097 * 334 282 Special Appropriations 25(b) 642 411 i 3 960 290 Additions to Net Asset Base Appropriations 25(a) 6146 2 280 Payments to Consolidated Fund " (14 005)"; (26 973) Total Government Revenue 892 649 4 269 879 OPERATING REVENUE User Charges 3 52 096" 52 214 Interest 59 3 Resources Received Free of Charge 4(a) 4 768" 66 537 Other 3 790 1 396 Total Operating Revenue 60 713 120150 Total Revenue 953 362 ' 4 390 029 EXPENSES Employee Costs 5 " 61 596 ' 61 843 Supplies and Services 6 : ' 100 009 177557 Capital Assets Charge 1(n) 41 750 40 676 Depreciation and Amortisation 7 28 560 " 27 510 Resources Provided Free of Charge 4(b) ~ 5403" 24 582 Grants and Transfer Payments 8 " 3/ 258 44 022 Superannuation Costs - Non-Departmental 19 1 313118 658 990 Other 9 62159 40 062 Total Expenses • f?649 853-: 1 075 242 NET SURPLUS/(DEFICIT) BEFORE ABNORMAL ITEMS . .,(696 491); 3 314 787 Abnormal Items 10 (122 000) NET SURPLUS/(DEFICIT) FROM OPERATIONS 20 (696 491), 3 192 787 The above Operating Statement should be read in conjunction with the accompanying notes. Statement of Financial Position as at 30 June 2000 <#' Ip1" .\®f flp^ Iflfflsa ©W ASSETS CURRENT ASSETS Cash i 219 - Receivables 11 43129 ' 81 364 Surplus Land for Resale 32 634 38 406 Other 12 1 862 ^ 2 585 Total Current Assets 77 844 122355 NON-CURRENT ASSETS Investments 13 132 974 135893 Land and Buildings 14 ~ 247 572 289 014 Plant and Equipment 15 215 007 230 866 Total Non-Current Assets 595 553 655 773 Total Assets 673 397 778 128 LIABILITIES CURRENT LIABILITIES Bank Overdraft 13 877 18 642 Creditors and Accruals 16 ! 11734 66 712 Lease Liabilities 17 12 680 7 932 Employee Entitlements 18 F" 8 360 ' 6 756 Unfunded Superannuation 19 277 370 241 995 Other 1614 1 707 Total Current Liabilities 325 635 343 744 NON-CURRENT LIABILITIES Lease Liabilities 17 1 262 729 294 474 Employee Entitlements 18 8169 9 328 Unfunded Superannuation 19 fl1 456 737 ' 10 821 405 Total Non-Current Liabilities 11 727 635 11 125 207 Total Liabilities . 12 053 270 11 468 951 Net Liabilities '(11 379 873) (10 690 823) i EQUITY Accumulated Deficit 20 (11 404 492) (10 715 442) Asset Revaluation Reserve 20 1 24 619 24 619 Total Equity :(11 379 873) (10 690 823) The above Statement of Financial Position should be read in conjunction with the accompanying notes. Statement of Cash Flows for the year ended 30 June 2000 y -w^ ''"W ^jp" y '^wg^jggp- 'f flSBSf A. JÈk JÊL À A. A IBM «t. -afc .^jP^ite À »fr- CASH FLOWS FROM OPERATING ACTIVITIES CASH FLOWS FROM GOVERNMENT Provision of Outputs ^266 31334 282 Special Appropriations 642411 3 960 290 Additions to Net Asset Base Appropriations 6146 2 280 Payments to Consolidated Fund (15 421 ) (41 584) Total Cash Flows from Government 899 452 4 255 268 RECEIPTS User Charges 49 667 52 483 Interest 79 3 Other 6 070 2 869 Total Receipts 55 816 55 355 PAYMENTS Employee Costs (60 603) (61 298) Supplies and Services (113 210). (198 402) Capital Assets Charge (41 750) (40 676) Grants and Transfer Payments (39 645) (40 638) 53] Superannuation Costs - Non-Departmental Staff (67 416) (46 373) Reduction in Unfunded Superannuation Liability (574 995) (3 913 927) Other (24 848) (21 869) Total Payments (922 467) (4 323183) Net Cash Provided By/(Used In) Operating Activities 21 •"'32 801 (12 560) CASH FLOWS FROM INVESTING AND FINANCING ACTIVITIES RECEIPTS 2 250 671 Investment Proceeds (net) 2 250 671 Total Receipts PAYMENTS (17 695p (10 486) Purchase of Non-Current Assets (12 372) (2 245) Repayment of Lease Liabilities (net) Total Payments (30 067) (12 731) Net Cash Used In Investing and Financing Activities (27 817) (12 060) Net lncrease/(Decrease) In Cash Held 4 984 (24 620) Cash/(0verdraft) at the Beginning of the Financial Year (18 642) 14 783 Amounts Transferred to the State Administration Unit (8 805) Cash/(Overdraft) at the End of the Financial Year (13 658) j (18 642) The above Statement of Cash Flows should be read In conjunction with the accompanying notes. Notes to and forming part of the Financial Statements for the year ended 30 June 2000 1. Summary of Significant Accounting Policies a) Basis of Accounting The Financial Statements have been prepared under the accrual basis of accounting, in accordance with the Financial Management Act 1994, Accounting and Financial Reporting Bulletins and other accounting policy papers issued under the Directions of the Minister for Finance under the Financial Management Act 1994, applicable Australian Accounting Standards and other mandatory reporting requirements (Urgent Issues Group Consensus Views). The Financial Statements have been prepared on an historical cost basis, except with respect to certain non-current assets, which are at valuation (refer Note 14), and long service leave liabilities, which are measured at the present value of expected future payments. b) The Reporting Entity The following entities, which are part of the Department's portfolio, prepare separate annual Financial Statements and are accordingly not Included In the Department's Financial Statements: • Office of the Regulator-General • Office of the Chief Electrical Inspector • Office of Gas Safety • Victorian Casino and Gaming Authority. With the above exceptions, all funds through which the Department controls resources to carry out Its functions have been included in these Financial Statements. This includes the transactions and balances of the following controlled trust funds: • Finance Agency Trust • Government Owned Rental Accommodation Trust • Mobile Radio Network Working Account • Performance Incentive Payments Trust • Treasury Trust. Certain assets and liabilities held within trust funds were previously aggregated and shown separately in the Statement of Financial Position. Such assets and liabilities are now included on a line-by-line basis within the various asset and liability categories. The comparative figures have been adjusted accordingly. c) Administered Resources The Department administers, but does not control, certain resources on behalf of the Victorian Government, for example taxes raised by the State Revenue Office. It is accountable for the transactions involving those administered resources, but does not have the discretion to deploy them to achieve the Department's objectives. For these resources, the Department acts only on behalf of the Victorian Government. Transactions and balances relating to these administered resources are not recognised as Departmental revenues, expenses, assets or liabilities within the body of the Financial Statements, but are disclosed separately in Note 28. In accordance with the Financial Management Act 1994, the Department has reviewed the accounting treatment of various administered and controlled transactions and reclassified some items where appropriate. d) Revenue USER CHARGES User charges controlled by the Department are recognised as revenue. User charges raised by business units are controlled by the Department where they can be deployed for the achievement of Departmental objectives. Revenue is recognised when the services are provided, or when the fee for providing services is received. Notes to and forming part of the Financial Statements continued ADMINISTERED REVENUE Taxes, Public Authority dividends, fines and fees that are collected, but not controlled, by the Department, are not recognised as revenues in the Operating Statement or Statement of Cash Flows, but are reported as administered revenues (Note 28). Revenues received in lieu of the States' constitutional inability to collect franchise fees are received from the Commonwealth Government in the form of a grant and disclosed as taxation revenue. TAXATION State taxation and fee revenue is recognised by the State on receipt of a taxpayer's self-assessment, or the time the taxpayer's obligation to pay arises pursuant to the issue of an assessment, whichever is earlier. FINES AND REGULATORY FEES Revenue is recognised at the time the fine or regulatory fee is issued. INVESTMENT INCOME Investment income is recognised on an accrual basis and dividend income is recognised when dividends are declared. e) Appropriations Amounts appropriated for controlled transactions are recognised as Government Revenue in the Operating Statement. Appropriations are recognised upon output delivery. Amounts appropriated for administered transactions, for example payments made on behalf of the State, are not recognised in the Operating Statement or Statement of Cash Flows, but are reported as administered revenue within Note 28. Appropriations are recognised when expenditure is incurred. f) Acquisitions of Assets [54 The cost method of accounting is used for the initial recording of all acquisitions: of assets controlled by the Department. Cost is determined as the 551 fair value of the assets given as consideration plus costs incidental to the acquisition, including architects' fees, engineering design fees and all other costs incurred in preparing the assets for use. The capitalisation threshold is $1 000. Assets acquired at no cost, or for nominal consideration, are recognised as assets and revenues at their fair value at the date of acquisition. Fair value is the amount for which an asset could be exchanged between a knowledgeable, willing buyer and a knowledgeable, willing seller in an arm's- length transaction. g) Revaluations of Non-Current Assets Land and buildings (including heritage buildings) are revalued at least every three years. The bases of the most recent valuations are set out in Note 14... Revaluation increments are credited directly to the Asset Revaluation Reserve, while decrements are expensed to the Operating Statement, unless previous revaluations resulted In a valuation increment, in which case the subsequent decrement is offset against the Asset Revaluation Reserve. h) Depreciation of Non-Current Assets Depreciation is calculated on a straight-line basis to write off the net cost or revalued amount of each non-current asset over Its expected useful life to the Department. Estimates of remaining useful life are made on a regular basis for all assets, with major items being assessed annually. Land Is not a depreciable asset. The Department has adopted the following depreciation rates and average useful lives for the following categories of assets: BKS Useful Life (Years)"' Depreciation'Rate %1 Computers and Equipment - Generic Revenue Collection System 7 14.3 - Other 3 33.3 Leased Equipment 5 20,0 Municipal Valuations - Metropolitan 4 25.0 - Non-Metropolitan 6 16.7 Office Equipment 4 25.0 Plant, Furniture and Equipment 10 10.0 Leasehold Improvements/Fitouts 10 10.0 Leased Motor Vehicles 2.4 41.0 Buildings 23 4.3 i) Surplus Land and Buildings Surplus land and buildings that fall within the Government's Asset Sales Program, and are not controlled by the Department, are reported by the relevant agency and not by this Department. Reporting responsibility for these assets remains with the relevant agency until the total sale price is fully discharged. Surplus properties that are surrendered to the Crown prior to disposal are treated as controlled assets in the Department's Statement of Financial Position and are shown as Surplus Land for Resale. j) Employee Entitlements (I) WAGES AND SALARIES AND ANNUAL LEAVE Liabilities for wages and salaries and annual leave are recognised and are measured as the amount unpaid at the reporting date, at current pay rates, in respect of employees' services up to that date. (II) SICK LEAVE As it is considered that non-vesting sick leave to be taken in future reporting periods will not exceed entitlements which are expected to accrue in those periods, no provision has been made In these Financial Statements. (III) LONG SERVICE LEAVE A liability for long service leave Is recognised for all staff and Is measured as the present value of expected future payments to be made In respect of services provided by employees up to the reporting date. When assessing expected future payments, consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using interest rates attached, as at the reporting date, to Commonwealth Government guaranteed securities with terms to maturity that match, as closely as possible, the estimated future cash outflows. The estimated amount payable In the next twelve months is disclosed as a current liability. The following assumptions were adopted in measuring present value: Weighted average rate of Increase in annual employee entitlements to settlement of the liabilities 4.6% 4.4% Weighted average discount rate 6.1 % 5.9% Average term to settlement of the liabilities 17 years 17 years (IV) SUPERANNUATION During the year the Department made superannuation contributions to a number of private sector funds as elected by employees, Superannuation expense (as included in Employee costs - Note 5) relates to the reporting period only and represents the Department's contribution in respect of current departmental staff, as determined under various Superannuation Acts. Notes to and forming part of the Financial Statements continued k) Unfunded Superannuation Liability An unfunded superannuation liability exists because funds' assets are not sufficient to cover members' accrued benefits as actuarially assessed at 30 June 2000. Government policy in relation to this liability is that the unfunded amount for the entire Budget Sector should be taken up in the Financial Statements of the Department of Treasury and Finance (refer to Note 19). I) Investments Investments are brought to account at the lower of cost or their net realisable market value. Interest revenues are recognised as they accrue. Investments and Investment income are disclosed as administered items (Note 28), with the exception of Accelerated Infrastructure Program Bonds, which are reported as controlled In the Statement of Financial Position. Investments comprising marketable securities and deposits held with the Victorian Funds Management Corporation are valued at market value as at 30 June 2000. m) Leases A distinction is made between finance leases, which effectively transfer from the lessor to the lessee substantially all the risks and benefits incidental to ownership of leased non-current assets, and operating leases, under which the lessor effectively retains subtantially all such risks and benefits, When a non-current asset Is acquired by means of a finance lease, the asset Is established at Its fair value at the Inception of the lease, and the liability Is established at the same amount. Lease payments are allocated between the principal component and the interest expense. On 3 July 1997 the State of Victoria sold the majority of its motor vehicle fleet and entered into a Master Lease Agreement to enable departments and public bodies to lease and replace vehicles under a short term operating lease for each vehicle. The Master Lease Agreement has been recognised as a finance lease (non-current asset and related liability) in this Department's Financial Statements (refer to Note 15). The Department has recognised (as a non-current asset and related liability) finance leases relating to buildings constructed under the Accelerated Infrastructure Program. The Program was established in 1990-91, in conjunction with a major private bank, to provide accommodation for certain government agencies, principally police stations and law courts (refer to Note 14). Operating lease payments are representative of the pattern of benefits derived from the leased assets and accordingly are charged to the Operating Statement in the periods in which they are incurred. n) Capital Assets Charge The Capital Assets Charge, Introduced for the 1998-99 financial year, was calculated for 1999-2000 at 8 per cent on the net book value of non- current physical assets. These charges represent the opportunity cost of capital invested in non-current assets used in the provision of outputs. o) Resources Received/Provided Free of Charge To reflect the total cost of service delivery, resources provided free of charge to other departments have been Itemised separately in the Department's expenses. Where an asset is provided free of charge, an adjustment is made to the asset account and the accumulated depreciation account to reflect the transfer of the asset. Resources received free of charge from other departments have been Itemised separately within the Department's revenues, p) Public Account Liabilities Within Administered assets and liabilities (refer to Note 28), the Department has recognised certain liabilities that exist in the Public Account at year end. These are: a) the outstanding liability to other Departments in respect of amounts appropriated from the Consolidated Fund but remaining undrawn at the end of the year; and b) the temporary Public Account advance, funded from Trust Fund balances, used to cover the cash shortfall In the Consolidated Fund. q) Cash For the purposes of the Statement of Cash Flows, cash includes deposits that are readily convertible to cash within 90 days and which are used in the cash management function on a day-to-day basis. r) Comparative Figures Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year, s) Rounding Unless otherwise shown, all amounts have been rounded to the nearest thousand dollars. 2. Output Groups of the Department The names and descriptions of the Department's output groups for the year ended 30 June 2000 are summarised below. Output Group 711 - Strategic Policy Advice This output group provides policy advice to Government on financial management, long term economic and financial strategy, intergovernmental financial relations, Industry and Government Business Enterprise (GBE) reform, budget, gaming and research on potential future economic and health reforms (refer to page 31 for more information). Output Group 712 - Financial Management Services This output group provides financial accounting, reporting and control, and monitors performance of Government departments, agencies and corporatised GBEs (refer to page 20 for more information). Output Group 713 - Risk Management Services This output group implements the Government's risk management framework, including Year 2000 compliance, regulates prudential frameworks and minimises the Government's exposure to any on-going liabilities from infrastructure outsourcing (refer to page 24 for more information). Output Group 714 - Privatisation Services This output group implements Government policy on privatisation of GBEs and private provision of public sector goods and services. It was wound up in 1999 and residual activities were transferred to the Reform Services and the Resource Management Services output groups (refer to page 40 for more information). Output Group 716 - Reform Services This output group implements major Government reforms, including financial management reform, tax reform, energy industry reform, National Competition policy and GBE reform (refer to page 42 for more information). Output Group 718 - Resource Management Services This output group administers Government resource processes, including accommodation, purchasing and procurement, land and property and public sector employee relations (refer to page 27 for more Information). Output Group 719 - Regulatory Services This output group monitors and regulates Victoria's gambling activities, and provides economic regulation of certain industries to promote competitive conduct, prevent misuse of market powers, facilitate market entry and industry efficiency (refer to page 34 for more information). Output Group 720 - Taxation Management Services This output group ensures customer needs are central to the design and delivery of service, and all due taxation is delivered to Government using fair and cost effective taxation management services (refer to page 37 for more information). Mgs to ancfl forming pairft offfiBne Financia l Siattementts continued Output Groups Schedule - Revenue and Expenses for the year ended 30 June 2000 Departmental Revenue and Expenses Government Revenue Provision of Outputs 19 547 18 230 33 461 14 814 16 014 21 621 29 241 98 578 Special Appropriations J Additions to Net Asset Base Appropriations Payments to Consolidated Fund Total Government Revenue 19 547 18 230 33 461 14814 f 16 014 21 621 29 241 : 98 578 User Charges 454 491 183 161 ? Interest 59 Resources Received Free of Charge 53 466 L- ' Other 576 Total Operating Revenue 454 ; - i • 550 ; 1 i, 1S3 9 . ¿. 161 j 54 042 > 1 s V s Total Revenue 20 001 ' 18 230 i' 34011 14 815 i 16197 21 630 29 402 " 152 620 i Expenses i,i . Employee Costs 6 902 6 573 7 60 5 948 2 784 3103 2 449 5 679 - ä .^ilSj.'- •••••,4 • h< i , Supplies and Services 6188 _ 10 894 10013 • 3 415 2 820 ' 6 990 . 26 074. : 84 336 f. 158 Capital Assets Charge 103 182 325 440 116 242 513 ? 1 221 59 » Depreciation and Amortisation 339 360 757 223 i 223 187 - 496 Usi r Resources Provided Free of Charge _ - 53 _ 21 21 86 24 130 , 150 —,(92). 1 Grants and Transfer Payments 299 - 2 337 _ 64 13 737 > 10165 3 14 782 Superannuation Costs - Non-Departmental Other 227 ; 300 7 542 3 342 184 > 147 123 13 484 Total Expenses 14111 ; 18 330 28 318 13 987 19 950 20 894 29 479 « 120148 i 1 Net Surplus/(Deficit) Before Abnormal Items 1 5 890 (100) 5 693 828 (375J_ 736 32 472 - i=- ±_ Abnormal Items i Net Surplus/(Deficit) From Operations , 5 890 , (100) 5 693 828 j . (3 753) 736 (77) , 32 472 Output Groups Schedule - Assets and Liabilities as at 30 June 2000 ¡3000 GBtSBDSniSjW B »SÉ - Ifesarjjy It Pt#i » TEBE) Bffili) flfEEl I®® TU'®® 0® ©W ©W Departmental Assets and Liabilities i J •- t Assets 'r Current Assets _ :i3 429 j 3 304 .1.627 __ 2 553 El 805 . 3 874 60 707 T ' Non-Current Assets - 850 : 279 131 881 136108 105 327 30 217 Total Assets - 4 279 j 3 583 133 508 138 661 910 . 4 201 - 90 924 i • Liabilities Current Liabilities 340 f 3 621 (409) ' 2 797 689 4 244 ^ r 24 396 Non-Current Liabilities (188) ' 410 (420) 317 128 481 2 726 S 1 • i Total Liabilities 152 • 4 031 (829) ' 3114 1 817 4 725 27122 NetAssets/(Liabilities) «4127 j 134 337 ; 135 547 (524) 63 802 L. JL .¿L a5jjna©ii5i)is© fflgjnBMp®^ Reform Services litfMi® 19 359 35 701 60152 69 476 14 609 13 549 65 714 62 313 258 097 334 282 S 642 411 3 960 290 642 411 3 960 290 6146 - - 2 280 6146 2 280 (11 652) (23 713) ; ; (2 353) . (3 260) (14 005) (26 973) 19 359 35 701 54 646 45 763 14 609 13 549 63 361 61 333 642 411 3 960 290 892 649 4 269 879 - 50 124 - - 2 090 52 096 52 214 340 j i 48146 • 20 2 301 - 3 59 3 « 4 768 13 061 - 4 768 66 537 =:...„, ... - 10 3 790 810 3 790 1 396 '»-340 10 56 704 63 998 : 20 - 2 301 2 090 " - - 60 713 120150 19 699 35 711 111 350 109 761 14 629 13 549 65 662 63 423 642 411 3 960 290 953 362 4 390 029 ' - 5 841 10 481 7 394 298 367 i 26 052 • 26 938 ; 61596 61 843 1 5 170 , i 7 497 26133 23 467 19 486 • 560 255 23 390 26 048 100009 177 557 s • .439 216 * 38 976 36 648 27 260 1 251 1 467 41750 40 676 450 20 778 19 204 67 129 5 844 5 891 28 560 27 510 i 389 -f- -- * (134) 19 1 5 444 : 24 237 ' (100) ' 19 16 ' 91 5 403 ^ 24 582 4 603 3 435 86 ^ 350 12 775 12 258 3 418 ^ 2 968 37 258 44 022 - 1 313118 658 990 1 313118 658 090 356 247 52 596 21 552 68 37 1 063 953 62159 40 062 | 18 320 36 341 151828 128 871 13 695 13 325 61 034 64 356 1 313118 658 990 1 649 853 1 075 242 ' 1 379 (630) i (40 478) (19110) : 934 224 4 628 (933) * (670707) 3 301 300 ; (696 491) ; 3 314 787 (122 000) (122 000) 1 379 (630) (40 478) (19110) 934 224 4 628 (933) (670 707) 3179 300 . (696 491) 3192 787 lUutputjiroupt/iiuBI ®S§7 E&MßiiÜ3iMl =BïtoîiWMSfla fRBfl flip SES) fl® fliîîTï) * féû) ETiTia tEÊSJ 039 'T ®S9 ffiiTO Öl ©•GEE) ©rçEID M ©w ©fs® ©W ©m QMS t. ; - 0 C O 6 607 54-385 31 716 ! 4*423 1 904 ; 12341 ' 11 690 S 77844 122 355 249 557 443 415 483 506 - 2 838 85 .. 16215 4 694 595 553 655 773 1 083 7164 497 800 515 222 * 7 261 1 989 * 28 556 16 384 - - 673 397 778 128 î 1 572 7 239 26 344 44 645 3 491 2 001 16 238 12 806 277 370 241 995^ 325 635 343 744 r 561 821 ? 265 594 : 297 469 ? 1 444 126 > 3779 1 452 ! 11 456 737 10 821 405 * 11 727 635 11 125 207 2133 8 060 291 938 342 114 . 4 935 2127 20 017 14 258 ' 11 734107 11 063 400 . 12 053 270 11 468 951 (1 050) (896) : 205 862 173108 2 326 (138) 8 539 2126 (11 734107) (11 063 400) (11 379 873) (10 690 823) Notes to and forming part of the Financial Statements continued 3. User Charges Rental Accommodation and Associated Recoupments 17 702 15713 Imputed Lease Rentals 27 985 23 264 Lease Coordination Fee 6172 Other 6 409 7 065 52 096 52 214 4. Resources Received and Provided Free of Charge a) Received free of charge Assets Transferred from Other Government Agencies 4 768 66 433 Other 104 4 768 66 537 b) Provided free of charge Fltout Costs 4128 15 487 Other Assets Transferred to Other Government Agencies 1 275 9 095 160 611 5 403 24 582 5. Employee Costs Wages and Salaries 51 056 51 730 Superannuation Expense Related to Departmental Staff 3 660 3 619 Termination Payments 1 040 441 Other On-Costs 5 840 6 053 61 596 61 843 6. Supplies and Services Accommodation/Rent and Outgoings 5 799 4 969 Contract Services and Consultancies 64 702 131 189 Information Systems 6 908 3 801 Building Services and Utilities 11 407 8 513 Marketing and Promotion 1 487 4 651 Postal and Telephone 2 173 2 606 Office Requisites 1 420 2111 Staff Development and Recruitment 2137 2 011 Ex-Gratia Payments 134 1 333 Other 3 842 16 373 100 009 177 557 1 2000 1999 $ '000 $'000 7. Depreciation and Amortisation Buildings, Fitouts and Grounds Development 8 687 6 838 Computer Equipment 3 230 3 779 Office Equipment, Furniture and Fittings 299 332 Leased Assets 11 296 11 558 Intellectual Property 5 048 5 003 28 560 27 510 8. Grants and Transfer Payments Victorian Government Business Enterprises 13 738 8125 Other Victorian Government Entities 15 075 28 779 Other Governments 4 775 3 234 Non-Government Grants 3 670 3 884 37 258 44 022 9. Other Expenses Finance Lease Interest 15 935 16 094 Audit Fees: • Internal 788 393 • External - Auditor-General • Annual Financial Statements and Departmental Financial Report 808 700 • Other 274 424 - Other External Parties 99 88 Net Value of Assets Sold* 37 072 18168 Other "7 183 4195 62159 40 062 * Net Value of Assets Sold relates mainly to net book value of surplus real estate properties disposed of during the year. 10. Abnormal Items Expense: Provision for Diminution in Value of Investment (Mote 13) 122000 Notes to mû forming pant of the Financial Statements continued 11. Receivables State Administration Unit * 42 000 80 362 Fees Receivable by Business Units j"Ô47 931 Provision for Doubtful Debts (43) Other 114 43129 81 364 * Represents balance of annual appropriation relating to expenses incurred in the provision of outputs, for which payments had not been disbursed at balance date. 12. Other Current Assets Inventories J 00 112 Prepayments T'358 1 192 Investments 404~ 1 281 1 862 2 585 13. Investments Debt Securities 254 974_ 257 893 Provision for Diminution in Value "(122 000)"" (122 000) 132 974 135893 This amount (gross) represents the cost of bonds purchased by the Department in respect of the Accelerated Infrastructure Program. The proceeds of the bonds (issued by a special purpose company) were used to finance the construction of police stations, court buildings and other buildings for government use. The bonds were purchased to facilitate a restructure of the leasing arrangements related to those buildings. In view of the potential loss following the restructure of the Accelerated Infrastructure Program, $122 million was provided at 30 June 1999 to account for a possible decrement in the carrying value of these bonds (refer also Note 10). This amount was reviewed as at 30 June 2000 and is considered sufficient to cover any potential loss. 14. Land and Buildings Land and Improvements - at Valuation 60 452 89 901 Buildings - at Valuation 46 045 48 369 Accumulated Depreciation (3 418). (1 940) 42 627 46 429 Building Improvements - at Cost 8 069 6 281 Accumulated Depreciation : (1 577)" (509) 6 492 5 772 Fitouts - at Cost 35 444 34 811 Accumulated Depreciation (10 299) (6 319) 25145 : 28 492 fi "m» -sp -"W^lf'í -«if't Jjjpf. l-piB. p ^ fi» ' ^iy -fe- ^^ „ .. QTiTift Q'SSa 14. Land and Buildings continued Grounds Development - at Cost ,., 4110 3 900 Accumulated Depreciation (871) (471) 3.239 3 429 Construction in Progress - at Cost 10 247 7 825 Buildings under Finance Lease 103 994 103995 Accumulated Amortisation • (15 268)' (7 634) 88 726 96 361 Heritage Buildings - at Valuation 12 656 11 586 Accumulated Depreciation (2 012) (781) 10 644 10 805 Total Land and Buildings " 247 572 289 014 Valuations of land and buildings were determined by the Valuer-General's Office in June 1998, and were carried out in conformity with the accounting policy Recognition and Valuation of Non-Current Physical Assets issued by the Budget and Financial Management Division of the Department of Treasury and Finance. mm % A Ufe. • SB» • 'J® w - EftjSD ® 15. Plant and Equipment Office Equipment - at Cost 2 767 " 2 638 Accumulated Depreciation (1 824) . (1 700) 943 938 Computer Equipment - at Cost s 14 573 15 070 Accumulated Depreciation (11 684) (9 766) 2 889 5 304 Construction in Progress - at Cost ,, 15150 9 720 Plant and Equipment under Finance Lease 1 745 . 10 231 Accumulated Amortisation (1 745), (10144) 87 Motor Vehicles under Finance Lease 201 241 215 865 Accumulated Amortisation (5 262) Í (4 757) 195 979 211 108 Notes to and forming part of the Financial Statements continued 15. Plant and Equipment continued Intellectual Property Generic Revenue Collection System - at Cost 12 241 12 241 Accumulated Depreciation (12*195) (11 630) 46 611 Municipal Valuations Database - at Cost 742 13 242 Accumulated Amortisation 5 (742) (10144) - 3 098 Total Plant and Equipment 215 007 230 866 I 16. Creditors and Accruals Supplies and Services 8 959 64 878 Employee Costs 1 148 ; 944 Amounts Payable to Other Government Agencies " 1 627 890 11 734 66 712 164 651 17. Commitments for Expenditure a) Finance Leases .: v Current t 12680 7 932 Non-current 262 729 294 474 { 275 409 ; 302 406 Commitments under finance leases at the reporting date are payable as follows: I. „ Not later than one year 28 616 23 566 Later than one year and not later than 5 years 228 867 272 098 Later than 5 years 99 042 112983 Minimum lease payments 356 525 408 647 Less: Future finance charges 81 116 106 241 • 275 409 » 302 406 b) Operating Leases Commitments In relation to non-cancellable operating leases contracted for at the reporting date but not recognised as liabilities, payable: Not later than one year 5 970^ 5 344 Later than one year and not later than 5 years 19 065 14120 Later than 5 years 20 712 3 676 45 747 23140 c) Capital Commitments Commitments for capital expenditure contracted for at the reporting date but not recognised as liabilities (all payable within the next financial year): Building improvements, fltouts and maintenance 4 756 5 967 "Ml -w- "W MÜ JW 18. Employee Entitlements Current Provision for Annual Leave 3 828 4 227 Provision for Long Service Leave 1 062 1 036 Performance Incentive Provision 1 946 1 476 Accrued Wages and Salaries 1 524 17 8 360 6 756 Non-Current Provision for Long Service Leave 8169 9 328 19. Superannuation a) Superannuation Costs - Non-Departmental The Department bears the cost of superannuation for certain non-Departmental personnel, for example pension entitlements under constitutionally protected schemes operated forjudges, and contributions in respect of university employees. The major item included in this category, however, is the impact of the change to the outstanding unfunded superannuation liability. This item Increased from $613 million in 1998-99 to $1 157 million in 1999-2000. The majority of this increase relates to work undertaken by the actuary of the State Superannuation Fund, In the restatement of the liability for 1999-2000, which has resulted In a number of significant actuarial revaluations, including a change in the proportion of Revised Scheme members assumed to resign before the age of fifty-five. Another factor contributing to the increase in these superannuation costs related to surpluses held In certain defined benefit schemes, amounting to $89 million, which were not recognised in 1999-2000 as an offset to the total unfunded liability, In contrast to previous years. b) Unfunded Superannuation Liability The gross unfunded liability with respect to superannuation funds operated principally for budget sector employees was $12 908 million (1999 - $11 997 million), as detailed below. This liability represents the shortfall between the total net assets of the State's budget sector superannuation funds at 30 June 2000 and the total benefits that members have accrued up to that date, determined by an actuarial assessment. Not all of the $12 908 million is to be met from superannuation outlays of the budget. An amount of $1 321 million (1999 - $1 069 million) Is to be met from the revenues of Commonwealth funded agencies (for example, universities) and self-funded entities. In accordance with the State Superannuation Act 1988, the Government, through the Consolidated Fund, is primarily responsible for meeting the employer's share of the unfunded liability of the State Superannuation Fund. However, under the terms of that Act, the Minister for Finance can effectively pass this unfunded liability to individual authorities. In addition, the Department has recognised a liability of $147 million (1999 - $135 million) for accrued benefits arising from pension entitlements under constitutionally protected schemes operated principally for judges. As no assets are held In respect of these schemes, they are therefore unfunded and pensions become directly payable from the Consolidated Fund. The liability has been calculated by the Superannuation Policy Unit of the Department. During 1999-2000 the Government made a one-off payment of $271 million to the Emergency Services Superannuation Scheme in order to eliminate the unfunded liability relating to Victoria Police. The payment has contributed to this Scheme recording an overall surplus at 30 June 2000. Notes to and forming part of the Financial Statements continued 19. Superannuation continued Fund State Superannuation Fund 12 908 11 825 Emergency Services Superannuation Scheme 196 Parliamentary Contributory Superannuation Fund - (24) , 12 908 11 997 Constitutionally Protected Schemes 147': 135 : 13 055 12132 Liabilities to be met from Non-Budget Revenue (1 321) (1 069) Liabilities to be met from Budget Outlays 11 734. 11 063 Shown as: Current Liabilities 277 ' 242 Non-Current Liabilities 11 457^ 10 821 11 734" 11 063 Movements during the year were as follows: Restatement upon Actuarial Revaluations • 1 157~ 612 Write Back of Fund Surpluses 89" Payments to Reduce the Liability (575) (3 914) Net lncrease/(Decrease) in Liability 671 (3 302) 20. Changes in Equity Accumulated Deficit Balance at the Beginning of the Financial Year (10 715 442) r (13 948 789) Net Surpius/(Deficit) from Operations (696 491) 3 192 787 Transitional Adjustments * 12 776 i 3 685 Equity Adjustment ** (5 335) ! 36 875 Balance at the End of the Financial Year (11 404 492) (10 715 442) Asset Revaluation Reserve Balance at the Beginning of the Financial Year 24 619 29 293 Net Revaluation Decrement (4 674) Balance at the End of the Financial Year 24 619 - 24 619 * The 1999-2000 amount relates principally to a change in the treatment of certain trust funds, the net revenue from which is now taken at year end to equity rather than liabilities. " Relates to reclassification of items between controlled and administered. jj 21. Reconciliation of Net Surplus/(Deficit) from Operations to Net Cash Provided By/(Used In) Operating Activities Net Surplus/(Deflcit) from Operations (696 49 i) 3 192 787 Depreciation and Amortisation 28 560 " 27 510 (Profit)/Loss on Disposal of Non-Current Assets 37 072 I (24 926) Assets Provided Free of Charge 5 403 * Assets Received Free of Charge (4 768) Diminution in Value of investment 122000 (lncrease)/Decrease in Receivables 34 232 (58 342) (lncrease)/Decrease in Other Current Assets " i15i (17 857) Increase/(Decrease) in Creditors and Accruals (42 215)1 47 255 lncrease/(Decrease) in Unfunded Superannuation 670 707 ' (3 301 300) lncrease/(Decrease) in Employee Entitlements 549 j 313 lncrease/(Decrease) in Other Liabilities (93)1 Net Cash Provided By/(Used In) Operating Activities 32 801 (12 560) 22. Contingent Liabilities Contingent liabilities arise from guarantees, indemnities and other forms of support provided by the Government through the Treasurer of Victoria. They also arise from legal disputes and other claims against the Government. Contingent liabilities, by definition, are not actual liabilities. They are amounts relating to circumstances under which there Is the possibility, due to some future event, that an actual liability could arise. A conservative approach has been taken so that the amounts shown below represent the maximum potential liability, without accounting for any offsetting asset or security values. The following table summarises quantifiable contingent liabilities relating to the Department of Treasury and Finance. Ml regia IL Budget Sector State Financial Enterprises 365.0 365.0 Specific Guarantees and Indemnities under Statute 248.0 305.6 Monash Medical Centre 19.6 20.9 Litigation against State Revenue Office 15.1 112.2 Other 9.1 7.5 Total Budget Sector 656.i 811.2 Non-Budget Sector 2 529.2 2 707.1 Total ,3 186.0 3 518.3 PUBLIC TRANSPORT CORPORATION LEASE ARRANGEMENTS Under various transport lease arrangements made by the Public Transport Corporation, the State of Victoria indemnified the lessors against adverse tax rulings and third party personal injury claims, where the third party is injured by the operation of the equipment during the period of the lease. As at 30 June 2000, all of these lease arrangements have been terminated. The normal statute of limitations for tax claims Is five years and for personal injury claims is six years. Notes to and forming part of the Financial Statements continued GAS SUPPLY INCIDENT The State and a number of its instrumentalities have been named as cross respondents in a representative proceeding before the Federal Court arising from the fire and explosion at Esso's gas processing plant at Longford. The proceeding was instituted against Esso Australia Ltd and Esso Australia Resources Ltd (together 'Esso') on behalf of gas users and workers who were stood down who are alleged to have suffered losses during the incident. Esso, in turn, has cross-claimed against the State and a number of its instrumentalities. The State and its instrumentalities have denied any liability in respect of Esso's cross claim and are vigorously defending the cross claim. The State and a number of its instrumentalities have also Issued a further cross claim against BHP Petroleum (Bass Strait) Pty Ltd for contribution and indemnity. There is a dispute with insurers as to the extent of insurance cover and a claim has been made for indemnity by a number of the State's instrumentalities. A further proceeding tias been commenced in the Supreme Court of Victoria against some of the State's instrumentalities, but no document has been served. PAYROLL TAX AND TEMPORARY EMPLOYEES The status of temporary employees under the Pay-roll Tax Act has been the subject of legal proceedings. In June 2000 the Court of Appeal decided the case in favour of the Commissioner of State Revenue. The implications of this decision include the requirement that a number of affected companies commence paying payroll tax arrears, which may be owed over a range of periods. The Court of Appeal decision is currently subject to an application for special leave to the High Court. It is not possible to accurately measure the financial impacts, if any, of the initial decision or of the High Court appeal. TRANSMISSION OF BUSINESS UNDER SECTION 149 OF THE WORKPLACE RELATIONS ACT 1996 As a result of outsourcing, contractors now performing Government functions following acceptance of their tenders, have sometimes engaged staff on lesser rates and conditions than those that previously applied under Awards for public sector employees. Recent Federal Court decisions have indicated that previous award rates and conditions may apply to the contractor's employees performing what was previously a government function. The application of this principle requires transfer of part of the business (of the Government) and the test that is generally applied is whether there is a 'substantial identity' between the activities before and after the outsourcing. If applicable, the principle would generally cause increases in employment costs for the contractor. The Federal Court decision is subject to an application for leave to appeal to the High Court by the State of Victoria. Pending the appeal, the financial implications on the State of the transmission of business applications under the Workplace Relations Act are unclear. OTHER CONTINGENT LIABILITIES NOT QUANTIFIED There are other commitments, made by the Government, many of which are not quantifiable, arising from: • indemnities provided in relation to financing arrangements, consultancy services, directors and administrators; • performance guarantees; • deeds in respect of certain obligations of the Docklands Authority; and • outstanding unclaimed monies, which may be subject to future claims by the general public against the State. 23. Disclosures Relating to Ministers and Accountable Officer in accordance with the Directions of the Minister for Finance under the Financial Management Act 1994, the following disclosures are made for Ministers and for the Accountable Officer for the reporting period. NAMES The persons who held the above positions in the Department are as follows: Treasurer of Victoria The Hon John Brumby, MP 22 May 2000 to 30 June 2000 The Hon Steve Bracks, MP 20 October 1999 to 21 May 2000 The Hon Dennis Napthine, MP 7 October 1999 to 19 October 1999 The Hon Allan Stockdale, MP 1 July 1999 to 6 October 1999 Minister for Finance The Hon Lynne Kosky, MP 22 May 2000 to 30 June 2000 The Hon John Brumby, MP 20 October 1999 to 21 May 2000 The Hon Roger Hallam, MP 1 July 1999 to 19 October 1999 Minister for Gaming The Hon John Pandazopoulos, MP 20 October 1999 to 30 June 2000 The Hon Roger Hallam, MLC 1 July 1999 to 19 October 1999 Minister for WorkCover The Hon Bob Cameron, MP 20 October 1999 to 30 June 2000 Minister for Industrial The Hon Monica Gould, MLC 20 October 1999 to 3 March 2000* Relations Secretary Mr Ian Little 1 July 1999 to 30 June 2000 * Portfolio transferred to the Department of State and Regional Development from 3 March 2000. REMUNERATION Remuneration received or receivable by the Accountable Officer In connection with the management of the Department during the reporting period was In the range: $310 000 - $319 999 ($310 000 - $319 999 In 1998-1999) Amounts relating to Ministers are reported in the Financial Statements of the Department of Premier and Cabinet. OTHER TRANSACTIONS Other related transactions and loans requiring disclosure under the Directions of the Minister for Finance have been considered and there are no matters to report. 24. Executive Officers' Remuneration The numbers of executive officers, other than Ministers and the Accountable Officer, whose total remuneration exceeded $100 000 during the reporting period, are shown in their relevant income bands in the first two columns of the table below. The base remuneration of these executive officers is shown in the third and fourth columns. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits. $20 000 - $29 999 - 1 - $40 000 - $49 999 - - - 1 $70 000 - $79 999 - 1 1 $80 000 - $89 999 - - 1 5 $90 000-$99 999 - - 7 18 $100 000-$109 999 11 20 23 20 $110 000-$119 999 17 18 7 23 $120 000-$129 999 12 15 11 3 $130 000-$139 999 14 ' 10 10 6 . _ $140 000-$149 999 3 3 5 $150 000-$159 999 4 7 6~" - $160 000-$169 999 5 3 2 - $170 000-$179 999 '4 3 1 1 $180 000-$189 999 1 2 1 1 $190 000-$199 999 - 1 1 " - $200 000 - $209 999 2 1 1 1 $210 000-$219 999 - 1 - - $220 000 - $229 999 1 1 - $240 000 - $249 999 2 - - - Total Numbers 76 85 76 85 Total Amount $ '000 10 384 11 134 9 246 9 528 [Motes to amdl forming pact of He Financial Sttatteomiemtts continued 25. Compliance with Financial Directives (a) Summary of Compliance with Annual Parliamentary Appropriations Year Ended i 30 June 2000 Provision of Outputs t 288 063 2 353 (2 290) 11 584 299 710. 258 097 j41 613 Additions to ' Net Asset Base • 12 858 12 858. _ 6 146 6 712 Payments Made on Behalf ofthe State 937 177 2 290 . 235 753 1 175 220 . 417 254 757 966 Total 1 238 098 2 353 247 337 1 487 788 681 497 806 291 Year Ended 30 June 1999 Provision of Outputs 307 745 25 585 2 259 5 146 4 315 3 552 348 602 334 282 14 320 Additions to Net Asset Base 881 (881) 19 621 1 221 20 842 2 280 18 562 Payments Made on Behalf of the State 1 613 637 5 612 (4 265) 28 218 1 149 1 644 351 1 331 584 312 767 Total 1 922 263 31 197 2 259 52154 5 922 2 013 795 1 668146 345 649 170 "tT] Explanation of Variances between Annual Parliamentary Appropriations and Appropriations Applied - Year Ended 30 June 2000 (I) PROVISION OF OUTPUTS The change in Government direction and the observance of caretaker conventions during the period August to October 1999 meant that some outputs were either not delivered or ceased altogether. The cessation of the provision of certain outsourcing services and the elimination of the Privatisation Services output group reflected the Government's move away from privatisation of government services. The extended caretaker period deferred Superannuation Reform ($15 million) and Industry Reform Policy ($5 million) outputs to 2000-01. (II) ADDITIONS TO NET ASSET BASE APPROPRIATIONS The under expenditure is primarily due to delays caused to capital works projects by the extended caretaker conventions during the period August to October 1999. Major work on the relocation of the Environment Protection Authority laboratory commenced after year end, with the project to be completed by April 2001. (III) PAYMENTS MADE ON BEHALF OF THE STATE APPROPRIATIONS Significant items contributing to the variance were as follows: • underexpenditure on grants payments in connection with the termination of lease agreements ($132 million); » funding for separation packages, employee entitlements, creditors and automated ticketing expenses in connection with the PTC franchising program which were not taken up in 1999-2000 but may be taken up in 2000-01 ($117 million); • interest savings from application of Transmission Pipelines Australia sale proceeds ($73 million); and • underclaim of appropriation revenue in1999-2000, to match overclaims in 1998-99 for certain major items of non-cash expenditure, primarily revaluation of borrowings ($325 million). (b) Summary of Compliance with Special Appropriations Act Nos. 6282/7705/8731 Special Appropriations - Pensions Chairman General Sessions Act No. 8750 of 1975 Special Appropriations - Pensions Constitution (Governors Pension) Act No. 6230 Judges County Court Act Specials Appropriations - Pensions 3.489 3 056 Act No. 8750 Judges Supreme Court Special Appropriations 2 558 2 489 Act No. 6323 Section 3 - The Mint Special Appropriations 79 86 Act No. 50 of 1988 Section 90(2) Special Appropriations The Superannuation Fund - 858 945 Contributions State Superannuation Act No. 50 Special Appropriations - Pensions of 1988 Section 90 (1) Reduction in Unfunded Superannuation Liabilities 3 054 982 Emergency Service Superannuation Reduction in Unfunded Superannuation Liabilities 271 000 Act No. 94 of 1986, Section 20(1) Act No. 80 of 1992-Section 38 1998-99 Special Appropriations - Debt Charges 269108 5 179 638 Budget Sector Debt Retirement State Owned Enterprises Act Special Appropriations - Other Services 1 563 No. 90 of 1992 Section 88 - State Equivalent Tax Refund Act No. 35 of 1986 Section 11 Special Appropriations - Other Services . 600 1 020 Taxation (Interest on Overpayments) Act No. 6226, Section 77(2) Special Appropriations 34 102 Co-Operative Housing 97 Act No. 6232 - Crown Proceedings Special Appropriations .J35 Section 17 Business Franchise Safety Net Payments 21 174 Fees Act 1997-Liquor 21 831 Section 17 Business Franchise Safety Net Payments 79 000 Fees Act 1997-Petroleum '"8Í488 Business Franchise Fees (Petroleum Special Appropriations - Other Services 849 Products) Act No. 9272 of 1979, Safety Net Payments Section 13(2) Financial Management Act Debt Charges - Interest on Advance 6106 8011 No. 18 of 1994, Section 39 Financial Management Act Transport Leases 33 000 No. 18 of 1994, Section 28 TOTAL 981 567 9 244 393 Shown in these Financial Statements as: Controlled Appropriations Revenue 642 411 3 960 290 Administered Appropriations Revenue 339156 5 284 103 981 567 9 244 393 Notes to amcfl forming parti of the FSnnainiCDaD Statements continued 26. Transactions with other Victorian Government Controlled Entities During the year transactions were undertaken with other Victorian Government controlled entities. The resultant revenue and expense amounts, and related balances at year end, all of which would be eliminated within a whole-of-government consolidation, are summarised as follows: Assets J 420143 _ 350 567 280 084 383 230 Liabilities 5 860717 JM27196 6554419 1 391 912 Revenue 2 819 363 3 644 594 13 587 606 1 797 600 Expenses 16 375 830 145 973 22 285 588 1 884 993 'Intra1 transactions/balances are with entities within the Department's portfolio, including the State Administration Unit. 'Inter' transactions/balances are with entities outside the Department's portfolio, but which are controlled by the Victorian Government. 27. Financial Instruments Terms, Conditions and Accounting Policies The Department's accounting policies, and the terms and conditions of each class of financial asset and financial liability, are as follows: Financial Assets Overnight Deposits with Treasury Corporation 5.13% Valued at cost, being the • Interest is based on TCV's overnight investment 13] of Victoria (TCV) per annum capital outstanding. rate and received monthly in arrears. Capital is repayable at 11.00 am the following day. Public Account Investments with Victorian 7.47% Recorded at market value Interest is received semi-annually In arrears. Funds Management Corporation per annum as at 30 June 2000. Capital is received on maturity. Maturities for fixed interest securities range between 2001-02 and 2005-06. Deposits with the Commonwealth 5.12% Recorded at cost, subject The outstanding principal is used to retire (Debt Retirement Reserve Trust Account) per annum to set-off arrangements financial obligations of the State of Victoria against liabilities owed to owed to the Commonwealth. the Commonwealth. Compounding Interest. Requirement for annual contributions from the State of Victoria and monthly contributions from the Commonwealth to the deposit. Receivables N/A Receivables are carried at Receivables are normally settled within 30 days. nominal amounts due less any provision for doubtful debts. A provision is recognised when collection of the full nominal amount is no longer probable. Financial Liabilities Fixed Interest Borrowings from TCV 7.12% Recorded at book value, Interest Is paid quarterly in arrears as per per annum based on principal a fixed interest rate. outstanding with discounts Principal Is repaid as per an amortising schedule and premiums amortised over the life of the instrument or at maturity. over the life of the Maturities for fixed interest borrowings range instrument. from 2001-02 to 2010-11. Advances from the Commonwealth 4.12% Recorded at book value, Interest is paid semi-annually in arrears as per per annum based on principal a fixed interest rate. outstanding. Principal is repaid as per an amortising schedule over the life of the instrument or at maturity. Maturities for Commonwealth advances range from 2003-04 to 2030-31. 27. Financial Instruments continued Financial Liabilities continued CPI Indexed Borrowings (Indexed Annuities) Real rate of Recorded at book value, Interest Is indexed to the CPI and paid quarterly 8.58% per based on principal in arrears. annum outstanding with discounts Principal is repaid over the life of the instrument and premiums amortised as per an amortising schedule. over the life of the Maturities for indexed annuities range from instrument. 2000-01 to 2030-31. CPI Indexed Borrowings Real rate of Recorded at book value, Principal outstanding is indexed in accordance (Capital Indexed Bonds) 4.00% per based on Indexed with the movement in the CPI. annum principal outstanding with Interest is paid quarterly in arrears at a fixed rate discounts and premiums based on the Indexed face value of the bond. amortised over the life of The indexed face value is repaid at maturity. the instrument. Maturities for capital indexed bonds range from 2002-03 to 2020-21. Finance Lease Liabilities 6.52% per Recorded at the present Interest is charged at the interest rate Implicit In annum value of minimum lease the lease agreement. payments due at the Principal is repaid as per an amortisation inception of the lease, with schedule over the life of the lease. subsequent adjustments made for additions and disposals of assets held under lease. Creditors and Accruals N/A Creditors and Accruals No interest is payable. represent amounts that Normally settled on 30 day terms. are to be paid to suppliers and other outside entities. The carrying amounts recorded approximate their net market value. Interest rate risk - financial assets Long-term funds held in the Public Account have been invested by the Victorian Funds Management Corporation, consistent with the objective of being able to meet all medium-term Budget financing requirements, Including the financing of Growing Victoria reserve infrastructure expenditure. Interest rate risk - financial liabilities Management of the Budget Sector Debt Portfolio (BSDP) is based on the key objectives of achieving relative certainty of interest costs while minimising net borrowing costs and refinancing risk, and conservatively managing the financial operational risks of the Budget Sector treasury operations. The BSDP mainly comprises fixed-rate borrowing facilities that have an even maturity profile across the yield curve. This ensures that a relatively small proportion of the BSDP Is subject to repricing in any one period. Since borrowings in the BSDP will be held to maturity, the BSDP is accounted for on an historical cost basis. The interest rate risk profile of financial assets and liabilities held by the Department is detailed below, as per the face value of debt outstanding at balance date. Notes üo mú formniiig part of the FinnaniiciaD SttateimieDiitts continued 27. Financial Instruments continued _3ïïîliT En® Mtlïlïj tasa I ; DfESD 0 inJSHD, iih&GBBL „ o® Financial Assets Administered Overnight Deposits held with Treasury Corporation of Victoria ! 5.13% 115 040 _ - - - 115 040 Public Account Investments held with Victorian Funds Management f Corporation ' 7.47% 4834 973 462 6 282 984 578 Investments with the Commonwealth (Debt Retirement Reserve Trust Account) 5.12% 6 939 . 6 939 Other Investments 5.58% 76131 - - - 14 808 • 90 939 Cash 5.95% 11 844 - - - - Tl1 844" Receivables - 329 348 - • - - 403 903 ""733 25?" 544 136 ... . - 973 462 6 282 418 711 1:942 591 Departmental Cash 5.95% 219 - - - - 219 Investments í 5.57% . 133 378 - - - >- 133 378 Receivables - - - - - 43129 43129 f 133 597 - ' - - 43129 ,176 726 Total Financial Assets ? 677 733 _ 973462 ¥ 6 282 • 461 840 2119317 Financial Liabilities Administered Fixed Interest Borrowings 7 Í2% - 168 " 1 709103 3 057 309 - " 4766 580 Advances from the Commonwealth 4.12% - • 725 2 759 5 663 - 9147 : CPI Indexed Borrowings 6.93% 974 083 - - - 974 083 SAU Liability - - - - 832 596 • 832 596 ** Trust Fund Borrowings - - 294600 294 600 Creditors and Accruals 7 - 36 892 36 892 : Other * - - - "Ï69 917 ' 169 917 974 083 893 1 711 862 , 3 062 972 1 334 005 7083 815 Departmental Bank Overdraft " 9.25% * " " 13 877 " 13 877" Creditors and Accruals - - - , 11734 l 11 734 Lease Liabilities 6.52% 275 409 - - - - ™275 409 289 286 - - - 11734 301 020 Total Financial Liabilities 1 263 369 -893 « 1 711 862 3 062 972 ,1 345 739 7 384 835 tEEE) ffiffia MEiìiìa us a* ' fé^- Average (litMì Interest: Rate a Financial Assets Administered Investments with the Commonwealth (Debt Retirement Reserve Trust Account) 4.65% 5 894 - - - - 5 894 Other Investments - 25 744 - - - 17216 42 960 Receivables 4.60% 89 956 - - - 806 808 896 764 Cash - 551 899 - - - - 551 899 673 493 - - - 824 024 1 497 517 Departmental Investments - 137174 - - - - 137174 Receivables - - - - - 81 364 81 364 137174 - - - 81 364 218 538 Total Financial Assets 810 667 _ _ _ 905 388 1 716 055 Financial Liabilities Administered Fixed interest Borrowings 7.13% - 299 981 1 843 304 2 740 920 - 4 884 205 Advances from the Commonwealth 4.20% - 710 2 897 6 282 - 9 889 CPI Indexed Borrowings 6.60% 1 095 030 - - - - 1 095 030 Overnight Borrowings 4.80% 526 963 - - - - 526 963 SAU Liability - 613 368 - - - - 613 368 Trust Fund Borrowings - 778 537 - - - - 778 537 Creditors and Accruals - - - - - 29 450 29 450 Other - 7 708 - - - 177 719 185427 3 021 606 300 691 1 846 201 2 747 202 207 169 8 122 869 Departmental Bank Overdraft - 18 642 - - - - 18 642 Creditors and Accruals - - - - - 66 712 66 712 Lease Liabilities - 302 406 - - - - 302 406 321 048 - - - 66 712 387 760 Total Financial Liabilities 3 342 654 300 691 1 846 201 2 747 202 273 881 8 510 629 Notes to and forming part of the Financial Statements continued 27. Financial Instruments continued Net Fair Value for Financial Assets and Liabilities The carrying amounts of the Department's financial assets are valued at cost, which approximates their net fair value. The net fair value of financial liabilities is determined by the net present value of expected cash flows discounted at the Treasury Corporation of Victoria's rate for similar securities at balance date. The net fair value of the Department's financial assets and liabilities are detailed below: Financial Assets Administered Overnight Deposits held with Treasury Corporation of Victoria 115 040 115 040 - - Public Account Investments with the Victorian Funds Management Corporation 984 578 984 578 - - Investments with the Commonwealth (Debt Retirement Reserve Trust Account) ; 6 939 6 939 : 5 894 5 894 Other Investments 90 939 90 939 42 960 42 960 Cash 11 844 11 844 551 899 551 899 Receivables 733 251 733 251 896 764 896 764 1 942 591 1 942 591 1 497 517 1 497 517 Departmental Cash 219 219 - - Investments ? 133 378 133 378 ' 137174 137174 Receivables 43129t ,43 129 ,i 81 364 81 364 176 726 176 726 218 538 218 538 Total Financial Assets 2119317 2119317 1 716 055 1 716 055 Financial Liabilities Administered Fixed Interest Borrowings 4 766 580 4 942 451 4 884 205 5106 618 Advances from the Commonwealth 9147 7 432 9 889 8 036 CPI Indexed Borrowings 974 083 1 141 196 1 095 030 1 241 610 Overnight Borrowings - 526 963 526 963 BSDP Borrowings s 5 749 810: 6 091 079 6 516 087 6 883 227 Creditors and Accruals 36 892 36 892 29 450 29 450 SAU Liability 832 596 832 596 613 368 613 368 Trust Fund Borrowings 294 600 294 600 778 537 778 537 Other 169 917 169 917 185 427 185 427 7 083 815 7 425 084" 8 122 869 8 490 009 Departmental Bank Overdraft ~ 13 877 "73 877^ 18 642 18 642 Creditors and Accruals 11 734 11 734 66 712 66 712 Lease Liabilities 275 409 275 409 : 302 406 302 406 301 020 301 020 387 760 387 760 Total Financial Liabilities 7 384 835 7 726104 8 510 629 8 877 769 Foreign Exchange Risk The Department is not exposed to any foreign exchange risk. Off Balance Sheet Risk The Department is not exposed to any off balance sheet risk. 28. Administered Transactions Activities Administered by the Department In addition to the specific Departmental operations which are included in the Statement of Financial Position, Operating Statement and Statement of Cash Flows, the Department administers or manages activities on behalf of the State. The transactions relating to these State activities are reported as Administered in this Note. Administered transactions give rise to revenues, expenses, assets and liabilities and are determined on an accrual basis. Administered revenues Include taxes, fees and fines and the proceeds from the sale of administered surplus land and buildings. Administered liabilities include government expenses incurred but yet to be paid. Administered assets include government revenues earned but yet to be collected. Administered Borrowings The borrowings of the Budget Sector Debt Portfolio (BSDP) totalled $5 750 million at balance date (1999 - $6 516 million). The $5 750 million had a face value of $6 672 million (1999 - $6 431 million) and a market value of $6 091 million (1999 - $6 883 million). Refer to Note 27 for further discussion on BSDP borrowings. Departmental controlled and administered transactions are disclosed by class and also by Output Groups for controlled transactions In the following tables: | JHP -jp,- |P fP 'Mf» ——-m— Administered revenue'and expenses foiithe yeaTrende d •30'Jun?2000|| Jpfa. üfflSfl -.äStk > agjfa- àiiJMSe ADMINISTERED REVENUE Special Appropriations . 339156 5 284103 Payments on Behalf of the State Appropriations 417 254 1 331 584 Commonwealth Grants : . 3 644 840 3 591 579 Taxation 9 356 630 10 218 857 Dividends 887 336 1 006 971 Capital Assets Charges 1 533 520 1 474 721 Other Revenue 398 243 438 767 Abnormal Items (1) - 4 373 622 Payments to Consolidated Fund (15 826 795) (21 368 631) Total Administered Revenue 750184 6 351 573 ADMINISTERED EXPENSES Grants and Transfer Payments 299 765 350 580 Financing Costs 33 011 200 664 Interest Expense " 420 602 645 628 Taxation Expense 103 319 101 023 Other 123 269 434 Total Administered Expenses 979 966 1 298 329 (229 782) 5 053 244 State Revenues Received into Consolidated Fund, net of Appropriations Applied within Government Departments 1 1 709122 (1 727 799) NET ADMINISTERED REVENUE 479 340 3 325 445 (1) Abnormal Items for 1998-99 consisted of Privatisation and other asset sale proceeds. bottes to aoMfl forming pairtt of tthe FinanciaB Statements continued 28. Administered Transactions continued (ESD Administered Assets and Liabilities'as at 30*June 2000!MiPipf ajgi^^pi 4 0W ASSETS CURRENT ASSETS i Cash * 11 844 ' 551 899 Receivables ! 370 369 _ 497 451 Investments 127 321 * 33 048 Inventories ' 9297 ; 4 997 Prepayments 1 29 . 770 Total Current Assets ! 518 860 1 088 165 NON-CURRENT ASSETS Receivables i 362 882 ~ 399 313 Investments 1 070 175 * 15 806 Infrastructure Assets 5 68 609 ' 32 851 Total Non-Current Assets 1 501 666 ' 447 970 Total Assets 2 020 526 1 536 135 LIABILITIES CURRENT LIABILITIES Creditors and Accruals i, 36 892 37158 SAU Liability (1) 832 596 : 613 368 Trust Fund Borrowings (2). 294 600 ' 778 537 Borrowings 36 852 - 865 314 Other 46 943 7 921 Total Current Liabilities 1 247 883 ; 2 302 298 NON-CURRENT LIABILITIES Borrowings 5 712 958 5 650 773 Other 163 612 ' 169 798 Total Non-Current Liabilities 5 876 570 5 820 571 Total Liabilities 7 124 453 8122 869 Net Liabilities ' (5103 927)' (6 586 734) (1) Parliamentary appropriations applied, from which funds have not been issued from the Consolidated Fund. (2) Public Account advance from Trust Fund balances to the Consolidated Fund. Certification We certify that the accompanying Financial Statements for the Department of Treasury and Finance have been prepared in accordance with Part 9 of the Directions of the Minister for Finance under the Financial Management Act 1994, applicable Australian Accounting Standards and other mandatory reporting requirements. We further state that, in our opinion, the Financial Statements and Notes to and forming part of the Financial Statements, present fairly the financial transactions during the year ended 30 June 2000, and financial position of the Department as at that date. We are not aware of any circumstance that would render any particulars Included in the Financial Statements to be misleading or inaccurate. Peter Goddard Ian Little Chief Financial Officer Secretary Department of Treasury and Finance Department of Treasury and Finance Melbourne Melbourne 19 October 2000 19 October 2000 AUDITOR GENERAL VICTORIA AUDITOR-GENERAL'S REPORT To the Members of the Parliament of Victoria, the responsible Ministers and the Secretary of the Department of Treasury and Finance Audit Scope The accompanying financial report of the Department of Treasury and Finance for the financial year ended 30 June 2000, comprising operating statement, statement of financial position, statement of cash flows, and notes to the financial statements, has been audited. The Secretary of the Department of Treasury and Finance is responsible for the preparation and presentation of the financial report and the information it contains. An independent audit of the financial report has been carried out in order to express an opinion on it to the Members of the Parliament of Victoria, the responsible Ministers and the Secretary of the Department as required by the Audit Act 1994. The audit has been conducted in accordance with Australian Auditing Standards to provide reasonable assurance as to whether the financial report is free of material misstatement. The audit procedures included an examination, on a test basis, of evidence supporting the amounts and other disclosures in the financial report, and the evaluation of accounting policies and significant accounting estimates. These procedures have been undertaken to form an opinion as to whether, in all material respects, the financial report is presented fairly in accordance with Australian Accounting Standards and other mandatory professional reporting requirements and complies with the requirements of the Financial Management Act 1994, so as to present a view which is consistent with my understanding of the Department's financial position, the results of its operations and its cash flows. The audit opinion expressed in this report has been formed on the above basis. Audit Opinion In my opinion, the financial report presents fairly the financial position of the Department of Treasury and Finance as at 30 June 2000 and the results of its operations and its cash flows for the year ended on that date in accordance with Australian Accounting Standards and other mandatory professional reporting requirements and complies with the requirements of the Financial Management Act 1994. MELBOURNE 23 October 2000 Auditor-General Victorian Auditor-General's Office Level 34, ¡40 William Street, Melbourne Victoria 3000 Telephone (03) 8601 7000 Facsimile (03) 8601 7010 Email [email protected] Website www.audit.gov.au Auditing in the Public Interest Appendix 1: Directory (as at 30 September 2000) Department of Treasury and Finance PORTFOLIO ANALYSIS 1 Treasury Place Director: Mr Jeff Rosewarne Melbourne 3002 Level 4,1 Treasury Place Tel: (03) 9651 5111 Melbourne 3002 Fax: (03) 9561 5298 Tel: (03) 9651 6462 Fax: (03)9651 1030 Secretary to the Department of Treasury and Finance Mr Ian Little Director: Mr David Brooks (Acting) Level 4,1 Treasury Place Level 4,1 Treasury Place Melbourne 3002 Melbourne 3002 Tel: (03) 9651 6239 Tel: (03) 9651 5388 Fax: (03) 9651 5027 Fax: (03)9651 1030 RESOURCE MANAGEMENT REFORM Budget and Financial Management Division Director: Mr Steve Gurr Level 4,1 Treasury Place Deputy Secretary: Mr Grant Hehir Melbourne 3002 Level 4,1 Treasury Place Tel: (03)9651 1069 Melbourne 3002 Fax: (03)9651 1231 Tel: (03)9651 2134 Fax: (03)9651 2195 BUDGET COORDINATION AND DEVELOPMENT Commercial Policy and Projects Division Director: Mr Joe Monforte Deputy Secretary: Mr Warren Hodgson Level 4,1 Treasury Place Level 5,1 Treasury Place Melbourne 3002 Melbourne 3002 Tel: (03) 9651 5563 Tel: (03) 9651 5369 Fax: (03) 9651 0920 Fax: (03) 9651 6487 FINANCIAL MANAGEMENT SYSTEMS COMMERCIAL Director: Mr Mike De Jong Executive Director: Ms Deborah Radford Level 4,1 Macarthur Street Director: Ms Jenny Melican (Acting) Melbourne 3002 Level 5,1 Treasury Place Tel: (03) 9651 5477 Melbourne 3002 Fax: (03) 9651 0036 Tel: (03) 9651 5330 Fax: (03) 9651 0034 FINANCIAL POLICY AND COMPLIANCE Director: Mr Neil Taylor (Acting) FINANCE AND LIABILITY MANAGEMENT Level 4,1 Treasury Place Executive Director: Ms Deborah Radford Melbourne 3002 Level 5,1 Treasury Place Tel: (03)9651 5136 Melbourne 3002 Fax: (03)9651 1231 Tel: (03) 9651 6551 Fax: (03) 9651 5334 FINANCIAL REPORTING AND CONTROL Director: Mr Murray Jones GOVERNANCE Level 4,1 Treasury Place Director: Mr Alan Hawkes Melbourne 3002 Level 5,1 Treasury Place Tel: (03) 9651 2645 Melbourne 3002 Fax: (03) 9651 2293 Tel: (03) 9651 2691 Fax: (03)9654 6861 PROCUREMENT Director: Mr John Rickard Level 11,1 Macarthur Street Melbourne 3002 Tel: (03)9651 2162 Fax: (03)9651 2161 PROJECTS REVENUE POLICY Director: Mr John Fitzgerald Director: Mr Stein Helgeby Level 5,1 Treasury Place Level 5,1 Treasury Place Melbourne 3002 Melbourne 3002 Tel: (03) 9651 5793 Tel: (03) 9651 5350 Fax: (03) 9651 6425 Fax: (03) 9651 6495 PROPERTY Executive Director: Ms Deborah Radford Strategic Management Division Director: Mr Peter Carroll Executive Director: Ms Laurinda Gardner Level 10,1 Macarthur Street Level 3,1 Macarthur Street Melbourne 3002 Melbourne 3002 Tel: (03)9651 2177 Tel: (03) 9651 5288 Fax: (03)9651 2169 Fax: (03)9651 2132 RESOURCES CORPORATE COMMUNICATION Director: Ms Jo Beatty Director: Ms Annette Glenister Level 5,1 Treasury Place Level 3,1 Macarthur Street Melbourne 3002 Melbourne 3002 Tel: (03) 9651 0743 Tel: (03) 9651 5422 Fax: (03) 9651 5228 Fax: (03)9651 5810 CORPORATE PLANNING Economic and Financial Policy Division Director: Mr Paul Eyres Deputy Secretary: Mr Brett Rowse Level 3,1 Macarthur Street Level 5,1 Treasury Place Melbourne 3002 Melbourne 3002 Tel: (03) 9651 0723 Tel: (03)9651 5113 Fax: (03)9651 2132 Fax: (03)9651 5414 MINISTERIALAND LEGAL SERVICES ECONOMIC AND SOCIAL POLICY Director and Solicitor to Treasury and Finance: Mr Ian Gibson Director: MrVin Martin Level 3,1 Macarthur Street Level 5,1 Treasury Place Melbourne 3002 Melbourne 3002 Tel: (03)9651 5714 Tel: (03) 9651 6470 Fax: (03) 9651 5951 Fax: (03) 9651 2048 FINANCIAL AND ECONOMIC ANALYSIS Corporate Services Centre Director: Dr Michael Klrby Executive Director: Mr Adam Todhunter Level 5,1 Treasury Place Level 13,1 Macarthur Street Melbourne 3002 Melbourne 3002 Tel: (03) 9651 5543 Tel: (03)9651 5145 Fax: (03)9651 5414 Fax: (03) 9651 5239 INSURANCE POLICY CORPORATE ADMINISTRATIVE SERVICES Director: Mr Adrian Nye Director: Mr Lionel Newman Level 5,1 Treasury Place Level 13,1 Macarthur Street Melbourne 3002 Melbourne 3002 Tel: (03) 9651 5222 Tel: (03) 9651 6230 Fax: (03) 9651 2321 Fax: (03) 9651 0724 MARKETS AND REGULATION STRATEGY CORPORATE FINANCIAL SERVICES Director: Dr Stephen Rimmer Chief Financial Officer: Mr Peter Goddard Level 5,1 Treasury Place Level 13,1 Macarthur Street Melbourne 3002 Melbourne 3002 Tel: (03) 9651 2060 Tel: (03) 9651 2663 Fax: (03) 9651 5575 Fax: (03) 9651 0724 Appendix t: Directory continued CORPORATE INFORMATION TECHNOLOGY AND Statutory Bodies and Business Enterprises TELECOMMUNICATIONS City West Water Limited Director: Mr Ted Sharp St Albans Road Level 7,1 Macarthur Street Sunshine 3020 Melbourne 3002 Tel: (03)9313 8422 Tel: (03) 9651 5255 Fax: (03)9313 8417 Fax: (03) 9651 2373 Coal Mine Workers' Pension Tribunal 35 Spring Street State Revenue Office Melbourne 3000 Commissioner of State Revenue: Dr David Pollard Tel: (03) 9651 3368 505 Little Collins Street Emergency Services Superannuation Board Melbourne 3000 Level 2,493 St Kilda Road Tel: (03)9628 0505 Melbourne 3004 Fax: (03)9628 0501 Tel: (03)9866 4544 EXECUTIVE TEAM Fax: (03)9867 8404 Chief Adviser to the Commissioner: Mr Rod Rogers Gascor Pty Ltd 505 Little Collins Street Level 6,45 William Street Melbourne 3000 Melbourne 3002 Tel: (03)9628 0506 Tel: (03)9932 7829 Fax: (03)9628 0501 Fax: (03)9652 4783 Divisional Manager, Customer Relations: Mr Paul Broderlck Government Superannuation Office 505 Little Collins Street 184 Ground Floor, 35 Spring Street Melbourne 3000 851 Melbourne 3000 Tel: (03)9628 0510 Tel: 1800 032 524 Fax: (03)9628 0501 Fax: (03)9654 4315 Divisional Manager, Policy and Legal: Mr Rob Dickens Hastings Port (Holding) Corporation 505 Little Collins Street Level 5,452 Flinders Street Melbourne 3000 Melbourne 3000 Tel: (03)9628 0508 Tel: (03)9679 4777 Fax: (03)9628 0501 Fax: (03)9679 4747 Divisional Manager, Compliance: Mr Peter Hiland Land Tax Hardship Relief Board 505 Little Collins Street 505 Little Collins Street Melbourne 3000 Melbourne 3000 Tel: (03)9628 0511 Tel: (03)9628 0000 Fax: (03)9628 0501 Fax: (03)9628 0501 Director, Quality and Human Resources: Ms Kathleen Duffy Melbourne Port Corporation 505 Little Collins Street Level 48, Rialto South Tower Melbourne 3000 525 Collins Street Tel: (03)9628 0512 Melbourne 3000 Fax: (03)9628 0501 Tel: (03)9628 7555 Fax: (03)9628 7550 Victorian Casino and Gaming Authority Melbourne Water Corporation Director, Gaming and Betting and Director, Casino Surveillance: 607 Bourke Street Mr Bill Lahey Melbourne 3000 Level 5,35 Spring Street Tel: (03)9235 7100 Melbourne 3000 Fax: (03)9235 7200 Tel: (03)9651 3118 Fax: (03) 9651 3777 Office of the Administrator SECV Treasury Corporation Victoria Level 5,452 Flinders Street Level 12,1 Collins Street Melbourne 3000 Melbourne 3000 Tel: (03)9679 4777 Tel: (03) 9651 4800 Fax: (03)9679 4747 Fax: (03) 9651 4880 Office of the Regulator-General Tricontinental Holdings Limited Level 1,35 Spring Street Level 15,350 Collins Street Melbourne 3000 Melbourne 3000 Tel: (03) 9651 0222 Tel: (03)9670 2000 Fax: (03) 9651 3688 Fax: (03)96001295 Old Treasury Building Committee of Management Urban Land Corporation Old Treasury Building Level 11, Melbourne Central Spring Street 360 Elizabeth Street Melbourne 3000 Melbourne 3000 Tel: (03) 9651 2233 Tel: (03)9664 8444 Fax: (03) 9651 2288 Fax: (03)96621666 Overseas Projects Corporation of Victoria Vic Fleet Pty Ltd Level 1, 590 Orrong Rd Level 10,1 Macarthur Street Armadale 3143 Melbourne 3002 Tel: (03)9258 9300 Tel: (03) 9651 2574 Fax: (03)9576 0899 Fax: (03) 9651 2571 Parliamentary Trustee Victorian Channels Authority Level 10,35 Spring Street Level 6, (03) 99 King Street Melbourne 3000 Melbourne 3000 Tel: (03) 9651 3353 Tel: (03)9612 3512 Fax: (03) 9651 3699 Fax: (03)9612 3599 Rural Finance Corporation Victorian Energy Networks Corporation (VENCorp) Level 15, 350 Collins Street 433 Smith Street Melbourne 3000 North Fitzroy 3068 Tel: (03)9243 2600 Tel: (03) 9481 9222 Fax: (03)9243 2700 Fax: (03) 9481 9269 State Trustees Victorian Funds Management Corporation 168 Exhibition Street Level 10,60 Collins Street Melbourne 3000 Melbourne 3000 Tel: (03)9667 6444 Tel: (03)9207 2900 Fax: (03)9663 4260 Fax: (03)9207 2967 South East Water Limited Victorian Government Purchasing Board 20 Corporate Drive 1 Macarthur Street Moorabbin 3189 Melbourne 3002 Tel: (03)9552 3000 Tel: (03) 9651 2268 Fax: (03)9552 3001 Fax: (03)9651 2161 Transport Accident Commission Victorian Managed Insurance Authority 222 Exhibition Street Level 2,84 William Street Melbourne 3000 Melbourne 3000 Tel: (03)9664 6666 Tel: (03)9600 0788 Fax: (03)9664 6668 Fax: (03)9600 4528 Appendix t: Directory continued Victorian Plantations Corporation Businesses sold, wound up Level 3,517 Flinders Lane or transferred to other departments Melbourne 3000 • Audit Victoria Tel: (03)92891400 Fax: (03)96291552 • Electricity Appeals Board Victorian Power Exchange • Gas Appeals Board Level 14,452 Flinders Street • Gas services business Melbourne 3000 Tel: (03) 9691 4000 • Met Train 1 Fax: (03)9691 4100 • Met Train 2 Victorian WorkCover Authority • Met Tram 1 (incorporating WorkCover Conciliation Service and • Met Tram 2 WorkCover Medical Panels) Level 24,222 Exhibition Street • V/Line Passenger Melbourne 3000 • Victorian Rail Track Tel: (03)9641 1555 Fax: (03)9641 1222 • Victorian Superannuation Board Toll Free: 1800 136 089 Yarra Valley Water Limited Lucknow Street Mitcham 3132 Tel: (03)9874 2122 Young Farmers' Finance Council Level 15,350 Collins Street Melbourne 3000 Tel: (03)9243 2600 Fax: (03)9243 2700 Appendix 2: Functions and Services of the Department The Department of Treasury and Finance provides policy advice • purchasing and procurement, Including development on economic, financial and resource management in order to of e-Commerce; support the Government in delivering its financially responsible • providing advice on the State's superannuation policy; and socially progressive policy platform. • managing the State's ongoing commercial obligations in the The Department has overall responsibility for formulating and energy, transport and plantations industries; implementing the Government's longer-term economic and budgetary objectives, which are to achieve economic growth for • administering, managing and coordinating Government land all regions of the State and increase the living standards of all and property; and Victorians. The Department produces the State Budget each • administering, managing and coordinating whole-of- financial year, and Is responsible for ensuring that the State's government accommodation, building and motor vehicle financial accounting, control and reporting obligations are met. leases. The Department's functions are carried out through its five divisions: Economic and Financial Policy • Budget and Financial Management The Economic and Financial Policy Division provides economic and financial advice to the Government. The Division's main • Commercial Policy and Projects functions include: • Economic and Financial Policy • providing advice to the Government on longer term economic • Strategic Management development and financial strategy objectives; • Corporate Services Centre • providing advice to the Government on taxation policy and strategy; Budget and Financial Management • providing advice to the Government on strategic regulation The Budget and Financial Management Division provides policy policy, including the establishment of the Essential Services and advice to the Government and to other departments and Commission and the Essential Services Ombudsman; agencies, and is responsible for: • providing advice to the Government on gaming policy; • delivering the annual State Budget and Annual Financial • monitoring and forecasting revenue flows; Report; • monitoring and forecasting trends in the State and national • managing the Expenditure Review Committee process; economies; • managing whole-of-government financial systems and • managing State-Commonwealth Government financial reporting; relations; • implementing the Management Reform Program; • providing advice in relation to Victoria's transport accident and • implementing Victorian Government taxation compliance worker's compensation schemes; (including GST, FBT and PAYG); and • providing policy advice on the implementation of National • developing and maintaining financial management regulation Competition Policy reforms; and and accounting and asset policy. • operating Victoria's Competitive Neutrality Complaints Unit. Commercial Policy and Projects The Commercial Policy and Projects Division provides advice Strategic Management to the Government and manages commercial activities on its The Strategic Management Division provides corporate planning, behalf. The Division's main functions include: Ministerial and legal services, and corporate communication • managing the public-private partnerships policy framework; advice to enhance the Department's capability to deliver policy advice and services to the Government, The Division's main • managing the commercial aspects of projects such as the functions include: Snowy River corporatisation and Longford litigation; • corporate and business planning and reporting; • providing risk management advice and managing Government liabilities; • people management and human resources strategy; • monitoring and corporate governance of GBEs; • risk management and business assurance; • strategic communication advice and planning; Appendix 2: Functions and Services of the Department continued • executive support services to assist the Department in its dealings with Ministers, Parliament, Cabinet and the Executive Council; • internal legal services; and • Freedom of Information services. Corporate Services Centre The Corporate Services Centre provides shared corporate support services to the Department of Treasury and Finance, the Department of Premier and Cabinet, and the portfolio agencies of these departments. The Division's main functions include: • financial planning, reporting and analysis; • budget and accounting services; • information technology and telecommunications planning, advice and support; • library and research services; • document management and mail centre services; • facilities management; and contract management of outsourced human resources and [88 89Ì gymnasium services. Appendix 3: Boards and Committees Accommodation Committee Objective: CHAIRPERSON MEMBERS To review the provision of accommodation within the Department Laurinda Gardner Yehudi Blacher (DPC) in accordance with changing requirements. Adam Todhunter SECRETARY Brett Rowse Lionel Newman Accredited Purchasing Unit Objective: CHAIRPERSON MEMBERS To coordinate and oversee purchasing practices and reform Warren Hodgson Dennis Carmody (DPC) within the Department of Treasury and Finance and the (Joint Chair) Adam Todhunter Department of Premier and Cabinet in accordance with reforms Peter Goddard Yehudi Blacher introduced by the Victorian Government Purchasing Board. Jo Beatty (Joint Chair) (DPC) Peter Hiland (SRO) SECRETARY Bob Venables (Observer) Janine Goodman-Phin Audit Committee Objective: CHAIRPERSON MEMBERS To assist the Secretary and Ministers to fulfil their responsibilities Grant Hehir Adam Todhunter by reviewing the audit process, systems of internal controls Warren Hodgson SECRETARY established by management, and the financial information that is Adrian Nye Colin McCann provided to Parliament and other bodies. Sam Moshinsky (External) John Warburton (External) Balance Sheet Management Committee Objective: CHAIRPERSON MEMBERS To oversee the development of risk management policies for the Brett Rowse Ian Little State, by approving risk management policies for Treasury and Grant Hehir SECRETARY the State and by developing principles and guidelines for balance Warren Hodgson Ian McLean sheet management. Murray Jones Deborah Radford Business Planning and Reporting Sub-Committee Objective: CHAIRPERSON MEMBERS To review and maintain the standards of the Department's Ian Little Laurinda Gardner business planning and reporting: in the short term, by focusing Grant Hehir SECRETARY on the 2000-01 Business Plan and presentations to the Deborah Radford Paul Eyres Expenditure Review Committee by Ministers; in the long term, by Peter Goddard bringing the Department's planning and reporting fully Into line Michael Kirby with Management Reform Program standards. Human Resources and Remuneration Sub-Committee Objective: CHAIRPERSON MEMBERS To undertake consistent and rigorous decision making in relation Ian Little Warren Hodgson to the Department's management of human resources and to Grant Hehir SECRETARY ensure that human resources policies and practices are Brett Rowse Paul Eyres consistent with the Department's mission, structure and Laurinda Gardner environment. Adam Todhunter Appendix 3: Boards and Committees continued Information Technology and Telecommunications Sub-Committee CHAIRPERSON MEMBERS Objective: Grant Hehir Laurinda Gardner To ensure that the Department's information technology and Brett Rowse SECRETARY telecommunications (IT&T) policies and strategies are consistent Alan Hawkes Adam Todhunter with its business strategy and plans and with whole-of- Jeff Rosewarne government IT&T policies and initiatives, and to approve and Nell Taylor review major IT&T projects. Other boards and committees The Department of Treasury and Finance sponsors or has • Department of Natural Resources and Environment EC4P representation on the following committees: Supplier Advisory Group • Advisory Panel Consolidated Financial Reporting of Government • Department of Natural Resources and Environment Electronic Procurement Steering Committee • All States Fringe Benefits Tax Consultation Forum • Docklands Steering Committee • Accredited Purchasing Unit Chairs Group • Department of Treasury and Finance/Department of Human • Austin and Repatriation Medical Centre Redevelopment and Services Committee: Disclosure of Government Commitments Mercy Hospital for Women Relocation Steering Committee. in Contracts with the Private Sector • Australian Procurement and Construction Council • EC4P Steering Committee • Australian Procurement and Construction Council Electronic • Education - Steering Party Accrual Based Management Reporting Commerce Action Group • Emergency Management Working Group • Australian Society of Certified Practising Accountants External Reporting Centre of Excellence • Energy Industry Response Committee • Australian Society of Certified Practising Accountants • Energy Markets Group Electronic Commerce Cell • Facility Managers Network • Australian Society of Certified Practising Accountants • Gas Reform Implementation Group Information Management and Technology Centre of Excellence • Greenhouse Steering Committee • Australian Statistical Advisory Council • GST Interstate Working Group • Automated Ticketing Sub-Committee • Heads of Treasuries Committee • Berwick Hospital Steering Committee • Heads of Treasuries Accounting and Reporting Advisory • Bureau of Emergency Services Telecommunications Committee Ministerial Steering Committee • Heads of Treasuries Fiscal Reporting Committee • Bus Contracts Committee • Indicative Planning Council for the Housing Industry (Victorian • CityLink Tollways Inter-departmental Steering Committee State Committee) • Central Government Response Centre • Interdepartmental Multicultural Services Advisory Committee • Competitive Neutrality Steering Committee • Interjurisdictional Committee for NEM1 • Country Court Steering Committee • Finance Committee of the Anti-Cancer Council Victoria • Council of Australian Governments Steering Committee for the • Melbourne 2006 Commonwealth Games Bid Review of Commonwealth-State Service Provision • Melbourne 2006 Commonwealth Games Bid - • Department of Natural Resources and Environment EC4P Finance Sub-Committee Control Board • Mlldura Base Hospital Steering Committee • Department of Natural Resources and Environment EC4P Steering Committee • Minister's Delegates (NEM) National Gas Pipeline Advisory Committee • Victorian Government Financial Management Systems User Group National Electricity Market Interjurisdictional Liaison Group • Victorian Government Purchasing Board (Secretariat) National Tax Reform Implementation Steering Committee • Victorian Grants Commission Office of the Public Service Commissioner Joint Advisory Panel • Victorian Ports Strategic Study Steering Committee Office of Regulator-General Customer Consultative Committee • Victorian Statistical Advisory Committee Operational Safety and Tactics Training Steering Committee • Whole-of-Government Information Technology and Oracle Asia Pacific Customer Advisory Board Telecommunications Policy Committee Powerllnes Relocation Committee • Whole-of-Government Electronic Procurement Steering Public Sector Accountant Committee of the Australian Society Committee of CPAs Public Sector Accountant Committee, International Federation of Accountants Shrine of Remembrance Trustees Snowy Mountains Council Snowy Mountains Council Finance Committee State Emergency Recovery Planning Committee Standing Committee on Local Government Financial Management Steering Committee for the Review of Commonwealth-State Service Provision Steering Committee on National Performance Monitoring of Government Trading Enterprises Tax Exempt Leasing Focus Group Urgent Issues Group, Australian Accounting Standards Board . Utility Regulators' Forum Very High Speed Train Interdepartmental Working Group Victoria Police Project Oracle Steering Committee Victorian Emergency Management Council Victorian Accelerated Infrastructure Program Steering Committee Victorian County Court Project Steering Committee Appendix 4: Workforce Data 1. Department of Treasury and Finance TótáfDepartment of Treasury and Finance Employees asHtWJune 2000* Full time 430 Part time 14 Full time equivalent (FTE) 439.12 Total employees 444 Breakdown by gender Male Female Total Employees Full time 251 179 430 Part time 1 13 14 Total 252 192 444 Breakdown by division and by service agencies Total FTE Budget and Financial Management 110 109.49 Economic and Financial Policy 72 71.06 Commercial Policy and Projects 135 132.57 Strategic Management * 40 39.40 Corporate Services Centre 87 86.60 Total 444 439.12 * Employees numbers shown for Strategic Management include employees located In the Office of the Secretary. 92 Profile of; Executive Employees as at 30'June ~93l Classification Male Variation Female Variation Total Variation from from from previous previous previous year year year EO-1 3 - - -1 3 -1 EO-2 16 - 6 +1 22 •1 EO-3 46 -26 7 -6 53 -32 Total 65 -26 13 -6 78* -32 Recruiting for seven vacant Executive roles was underway as at 30 June 2000. ProfilejDf VPS Employees as at 30 June Classification Full Time Part Time Male Female Total Male Female Total VPS-5 68 27 95 4 4 VPS-4 45 28 73 2 2 VPS-3 33 53 86 3 3 VPS-2 30 52 82 2 2 VPS-1 10 6 16 2 2 Casual 1 1 Total 186 166 352 1 13 14 2. State Revenue Office T TotaliStatë RevenueJ)tfic? Full time 457 Part time 42 Full time equivalent (FTE) 485.16 Total employees 499 Breakdown by gender Male Female Total Employees Full time 257 200 457 Part time 4 38 42 Total 261 238 499 Rrof!ie5fiExecuti^Emp|öpes]a^Vß0JJune2000 Classification Male Variation Female Variation Total Variation from from from previous previous previous year year year EO-1 EO-2 EO-3 Total ProfilepfVPS Employeesas at 30'June 20001- Classification Full Time Part Time Male Female Total Wlale Female Total VPS-5 18 2 20 1 1 VPS-4 66 19 84 10 10 VPS-3 92 67 159 14 15 VPS-2 58 76 134 10 12 VPS-1 17 34 51 3 4 Casual - - - Total 251 198 449 38 42 Note: the following information refers to the Department of Treasury and Finance. Comparable information for the State Revenue Office is contained in the State Revenue Office Annual Report. 3. Department of Treasury and Finance HR Information Selecting on merit The Department is committed to ensuring that the best available people are recruited and selected for advancement. During 1999-2000 the Department advertised over 130 positions. Some of these were filled by Internal appointment without advertisement, as summarised below: Reasonjorinon-advertisement Reclassification of role 8 Specialised duties 3 Graduate recruitment 7 The Department advises employees of all positions that are exempt from advertisement through its internal electronic news bulletin, eNews@DTF. Appendix 4; Workforce Data continued Reviewing personal grievances The Occupational Health and Safety (OH&S) Committee continues The Department has a comprehensive process to ensure to roll out Innovative preventative health programs providing employee grievances and concerns are dealt with fairly and vision testing and subsidised eyewear, ergonomic workstation promptly. No grievance claims were lodged during the period. assessments and fully subsidised flu vaccinations. During 1999-2000 a 'Safety Map' audit was completed, all OH&S representatives attended a tailored representative training course Managing and valuing diversity and an OH&S Awareness program was offered to all employees. The Department is committed to applying merit and equity principles in all areas of human resource management. The Department's HR Strategy is based on the principles WorkCover of agility and professional service and has four key objectives: The Department continues to advise employees about WorkCover and Occupational Health and Safety issues as required. Eight • to know the skills and capabilities we need; WorkCover claims were lodged during the reporting period • to select and retain the people we need; compared to nine In the previous period. • to develop our people; and Employee relations • to recognise and reward our people. During the period the Department did not lose any time through The strategies adopted in meeting these objectives are based industrial disputes. on the principle of merit and are aimed at enhancing the productivity of all employees while recognising inherent differences. Training and development Training and development is encouraged so that employees can The Department has undertaken a staff survey - 'Our DTF, enhance the skills and knowledge they need to meet the Our Say' - and will use the results to develop and enhance Department's objectives. human resources policies and practices. 'Manager once Removed' career discussions have been Following a project completed by the Staff Consultative Committee, implemented for senior employees. This process provides an a Flexible Work policy and Work/Life Information Package detailing opportunity for employees to discuss their short and long term all existing and recently implemented flexible work policies and goals, key strengths and opportunities for further development. practices was distributed to employees and managers. Eleven employees were granted scholarships in order to further their professional development and another eleven employees Upholding public sector conduct were provided with assistance to undertake undergraduate studies. The Department ensures that all employees are made aware of their obligations by publishing the Code of Conduct online and providing a hard copy to all new employees at their induction. All executives complete a Declaration of Private Interests on appointment and annually thereafter. Details of assessments and measures undertaken to improve occupational health of employees The Department continues to provide an Employee Assistance Program (EAP) for the benefit of all employees. The EAP is a confidential and professional assistance and advisory service designed to assist individuals in resolving any work or business- related problems. The program offers rapid response and solution based interventions. An evaluation of the first 12 months of the program confirmed a healthy take-up by employees and supported the Department's commitment to employee health and well-being. Appendix 5: Information available on request and compliance index Information available on request The Financial Management Act 1994 determines the nature of information that must be included in a department's annual report. Under Ministerial Direction 9,1,3(iv) a department is required to hold certain additional information and make this available within the limitations of the Freedom of Information Act 1982. Some of this additional data is included within the Annual Report as general Information. Further requests for information may be made to the Department's Freedom of Information Officer by telephone (03) 9651 2115, or in writing to the following address: Freedom of Information Officer Department of Treasury and Finance Level 3,1 Macarthur Street Melbourne 3002 Compliance index to disclosure requirements 1999-2000 The Department's Annual Report is prepared in accordance with the Financial Management Act 1994 and the Directions of the Minister for Finance. This index has been prepared to facilitate identification of compliance with statutory disclosure and other requirements. Clause Disclosure :ßfggp'' " Page Report of Operations Charter and purpose 9.1.3 0(a) Manner of establishment and relevant Minister 12 9.1.3 (i)(b) Objectives, functions, powers and duties 12,17 9.1.3 0(c) Services provided and persons or sections of community served 12 Management and structure 9.1.3 0(d)(1) Names of governing board members, audit committee and chief executive officer 89 9.1.3 (i)(d) (ii) Names of senior office holders and brief description of each office 11 9.1.3 (i)(d) (ill) Chart setting out organisational structure 14 9.1.3 0(e) Workforce data and application of merit and equity principles 92-94 9.1.3 0(f) Application and operation of Freedom of Information Act 1982 106 Financial and other information 9.1.3 (ii) (a) Summary of financial results with previous four year comparatives NA 9.1.3 (ii) (b) Summary of significant changes in financial position 47 9.1.3 (ii) (c) Operational and budgetary objectives for the year and performance against those objectives 17-45 9.1.3 (il)(d) Major changes or factors affecting achievement of objectives 17-18 9.1.3 (ii) (e) Events subsequent to balance date NA 9.1.3 (ii)(f) Consultancies greater than $100 000 - Full details of each consultancy 107 9.1.3 00 (a) Consultancies less than $100 000 - Number and total cost of consulting engagements 107 9.1.3 (ii) (h) Extent of compliance with Building Act 1993 100 9.1.3 (Ii) (I) Statement that information listed in Part 9.1.3 (iv) is available on request 95 9.1.3 (ii) (k) Statement on implementation and compliance with National Competition Policy 101 Appendix 5: Information available on request and compliance index continued Compliance index to disclosure requirements 1999-2000 Clause Disclosure , • I ' , , Page Financial Statements Preparation 9.2.2 (ii) (a) Statement of preparation on an accrual basis 53 9.2.2 (ii) (b) Statement of compliance with Australian Accounting Standards and associated pronouncements 53 9.2.2 (ii) (C) Statement of compliance with accounting policies issued by the Minister for Finance 53 Statement of financial operations 9.2.2 (i) (a) A statement of financial operations for the year 50 9.2.3 (ii) (a) Operating revenue by class 50,60 9.2.3 (ii) (b) Investment income by class 50 9.2.3 (ii) (c) Other material revenue by class including sale of non-goods assets and contributions of assets 60 9.2.3 (ii) (d) Material revenues arising from exchanges of goods or services 50,60 9.2.3 (ii) (e) Depreciation, amortisation or diminution in value 61 9.2.3 (ii) ffl Bad and doubtful debts NA 9.2.3 (ii) (g) Financing costs 61 9.2.3 (ii) (h) Net increment or decrement on the revaluation of each category of assets 61 9.2.3 (ii)(i) ' Auditor-General's fees 61 Statement of financial position 9.2.2 (i) (b) A statement of financial position for the year 51 Assets 9.2.3 (iii) (a) (i) Cash at bank or in hand 51 9.2.3 (iii) (a) (ii) Inventories by class 62 9.2.3 (iii) (a) (iii) Receivables, including trade debtors, loans and other debtors 62 9.2.3 (iii) (a) (iv) Other assets, Including prepayments 62 9.2.3 (iii) (a) (v) Investments by class 62 9.2.3 (iii) (a) (vi) Property, plant and equipment 62-64 9.2.3 (iii) (a) (vii) Intangible assets NA Liabilities 9.2.3 (iii)(b)(i) Overdrafts 51 9.2.3 (iii) (b) (ii) Bank loans, bills payable, promissory notes, debentures and other loans NA 9.2.3 (iii) (b) (iii) Trade and other creditors 64 9.2.3 (iii) (b) (iv) Finance lease liabilities 64 9.2.3 (iii) (b) (v) Provisions, including employee entitlements 65 Equity 9.2.3 (iii) (c)(i) Authorised capital NA 9.2.3 (iii) (c) (ii) Issued capital NA 9.2.3 (iii) (d) Reserves, and transfers to and from reserves (shown separately) 66 Statement of cash flows 9.2.2 (i) (c) A statement of cash flows for the year 52 Clause Disclosure Page Financial Statements (continued) Notes to the financial statements 9.2.2 (i) (d) Ex gratia payments 60 9.2.2 (i) Amounts written off NA 9.2.3 (iv) (a) Charges against assets 61 9.2.3 (iv) (b) Contingent liabilities 67-68 9.2.3 (iv) (c) Commitments for expenditure 64 9.2.3 (iv) (d) Government grants received or receivable and source NA 9.2.3 (iv) (e) Employee superannuation funds 65-66 9.2.3 (iv) (f) Assets received without adequate consideration NA 9.4.2 Transactions with responsible persons and their related parties 68-69 9.7.2 Motor vehicle lease commitments 63 Appendix 8: Legislative and Regulatory Changes Legislative Changes 1999-2000 NATIONAL TAXATION REFORM (CONSEQUENTIAL PROVISIONS) ACT 2000 • to record the State's intention to give effect to the Spring 1999 Intergovernmental Agreement on the Reform of New or Amending Acts of the Treasurer Commonwealth-State Financial Relations; GAS INDUSTRY (AMENDMENT) ACT 1999 • to make further provision relating to non-franchise customers • to enable State entities to make GST equivalent payments; under the Gas Industry Act 1994. • to amend the Financial Institutions Duty Act 1982 and the Stamps Act 1958\o discontinue financial institutions duty and New or Amending Acts of the Minister for Finance stamp duty on certain share transfers and on bookmakers' Nil. statements; • to alter government fees and charges to take into account New or Amending Acts of the Minister for Gaming GST; and Nil. • to amend various Acts as a consequence of national taxation reform. New or Amending Acts of the Minister for WorkCover NATIONAL TAXATION REFORM (FURTHER CONSEQUENTIAL Nil. PROVISIONS) ACT 2000 • to make further amendments to State legislation as a New or Amending Acts of the Minister for Industrial consequence of national taxation reform. Relations FIRST HOME OWNERS' GRANT ACT 2000 Nil. • to encourage and assist home ownership, and to offset the effect of the GST on home ownership, by establishing a Autumn 2000 scheme for the payment of grants to first home owners. New or Amending Acts of the Treasurer APPROPRIATION (2000-01) ACT 2000 New or Amending Acts of the Minister for Finance • to make provision for the appropriation of certain sums from SUPERANNUATION ACTS (AMENDMENT) ACT 2000 the Consolidated Fund for the financial year 1999-2000. • to insert provisions relating to the superannuation contributions tax Into specified Superannuation Acts-, and APPROPRIATION (PARLIAMENT 2000-01) ACT2000 • to make provision for the appropriation of certain sums from • to make miscellaneous amendments to specified the Consolidated Fund for the Parliament for the financial year Superannuation Acts. 1999-2000. ELECTRICITY INDUSTRY ACTS (AMENDMENT) ACT 2000 New or Amending Acts of the Minister for Gaming • to make further provision for the regulation of the electricity GAMBLING LEGISLATION (RESPONSIBLE GAMBLING) ACT 2000 industry. • to restrict the number of gaming machines at the Melbourne Casino; FINANCIAL MANAGEMENT (FINANCIAL RESPONSIBILITY) ACT2000 • to amend the Financial Management Act 1994 and the Audit Act • to provide for the determination of maximum numbers 1994 to provide for the enhanced disclosure of financial and of gaming machines In regions of the State; budget information by the Victorian Government and the review • to provide for restrictions on 24-hour gaming; of estimated financial statements by the Auditor-General. • to provide for the views of a municipal council to be taken STATE TAXATION ACTS (MISCELLANEOUS AMENDMENTS) ACT2000 Into account when the Authority is considering the placement • to repeal the Gift Duty Act 1971 and the Probate Duty Act 1962, of gaming machines In the municipal district; • to amend the employment agency provisions of the Pay-roll • to provide for the establishment of the Gambling Research Tax Act 1971; and Panel; • to amend the land-rich provisions of the Stamps Act 1958. • to provide for players of gaming machines to be given information relevant to gaming on gaming machines; and • to provide for the regulation of advertising in relation to gambling. New or Amending Acts of the Minister for WorkCover New Regulations of the Minister for Finance ACCIDENT COMPENSATION (COMMON LAW AND BENEFITS) ACT 91 /99 Accident Compensation (Self-Insurers' Contributions) 2000 Regulations 1999 • to provide for the restoration of common law actions for 94/99 Occupational Health and Safety Regulations (Issue damages with effect from 20 October 1999; Resolution) Regulations 1999 • to increase the amount of compensation payable for non- 192/00 Financial Management Regulations 2000 economic loss; • to provide for regular payments for overtime and shift New Regulations of the Minister for Gaming allowances to be included when calculating a worker's weekly Nil for 1999 payments for the first 26 weeks; 44/00 Gaming Machine Control (Returns by Gaming • to make miscellaneous amendments to the Accident Operators) Regulations 2000 Compensation Act 1985 to improve the operation of the Act; and New Regulations of the Minister for WorkCover • to amend the Dangerous Goods Act 1985, the Transport 127/99 Subordinate Legislation (Dangerous Goods (Storage Accident Act 1986, the Accident Compensation (WorkCover and Handling) Regulations 1989- Extension of Insurance) Act 1993 and the Extractive Industries Development Operation) Regulations 1999 Act 1995. 142/99 Dangerous Goods (Explosives) (Amendment) New Regulations for 1999-2000 Regulations 1999 New Regulations of the Treasurer 19/00 Subordinate Legislation (Accident Compensation 99/99 Gas Safety (Gas Installation) (Amendment) Regulations Regulations 1990-Extension of Operation) 1999 Regulations 2000 100/99 Gas Safety (Safety Case) (Amendment) Regulations 50/00 Occupational Health and Safety (Major Hazard 1999 Facilities) Regulations 2000 129/99 Land Tax (Equalisation Factors) Regulations 1999 61 /00 Dangerous Goods (Explosives) Regulations 2000 139/99 Electrical Safety (Electrical Line Clearance) 62/00 Occupational Health and Safety (Lead) Regulations Regulations 1999 2000 140/99 Electrical Safety (Management) Regulations 1999 143/00 Occupational Health and Safety (Hazardous Substances) Regulations 2000 141 /99 Electrical Safety (Network Asset) Regulations 1999 30/00 Gas Safety (Gas Appeals Board) Regulations 2000 New Regulations of the Minister for Industrial 31/00 Electricity Safety (Equipment Efficiency) (Amendment) Relations Regulations 2000 Nil 32/00 Treasury Corporation of Victoria (Prescribed Agencies) (Amendment) Regulations 2000 Notes: * On 3 March 2000 responsibility for Industrial Relations was 39/00 National Taxation Reform (Fees) (No. 1) Regulations transferred from the Department of Treasury and Finance to 2000 the Department of State and Regional Development. 49/00 Co-operative Housing Societies Regulations 2000 ** On 22 May 2000 The Hon. John Brumby MP was appointed 59/00 National Tax Reform (Fees) (No2) Regulations 2000 Treasurer (assuming responsibility from The Hon. Steve 60/00 Financial Institutions Duty (First Home Owner Grants) Bracks MP) and The Hon. Lynne Kosky MP was appointed Regulations 2000 Minister for Finance (assuming responsibility from The Hon. John Brumby MP). Appendix 7: Building Act Compliance Standards for publicly owned buildings Mechanisms for inspection, reporting, scheduling and The Victorian Government Property Group (VGPG), Department of carrying out of rectification and maintenance works Treasury and Finance, employs an external service provider, on existing buildings Global Property Solutions Pty Ltd, to manage the Government- There are three main mechanisms established for the purpose of owned office accommodation portfolio and to ensure compliance inspecting, reporting, scheduling and performing rectification and with standards for publicly-owned buildings. maintenance works on existing buildings: At 30 June 2000 VGPG was responsible for 25 Government- 1. provision of and management of maintenance service owned buildings. contracts for all owned buildings; 2. building inspections, liaison with tenants and responses to Mechanisms to ensure that buildings conform with issues identified; and Building Standards 3. commissioning formal condition, maintenance and All building works undertaken on behalf of VGPG that require a compliance reports on buildings. building permit under the Building Act 1993 are certified by a building surveyor as conforming with building regulations. VGPG Global Property Solutions Pty Ltd currently manages the service project managers are instructed accordingly. Tenants undertaking maintenance contracts for the Government-owned premises on works within Government-owned premises are required to provide behalf of VGPG and is responsible for: a building surveyor's Certification of Conformity as part of the • breakdown, preventative and cyclical maintenance; conditions of the owner's consent to the work. • identifying and prioritising works required in consultation with VGPG has not sought to exempt works from certification by VGPG; applying the 10-year liability cap. • managing rectification works; and Major works projects (greater than $50 000) • conducting regular inspections to ensure that work is A number of major works have been completed this financial performed to the standard required. year. All of these have been issued with an appropriate Certificate of Occupancy or certification by a building surveyor Quality assurance measures have been built into the contract and a Final Certificate. with Global Property Solutions Pty Ltd. Major works include: Number of buildings conforming with Building • 253 Eleventh Street Mildura upgrade Standards • 30-38 Little Malop Street Geelong facade sealant All buildings conform. replacement • 30-38 Little Malop Street Geelong common area upgrade Number of buildings that have been brought into conformity • 565 Lonsdale Street upgrade works One. • Treasury Reserve Premiers' statues • Cnr Thompson and Martin Street Hamilton upgrade works Year all buildings are expected to be brought into • 402-406 Mair Street Ballarat valves and controls upgrade conformity • 83 Gellibrand Street Colac upgrade works Not applicable. • 28 High Street Seymour compliance works Arrangements to ensure that only registered building • 1 Macarthur Street Year 2000 compliance works practitioners are engaged for public sector works • 3 Treasury Place refurbishment for Cinemedia VGPG engages building practitioners listed on the Construction • 27 Francis Street compliance works Suppliers Register, which is managed by the Department of • 436 Lonsdale Street fit-out for Office of Public Advocate Infrastructure. • 26-28 Wellington Street Kerang upgrade works • 21 McLachlan Street Horsham compliance works Number of cases and circumstances where registered building practitioners became deregistered Major works (greater than $50 000) not subject to certi- Nil. fication of plans, mandatory inspections of the works and issue of Occupancy Permits or Final Certificate Nil. Appendix 8: Progress in Implementing National Competition Policy In Victoria, the Treasurer is responsible for the overall A public interest test underpins the application of the policy to implementation of National Competition Policy (NCP) legislation review and competitive neutrality. Consultation and Agreements, which includes reviewing legislation and securing transparency are key elements of the public interest test and competition payments from the Commonwealth. In October decisions regarding the Implementation of NCP are made in 1999, responsibility for the whole-of-government coordination of consideration of social welfare and equity, regional development NCP implementation was passed from the Department of and the interests of consumers generally. Premier and Cabinet to the Department of Treasury and Finance. The Department supports the Treasurer's role by coordinating the Legislation Review implementation of NCP within Victoria. Under its commitment to NCP, the Government is obliged to review by the end of 2000 all laws that restrict competition. The Department's role in relation to NCP Is fulfilled by the The guiding principle for NCP legislation review is that restrictive Markets and Regulation Strategy Branch and involves policy legislation is justified only when its benefits outweigh the cost of advice and implementation support in relation to: legislative restrictions and if the objectives of the legislation can • the public interest test; only be achieved by restricting competition. • the application of competitive neutrality to significant All reviews of legislation must follow five steps: government businesses; 1. Identify the objectives of the legislation; • the operation of an Independent Competitive Neutrality 2. identify the nature of the restriction on competition; Complaints Unit; 3. consider the likely effect of the restriction on competition and • certification of access regimes as effective; on the economy generally; • Implementation by departments of legislation reviews; 4. consider the costs and benefits of the restriction; and • structural reform of statutory monopolies; 5. Identify alternative means to achieve the same result, • application of NCP to local government In conjunction with the including non-legislative approaches. Department of Infrastructure; The removal of unwarranted restrictions on competition confers • application of price regulation to natural monopolies; a number of significant benefits on the economy and the community generally. Enhanced competition can result in lower • national coordination of amendments to Part IV of the Trade business costs, lower prices, an expansion of consumer choice, Practices Act 1974; increased flexibility and faster take-up of new technologies and • appointments to the National Competition Council and the market opportunities. Australian Competition and Consumer Commission; The following table lists legislation falling under the Treasury • representation on the Council of Australian Governments and Finance portfolios that was scheduled for NCP review in Committee for Regulatory Reform (COAG CRR), and related 1999-2000. Reviews completed prior to 1999-2000 were national officials forums; and listed In previous Annual Reports and have not been listed here. • liaison and reporting to the National Competition Council on Once the NCP Review Report Is complete, the Government Victoria's entitlement to the competition payments. usually prepares a formal response to Its recommendations. In cases where reform options require amendment to legislation, legislative amendments are subsequently drafted for consideration by Parliament. Appendix 8; Progress in Implementing National Competition Policy continued Progress.ach'ieved ¡0^199912000 Road Transport (Dangerous Goods) Act 1995 This is the mirror legislation of the Commonwealth's 1994 Act of the same name. It awaits outcome of the Commonwealth review. Gaming & Betting Act 1994 The review was undertaken jointly with the Department of State and Regional Development. Gaming Machine Control Act 1991 Review was postponed until late 2000. Borrowing & Investment Powers Act 1987 Response is under consideration. Electricity Industry Act 1993 Legislation was transferred to the Department of Natural Resources and Environment. State Electricity Commission Act 1958 Legislation was transferred to the Department of Natural Resources and Environment. Employee Relations Act 1992 Legislation was transferred to the Department of State and Regional Development. Labour&Industry Act 1958 Legislation was transferred to the Department of State and Regional Development. Tattersall Consultations Act 1958 Response is under consideration. Competitive Neutrality Policy Competitive neutrality requires government businesses to ensure In 1999-2000, the Government undertook a reconsideration of where services compete or potentially compete with the private competitive neutrality policy to ensure that its application was sector, they remove any net advantages arising solely due consistent with the public Interest test. It is Government policy to government ownership. This is achieved by requiring that competitive neutrality be applied to significant business government businesses to cost their services as If they were activities only when it is in the public interest to do so. In Victoria, Q2 privately owned. The Competitive Neutrality Policy provides it is the responsibility of Government businesses to determine 1031 a framework that enables Government to identify the most if their business activities fall within the scope of the policy. cost-effective provider of the service. Government businesses may have several competitive Competitive Neutrality Complaints Unit advantages over private firms that arise solely from their The Competitive Neutrality Complaints Unit is located in the government ownership. These advantages are usually in the Department of Treasury and Finance. The complaints form of exemption from various taxes and charges, and no mechanism was suspended in September 1999, pending the requirement to earn a rate of return on their assets. Competitive release of the new Competitive Neutrality Policy Victoria and the neutrality pricing takes into account these advantages, and Guide to Implementing Competitive Neutrality. The tables on the requires government businesses to adjust pricing so that private following pages provide a summary of complaints received and public sector organisations can compete on fair and equal during the 1999-2000 financial year. terms. This enable government businesses to compare their The Complaints Unit completed two complaints out of the efficiency with private sector providers. 18 received during 1999-2000. The commitment by both State and Commonwealth Governments to Implement competitive neutrality policy is a part of a wider range of reforms aimed at improving the efficiency and effectiveness of government, such as the move to accrual accounting and various management improvement initiatives. The policy does not override other Government policy objectives, but enables business to assess the most efficient and effective provider by comparing the cost and quality of services delivered by government with those of alternative providers. Date of recei 0 escri ptionJpfiCom pì ài n t 7 Jul 1999 VETASSESS The complainant has alleged that The Complaints Unit concluded that VETASSESS VETASSESS receives subsidies from OTFE does not enjoy financial or regulatory Office of Training and and its other joint venture partners. advantages associated with its government Further Education (OTFE) VETASSESS is not required to have the same ownership. VETASSESS does account for certifications as other training providers. advantages of government ownership and therefore its activities are consistent with There is a conflict of interest for OTFE as Victorian Government's Competitive Neutrality industry regulator and joint venture partner Policy. of a training company. The Complaints Unit has also concluded that VETASSESS advertises its affiliation with OTFE is not a competitor in the market for OTFE and this is represented as an assessment services. The role played by OTFE endorsement of OTFE. is confined to that of industry regulator. Finally, the national regulatory arrangements in place to govern the actions of Industry Training Boards competing In the market for assessment services appear to be consistent with Competitive Neutrality Policy. 22 Jul 1999 Melbourne Sports and The complainant has alleged that the MSAC In its initial investigation, the Complaints Unit Aquatic Centre (MSAC)/ does not apply full competitive neutrality found that MSAC did not comply with Department of State costing to the provision of fitness programs competitive neutrality policy because it: Development and recreational facilities. • failed to document fully and transparently the competitively neutral cost adjustments in regard to the gymnasium and aerobics activities; • provided insufficient evidence to support the argument that only the gymnasium and aerobics facilities were subject to competitive neutrality policy; and • failed to apply transparent competitively neutral pricing to the gymnasium, aerobics and other ancillary commercial activities. This is despite being previously advised in 1997 by the Complaints Unit and DPC to cost and price these activities transparently. In February 2000, as part of a follow-up investigation conducted by the Complaints Unit, it was confirmed that the MSAC complied with the Government's competitive neutrality policy. 5 Jul 1999 Coburg Leisure Centre/ The complainant alleged that the Coburg [Complaint received, but on hold pending Moreland City Council Leisure Centre does not apply competitively release of the revised policy] neutral pricing in the provision of its gym and fitness programs. 11 Aug 1999 Various public sector The complainant alleged that various public [Complaint received, but on hold pending hospital laundries hospital laundries did not apply competitively release of the revised policy] neutral pricing in providing laundry services. Appendix 8: Progress in Implementing National Competition Policy continued Date,of.receipt '^Jàrgët of complaint'^HDescHptio^of complaint f ] ggFimlings of investigation! 9 Aug 1999 Childcare centres run The complainant alleged that the City of [Complaint on hold pending release of the by the Whitehorse City Whitehorse provided competitive advantages revised policy] Council to council operated childcare centres that were not available to private sector childcare centres, such as access to funding and use of rent-free buildings and facilities. 20 Aug 1999 Childcare centres run A private operator of a childcare centre [Complaint on hold pending release of the by the City of Greater alleged that the council operated childcare revised policy] Geelong centres enjoy the advantages of government ownership in the form of subsidies that are only available to council operated centres. It was alleged that the provision of these subsidies was inconsistent with competitive neutrality policy and are costing the community $277 000 a year. 24 Aug 1999 Shire of Melton - Melton The complainant alleged that Melton Waves Complaint withdrawn by complainant on 1 Waves (recreation centre) was selling subsidised memberships and not September 1999 following discussions with the re-submitted applying competitively neutral costing and council. The complainant was satisfied because 17 Apr 2000 pricing principles. the council indicated that a new contract was being entered into which the complainant considered to be consistent with competitive 1104 1051 neutrality policy. 24 Aug 1999 Shire of Nlllumbik- The complainant alleged that these [Complaint received, but on hold pending Eltham Leisure Centre recreation centres were not applying release of the revised policy] and Diamond Valley competitively neutral costing and pricing Sporting Complex principles. 10 Sep 1999 Childcare centres run by The complainant alleged that the council was [Complaint on hold pending release of the the Banyule City Council not applying competitively neutral costing and revised policy] pricing principles to Its childcare centres. 21 Sep 1999 Indigo Shire Council - The complainant alleged that the council had [Complaint received, but on hold pending waste and recycling not applied competitively neutral cost and release of the revised policy] collection services pricing principles to its waste and recycling collection services and passenger and freight transportation services. 3 Nov 1999 Department of Natural The complainant alleged that DNRE had not [Complaint received, but on hold pending Resources and applied competitively neutral cost and pricing release of the revised policy] Environment (DNRE) - principles to its native forest hardwood logs native forest hardwood timber 8 Nov 1999 Childcare centres run The complainant alleged that the council was [Complaint on hold pending release of the by the City of Greater not applying competitively neutral costing and revised policy] Geelong pricing principles to its childcare centres. 23 Dec 1999 City of Casey - Leisure The complainant alleged that the council was [Complaint received, but on hold pending Centre not applying competitively neutral costing release of the revised policy] and pricing principles to the proposed City of Casey Leisure Centre. Date of receipt Target of complaint • f Description of complaint Findings of investigation 4 Feb 2000 Community Fire Authority The complainant alleged that the Authority [Complaint received, but on hold pending was not applying competitive neutral costing release of the revised policy] and pricing principles to the operation of its business. 29 Mar 2000 Active Consulting The complainant alleged that Aust-LInk was [Complaint received, but on hold pending not applying competitive neutral costing and release of the revised policy] pricing principles to the operation of Its business. 17 Apr 2000 Shire of Melton - Melton The complainant alleged that Melton Waves [Complaint received, but on hold pending Waves (recreation centre) was selling subsidised memberships and not release of the revised policy] applying competitively neutral costing and pricing principles. 17 May 2000 Frankston City Council The complainant alleged that the Frankston [Complaint received, but on hold pending City Regional Aquatic Centre, The Pines and release of the revised policy] the Frankston Basketball Centre were not Implementing competitively neutral costing and pricing and were receiving street signage advantages not available to private sector competitors. 23 May 2000 Collingwood College The complainant alleged that Collingwood [Complaint received, but on hold pending College was not applying competitive release of the revised policy] neutrality pricing to its Rudolph Steiner education services. As well as undertaking formal investigations, the Complaints Unit provides information to: • Victorian government businesses, local governments and consultants relating the application and implementation of competitive neutrality policy; and • potential complainants relating to the complaints process. In the case of a number of complaints, the Complaints Unit has undertaken initial inquiries to establish whether or not grounds for further investigation exist. Appendix 9: Freedom of Information The following Information is required In the Annual Report Further information regarding the application of the Freedom of pursuant to S.(1)(a)(vl) of the Freedom of Information Act 1982. Information Act 1982 may be obtained from: Requests for access to documents In the possession of the • the Act Itself; Department, excluding the State Revenue Office (SRO) and the • various regulations made under the Act; and Victorian Casino and Gaming Authority (VCGA), are dealt with by the Department's Freedom of Information (FOI) officers. Requests • the Department of Justice website at www.justice.vlc.gov.au for access to documents in the possession of SRO and the VCGA and specifically at are dealt with by the FOI officers of these administrations. www.justlce.vic.gov.au/dojslte.nsf/pages/exsJoi_howto The publications listed above are available for purchase from Making a Request Information Victoria: Requests fall within three categories: 356 Collins Street Melbourne 3000 Tel: 1300 366 356. 1. Requests for access to documents of the Agency or the Minister, which must contain sufficient information to identify the documents sought; Freedom of Information Contacts Department of Treasury and Finance 2. Requests for amendment of personal records, which must Mrs Karen Macdonald identify the record involved sufficiently and specify the Tel: (03)9651 2115 amendments sought; State Revenue Office 3. Requests for internal review of a decision made on an earlier Ms Diana Pereria request, which may or may not identify the basis upon which Tel: (03)9628 0515 the internal review is sought. Victorian Casino and Gaming Authority The listings under filing systems (see below) may help to identify Ms Anne Clark the category of documents for which access Is sought. It should Tel: (03) 9651 3708 be noted that the Act does not entitle applicants to access to documents created prior to July 1978 unless these relate to their personal affairs. Description of record keeping systems The Department of Treasury and Finance has two separate filing Requests for documents must be made in writing to the agency systems: or Minister. Requests should be addressed as follows: • the Personnel Records Management filing system FOI Officer • the Departmental Records Management filing systems Department of Treasury and Finance Level 3,1 Macarthur Street The Departmental Records Management filing system contains Melbourne Vic 3002 general flies, including Cabinet files and FOI files. Current and recent files are held at 1 Treasury Place, Melbourne. Older ones FOI Officer are stored either in off-site secondary storage or at the Public State Revenue Office Record Office in Laverton. 505 Little Collins Street Melbourne Vic 3000 The State Revenue Office and the Victorian Casino and Gaming Authority have their own filing systems. For further details on the FOI Officer particular categories of documents held by these bodies, contact Victorian Casino and Gaming Authority the responsible FOI Officer or the Director of the relevant division 35 Spring Street or office. Melbourne 3000 Fees and Charges An application fee of $20.00 must accompany any request. This fee may be waived or reduced if payment is likely to cause hardship to the applicant. The Act also prescribes fees for the provision of documents based on the schedule of charges detailed in the FOI (Access Charges) Regulations 1993. The main charges relate to search time (at $20 per hour) and photocopying (at 20 cents per page). Appendix 10: Consultants engaged Consultancies over $100 000 (%qhq 0 Australian Prudential Regulation Authority Industry supervision - Cooperative housing 140000 Department of Natural Resources Establishment of Plantation 113014 and Environment Licences Register System Charter Wilson & Associates Pty Ltd Tax Reform Project - Business Reguirements 365 090 and System Design PrlcewaterhouseCoopers Strategic services for GST implementation 1 962 219 638 780 SMS Consulting Group Pty Ltd Advice in relation to Info-technology 113625 and systems Stanton Consulting Partners Information Management Project 145 835 - Data definition Trowbridge Consulting Strategic advice on restoration 295 000 of common law rights Total 3 134 783 638 780 Consultancies under $100 000 There were 103 consultancies that cost less than $100 000 engaged during 1999-2000, at a total cost of $1 821 682. Appendix 11: Acronyms APU Accredited Purchasing Unit GST Goods and Services Tax CAC Capital Assets Charge GSP Gross State Product COAGCRR Council of Australian Governments HR Human Resources Commitment for Regulatory Reform IT&T Information Technology and CSC Corporate Services Centre Telecommunications DEET Department of Education Employment and ITSP IT Strategic Plan Training LAN Local Area Network DNRE Department of Natural Resources and LFS Labor's Financial Statement Environment MRP Management Reform Program DOI Department of Infrastructure NCC National Competition Council DPC Department of Premier and Cabinet NCP National Competition Policy DSRD Department of State and Regional Development OH&S Occupational Health and Safety DTF Department of Treasury and Finance ORG Office of the Regulator-General EAP Employee Assistance Program PAYG Pay As You Go EC4P Electronic Commerce for Procurement PFI Public Financial Institutions EFT Electronic Funds Transfer SAU State Administration Unit EPA Environment Protection Authority SEG Senior Executive Group ERC Expenditure Review Committee SRO State Revenue Office ESC Essential Services Commission TAC Transport Accident Commission ESO Essential Services Ombudsman TCV Treasury Corporation of Victoria FBT Fringe Benefit Tax VCGA Victorian Casino and Gaming Authority FHOG First Home Owners Grant VGPB Victorian Government Purchasing Board FMA Financial Management Act VGPG Victorian Government Property Group FOI Freedom of Information VPS Victorian Public Service GAAP Generally Accepted Accounting Principles VPX Victorian Power Exchange GBE Government Business Enterprises Appendix 12: Glossary Abnormal Items Items of revenue and expense included in the Budget Appropriation An authority from the Parliament which operating result for the reporting period, which are considered is not to exceed that amount specified, for the Treasurer to abnormal by reason of their size and effect on the operating enable departments to draw from the Consolidated Fund to meet result for the reporting period. their obligations. Accrual Financial Management A budget and management Budget Surplus The forecast change in financial position for the system that focuses primarily on outputs or products and reporting period where operating revenue is expected to exceed services provided (rather than inputs); and full cost accrual operating expenses incurred in the production of outputs and (rather than cash) accounting methods that include non-cash other trading activities. and capital costs. Capital Assets Charge (CAC) Operating expenses which Accumulated Surplus Funds (not necessarily cash) accumulated represents the cost of servicing the funds the government has in a department as a result of generating surpluses on operations. supplied over the years to build the asset base for the departments operations. The CAC ensures that departments Agency Any government or semi-government organisation not explicitly recognise the full costs of their asset base. Buy defined under the Public Sector Management and Employment recognising the cost of capital as a real cost, an incentive is Act 1998. provided for departments to optimise the use of their assets. Annual Financial Statements Consolidated annual financial The CAC is applied to non-current physical assets controlled report to Parliament which includes the State's financial by departments with the exception of national parks, roads statements that are subject to audit by the Auditor-General. The and heritage assets. Annual Financial Statements must present fairly the transactions Caretaker Government Period When an election is called, the on the Public Account, and other financial transactions of the Government adopts a 'caretaker' role. During this period, the State in respect to the financial year and the financial position of Government avoids making any major policy decisions that the State as at the end of the financial year on an accrual basis. would bind the Government that takes office after the election, Annual Appropriation The limit on the level of resources that making any significant appointments, or entering into any major the Treasurer can apply as: (i) revenue to a department for contracts or undertakings. provision of outputs; (ii) contributions for additions to the net Competitive Neutrality The principle that government asset base of a department; and (iii) funding for payments made departments and business enterprises should not have any net on behalf of the State. These lapse at the end of the financial competitive advantage or disadvantage simply from virtue of year (30 June), and are contained in the Appropriation Act and government ownership. Appropriation (Parliament) Act. Contestability A market which is potentially open to Asset Future economic benefits controlled by an entity (e.g. a competition, even if competition In that market is not actually department) as a result of past transactions or other past events. occurring at that time. An asset may be physical (e.g. buildings) or non-physical (e.g. goodwill). Assets may also be classified as current, having a Contingent liability A liability which will become due only store of service potential which is consumed in one year or less; on the occurrence of an event which may or may not happen. or non-current, having a store of service potential which is They commonly arise when the government gives a guarantee consumed over a period exceeding one year. to secure borrowings by a third party. Contingent liabilities are recorded in the notes to the financial statements, Asset Management Process of guiding the acquisition, operation, maintenance, use and disposal of assets to make the Corporatisation Describes a process which seeks to establish most of their service delivery potential and manage the related for a government business enterprise a structure of incentives risks and costs over their entire life. that approximates those that exist for private sector firms and thereby to provide the enterprise with a more commercial focus. Auditor-General The Auditor-General is an independent officer of the Parliament. The Audit Act 1994 which established the Office Credit Rating An independent measure of the State's net of the Auditor-General provides for the audit of State finances, financial liabilities determined by credit rating agencies. Factors Including the Annual Financial Statements. which affect the determination include level of debt, the Government's commitment to maintaining an operating surplus Branches Each Division within the Department is made up of In each year, and the view that these trends are sustainable. smaller Branches which help the Division to achieve its outcomes. Appendix 12: Glossary continued Debt A legal obligation to make payments of principal and Financial Reports Reports containing financial information (In most cases) interest according to a predetermined schedule. about the entity, having regard to Its control over the economic Debt, as measured in public sector finance statistics includes: resources, financial structure, capacity for adaptation, and obligations arising from loans (often referred to as advances) solvency. Under Australian Accounting Standard AAS 29, the from the Commonwealth; bonds, notes and other securities on general purpose financial report of a department must include issue; the capitalised value of outstanding lease commitments a) a Cash Flow Statement; b) an Operating Statement; and under finance lease arrangements; supplier/buyer credits; bank c) a Statement of Financial Position. overdrafts; and deferred contract payments. The total of these Forward Estimates Database of financial Information which items is usually referred to as gross debt. Debt Is a subset of a records estimated departmental and administered revenues, broader concept known as liabilities. expenses, assets and liabilities for future financial years. These Deficit A commonly used term for the difference in the estimates are based on an assumption of no policy change. Government Finance Statistics framework between outlays Currently in Victoria this database holds data for the three years and revenue. The difference between expenses and revenue following the budget year, as well as historical data. Is known as financing transactions, which In turn comprises Franchising The sale to an external party, usually on a basis of a the deficit (or surplus) plus the increase In provisions (for competitive bidding process, of the right to distribute a particular depreciation and employee entitlements). The deficit thus good or a service to a particular market for a defined period. measures the requirement for additional resources or funding. Franchising is often see as a way of Introducing competition into Deliverables Components of outputs that merit separate reporting an industry that might otherwise be a natural monopoly. and performance measurement. Major projects are one example Government Business Publicly owned entities providing goods where the output may be separated into deliverables. or services on Enterprises (GBE) commercial terms with the Department A department existing by virtue of an order made objective of recovering their costs of production and, in most under s10 of the Public Sector Management and Employment cases, of providing some financial return to government. GBEs Act 1998. are often referred to as Public Trading Enterprises (PTEs) or State Owned Enterprises (SOEs). Divisions The Department comprises five Divisions, each with specific roles to support current business needs. Each Division Gross Domestic Product The total market value of goods and is headed by a Deputy Secretary or Executive Director. The services produced in a country after deducting the cost of goods Divisions are: Budget and Financial Management; Commercial and services used up In the production processes, but before Policy and Projects; Economic and Financial Policy; Strategic deducting the consumption of the fixed capital. Management; and Corporate Services. Gross State Product (GSP) A measure of the total money value Electricity Distributors Electricity distributors distribute of goods and services produced in a State during a given period. electricity at high and low voltages (240V-66kV) over distribution Infrastructure Assets that comprise public facilities and which networks ('poles and wires') in their region. Most areas of provide essential services and enhance the productive capacity Victoria are covered by only one licensed distributor, as of the economy including the roads network (road pavement, distribution of electricity is a natural monopoly activity. bridges, earthworks), public transport, sewerage and water Entity Any legal, administrative, or fiduciary arrangement, supply systems and reservoirs. organisational structure or other party (Including a person) Initiatives Strategies designed to contribute to the having the capacity to deploy scarce resources in order to Government's required outcomes. achieve objectives. Investments Represents assets held by an entity for the Equity Residual Interest In the assets of an entity after deduction accumulation of wealth by the way of revenue (e.g. Interest, of its liabilities. dividends), for capital appreciation or for other benefits to the Executive Council Ministers (past and present) of the investing entity. Examples Include shares, foreign and domestic Government. The clerk and the Governor are not members of the (fixed and/or floating Interest) deposits, loans, placements, Executive Council. partnership interests, managed portfolios, debt securities. Jurisdiction The area over which judicial or administrative power extends. Land Tax Land tax is an annual tax assessed on the unimproved site value of taxable land owned by a landowner. Land that is used for primary production, or as a landowner's principal place of residence, is exempt. Liabilities The future sacrifices of economic benefit that the Performance Measures Dimensions of quality, quantity, entity is presently obliged to make other entities as a result of timeliness and cost used to describe how many, how well, past transactions or other past events. Liabilities comprise future when or how frequently, and at what cost the outputs that payments that an entity is presently obliged to make other the Government Intends to fund will be delivered. entities as a result of past transactions or other past events. Performance Targets Intended output delivery levels expressed Liabilities are thus a broader concept than debt. It also includes In terms of each performance measure. Targets are used as a obligations which do not have a predetermined repayment benchmark to assess performance In delivering budget outputs. schedule, and those which do not require payments of interest - such as unfunded liabilities of superannuation funds, liabilities in Portfolio Entities Statutory authorities and government respect of other employee entitlements (long service and annual business enterprises, which may or may not be budget funded, leave), trade creditors, and provisions for deferred maintenance. but which are accountable to one of the portfolio Ministers. National Competition Policy In 1995, the Commonwealth and Privatisation The transfer of activities or ownership of assets all State and Territory governments signed the Competition and operations from the public sector to the private sector. Principles Agreement to Implement a National Competition Procurement Policy Processes and procedures governing the Policy. This Agreement represents a commitment by all purchasing of goods and/or services. Australian governments to promote competition In the Australian economy where this would result In higher economic growth and Public Account The Government's official bank account. The increased community well being. Account holds the balances of the Consolidated Fund and the Trust Fund. The Public Account is maintained at one or more Net Assets The residual interest in the assets of an entity after banks, as required by the Financial Management Act 1994. deduction of its liabilities (the net worth of an entity). Public Financial Institutions (PFI) Resident public enterprises Net Debt (Liability) Gross debt (liability) minus liquid financial including central borrowing authorities primarily engaged in both assets (cash, bank deposits, marketable securities and sinking incurring liabilities and acquiring financial assets in the financial fund investments). market. PFIs are referred to as Public Financial Enterprises (PFE) Operating Deficit Where operating expenses incurred exceed by the Australian Bureau of Statistics (ABS). operating revenue earned In the production of outputs and other Resources Labour, materials and other inputs used to produce trading activities during the reporting period. An operating deficit outputs. has the effect of reducing the net worth of the entity. Revenues Inflows or other enhancements, or savings in Operating surplus Change in financial position for the reporting outflows, of future economic benefits in the form increases in period where operating revenue exceeds operating expenses assets or reductions in liabilities of the entity, other than those Incurred In the production of outputs and other trading activities. relating to contributions by owners, that result in an increase Outcomes Government's desired or intended Impacts/effects in equity during the reporting period. on the community resulting from a set of outputs and other Revenues on Behalf of the State Revenue collected from factors including community action. sources such as taxes and Commonwealth Financial Assistance Outputs Goods produced or services provided by or on behalf of Grants which are collected for the purpose of funding State an authority (department) or public body. Includes products and government generally. These revenues are not retained services delivered to ministers. specifically by the department which collects them, and are not related to the provision of departmental outputs. Output Group Aggregation of outputs which contribute to Revenue on behalf of the State are administered Items. common outcomes into groupings for budget submission and reporting purposes. Risk Management A structured process of identifying and analysing potential risks, and devising and implementing Outsourcing External party providing goods or services which responses appropriate to their Impact. were previously supplied internally. Involves provision of an agreed level of service for a predetermined fee as stipulated Senior Executive Group The Department is managed by the in a contractual arrangement. Senior Executive Group, which comprises the Secretary and the head of each Division. The role of the Senior Executive Group is to Payroll Tax Payroll tax is imposed on employers and is levied set, monitor and review the strategic direction of the Department. on taxable wages (salaries and wages, commissions, bonuses, allowances, remunerations, employer superannuation Special Appropriations Special appropriations are amounts contributions, relevant contracts and other benefits). Payroll tax authorised under standing provisions of Acts, other than the is payable when total Australian wages exceed the tax-free Appropriation Act, that remain in force until amended or repealed threshold of $515 000. by Parliament. As such they do not lapse each year as annual appropriations do. Stakeholders People, organisations and departments whose Unclaimed Monies The Unclaimed Moneys Act 1962 provides interests are effected by the provisions of outputs. for the administration, management, receipt and payment of certain funds that are legally payable to an owner and have Stamp Duty Duty payable on documents or transactions remained unclaimed for at least 12 months after they became involving land transfers, insurance policies, registration or payable. These funds include dividends, salaries, wages, bonds, transfer of motor vehicles, marketable securities, leases, rental deposits, trusts and superannuation benefits. Receipts from business and betting. The duty payable depends on the nature other acts and regulations include unclaimed amounts from and value of the document or transaction. The Stamps Act 1958 Tattersall/Tattslotto prizes, Keno, poker machines and Tabcorp/ governs these revenue lines. racing dividends. State Administration Unit An accounting device which serves Unfunded Superannuation Liabilities Liabilities which are as a repository for the financial liabilities of the government accruing but for which no explicit provision has been made for (being amounts appropriated to departments, but not yet drawn payment. In the Victorian public sector, the most significant down by departments In cash), holding assets and liabilities and examples are those of the defined benefits public sector receiving revenue and incurring expenses on behalf of the State. superannuation schemes. State Budget The State Budget Is the Government's business Victorian Public Sector In addition to general government, plan for the budget sector of the coming financial year. It includes the public sector covers public trading enterprises and public estimates of receipts and expenditure for the period and also financial institutions and is distinguished by government indicates the funding required to achieve the plan. The Treasurer, ownership or control. in the Autumn session, presents the State Budget to Parliament. The Budget includes the annual appropriation legislation together Whole of Government Compliance/consistency across all with accompanying documentation explaining the Budget Government departments. May also include other relevant strategies and policies. government agencies. State Revenue Office Administers 13 Acts of Parliament and Is responsible for managing the collection of 17 different types of taxes, duties and levies, including stamp duties, payroll tax, land tax, tobacco, petroleum and liquor revenue, financial institutions duty and debits tax. Statutory Authority An organisation established under an Act of the Victorian Parliament for a public purpose. Taxation Includes a number of compulsory levies imposed by the State that are mainly designed to raise revenue, and are prescribed under State tax legislation. The types of taxation revenue raised by the State include payroll tax, land tax, stamp duties, financial Institutions duty and debits tax, gambling taxes, insurance duty, motor vehicle registration fees and driver licenses, revenue replacement payments (liquor, petroleum, tobacco), electricity franchise fees. Trust Accounts Trust accounts are created by specific legislation (e.g. Hospitals and Charities Fund) or established by the Minister for Finance pursuant to the Financial Management Act 1994 (e.g. working accounts, cash suspense accounts and revenue suspense accounts) for particular purposes. Trust Fund A trust fund or trust account which, when aggregated with other Trust Fund Accounts and the Consolidation Fund, forms the Public Account. It includes deposits by individual departments in the Public Account. Trustee Companies Trustee Companies are companies authorised to carry on business as a trustee company under section 6 or 7 of the Trustee Companies Act 1984. Designed by Kajetan Design Group Pty Ltd www.kdg.com.au Photography by Bernie Phelan Photography Printed by Mcpherson's Printing Group Printed on Australian paper State Governmensntt *J 7 Victoria