EXHIBIT (c)(ii)
Queensland Government Budget Papers
APPROPRIATION BILL 2003
(Second Reading Speech, 3 June 2003)
TREASURER
The Honourable Terry Mackenroth MP
Deputy Premier, Treasurer and Minister for Sport
APPROPRIATION BILL 2003
(Second Reading Speech, 3 June 2003)
TREASURER
The Honourable Terry Mackenroth MP
Deputy Premier, Treasurer and Minister for Sport
Mr Speaker, I move that the Bill now be read a second time.
INTRODUCTION
The Beattie Government has a clear vision for Queensland and a clear set of
priorities.
We are giving Queensland a strong identity as Australia's Smart State by
improving the lives of all Queenslanders and creating sustainable opportunities
for everyone.
We are acting on our priorities to deliver our vision for Queensland.
The Beattie Government has:
.. generated average annual economic growth of over 5%;
.. maintained a strong fiscal position despite turbulent world events;
.. reduced the unemployment rate to levels not seen for 13 years;
.. invested $24 billion in improved infrastructure;
.. enhanced and improved key services; and
.. taken action to protect the environment.
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Our Government has fully funded all our election commitments and we continue to
deliver more for Queensland.
This Budget builds on our vision through further investment in health and
disability services as well as increased investment to foster innovation which
is at the heart of our Smart State vision.
This Budget provides:
.. an increase in the Health Budget of $300 million or almost 7% as part of a
cumulative four-year increase in spending on health of over $2.6 billion;
.. $290.5 million in increased State funding over four years to Disability
Services including $200 million in new funding; and
.. $100 million over four years to build upon the investment in our Smart
State Strategy.
ECONOMIC OUTLOOK
The State Government's economic strategy is aimed at maximising Queensland's
economic performance and providing a better quality of life for all
Queenslanders.
Our strategy focuses on the main drivers of productivity growth-improving
economic fundamentals, fostering innovation and investing in human capital.
The Queensland economy has continued to outperform the rest of Australia and
indeed most of the rest of the world in terms of economic growth in 2002-03. In
year-average terms, estimated growth in gross state product will be 4 3/4% this
year, 2 percentage points faster than growth in the rest of Australia.
This has occurred despite drought and a hostile external environment-terrorist
attacks in Bali, war with Iraq, weak overseas equity markets, declining world
growth and, more recently, SARS.
The resilience of the Queensland economy, however, is again clear.
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Despite major international and national impacts in recent years State economic
growth has been underpinned by the strength of domestic demand, particularly
dwelling and business investment.
The Beattie Government has again delivered on its promise of jobs. Employment
growth in Queensland has exceeded our expectations this year, growing by an
estimated 3 1/4%, 1 percentage point faster than growth in the rest of
Australia.
This means we have created an additional 55,000 jobs in 2002-03, some 12,000
more than our Budget forecast.
Since this Government came to power in June 1998, an additional 200,000 jobs
have been created in Queensland.
Unemployment has continued to fall during the year, even with our strong
population growth, to the lowest levels since 1990.
This growth was fuelled by Queensland's thriving economy. We attracted large
numbers of people to the state from interstate and from overseas. A net inflow
of 36,500 interstate migrants moved to Queensland over the 12 months to December
2002, the highest level recorded in over six years. Overseas migration to
Queensland also reached a historical high over the same 12 month period, with a
net balance of almost 26,000 international migrants settling in Queensland.
Turning to the year ahead, the Queensland economy is forecast to continue to
grow solidly in 2003-04, with forecast growth of 4%. This is 1 percentage point
faster than forecast growth in the rest of Australia.
While the Commonwealth's national forecast growth of 3 1/4% relies on an
exchange rate of around US60c, our forecast incorporates the more recent
appreciation of the Australian dollar, with a year-average exchange rate
assumption for 2003-04 around current levels.
Business investment will continue to be a major driver of growth in 2003-04,
with ongoing activity supported by low interest rates, improved profitability
and strengthening equity markets. Business investment is forecast to increase by
around 9 1/2%, following extraordinary growth this year. Dwelling investment is
forecast to ease slightly but remain at a high level.
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Household consumption will also contribute strongly to growth, with rapid
population growth, solid labour market conditions, continued growth in real
earnings and low interest rates all driving growth of around 4 3/4% in this
sector.
Labour market conditions will remain strong in the State, with employment
forecast to increase by 2 1/4%. This translates to the creation of around 38,000
jobs in year-average terms for 2003-04.
Continuing strong population growth is forecast to result in labour force growth
of 2 1/4%, matching employment growth and keeping the unemployment rate
remaining broadly unchanged in year-average terms.
MORE JOBS FOR QUEENSLAND - SKILLS AND INNOVATION - THE SMART STATE
Our economic strategy recognises that fostering innovation and investing in the
skills and capabilities of Queenslanders are critical to the future growth of
the Queensland economy.
With initiatives in this Budget, spending on education by 2006-07 will have
increased by 55% or more than $1.6 billion since 1997-98.
The 2003-04 Budget in the area of education includes:
.. $300 million for capital outlays;
.. $155 million for continuing literacy and numeracy initiatives;
.. $6.8 million to extend the trialing of a preparatory year of schooling to
an additional 25 schools including 20 State schools; and
.. $67 million for information and communication technologies in schools.
We are on target to achieve a student to computer ratio of 5:1 for Years 3-12 by
2005.
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In aggregate, the Budget provides for 636 additional classroom teachers to meet
enrolment growth, support students with disabilities, reform initiatives and
enhancements. This will bring the total number of new teachers appointed since
1998 to around 3,000.
Mr Speaker, a centre-piece of our commitment to jobs for Queenslanders is our
Breaking the Unemployment Cycle initiative. This initiative provides a range of
programs to create jobs and training opportunities for those at risk of
long-term unemployment.
I am pleased to announce this Budget provides an additional $85 million per
annum commencing in 2004-05 to continue this initiative to 2006-07.
An additional $19 million is allocated over four years for the employment of 300
public sector apprentices in targeted skill shortage areas.
Mr Speaker, innovation is a primary driver of productivity growth, improved
living standards and better job opportunities.
The Beattie Government's vision for the development of Smart State industries
and jobs is backed up by our investment in research and development.
Our Government's focus of building on the State's traditional strengths and
fostering new innovative industries has delivered consistently higher rates of
economic growth than the rest of Australia.
We have been a strong investor in molecular bioscience research, cancer research
and biotechnology. Our $100 million Smart State Research Facilities Fund is
supporting initiatives such as the Australian Institute of Bioengineering and
Nanotechnology.
Mr Speaker, the Government will shortly release a document, Queensland - Smart
State - Investing in Science, Research and Innovation, which will include a $100
million four-year package of initiatives across a number of sectors of the
knowledge economy to underpin Queensland's delivery of the Smart State vision.
Areas of investment will include medical and bio-discovery research, tropical
marine science and clean coal technology.
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The strategy will generate smart, sustainable jobs and investment opportunities
and ensure that Queensland remains at the forefront of science and technology
innovation.
COMMUNITY ENGAGEMENT AND A BETTER QUALITY OF LIFE
Queenslanders enjoy a quality of life that is among the highest in the world.
The Beattie Government is committed to engaging the community in decision making
processes to further improve our quality of life. We achieve this through
Regional Community Forums, Community Cabinet meetings and our first regional
sitting of Parliament.
Access to high quality health care is fundamental to quality of life and a clear
priority for the Beattie Government.
Compared to the 2002-03 Health Budget, the next four years will see a cumulative
increase in health spending of over $2.6 billion for wage increases, operating
cost increases and for increased and enhanced services for a growing and ageing
population. This comprises around $1.6 billion in State funding and around $1
billion in Commonwealth funding.
By 2006-07 the Health Budget will grow to around $5.4 billion, that is over $1
billion or around 25% higher than the 2002-03 Health Budget.
In 2003-04 the Health Budget will increase by $300 million or almost 7% over
last year's Budget, providing:
.. increased funding of $40 million to manage demand pressures for oncology
and cancer care, renal dialysis services, intensive care, cardiac services
and emergency services;
.. an additional $10 million to continue the Elective Surgery Enhancement
initiative beyond our $20 million two year election commitment;
.. an additional $8.4 million for mental health services including funding for
40 additional community mental health staff;
.. an increase in State funding for the Home and Community Care program of
$7.5 million;
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.. an additional $5 million to manage the increasing demand for dental care
including improved access and better management of waiting lists; and
.. $2 million in 2003-04 rising to $8 million in a full year for additional
medical services at the Logan and Caboolture Hospitals to relieve pressure
on accident and emergency departments.
Over 10 years from 1994, $2.8 billion will have been invested in rebuilding,
modernising and re-equipping hospitals and community health facilities. This
investment continues in 2003-04 with ongoing redevelopment including hospitals
at Ayr and Gympie as part of a health capital program of over $280 million.
In contrast to the Commonwealth Government, the Beattie Government is strongly
committed to the principles of Medicare and providing Queenslanders with access
to affordable, quality health care.
The lack of commitment by the Commonwealth is plain for all to see.
Their new Health Care Agreement funding offer to the states is, by their own
admission, $1 billion less than they factored into their forward estimates to
continue the current five year agreement.
The Howard Government is making it more expensive for the average Australian to
see a doctor. If your family earns more than $32,000 you won't qualify for bulk
billing.
As more families are denied access to free GP services they will increasingly
turn to our emergency departments at hospitals for treatment increasing pressure
on our public hospital system.
The Howard Government's lack of commitment to our public hospitals and to
Medicare should rightly anger all Australians.
Queenslanders can be assured that the Beattie Government is committed to the
retention of Medicare and the provision of accessible, affordable and high
quality health care for all Queenslanders.
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Mr Speaker, people with disabilities require support and assistance to enable
them to actively participate in society.
In some cases specialised services are needed but it is important to recognise
and support informal networks, families, carers and friends to ensure people
with disabilities have the opportunity to fully participate in all aspects of
everyday life.
This Budget delivers on the Beattie Government's commitment to providing a
better quality of life for Queenslanders with a disability.
Last year, our Government initiated the Funding Reform Project - one of the most
progressive and significant pieces of work in the history of disability services
in Queensland. The results of extensive consultation with stakeholders showed
the need for reform and provided a strong direction for the way we deliver
disability services.
Our agenda for change is to deliver a better deal to people with disabilities
and their families.
This Budget delivers $200 million in new funding over four years including $35
million in 2003-04 for a range of initiatives that will provide better outcomes
for people with a disability, their families, carers and disability services
providers. The details of these initiatives are set out in a new policy
statement - Future Directions for Disability Services.
Together with funding for grant indexation, enterprise bargaining and other
factors, an additional $290.5 million in State funding will have been injected
into the provision of disability services and support by 2006-07.
This increased funding will see the budget for Disability Services Queensland
grow to $385 million in 2003-04, an increase of 16.3% on last year's Budget.
Over the next four years State funding will grow by 43% compared to Commonwealth
funding growth of 16%.
This again shows the stark contrast between the priorities of the Howard
Government and those of the Beattie Government.
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With the new four-year funding provided for in this Budget, the level of State
funding for disability services will have increased from around $125 million in
1997-98 - the year before the Beattie Government came to office - to $330
million in 2006-07.
The Beattie Government recognises that safe, secure and affordable housing is an
essential component of individual, family and community wellbeing.
This Budget allocates $528 million for housing assistance programs for 2003-04
representing an increase of 11% on last year's allocation. This includes:
.. over $170 million for public rental housing allowing for the commencement
of 300 dwellings, the completion of 239 dwellings and for upgrades to
improve existing accommodation; and
.. an additional 60 dwellings will be provided for transitional housing to
improve options for homeless people in crisis. This is part of a $15.5
million allocation for homelessness initiatives.
As part of the Beattie Government's strong commitment to enhancement of public
transport, $21.4 million is provided in 2003-04 to progress the introduction of
an integrated ticketing system in South East Queensland together with $42
million for the construction of the Inner Northern Busway.
The arts, culture and recreation are key elements of quality of life and
essential components of a strong and vibrant Queensland society.
The Budget provides $92.6 million for ongoing capital works for the Millennium
Arts project, including $3.8 million for the Musgrave Park Indigenous Cultural
Centre. Additional funding of $3.2 million is provided over four years for arts
and cultural organisations and major performing arts companies.
SAFER AND MORE SUPPORTIVE COMMUNITIES
Last year's Budget provided additional funding of $188 million over four years
to strengthen this Government's capacity to assist Queensland families, youth
and children in need.
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This increased investment saw 92 additional staffing positions created in the
Department of Families in 2002-03 together with the establishment of trials of
innovative approaches to prevention and early intervention which will be
completed in 2003-04.
The trials will be carefully evaluated and a selection of successful approaches
will be piloted with a view to implementation.
A key element of ensuring our communities are safe and secure is strong policing
and effective crime prevention. This Budget maintains the Beattie Government's
commitment to this priority with initiatives including:
.. 300 additional police as part of our plan to have 9,100 officers by 2005;
.. an additional $30 million over two years to continue the upgrade and
improvement of the Queensland Police Service's information technology
systems; and
.. an additional $5.3 million over the next two years for the South East
Queensland Drug Trial.
Mr Speaker, road safety is important to Queenslanders and our Government.
We are committed to implementing the National Road Safety Strategy which targets
a 40% reduction in road deaths per 100,000 population by 2010 and additional
funding of $16.1 million is provided in 2003-04 to implement the Government's
Road Safety Initiative Package.
As previously announced the Budget provides for the introduction of a Community
Ambulance Cover to give the Queensland Ambulance Service a predictable,
long-term funding source to maintain a world-class ambulance service.
Consistent with this objective the Budget provides an additional $6.27 million
for the Queensland Ambulance Service to support the employment of an additional
110 officers and additional capital investment.
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The overall Queensland Ambulance Service capital program provides for the
commencement or completion of 17 replacement ambulance stations and four new
stations.
VALUING THE ENVIRONMENT
Protecting the environment and biodiversity while allowing the ecologically
sustainable development of our natural resources is a key priority for our
Government.
We are addressing the areas of major challenge including land clearing, water
resource management and salinity.
This Budget commits an additional $75 million in State funding over five years
as part of the recently announced $150 million Commonwealth-State tree clearing
reduction package.
The adjustment assistance package will involve $130 million in financial
incentives to assist landholders with transition or for exit assistance if
necessary, $12 million in incentives to improve the management of more valuable
remnant vegetation and $8 million to develop best practice farm management
plans.
The Budget provides $11 million as part of our $81 million seven year funding
commitment to the National Action Plan for Salinity and Water Quality.
Ensuring compliance with our natural resource legislation will be enhanced with
an additional $8 million over four years to support the necessary assessment,
monitoring and enforcement of existing legislation concerning vegetation, water,
land and pests.
An additional $1.78 million is allocated in 2003-04 for the Great Artesian Basin
Sustainability initiative to support more bore capping, rehabilitation and drain
replacement projects.
This Budget also commits an additional $3.5 million over four years to introduce
and implement new cultural heritage legislation. This legislation seeks to
effectively recognise and protect Aboriginal and Torres Strait Islander cultural
heritage and to establish practical and workable processes for managing cultural
heritage impacts.
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Queensland's National Parks and protected areas represent an invaluable asset
for all current and future generations of Queenslanders.
As promised we have delivered on our election commitment to employ 140
additional rangers as part of our Enhanced Park Maintenance initiative.
The 2003-04 Budget also provides $3.2 million for the continued development of
our Great Walks of Queensland initiative and $1.3 million for the continuing
acquisition of land for the State's protected estates and forests.
BUILDING QUEENSLAND'S REGIONS
The Beattie Government has demonstrated a strong commitment to building
Queensland's regions through the growth of regional economies, regional
infrastructure and improving the liveability of cities, towns, regions and
remote communities.
We have been a strong investor in infrastructure.
Our capital program for 2003-04 is almost $5.3 billion with over 62% on projects
outside the Brisbane statistical division.
Regional infrastructure projects funded in this Budget include:
.. $26.9 million to continue construction of the Douglas Arterial in
Townsville;
.. $25 million towards planning and construction of the $240 million Tugun
Bypass;
.. $60.5 million for the Burnett Water Infrastructure Development; and
.. $49.8 million for the Rockhampton-Townsville-Cairns Rail Track Upgrade
project.
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Our Regional Centres program has supported the development of a range of
infrastructure and community facilities across the State. This Budget provides
$50 million over four years to extend this successful program to 2006-07. This
extension will support projects such as the Riverway project in Thuringowa, the
Warwick Streetscape project, the Mount Isa Outdoor Events Park, and the Cairns
Botanic Gardens and Tanks Precinct Redevelopment.
Mr Speaker, our primary industries form an essential part of Queensland's
economic, social and environmental foundations.
The Beattie Government is committed to supporting and assisting our primary
producers in meeting the challenges they face.
The Budget includes $25 million for drought assistance and related activities,
including farm financial counselling, climate modelling and research into
drought resistant plants.
We will make available an additional $30 million to the sugar industry over four
years, on top of the $55 million already committed, subject to the Commonwealth
Government's continued commitment to the Memorandum of Understanding on the
sugar industry. This additional $30 million package includes a $10 million Sugar
Industry Innovation fund, a $10 million Sugar Industry Change Management program
and a $10 million Farm Consolidation Loan program.
We are continuing to invest in the risk management of biosecurity threats such
as foot and mouth disease and $39 million is allocated to market assurance
services, animal and plant health risk containment, surveillance and emergency
response capability.
GOVERNMENT FINANCES
Mr Speaker, the capacity for our Government to continue to improve the quality
and range of services and infrastructure to the Queensland community is
underpinned by our commitment to strong fiscal management.
This Budget provides for a net operating surplus of $153 million with growing
surpluses over the forward estimates period.
Our balance sheet is strong with total State net worth forecast to grow to more
than $60 billion in 2003-04.
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All the major ratings agencies recognise the strength of our fiscal position by
confirming our AAA credit rating.
In our Mid Year Fiscal and Economic Review we indicated that the continuing
volatility in equity markets would impact on the 2002-03 operating result and a
deficit of $741 million was forecast on the basis of investment returns of zero.
Despite the fact that equity markets have continued to under-perform and a
consequent revision to our investment return expectations to negative 3%, the
forecast deficit for 2002-03 has improved to $350 million. This reflects
improvements in other revenues and reduced expenses.
Our policy of fully funding superannuation liabilities means that while we have
stronger finances than any other State by a considerable margin, it does create
volatility in annual budget results. This volatility is manageable given our
very strong balance sheet and does not impact on our capacity to maintain and
improve services.
This is highlighted by the fact that if Queensland's superannuation arrangements
were structured on the same basis as other jurisdictions, the General Government
sector underlying operating result for 2002-03 would be a surplus of $587
million.
In aggregate terms, General Government expenses will grow by 5.3% on last year's
Budget to $21.2 billion. Importantly we are giving a clear priority to key
service delivery areas.
The Health budget is growing by almost 7%, the Disability Services budget is
growing by over 16 % and housing assistance programs by 11%.
REVENUES
The Beattie Government has a clear commitment to maintaining a competitive tax
regime.
The Budget forecasts that in 2003-04 Queenslanders will pay $1,480 per capita in
State taxes compared with $1,892 per capita for the average of the other states.
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This means that taxpayers in other states pay 28% more than Queenslanders.
Mr Speaker, Queenslander's land tax regime is not onerous compared to the other
States. According to the Commonwealth Grants Commission, Queensland's land tax
effort in 2001-02 was the lowest in the nation at about 28% less than the
national average.
Nevertheless, the Government recognises that rising land values will have a
significant community impact with some 11,000 new taxpayers expected in 2003-04
under existing land tax provisions.
In order to provide a measure of land tax relief, particularly to those with
lower land holdings, I am pleased to announce that with effect from 1 July 2003:
.. the statutory deduction for residents will be increased from $200,000 to
$220,000;
.. the minimum tax payable by resident taxpayers will be increased from $100
to $350. In other words taxpayers with a tax liability of less than $350
will not be liable for land tax; and
.. the exemption threshold for companies, trustees and absentees will be
increased from $150,000 to $170,000 with a consequential extension of the
phasing-in rebate.
The combination of the statutory deduction increase and the increase in the
minimum tax level will mean that residents with landholdings (excluding their
principal place of residence) of less than $275,997 will not be liable for land
tax. Without these changes residents with landholdings of $221,665 or more would
have had to pay land tax.
This reduces the number of resident taxpayers in 2003-04 by around 11,400
relative to the number of taxpayers in the absence of these changes. In fact,
there will be around 3,050 fewer resident taxpayers compared to 2002-03.
Further, all resident land taxpayers will benefit from the $20,000 increase in
the statutory deduction.
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The $20,000 increase in the threshold for companies, trustees and absentees will
constrain the increase in the number of taxpayers to around 450. Without the
threshold increase the number of company, trustee and absentee taxpayers would
have grown by around 2,750.
In addition, companies, trustees and absentees with land holdings between
$170,000 and $235,000 will benefit from an increased phasing-in rebate.
The Government will forgo revenue of $11.6 million as a result of these
concessions.
ACCOUNTABILITY LEADERSHIP AND INNOVATION
Mr Speaker, in delivering on our social and fiscal objectives, the Beattie
Government will continue to demonstrate high standards of accountability,
leadership and innovation.
We are committed to delivering cost effective services to the community and to
finding smarter ways to operate and deliver services.
This Budget provides $4 million over two years to expand services available to
the public through our single access point, Smart Service Queensland.
We are also investing in new information technology systems with an additional
allocation of $64 million over the next three years for an integrated justice
information strategy, a single integrated revenue system for the Office of State
Revenue, major upgrades to police information and communication technology
systems and disability services information systems.
To provide high-quality and cost-effective corporate support services we are
implementing a shared services initiative from 1 July this year. This initiative
will consolidate corporate service functions such as finance and pay-roll into
five large-scale and two smaller-scale shared service providers and a technology
centre of skill.
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The Beattie Government is also seeking to incorporate private sector innovation
to achieve better value for money in the delivery of public infrastructure. The
Government is currently considering a range of projects for private sector
involvement and has recently sought expressions of interest for the delivery of
the infrastructure and non-core services required for the Southbank Education
and Training Precinct.
CONCLUSION
Mr Speaker, I am very proud to have delivered the third Budget of the second
Beattie Government.
The Budgets I have presented have:
.. delivered on fully funding all the Government's commitments;
.. delivered on education and training reforms for the future;
.. delivered on funding for family services and particularly child protection;
.. delivered improved health services;
.. delivered a better deal to people with disabilities; and
.. delivered a better quality of life for all Queenslanders.
Mr Speaker, I commend the Bill to the House.
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STATE BUDGET
2003-04
BUDGET STRATEGY AND OUTLOOK
BUDGET PAPER NO. 2
TABLE OF CONTENTS
1. Budget Strategy, Performance and Outlook 1
Introduction 1
Fiscal Strategy 1
Summary of Key Financial Aggregates 5
Budget Outcomes 2002-03 6
Budget 2003-04 and Outyear Projections 9
Reconciliation of Operating Result 10
2. Economic Performance and Outlook 11
Introduction 11
External Environment 12
External Assumptions 15
The Queensland Economy 16
3. Economic Strategy 31
Aims of the Economic Strategy 31
The Importance of Improving Productive Capacity 32
A Strategy for Sustainable Economic Growth 37
Economic Fundamentals 37
Innovation 40
Human Capital 44
Positioning Queensland's Economic Future 47
4. Budget Priorities 49
Introduction 49
Government Policy Priorities 49
Service Delivery Highlights 51
Financial Management and Governance 63
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5. Revenue 67
Introduction 67
Revenue by Operating Statement Category 68
Taxation Revenue 70
Grants and Subsidies 75
Sales of Goods and Services 80
Interest Income 81
Other Revenue 82
6. Expenses 87
Introduction 87
Expenditure by Category 88
Details of Expenses 90
Operating Expenses by Purpose 93
Level of Service Provision 94
7. Balance Sheet and Cash Flows 97
Introduction 97
Balance Sheet 98
Cash Flows 106
Reconciliation of Operating Cash Flows to the Operating Statement 112
8. Inter-Governmental Financial Relations 113
Commonwealth-State Financial Relations 113
Commonwealth Funding to the States 115
State Shares of Commonwealth Funding 117
Queensland's Share of Funding 118
Institutional Arrangements 119
Specific Purpose Payments 123
State-Local Government Relations 125
Queensland as a Taxpayer 128
Appendix A - Tax Expenditure Statement 131
Appendix B - Concessions Statement 137
Appendix C - Statement of Risks and Sensitivity Analysis 143
Appendix D - Demographic Trends 149
Appendix E - Government Finance Statistics 155
Appendix F - Departmental Expenses 173
1. BUDGET STRATEGY, PERFORMANCE AND OUTLOOK
KEY POINTS
.. Cash surpluses are forecast for 2002-03, 2003-04 and the outyears in the
General Government sector.
.. For 2003-04, there is a budgeted net operating surplus of $153 million,
with a sustained and improving surplus position throughout the outyears.
Page 2
.. In 2002-03, the General Government sector is forecast to have an accrual
deficit of $350 million. This is due to the poor performance of investment
markets, which has impacted on the returns the State receives on the
substantial funds set aside to meet future employee entitlements.
.. The forecast underlying operating result for 2002-03 (adjusted for
comparable superannuation arrangements) is for a surplus of $587 million.
.. The State's net worth is forecast to increase in 2002-03, 2003-04 and the
outyears to $67.012 billion.
.. The State capital program in 2003-04 is budgeted to be $5.273 billion, an
8% increase on the estimated 2002-03 outlays. 62.5% of the capital program
will be spent outside the Brisbane region.
INTRODUCTION
This chapter discusses:
.. the Government's fiscal strategy as outlined under the Charter of Social
and Fiscal Responsibility
.. the summary financial aggregates of the 2003-04 Budget.
FISCAL STRATEGY
The Charter of Social and Fiscal Responsibility outlines the Government's fiscal
principles, and is an integral part of the Government's commitment to the
community.
The fiscal principles, which are detailed in Box 1.1, have been framed to meet a
number of objectives, with the overriding requirement to maintain the integrity
of the State's finances.
The fiscal principles establish the basis for sustainability of the Government's
policies. They require that the services provided by Government be funded from
tax and other revenue sources over the long-term. The principles are supported
by an accrual budgeting framework, which recognises future liabilities of the
State and highlights the full cost of sustaining the Government's operations on
an ongoing basis.
The principles recognise the importance of a strong financial position for the
State. A state government, because of its more limited tax base, does not have
the same capacity as a national government to cushion economic and financial
shocks. At the same time, state governments have a responsibility to provide
continuity of services, such as health, police and education. A strong financial
position, as indicated by a AAA credit rating, enables lower borrowing costs and
is an indication of the soundness of the financial position and policies of the
Government, rather than a goal in itself.
The success of Queensland's financial and economic management has been
consistently affirmed by international ratings agencies. These agencies have
cited Queensland's strong balance sheet, sound financial operations, modest debt
levels and dynamic economic base as reasons underpinning the State's AAA credit
rating.
Box 1.1
The Fiscal Principles of the Queensland Government
Competitive tax environment
The Government will ensure that State taxes and charges remain competitive with
the other states and territories.
Affordable service provision
The Government will ensure that its level of service provision is sustainable by
maintaining an overall General Government operating surplus, as measured in
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Government Finance Statistics terms.
Capital funding
Borrowings or other financial arrangements will only be undertaken for capital
investments and only where these can be serviced within the operating surplus,
consistent with maintaining a AAA credit rating.
Managing financial risk
The Government will ensure that the State's financial assets cover all accruing
and expected future liabilities of the General Government sector.
Building the State's net worth
The Government will at least maintain and seek to increase total State net
worth.
Competitive Tax Environment
One of the Queensland Government's key social and fiscal objectives is to
maintain a competitive tax environment which raises sufficient revenue to meet
the infrastructure and Government service delivery needs of the people of
Queensland, whilst at the same time providing a low cost environment for
business to promote economic development and jobs growth.
The competitiveness of a state's tax system is usually assessed by using one of
the following measures:
.. taxation revenue on a per capita basis
.. taxation relativities based on Commonwealth Grants Commission methodology
.. taxation revenue expressed as a percentage of gross state product (GSP).
Queensland's competitive tax position is confirmed by all three measures.
.. Per capita tax collections in Queensland in 2003-04 are estimated at
$1,480, compared with an estimated $1,892 for the average of the other
states.
.. Commonwealth Grants Commission data indicates that Queensland's taxation
effort ratio of 85.7% is considerably less than the standard (100%).
.. Latest Australian Bureau of Statistics data shows Queensland's tax
collections at 4% of GSP compared to 4.8% for the average of the other
states.
The 2003-04 Budget includes a land tax relief measure. Details of this change
and other revenue items are provided in Chapter 5.
Affordable Service Provision
The objective of maintaining affordable service provision is to require the
maintenance of a budget operating surplus, to ensure recurrent services can be
funded from recurrent resources.
As discussed below, the achievement of a headline budget surplus in an
environment of poor international investment returns has not been possible.
However, the underlying revenue and expenditure balance, which provides the
funding basis for Government service delivery, has improved during 2002-03.
Surpluses in excess of $150 million are forecast for 2003-04 and the outyears.
The Government's expenditure strategy is based around providing targeted funding
for high priority community services, and increasing opportunities for
individuals through expenditure in education and training.
Following on from the significant funding package for families to deliver better
outcomes for children and young people announced in the 2002-03 Budget, the
2003-04 Budget and forward estimates also includes new funding for high priority
community service delivery in areas such as health and for disability services
reform.
Page 4
The 2003-04 Budget and forward estimates continue the implementation of the
Government's Education and Training Reforms for the Future including trials for
a preparatory year of schooling and substantial investment in information and
communication technology.
The adoption of new measures for the Smart State Strategy to enhance the
capacity of the Queensland economy are also included in the 2003-04 Budget and
forward estimates.
More information on these initiatives is provided in Chapter 4.
Queensland is already one of the more efficient providers of government services
among the states. Nevertheless, further improving the efficiency and
effectiveness of Government services is an essential element of delivering on
these key policy priorities in a way that is both affordable and sustainable.
The Government has in place an ongoing Aligning Services and Priorities (ASAP)
program which provides for a process of ongoing activity and process review to
ensure that Government resources are used efficiently so that funding can be
directed to the high priority areas outlined above.
In this context, the Government has recently announced a shared service
initiative designed to achieve best practice in corporate services across
Government, with the savings to be achieved from this initiative to be directed
to service delivery.
Capital Funding
The provision of adequate levels of infrastructure is an ongoing challenge for a
state such as Queensland which continues to experience high levels of economic
and population growth. Meeting this challenge, the Government provides for
consistently higher levels of capital expenditure per capita than any other
state.
In recognition of Queensland's capital requirements, the Charter allows
borrowing for capital only where the costs of the borrowing can be serviced
within the context of an overall operating surplus.
Despite this capacity, the bulk of Queensland's 2003-04 capital program will be
funded from recurrent sources and the forward estimates provide for only modest
levels of borrowing consistent with net capital acquisitions.
Details of the State capital program for 2003-04 and sources of funds are
provided in Budget Paper No. 3. - Capital Statement.
Managing Financial Risk
Queensland has a long-standing policy of setting aside funds to accumulate
financial assets sufficient to meet future liabilities, the largest being for
future employee entitlements, most notably superannuation.
In this respect, Queensland is far better placed than any of the other state or
territory governments, or indeed the Commonwealth Government, to fund future
accruing liabilities as most other jurisdictions have substantial unfunded
superannuation liabilities.
In common with other superannuation managers in both the public and private
sectors Queensland has experienced poor investment returns over recent years,
and these have continued into 2002-03. Nonetheless, the State's policy of
managing financial risk and setting aside funds to meet future liabilities
remains sound.
Building the State's Net Worth
The Charter policy of building the State's net worth is intended to ensure that
infrastructure and other assets are not run-down to the detriment of future
citizens and taxpayers. It is an important element in ensuring
inter-generational equity.
Queensland's net worth is forecast to grow over the forward estimates.
Queensland's per capita net worth is expected to be 16% greater in 2003-04 than
the average per capita net worth of the other states.
Page 5
Further information on State net worth and other balance sheet aggregates can be
found in Chapter 7.
SUMMARY OF KEY FINANCIAL AGGREGATES
Table 1.1 provides aggregate estimated actual outcome information for 2002-03
and projections for 2003-04 and the outyears.
Table 1.1
General Government sector - Key Financial Aggregates1 2002-03
Est. Act.
$ million2003-04
Budget
$ million2004-05
Projected
$ million2005-06
Projected
$ million2006-07
Projected
$
millionRevenue19,91321,38222,18623,10724,097Expenses20,26321,22922,02422,
90923,814Net operating balance(350)153162198283Cash surplus
51152521622885Capital purchases2,4102,5452,1221,9271,818Net
worth58,69260,31262,39664,63667,012
Note:
1. Numbers may not add due to rounding.
BUDGET OUTCOMES 2002-03
Operating Result
The operating result expected for 2002-03 is a deficit of $350 million. The
estimated 2002-03 deficit is the result of poor investment returns. The
investment return rate assumed at the time of the Mid-Year Review was 0% for
2002-03 on financial assets held to meet long-term liabilities such as
superannuation. In light of the ongoing poor performance of equity markets, the
investment return rate assumption has been revised to -3% for 2002-03.
Budget estimates for investment returns are based on the expected long-term
average return for the portfolio of 7.5%.
With over $12.6 billion in funds invested in a portfolio of equities, property,
cash and fixed interest, the performance of international financial markets has
a major influence on the Budget result.
Following a period of very high returns in the 1990s, equity markets have
performed very poorly. While returns achieved by the Government's fund manager,
Queensland Investment Corporation (QIC), in the 1990s averaged around 12% per
annum, returns in 2001-02 and currently in 2002-03 have been negative (-5% and
- -3% respectively), as illustrated in Chart 1.1.
Chart 1.1
Investment Returns
1989-90 to 2002-031 (% per annum)
Note:
1. Estimate.
Source: 1989-90 to 2001-02: Queensland Investment Corporation.
The past two years have been extraordinary in terms of investment history, with
one of the largest market downturns in several decades. In the last 100 years,
the current downturn is comparable to the Oil Crisis in the 1970s and is only
exceeded by the Great Depression in 1929.
Page 6
Despite the further downward revision to investment earnings, the 2002-03
operating deficit represents an improvement on that forecast at the Mid-Year
Review. At the time of the Mid-Year Review investment earnings forecasts and
other estimates indicated an expected deficit outcome of $741 million.
Factors contributing to this overall improvement include increases in revenue
reflecting the continued strength of the property market, higher Commonwealth
revenues following upward revisions to the GST estimates in the recent
Commonwealth Budget and reduced expenses. Significant adjustments since the
publication of the Mid-Year Review are detailed in Table 1.3.
The Underlying Operating Result
In the absence of poor investment returns, the 2002-03 operating result would
have been a strong surplus.
Investment market volatility impacts on the Queensland Budget more in Government
Finance Statistics (GFS) terms than it does for other states. This is in part
due to differences in the way Queensland's public sector superannuation
arrangements are structured. Queensland's financial assets set aside to meet
future employer superannuation liabilities are held as General Government sector
assets and associated superannuation liabilities are similarly recorded as
General Government sector financial liabilities. In contrast, other
jurisdictions generally have structures whereby only the net superannuation
liability is recorded in the balance sheet.
The differing superannuation structure leads to a significant difference in
accounting treatment between states. For example, in other states poor
investment returns are largely treated as asset revaluations, reflecting changes
in the net superannuation liability. In contrast, poor investment returns impact
directly on Queensland's operating result as a decrease in revenue associated
with the investment of financial assets held to meet future liabilities.
If Queensland's superannuation arrangements were structured on the same basis as
generally applies in other states the General Government sector underlying
operating result for 2002-03 would be in surplus, as outlined in Table 1.2
below. The underlying result concept is based on the treatment of variations
between Budget and revised assumptions. For the 2003-04 Budget no adjustment is
required to the forecast operating result as both the earnings rate on financial
assets and the interest rate for the nominal superannuation interest expense are
based on long-term actuarial assumptions.
Table 1.2
Calculation of Underlying Result2002-03
Est. Act.
$ millionOperating Balance(350)Less Investment Earnings 1(295)Plus Nominal
Superannuation Expense 2642Underlying Balance587
Notes:
1. Represents investment earnings on financial assets held to meet future
defined benefit superannuation liabilities.
2. Represents the adjustment required to the nominal superannuation expense to
be calculated on the basis of the net superannuation liability.
Cash Surplus
The General Government sector is estimated to achieve a cash surplus in 2002-03
of $51 million.
At Mid-Year Review, the cash surplus for 2002-03 was an estimated $364 million.
Factors contributing to the reduction in the size of the estimated surplus
include the cash impact of the further downward revision to investment returns
from 0% to -3%, and the recommencement of payments for the State's component of
superannuation beneficiary payments (following the expiration of the $1.1
billion forward funding
Page 7
payment made in 1999-2000). Continued strength in property related taxes and
increased Commonwealth revenues have in part offset these additional cash
outflows.
The underlying strength of the General Government cash flow for 2002-03 is
demonstrated through the borrowing requirement.
Borrowings for 2002-03 have been further revised down to $168 million, from $342
million at the Mid-Year Review 2002-03 (Budget estimate $635 million).
Capital Purchases
General Government investment in capital in 2002-03 is estimated to be
$2.41 billion, broadly consistent with the amount forecast at Mid-Year Review.
Net Worth
The net worth, or equity, of the State is the amount by which the State's assets
exceed its liabilities. This is the value of the investment held on behalf of
the people of Queensland by public sector instrumentalities. The net worth of
the General Government sector at 30 June 2003 is estimated at $58.692 billion.
This is $756 million higher than net worth forecast at the Mid-Year Review, and
reflects the improved operating position together with the impact of asset
revaluations, particularly on the value of Crown land.
BUDGET 2003-04 AND OUTYEAR PROJECTIONS
Operating Result
The budgeted position for the General Government sector is for an operating
surplus of $153 million in 2003-04, growing steadily in the outyears.
The surpluses provide capacity to manage external factors that can impact on the
Budget and are consistent with the Government's fiscal commitment to a
competitive tax regime, and the already strong balance sheet position of the
State.
The increase in expenditure relative to 2003-04 levels primarily relates to
employee expenses, service enhancements and parameter based adjustments.
Taxation revenue growth is expected to moderate in 2003-04 with an easing in
property market activity, while investment returns are based on the assumption
of long-term investment return rates.
Further details on revenue and expenditure projections are contained in Chapters
5 and 6 respectively.
Cash Surplus
A cash surplus of $152 million is expected in 2003-04 for the General Government
sector. The cash surplus is forecast to grow strongly in the outyears, reaching
$885 million by 2006-07.
Growth in the cash surplus in the outyears is due to a moderation in net capital
purchases from the high levels budgeted for 2003-04.
Capital Purchases
This Budget continues the trend of sizeable State capital works programs, in
both nominal and per capita terms. General Government capital purchases in
2003-04 are expected to be slightly higher than the 2002-03 estimated actual.
Budget Paper No.3
.. Capital Statement provides details by portfolio of 2002-03 estimated actual
and budgeted 2003-04 capital outlays.
Net Worth
State net worth is projected to increase from the 2002-03 estimated actual by
$1.62 billion to $60.312 billion at 30 June 2004. Net worth is also expected to
increase in all forward estimate years.
More information on the State's net worth, assets and liabilities is provided in
Chapter 7.
RECONCILIATION OF OPERATING RESULT
Table 1.3 provides a reconciliation of the General Government sector operating
Page 8
result for 2002-03 and 2003-04 published in the Mid-Year Fiscal and Economic
Review (MYFER) and current Budget estimates.
Table 1.3
Reconciliation of 2002-03 and 2003-04 Operating Result to MYFER Estimates1
2002-03
Est. Act.
$ million 2003-04
Budget
$ millionMYFER Operating Balance(741)72 Expenditure Policy Decisions2(4)(217)
Revenue Policy Decisions3..(12) Other Significant Variations Impacting on
Operating Result - Agency Depreciation Expense Adjustments4195198 -
Superannuation Expense Adjustment5154.. - Investment Returns6(383)(42) -
Commonwealth General Revenue Grants7204167 - Other Parameter
Adjustments8225(13)2003-04 Budget(350)153
Notes:
1. Denotes impact on Operating Result.
2. Reflects expenditure policy decisions taken in the Budget context.
3. Land tax relief provided in 2003-04 Budget - see Chapter 5.
4. During 2002-03, the Department of Main Roads and the Department of Housing
conducted reviews of the depreciation methodology applied to fixed assets. These
reviews resulted in an extension in the useful life of those assets and a
consequent reduction in depreciation expense.
5. The reduction in superannuation expense reflects a reduction in liabilities
associated with lower investment earnings on non-defined benefit post-retirement
accounts.
6. Reflects revisions of estimated rate of return on investments from 0% to -3%
in 2002-03.
7. Includes outcomes of Commonwealth Grants Commission 2003 Update, population
changes and most recent estimates of GST revenue included in the 2003-04
Commonwealth Budget.
8. Generally refers to adjustments relating to movements in underlying social
and/or economic parameters or other no policy change adjustments to estimates.
For 2002-03 includes upward revisions to taxation estimates of approximately
$140 million.
2. ECONOMIC PERFORMANCE AND OUTLOOK
KEY POINTS
.. Economic growth in Queensland has been particularly strong in 2002-03 with
expected growth of 43/4%, significantly higher than the 3% forecast
nationally.
.. The strong growth in 2002-03 reflects substantial increases in household
consumption, dwelling investment and business investment, while net exports
are expected to detract from overall growth.
.. Employment has grown strongly in Queensland in 2002-03, up an expected
31/4%, outpacing growth in the State's labour force. As a result, the
State's year-average unemployment rate is expected to fall to 7%, the
lowest rate in more than a decade.
.. Queensland's economic growth is expected to moderate slightly to 4% in
2003-04 but is once again set to exceed the national forecast of 31/4%.
.. The forecast easing in the rate of Queensland's economic growth in 2003-04
reflects a combination of factors. A forecast decline in dwelling
investment from current record levels is expected to flow through to a
slight moderation in household consumption expenditure. Business investment
is still forecast to record solid growth, albeit less than the exceptional
growth experienced in 2002-03. Net exports are expected to again detract
from growth, with a forecast increase in exports likely to be offset by a
further increase in imports, resulting primarily from the stronger
Australian dollar.
.. Employment growth is forecast to moderate to 21/4% in 2003-04, in line with
the general slowing of domestic economic activity. With the labour force
expected to
Page 9
grow at a similar rate to employment, Queensland's year-average
unemployment rate is forecast to remain unchanged at 7% in 2003-04.
INTRODUCTION
This chapter presents the economic framework within which the 2003-04 Budget has
been produced. It examines recent developments in Queensland's external economic
conditions, both international and national, and reviews the performance and
outlook for the Queensland economy. It details estimated actuals and forecasts
for the major components of State economic activity for 2002-03 and 2003-04
respectively, and presents projections for key State economic variables over the
medium-term to 2006-071.
EXTERNAL ENVIRONMENT
CURRENT CONDITIONS
International
Queensland's major trading partners have experienced relatively modest economic
growth over the first few years of the new century. The second half of the 1990s
was characterised by strong growth in Queensland's traditional markets of North
America and Europe. However, the last two years have seen Non-Japan Asia
re-emerge as the area of economic strength, with the US and Euro area struggling
to recover from the world economic slowdown that commenced in 2000. As a result,
economic growth in Queensland's major trading partners in 2003-04 is likely to
show only a modest improvement compared with that recorded in 2002-03. This
improvement is not expected to eventuate until early 2004 (see Chart 2.1).
Chart 2.1
Economic Growth in Queensland's Major Trading Partners1
Note:
1. Growth in calendar years 2003 and 2004 represent forecasts. Sources:
Queensland Treasury and Consensus Forecasts.
The performance of the US economy has remained lacklustre in 2002-03. Prospects
of an immediate recovery in growth are also limited, with personal consumption
expenditure, the main driver of aggregate demand in the US over the past year,
recently showing signs of moderation. A recovery in business investment is also
yet to be seen, however the US business sector is likely to benefit from reduced
uncertainty in its external environment following the war in Iraq. In
particular, the recent unwinding of 'war premiums' on US corporate bond yields
and oil prices, combined with the depreciation of the US$, has significantly
improved the outlook for business investment over the remainder of 2003.
The resultant appreciation of the Euro against the US$ has reduced the prospect
of an export-led recovery in the Euro area. In particular, Germany appears to be
facing major structural adjustment challenges which continue to limit economic
growth in the largest member country of the Euro area.
The outbreak of Severe Acute Respiratory Syndrome (SARS) in Non-Japan Asia has
disrupted economic activity in the region. While the SARS epidemic has not
spread to Japan, the Japanese economy has been increasingly undermined by
deflation, with consumers becoming accustomed to continuing declines in consumer
prices.
National
Strong domestic demand has continued to support economic growth in Australia in
2002-03, with gross domestic product estimated to grow by 3%. Solid growth in
business and dwelling investment has more than offset the negative impacts
associated with severe drought conditions and heightened geopolitical
uncertainty.
Page 10
A substantial decline in agricultural production due to the drought and a surge
in imports of capital goods are expected to lead to net exports detracting an
estimated 23/4 percentage points from overall growth in 2002-03. In contrast,
low interest rates and positive employment conditions have supported domestic
demand, countering the weakness in Australia's external environment. Australian
businesses have continued to invest, taking advantage of historically low
interest rates. The national housing boom, which began in the middle of 2001,
has continued in 2002-03, with housing alterations and additions activity a key
driver of this growth.
The national labour market strengthened in the first half of 2002-03 but has
moderated somewhat in the second half of the year. Strong growth in construction
and retail employment, reflecting robust housing construction and consumption
spending, has more than offset job losses in the farm sector over the course of
the year. As a result, the national unemployment rate is estimated to fall to a
year-average 6% in 2002-03.
A number of temporary factors such as higher fuel and food prices, due to
international geopolitical tensions and the drought, respectively, have led to
an acceleration in headline consumer price inflation in 2002-03, with the
year-average inflation rate estimated to be 31/4%. This will be the highest
inflation rate since 1995-96, excluding 2000-01 when the GST was introduced.
However, the underlying rate of inflation has been more contained and is
expected to remain around the lower end of the Reserve Bank of Australia's (RBA)
2-3% target band in the final quarter of 2002-03.
Looking forward to 2003-04, economic growth in Australia is forecast to be
similar to that in 2002-03. While growth in private investment should revert to
a more sustainable level in 2003-04, an anticipated return to normal seasonal
conditions is expected to lead to a recovery in rural exports.
The greatest risk to this outlook for the national economy relates to the
prospect of a continued appreciation in the A$ over the coming year. The A$ has
increased in value by around 15% against the US$ over the 11 months to May 20032
and any further appreciation in the A$ could be expected to significantly affect
Australia's export performance in 2003-04.
Chart 2.2
Exchange Rates and Interest Rates, Australia1
Note:
1. Exchange rates and cash rates have been calculated on an end of month basis.
For May 2003, rates were calculated based on the latest available data at the
time of preparation of the budget papers.
Sources: Reuters and RBA.
Chart 2.3
Gross Domestic Product and Inflation, Australia1
Note:
1. Economic growth presented on a trend basis. Ongoing inflation excludes an
estimated 23/4% impact of the GST on the consumer price index in September
quarter 2000.
Sources: Queensland Treasury and Australian Bureau of Statistics (ABS) 6401.0.
External Assumptions
Queensland has strong links with both the national and international economies.
Consequently, the performance of the State economy is, in part, dependent on the
economic outlook for Australia and its major trading partners. The forecasts for
Page 11
the Queensland economy in 2003-04 are therefore based on the following key
assumptions about the State's external environment (see Table 2.1).
.. Economic growth in Queensland's major trading partners is not expected to
show any sustained recovery until 2004, with forecast year-average growth
of 23/4% in 2003-04 only slightly higher than that experienced over the
current financial year. Non-Japan Asia is assumed to remain the fastest
growing region of the world, although any failure to control the outbreak
of SARS may result in lower than expected growth in that region.
.. Inflation is assumed to remain at low levels in Queensland's major trading
partners, as a result of lower than average economic growth and a return to
generally lower oil prices than have been experienced throughout 2002-03.
.. As a result, Australian monetary policy is assumed to be broadly unchanged
over 2003-04, with interest rates to remain around their current low
levels.
.. Commonwealth Government economic forecasts and projections, as at May 2003,
have been adopted as the basis for national economic performance over the
forecast horizon, with national growth of 31/4% assumed for 2003-04 and
31/2% for the outyears.
.. The Queensland economic forecasts have been based on an A$ exchange rate at
around current levels, in both US$ and trade-weighted index terms,
reflecting the weakness of the US currency and the relatively more positive
outlook for the Australian economy in comparison with the world's major
economies. This contrasts with the assumption that the exchange rate would
remain around US$0.60c, contained in the recently-released 2003-04
Commonwealth Budget.
Information on the risks to these assumptions is contained in a later section of
this chapter.
Table 2.1
External Assumptions1OutcomesEst. ActualForecast2000-01
%2001-02
%2002-03
%2003-04
%International assumptionsMajor trading partner economic
growth3.31.121/223/4Major trading partner inflation1.01.711/4 11/2 National
assumptionsEconomic growth1.84.0331/4 Inflation23.22.931/4 23/4
Note:
1. Decimal point figures indicate an actual outcome.
2. Inflation, calculated on a year-average basis, excludes the first round
effects of the introduction of the GST in 2000-01.
Sources: Queensland Treasury, ABS 6401.0, Commonwealth Treasury and Consensus
Forecasts.
THE QUEENSLAND ECONOMY
OVERALL ECONOMIC GROWTH
The Queensland economy has continued to perform strongly in 2002-03, despite
ongoing weakness and uncertainty in the global economic environment. Gross state
product in Queensland is expected to grow by 43/4% in 2002-03, outperforming
estimated growth of 3% nationally (see Chart 2.4 and Table 2.2).
Domestic demand has been the main driver of growth in 2002-03, with household
consumption, dwelling investment and business investment all growing strongly.
In contrast, net exports is expected to detract from growth, reflecting the
subdued nature of the global economy, as well as the impacts of the drought and
external shocks on tourism exports.
The outlook for the Queensland economy remains positive, with solid growth of 4%
Page 12
forecast for 2003-04. The slight moderation in activity in 2003-04 reflects an
expected easing in growth in private final demand, particularly dwelling
investment. However, the recent appreciation of the A$, in addition to continued
construction activity in the mining and manufacturing sectors, should help
maintain strong growth in business investment. Furthermore, low interest rates
and strong population growth are expected to provide continued underlying
support for solid economic growth in Queensland in 2003-04.
Net exports are forecast to result in a greater detraction from growth in
Queensland (-3/4 percentage point) than nationally (-1/4 percentage point) in
2003-04. This partially reflects the expected slower recovery from the drought
of some of Queensland's major agricultural exports, in particular meat and
sugar. Compared with the 2003-04 Commonwealth Budget forecasts, the larger
detraction from growth of net exports in Queensland also reflects the difference
in exchange rate assumptions discussed above.
CHART 2.4
AGGREGATE ECONOMIC GROWTH1
Note:
1. Chain volume measure, 2000-01 reference year. Growth for 2002-03 represents
an estimated actual rate while growth for 2003-04 represents a forecast.
Sources: Queensland Treasury and Commonwealth Treasury.
Table 2.2
State and National Economic ForecastsOutcomesEst. ActualForecast2000-01
%2001-02
%2002-03
%2003-04
%Queensland forecasts Domestic production1 Household consumption4.62.85 43/4
Private investment2,3-9.120.6181/251/4 Dwellings-15.030.921 -11/2 Business
investment3, 4-9.712.7231/291/2 Other buildings and
structures3-6.6-2.8271/4123/4 Machinery and equipment3-11.421.8213/473/4 Private
final demand31.16.881/25 Public final demand3-2.24.7231/4 Gross state
expenditure5-0.26.4743/4 Exports of goods and services6.34.733/44 Imports of
goods and services-3.07.091/4 51/2 Net exports63.5-1.0-21/4-3/4 Gross state
product3.35.543/44 Other state economic measures Population1.82.021/421/4
Inflation73.02.931/4 21/2 Average earnings (state accounts basis)6.12.941/441/4
Employment (labour force survey)1.81.931/421/4 Unemployment rate (%,
year-average)8.07.97 7 Labour force2.11.821/421/4 Participation rate65.165.065
65National forecasts Domestic production1 Household consumption3.03.433/431/4
Private investment na na na na Dwellings-20.919.518 -5 Business
investment3,4na4.615 7 Other buildings and structures3na9.728 14 Machinery and
equipment3na2.112 4
Private final demand3na4.961/43 Public final demand3na4.333/431/4 Gross
national expenditure50.04.853/431/2 Exports of goods and services7.3-1.50 6
Imports of goods and services-1.32.313 6 Net exports61.9-0.9-23/4-1/4 Gross
domestic product1.84.03 31/4 Other national economic measures
Population1.31.311/411/4 Inflation73.22.931/423/4 Average earnings (national
accounts basis) 8, 93.8 4.331/44 Employment (labour force survey)2.11.121/213/4
Unemployment rate (%, year-average)6.46.66 6 Labour force1.91.413/413/4
Participation rate63.763.764 64
Notes: Unless otherwise stated, all figures are annual % changes. Decimal point
figures indicate an actual outcome.
na - not available.
1. Chain volume measure, 2000-01 reference year.
2. Private investment includes livestock, intangible fixed assets and ownership
transfer costs.
3. Excluding private sector net purchases of second-hand public sector assets.
Page 13
4. National calculations of business investment includes investment in livestock
and intangible fixed assets, which are not included in the Queensland
calculations.
5. Includes statistical discrepancy and change in inventories.
6. Percentage point contribution to growth in gross state or domestic product.
7. Excludes the first round effects of the introduction of the GST in 2000-01.
8. 2000-01 average compensation of employees (national accounts basis).
9. 2001-02 average non-farm compensation of employees (national accounts basis).
Sources: Queensland Treasury, Commonwealth Treasury and ABS 5206.0.
CHART 2.5
Contribution to Growth in Queensland's Gross State Product1
Note:
1. Chain volume measure, 2000-01 reference year. Contributions for 2002-03
represent estimated actuals while contributions for 2003-04 represent forecasts.
Source: Queensland Treasury.
Chart 2.6
Contribution to Growth in Australia's Gross Domestic Product1
Note:
1. Chain volume measure, 2000-01 reference year. Contributions for 2002-03
represent estimated actuals while contributions for 2003-04 represent forecasts.
Sources: Queensland Treasury and Commonwealth Treasury.
Household Consumption
Household consumption, the largest single component of the Queensland economy,
is expected to grow by 5% in 2002-03, almost double the rate of growth recorded
in the previous year. Consumption expenditure has been supported by sustained
low interest rates and strong population growth throughout the year. This has
more than compensated for any negative impact on consumption resulting from the
drought, negative external shocks and the easing in housing activity in the
State over the second half of the year.
Retail trade, which accounts for approximately 40% of household consumption, has
experienced moderating growth over the year. This has partially reflected
declining sales in the previously strong household goods sector, while negative
shocks, such as the war in Iraq and the drought, contributed to an easing in
consumer sentiment, further inhibiting the rate of retail trade growth late in
the year.
Growth in household consumption is forecast to moderate slightly to 43/4% in
2003-04. This reflects an expected moderation in labour market conditions and a
slowdown in the housing industry. However, there are several factors which will
continue to support household consumption in Queensland. Continued low interest
rates will continue to underpin consumption expenditure over the coming year,
while growth in average earnings is expected to outpace inflation, resulting in
increases in real incomes. In addition, continued high levels of interstate
migration to Queensland are expected to maintain strong population growth,
providing further underlying support for household consumption growth in
Queensland.
CHART 2.7
HOUSEHOLD CONSUMPTION AND POPULATION GROWTH, QUEENSLAND
Sources: Queensland Treasury and ABS 3101.0.
Dwelling Investment
Following exceptionally strong growth in 2001-02, dwelling investment in
Queensland
Page 14
has remained robust in 2002-03 and is expected to grow by 21% over the year.
The strong growth in dwelling investment reflects a combination of new dwelling
construction and alterations and additions to existing dwellings. Demand from
first home buyers subsided in 2002-03, following the removal of the additional
component of the First Home Owner Grant. However, rising house prices have
fuelled demand for investment properties in Queensland and have led to many home
owners drawing on their increased equity to renovate their properties. This has
resulted in a surge in alterations and additions activity, with the value of
private residential alterations and additions in the first half of 2002-03
increasing by more than 45% compared with the same period a year earlier.
Dwelling investment is expected to return to a more sustainable level over the
coming year, with a decline in dwelling investment of 11/2% forecast for
2003-04. Leading indicators, such as dwelling approvals and housing finance
commitments, suggest that dwelling investment is likely to moderate. The number
of private dwelling approvals peaked in September 2002 and has recently fallen
to a level similar to that recorded in late 2001. Meanwhile, the number of
finance commitments for the construction of new owner occupied dwellings fell
24% in the first three quarters of 2002-03, compared with the same period a year
earlier.
Continued low interest rates, high population growth and continued strong
alterations and additions expenditure, in addition to a large number of recently
approved unit developments, should cushion the forecast decline in dwelling
investment during 2003-04.
CHART 2.8
DWELLING APPROVALS AND HOUSING FINANCE COMMITMENTS1, QUEENSLAND
Note:
1. Housing finance commitments for owner-occupied new dwellings. Sources: ABS
8731.0 and 5609.0.
Business Investment
Economic conditions have been conducive to continued high levels of business
investment in 2002-03. Low interest rates, a substantial appreciation of the A$
over much of the year and a general improvement in business conditions are
expected to result in business investment rising 231/2% in 2002-03.
With the US economy struggling to emerge from a period of sluggish growth and
ongoing geopolitical uncertainty, the RBA has refrained from further tightening
monetary policy since June 2002. The A$ has recovered strongly since early 2002,
appreciating by around 15% against the US$ and more than 10% on a Trade Weighted
Index (TWI) basis over the 11 months to May 20033, primarily reflecting the
weakening of the US$.
Combined with solid business conditions in Queensland, these factors resulted in
strong growth in both of the major components of business investment in 2002-03.
Investment in other buildings and structures is expected to rise by 271/4%,
while investment in machinery and equipment is predicted to rise by 213/4%.
With ongoing construction activity in Queensland's mining and manufacturing
sectors, investment in other buildings and structures is forecast to increase by
a further 123/4% in 2003-04. Meanwhile, investment in machinery and equipment,
which is expected to be supported by continued strong A$ exchange rates and, to
a lesser degree, falling international prices of information technology
products, is forecast to grow by a further 73/4%. As a result, total business
investment in Queensland is forecast to rise 91/2% in 2003-04.
Page 15
Chart 2.9
Business Investment and Business Conditions, Queensland
Sources: Queensland Treasury and National Australia Bank.
Net Exports
A relatively subdued global economy is expected to lead to only marginal growth
of 33/4% in Queensland exports in 2002-03, while imports are estimated to rise
by 91/4%, reflecting the relative strength of the Queensland economy. As a
consequence, net exports are expected to detract 21/4 percentage points from
overall growth in Queensland in 2002-03.
Growth in merchandise exports has moderated in 2002-03, reflecting the subdued
economic conditions of many of Queensland's trading partners. Exports of coal
and non-ferrous metals have been hampered by low growth in global industrial
production and a stronger A$, with nominal earnings from coal exports further
reduced due to easing international coal prices. The drought is also likely to
impact on rural exports during the remainder of 2002-03.
Growth in Queensland's tourism exports has also remained subdued throughout
2002-03. The beginning of a recovery in international tourism, following
terrorist attacks and the collapse of Ansett Airlines, has been disrupted by the
war in Iraq and the SARS epidemic in the East Asia region. This has resulted in
a decline in visitors from the Asian region, as well as a decline in visitors,
mainly from Europe, who would have travelled via Asia. Offsetting this weakness
has been the continued strength of interstate tourism to Queensland.
The anticipated end of the drought and a gradual recovery in the global economy
are forecast to lead to a slight increase in growth in merchandise exports in
2003-04. Exports of cereals and textile fibres should increase, while beef
exports are likely to be affected by herd rebuilding following the drought. As
global industrial production gradually increases, this is expected to lead to an
improvement in export earnings, largely through higher commodity prices, while
increases in Queensland coal production should lead to higher export volumes.
The key factor influencing net exports in 2003-04 will be the higher Australian
dollar exchange rate, which is expected to drive a further increase in imports.
As a consequence, net exports are forecast to detract 3/4 of a percentage point
from State economic growth in 2003-04.
Chart 2.10
Merchandise Trade and Services Exports, Queensland
Source: Queensland Treasury.
Employment
The number of people employed in Queensland is estimated to rise, in
year-average terms, by around 55,000 or 31/4% in 2002-03. This strong increase
in employment should more than offset labour force growth, resulting in a
further decline in the State's year-average unemployment rate to an expected 7%,
the lowest rate in Queensland since 1989-90.
Employment growth in Queensland has been particularly strong throughout most of
2002-03, reflecting the performance of many of Queensland's labour-intensive
industries. In particular, solid consumption expenditure has led to strong
employment growth in the service sector while the robust performance of the
housing sector has supported employment growth in the construction industry.
However, employment growth is expected to moderate in the final months of
2002-03, in line with the recent easing of growth in the housing and retail
trade industries, job losses in the drought-affected farm sector and the
negative impacts of the uncertain
Page 16
external environment on tourism.
Given these factors will continue to influence employment conditions in the
early part of 2003-04, combined with the expected easing in economic growth
generally in coming quarters, employment growth is forecast to ease to 21/4% in
2003-04. This remains above forecast national employment growth of 13/4% for
2003-04 and translates into the creation of an expected 38,000 jobs in
Queensland in year-average terms.
Labour force growth is expected to be similar to employment growth in 2003-04,
resulting in the forecast year-average unemployment rate remaining unchanged at
7%.
CHART 2.11
Employment Growth, Labour Force Growth and Unemployment Rate, Queensland1
Note:
1. Growth rates and unemployment rates for 2002-03 represent estimated actuals
while figures for 2003-04 represent forecasts.
Sources: Queensland Treasury and ABS 6202.0.
Population
Queensland is estimated to record strong population growth of 21/4% in 2002-03,
with a similar rate of growth forecast for 2003-04. As a result, Queensland's
population is expected to increase by approximately 80,000 persons in each of
the two years to a total of more than 3.8 million persons in 2003-04,
representing 19.1% of the forecast national population.
Queensland's forecast strong population growth partially reflects the impact of
a recent increase in net overseas migration, consistent with the national trend.
However, the substantially higher forecast population growth in Queensland
compared with that nationally continues to be primarily driven by net interstate
migration.
The recent surge in net interstate migration to Queensland is expected to
continue in 2003-04 and may partially be a response to the impact of the housing
boom in Sydney and Melbourne, with the substantially higher prices increasing
the relative cost of housing in those States. However, the increased number of
interstate arrivals to Queensland suggests that interstate migration continues
to be underpinned by more traditional factors. These factors include improved
employment prospects, reflecting Queensland's stronger employment growth, the
State's generally lower cost of living and other socio-economic factors such as
Queensland's lifestyle and preferable climate.
Average Earnings
Nominal average earnings in Queensland are expected to increase by 41/4% in
2002-03, outpacing inflation and implying a rise in real average earnings during
the year.
Nominal earnings growth is expected to remain at around 41/4% in 2003-04.
However, with the rate of inflation expected to ease during the year, real
earnings are expected to increase further in 2003-04, reflecting continued
strong growth in labour productivity.
Chart 2.12
REAL AVERAGE EARNINGS AND LABOUR PRODUCTIVITY, QUEENSLAND
Source: Queensland Treasury.
Inflation
Page 17
A combination of circumstances is expected to lead to a slightly greater than
expected rise in consumer prices of an estimated 31/4% in 2002-03. Exceptional
growth in the State's housing sector has led to considerable increases in the
cost of renting and dwelling prices. Higher vegetable prices, associated with
drought conditions across most of Australia, have also resulted in a significant
increase in the cost of food. Meanwhile, higher world oil prices, brought about
primarily as a result of the military conflict in Iraq, have directly affected
the price of automotive fuel. As a result, rises in the prices of housing, food
and transportation accounted for more than 70% of the total rise in the
Queensland Consumer Price Index (CPI) over the four quarters to March 2003 (see
Chart 2.13).
Inflation is expected to moderate to a year-average of 21/2% in 2003-04. An
expected easing in growth in domestic final demand over the year suggests that
any upward pressure on prices is not likely to be broad-based, particularly at a
time when growth in some key sectors of the economy, such as housing, is
expected to moderate. Continued weakness in the US$ is also expected to maintain
a high A$ exchange rate over the coming year, curbing any potential import-based
inflation.
Moreover, many of the factors which impacted on consumer prices in 2002-03 are
generally expected to subside over the course of 2003-04. In addition to the
pending moderation in activity in the State's housing sector, world oil prices
have fallen back to around pre-Iraq war levels and this is already being
reflected in lower automotive fuel prices. The intensity of the drought has also
eased slightly in Queensland, with food prices likely to return to pre-drought
levels.
Chart 2.13
CONTRIBUTION TO GROWTH IN THE CPI BY COMPONENT, QUEENSLAND1
Note:
1. Contributions to growth based on % share of the change in the Brisbane CPI
over the four quarters to March quarter 2003.
Source: ABS 6401.0
RISKS AND OPPORTUNITIES
National and international economic conditions will continue to have a major
impact on the outlook for the Queensland economy in 2003-04 and beyond, with
exports of goods and services comprising over 36% of Queensland's gross state
product. The continuing weakness in the US and key European economies, combined
with uncertainty in world financial markets, may undermine any global economic
recovery, while SARS threatens to have a major impact on economic growth in key
Asian economies, at least in 2003. There may also be a significant direct impact
from SARS on the Queensland economy, mainly through its impact on tourism.
Domestically, the continuing drought situation in some regions of the State and
any sudden downturn in the dwelling cycle remain the key risks to the Queensland
economy. The factors discussed below are therefore likely to remain the key
identifiable risks to the Queensland economy in 2003-04.
International Conditions
As in the previous two State budgets, international conditions remain a key risk
to the State economy. The much awaited recovery in the US economy is proving
elusive, with the pace of recovery so far being lacklustre, despite highly
expansionary fiscal and monetary policy settings. In the early part of this
year, Consensus Forecasts revised down their estimates for US economic growth
for both 2003 and 2004. Forecasts of growth in the Euro area have also been
consistently downgraded in recent months and major structural adjustment
challenges continue to face several of the area's largest economies,
particularly Germany.
Despite some recent signs of improvement, economic activity in Japan remains
generally flat with persistent deflationary pressure hampering domestic economic
activity. Concerns over the SARS virus have also resulted in estimates of growth
in
Page 18
Non-Japan Asia for 2003 being downgraded recently.
A sustained recovery in the world economy is now not expected until 2004.
However, should the recovery in economic growth in Queensland's major trading
partners be delayed beyond the beginning of 2004, or the impact of SARS on
growth in Non-Japan Asia be greater than currently expected, Queensland's export
performance will be weaker than forecast.
Moreover, the general weakness in the world's major economies has led to the
recent appreciation of the A$ against the US$ and on a trade-weighted basis.
Therefore, any further weakening of the global economy could lead to a continued
appreciation of the A$ and, consequently, a greater impact on Queensland's net
exports position than currently forecast.
International Financial Markets
The ongoing weakness in the outlook of the world's major economies is reflected
in world financial markets. Despite a rally following the invasion of Iraq,
equity markets have not rebounded as decisively as many analysts had predicted.
This may dampen consumer and business confidence in the US in particular, where
household wealth has been particularly adversely impacted upon by weak equity
markets. US firms also continue to face high borrowing costs, with low official
interest rates supplemented by high risk premiums, the risk being that business
investment will not experience the rapid turnaround required to kick-start the
US economy. This would result in lower than expected growth in the US and its
key trading partners in Non-Japan Asia in 2003 and into 2004.
Severe Acute Respiratory Syndrome
In addition to the effect that SARS is having on economic growth in the affected
countries, the outbreak of the virus in East Asian nations presents a specific
risk to Queensland tourism. The East Asian region has accounted for around 40%
of international visitors to Queensland over the past five years. In addition,
visitors from Europe, who make up a further quarter of overseas visitors to
Australia, tend to travel via Singapore or an alternative Asian stopover.
Queensland tourism has already been adversely impacted by the SARS outbreak,
coming on top of the weakness in international tourism induced by the Iraq war.
The number of overseas visitors to Australia was down 13% over the year to April
2003.
Almost two thirds of overseas visitors to Australia may potentially be
discouraged from travelling during this epidemic. This impact may be offset to
some extent by Queenslanders and other Australians opting to holiday in
Queensland rather than travel overseas. However, the relative sizes of these
components of Queensland's tourism sector mean that the overall effect on
economic activity is still likely to be negative.
The direct impact of SARS on the Queensland economy is not limited to the
tourism sector. Merchandise exports to the Asian region are also likely to be
adversely affected. Aquaculture exports to Asia have already suffered, with
restaurant trade in key Asian markets dramatically reduced.
The current forecasts assume that the SARS epidemic will be brought under
control quickly, with the major impact over by early 2003-04. Any prolonging of
the epidemic beyond this period will result in tourism and food exports in
2003-04 falling below the levels currently forecast.
Drought
While Autumn rains have gone some way toward breaking the drought in several
regions of the State, other regions have not experienced any improvement in
water availability and further good rainfalls are required to result in any
significant increase in summer crop production. The assumed recovery in
agricultural production in 2003-04 is dependent upon the drought breaking by
around mid-2003 and normal seasonal conditions then resuming, that is, the
drought is not followed by floods or other damaging weather conditions. Should
the drought continue into 2003-04, export and overall economic growth and, as a
result, employment growth will all be lower than currently forecast.
Page 19
Population Growth
Only one quarter of data on the components of population growth in Queensland
for 2002-03 were available at the time of preparing the economic forecasts.
Recent data show a return to strong levels of net interstate migration and a
rise in net overseas migration. The forecast population growth of 21/4% in
2003-04 is based on this trend continuing. However, should net migration return
sharply to the levels of the late 1990s, population growth will be lower than
forecast, resulting in weaker household consumption and dwelling investment.
Dwelling Investment
The economic forecasts are based on a decline in new dwelling construction,
partially offset by continuing growth in alterations and additions (which makes
up more than 40% of dwelling investment).
The downside risk to this forecast is that households may choose to reinvest
their increased housing equity, which resulted from the recent rapid rise in
house prices, in other investment opportunities, such as the share market. In
this case, dwelling investment in 2003-04 will be weaker than currently
forecast.
Business Investment
Business investment is forecast to continue to be a major driver of growth in
2003-04. However, should business confidence be adversely affected by external
factors, lower business investment would result, resulting in slower economic
growth.
Inflation
Inflation has been forecast to remain around the middle of the RBA's 2-3% target
band in 2003-04. However, there is some likelihood that prices may rise by less
than forecast. Two of the major drivers of inflation in 2002-03, fuel and fresh
food, may well experience price falls in 2003-04 as the price effects of
geopolitical uncertainty and the drought dissipate. This would result in real
incomes rising more rapidly than currently forecast, with positive flow-on
effects on household consumption and employment.
MEDIUM-TERM OUTLOOK
Queensland Treasury provides projections for key economic parameters for the
three years following the immediate forecast period in the annual Budget and in
the Mid-Year Fiscal and Economic Review. The projections for the years 2004-05
to 2006-07, shown in Table 2.3, provide a broad indication of the likely path of
economic conditions in the State and nationally over the medium-term, rather
than point estimates of actual growth for this period.
World economic conditions are projected to improve, with economic growth in
Queensland's major trading partners assumed to grow at around 31/2%.
The following medium-term projections assume a continuation of the longer-term
Commonwealth Government fiscal policy and monetary stance of the RBA. These are
directed at the maintenance of a stable budget position and economic growth in a
low inflationary environment. In particular, the projections incorporate the
anticipated impacts of the Commonwealth Government's 2003-04 fiscal strategy and
Budget priorities.
Economic growth in Queensland is projected to return towards the average growth
rate over the past decade, with an increase of around 41/2% per annum projected
for the period to 2006-07. Average employment growth of 21/2% per annum over
this period is projected to outpace population growth of 13/4% per annum,
implying an ongoing improvement in the unemployment rate over the medium-term.
Queensland's economic growth is expected to remain higher than that recorded
nationally over the medium-term. However, for Queensland to sustain high rates
of economic growth over the longer-term, it is essential that the productive
capacity of the State's industries and workforce continues to be enhanced. This
is the ultimate aim of the Government's economic strategy, which is described in
detail in the following chapter.
Page 20
Table 2.3
Economic Parameters/Projections
(annual % change)OUTCOMEEst. ActualForecastProjections12001-02
%2002-03
%2003-04
%2004-05 to 2006-07
%Queensland Gross state product25.543/4441/2 Employment1.931/421/421/2
Inflation2.931/421/221/2 Average earnings32.941/441/433/4
Population2.021/421/413/4Australia Gross domestic product24.0331/431/2
Employment1.121/213/411/2 Inflation2.931/423/421/2 Average earnings34.331/4433/4
Population1.311/411/411/4
Notes: Decimal point figures indicate an actual outcome.
1. Average annual percentage change over the period.
2. Chain volume measure, 2000-01 reference year.
3. Average earnings are on a National/State Accounts basis.
SOURCES: QUEENSLAND TREASURY AND COMMONWEALTH TREASURY.
3. ECONOMIC STRATEGY
KEY POINTS
.. Queensland's economic strategy is focused on raising productive capacity,
given its importance in achieving sustainable economic growth, higher
living standards and greater employment opportunities - key economic and
social policy priorities of the State Government.
.. The economic strategy complements sound economic fundamentals with a Smart
State strategy that fosters innovation and invests in human capital, the
main drivers of productivity growth in a modern service-based economy.
.. The Government is focused on improving economic fundamentals through a
sound fiscal environment, ensuring an appropriate infrastructure base,
improving industry efficiency and regulatory reform, to enable industries
and businesses to make effective and efficient investment decisions.
.. In fostering innovation, the Government has implemented initiatives that
support the creation and adoption of new technologies, to raise the
productive capacity of established industries, and to foster growth in
emerging areas of technological opportunity where the State has a
competitive advantage.
.. The Government's investment in human capital focuses on education, training
and employment programs that promote successful labour market
participation, to provide more Queenslanders with the opportunity to make a
valuable contribution to society and to share the benefits of economic
progress.
AIMS OF THE ECONOMIC STRATEGY
The State Government's economic strategy is aimed at enhancing Queensland's
economic performance and providing a better quality of life for all
Queenslanders, in keeping with the Government's key economic and social policy
priorities outlined in its Charter of Social and Fiscal Responsibility.
One of the key objectives of the strategy is to raise the productive capacity of
Queensland's labour force and industries. A more productive workforce will
generate higher rates of sustainable economic growth. This will result in the
further development of the State's industries and regions, and lead to increased
employment opportunities for Queenslanders.
In turn, lower levels of unemployment and growth in household incomes will help
grow the revenue base needed to provide essential services throughout
Queensland's regions and to maintain the quality of the State's natural
environment and the safety of Queensland communities - providing a higher
standard of living for all Queenslanders (see Figure 3.1).
Page 21
FIGURE 3.1
QUEENSLAND'S ECONOMIC STRATEGY
The economic strategy is supported by the findings of the Drivers of Economic
Growth research project, which will be published shortly. This research project
was undertaken by senior academics, working in a collaborative partnership with
Queensland Treasury. The project sought to determine the main factors that have
impacted on the State's past economic performance and identify factors likely to
drive Queensland's economic growth in the future.
The Drivers of Economic Growth project highlighted the need to maintain
Queensland's existing sound economic fundamentals and enhance the traditional
drivers of growth, such as developing the State's physical infrastructure. More
importantly, the research highlighted the importance of focusing on those
factors embodied in the Government's Smart State strategy - fostering innovation
and investing in human capital. Along with maintaining sound economic
fundamentals, these factors will be the main drivers of improvements in
productive capacity and higher rates of sustainable economic growth for future
generations of Queenslanders.
THE IMPORTANCE OF IMPROVING PRODUCTIVE CAPACITY
People are the State's most valuable resource, creating output, income and
wealth through their skills, innovation and employment. Growth in the amount of
labour employed in an economy therefore directly contributes to the increased
production of goods and services. However, the extent to which people contribute
to economic activity depends primarily on their productive capacity - that is,
the rate at which they can convert economic inputs into valuable output.
Economic growth can be then seen as driven by two main factors: increases in
employed labour and the growth of labour productivity.
Chart 3.1 shows the contribution of these factors to economic activity in
Queensland and the rest of Australia between 1997-98 and 2001-02. This period is
often dubbed the New Economy era, due to the marked increase in labour
productivity and economic growth in the United States and other major economies.
Queensland generated average annual economic growth of 5.6% over this period,
well above the 3.6% growth recorded in the rest of Australia. Queensland's
faster economic growth was partly driven by stronger growth in employed labour,
that is, the total number of hours worked by the labour force. However,
two-thirds of the economic growth differential resulted from greater
productivity, with Queensland averaging annual productivity growth of 3.5%,
Page 22
compared with 2.1% in the rest of Australia.
CHART 3.1
DRIVERS OF ECONOMIC GROWTH: 1997-98 TO 2001-02
Source: Queensland State Accounts, ABS 6202.0 unpublished data.
Queensland's stronger growth in employed labour over this period has been partly
driven by faster population growth. This trend has in turn been underpinned by
strong interstate migration, with Queensland attracting an average annual net
inflow of more than 20,000 interstate migrants between 1997-98 and 2001-02. This
was more than five times the average inflow to Victoria, while all other states
recorded net outflows over this period. Net interstate migration swelled to over
29,000 persons in Queensland in 2001-02, more than 9,000 persons higher than in
2000-01 and representing the highest level in the past six years. Most recently,
net interstate migration totalled well over 9,000 persons in September quarter
2003, compared with a marginal inflow in Victoria and net outflows in all other
states.
However, the major source of economic growth in Queensland in recent years has
been the higher productivity of Queensland workers, reflecting the smarter use
of available resources. The key drivers of productivity growth are capital
deepening (providing workers and firms with access to greater amounts of
investment and higher quality capital infrastructure), efficiency improvements
(making better use of existing resources given current technology) and
technological progress (driven by innovation and improvements in human capital).
Growth in productive capacity is also the main source of improvement to
individual living standards over time. Productivity growth creates more output
from given inputs. This generates a greater amount of income to be shared among
citizens and raises real per capita incomes - the main economic indicator used
to measure living standards. Productivity gains can be passed on to employees in
the form of higher real wages, to consumers in the form of lower prices, or to
employers and shareholders in the form of higher dividends. In each case,
productivity gains ultimately result in higher real incomes.
Table 3.1 illustrates how accelerating productivity growth has driven growth in
real per capita output in Queensland over the past 15 years. Productivity growth
rose from a five-year average annual rate of 0.8% in 1991-92 to 1.7% in 1996-97,
before jumping to 3.5% in 2001-02. As a result, average annual growth in real
per capita output strengthened from 1.3% to 2.1% and 3.8% over the three
periods. This increased rate of growth was largely due to a rapidly increasing
contribution from labour productivity growth over the last 15 years.
TABLE 3.1
REAL OUTPUT PER CAPITA: 1987-88 TO 2001-02
(average annual percentage point contribution to growth) 1987-88 to
1991-921992-93 to
1996-971997-98 to
2001-02Real output per capita1.32.13.8Labour productivity0.81.73.5Employed
labour as a share of population0.50.40.3 Working age share of
population0.30.20.2 Rise in participation rate0.40.40.1 Fall in unemployment
rate0.00.10.3 Average hours worked-0.1-0.4-0.3
Source: Queensland State Accounts, ABS 3101.0, 6202.0 unpublished data.
The remaining growth in real per capita output over the past 15 years has
resulted from an increase in employed labour as a share of the population. This
has been
Page 23
underpinned by a rise in the working age share of the population as the
baby-boomer generation moved into the middle years of working life. There has
also been a rise in the labour force participation rate during this period,
underpinned primarily by increased female participation. A fall in the
unemployment rate, particularly since 1997-98, has also increased the share of
the population actively in employment.
The increase in employment has been partially offset by a reduction in the
average hours worked per employee in Queensland over the period. This primarily
reflects a greater incidence of part-time employment, which itself has been
partly due to a shift toward a more service-based economy. This trend towards
shorter average hours of work also highlights the extent to which Queensland
workers have become more productive - working smarter not longer, over the last
decade.
This increased productivity has raised per capita incomes, leading to increased
demand for goods and services, and making labour a more attractive resource to
employers. These factors stimulated employment demand and resulted in the
creation of more jobs - a key policy priority of the Queensland Government.
Chart 3.2 illustrates how Queensland has outperformed the rest of Australia in
terms of employment growth over the past two decades.
CHART 3.2
EMPLOYMENT GROWTH: 1982-83 TO 2001-02
(average annual % change)
Source: ABS 6202.0.
Productivity growth also plays an important role in the delivery of the
Government's social policy priorities. For instance, policies that create better
healthcare services or improve the efficient use of natural resources will raise
individual well being and improve environmental sustainability, respectively.
The rise in real incomes and employment generated by productivity growth also
gives the Government the means to increase spending on education, crime and
poverty prevention, cultural activities, regional development, health and aged
care, and environmental protection. As incomes increase, individuals also tend
to devote more time to other activities associated with a better quality of
life.
Emerging intergenerational issues also highlight the importance of productive
capacity as a source of sustainable growth. Intergenerational research by the
Queensland Government suggests that the population will slowly age over the
first half of the 21st century, as the baby-boomers move into retirement age.
This highlights the importance of productivity growth, and policies that
encourage increased labour force participation by youth and mature age workers,
to achieve sustainable growth in economic activity and living standards for
future generations. Box 3.1 provides more details of the Intergenerational
Research Project4 in Queensland Treasury and its implications for the State's
economic strategy.
Box 3.1
The Intergenerational Research Project
An important long-term issue confronting Queensland is the economic, social and
fiscal impacts of demographic change. It is projected that the Queensland
population will continue to age over the next 50 years, as fertility remains
below the replacement level and life expectancy continues to increase.
The State Government has initiated a whole-of-Government research program to
analyse
Page 24
the long-term sustainability of State finances and Queensland living standards
in the context of demographic change. A key finding of the Intergenerational
Research Project is the importance of the growth of productive capacity to the
welfare of Queenslanders over the long term. Put simply, an ageing population
means that the share of the population actively working will slowly decline.
This highlights the need to offset this trend through policies that raise
productivity growth and encourage labour force participation, to maintain strong
growth in overall living standards.
The project has highlighted several demographic issues relating to raising
long-term productive capacity, including:
.. The age structure of the workforce itself could influence productive
capacity. On average, older workers are more productive because long-term
participation in work builds skills. This means that the human capital
currently residing within the large baby-boomer age group will be difficult
to replace when this generation retires from the workforce.
.. Overseas and interstate migration will become more important sources of
labour and productive capacity in Queensland. Natural increase (births less
deaths) will decline as a source of population growth over the next 40
years, due to falling fertility rates and higher life expectancy. Policies
that attract skilled migrants to the economy, and training and employment
programs for migrants will become even more important in this respect.
Several policies within Queensland's current economic strategy aim to raise
long-term growth in productivity and living standards in the context of
population ageing. For instance, the Education and Training Reforms for the
Future package for secondary schooling aims to maximise the productive capacity
of the current generation of youth that will reach their prime years of working
life as the baby-boomer generation retires. Similarly, a commitment to building
a strong research and development infrastructure base in Queensland will raise
the State's innovative capacity as well as attract skilled labour to Queensland.
Finally, employment programs under the Breaking the Unemployment Cycle
initiative aim to skill and educate those at risk of repeated or long-term
unemployment spells, helping to raise the long-term potential for labour market
participation. These initiatives are outlined in more detail in the body of this
chapter.
The Intergenerational Research Project is continuing to evaluate the potential
impacts of population ageing on the Queensland Budget and economy. Additionally,
Queensland Treasury is liaising with other state and territory Treasuries to
evaluate the implications for Australia's states and territories as a whole.
Appendix D provides further information on this important issue.
A STRATEGY FOR SUSTAINABLE ECONOMIC GROWTH
The Queensland Government's economic strategy focuses on raising the productive
capacity of Queensland's labour force and industry, given the importance of
productivity to improving overall economic growth, living standards and
employment opportunities. The strategy aims to achieve this by improving
economic fundamentals, fostering innovation and investing in human capital (see
Figure 3.2). These are the main drivers of productivity growth in a modern
service-based economy, as highlighted by the Drivers of Economic Growth project.
FIGURE 3.2
BUILDING PRODUCTIVE CAPACITY
Page 25
Economic Fundamentals
The maintenance of a stable, supportive economic environment is a vital element
in enabling the State's industries and businesses to make effective and
efficient investment decisions. This has been underlined in recent years by the
resilience of the State's economy in the face of several major external threats,
including the Asian crisis, the introduction of the GST and in the aftermath of
international terrorist attacks.
The Government will continue to ensure Queensland enjoys an economic environment
that supports business development and promotes investment in physical and human
capital, the key drivers of sustainable economic growth. The key elements of the
economic strategy that achieve this aim are:
Providing a Sound Fiscal Environment
By maintaining and improving the State's sound fiscal position, the Government
will continue to promote business and investor confidence. A responsible fiscal
approach is also necessary to enable the Government to effectively target its
key social policies.
The key measure here is the underlying fiscal balance, as evidence of the
sustainability of the Government's revenue and expenditure policies. In
underlying terms, the fiscal position of the Government has strengthened during
2002-03. In the absence of poor investment returns, the General Government
sector would have recorded a significant surplus.
As outlined in the Charter of Social and Fiscal Responsibility, a critical
component of maintaining a sound fiscal environment in Queensland is ensuring
the services provided by the public sector are being delivered as efficiently
and effectively as possible - the ultimate goal of the State's Aligning Services
and Priorities (ASAP) process.
A key outcome of ASAP has been the Shared Service Initiative. This initiative
will result in new shared service providers servicing clusters of agencies,
while infrastructure services and applications support services will be
delivered by a new technology centre of skill.
This initiative will also lead to improved productivity in the public service,
reflecting the Government's broader economic strategy. Productivity growth in
the Queensland public sector benefits the community through more efficient and
cost-effective service delivery. It is also a major contributor to Queensland's
broader productive capacity, given that the public sector accounts for over
one-fifth of economic output and employs more than one-fifth of total employees
in the State.
Ensuring an Appropriate Infrastructure Base
Public and private infrastructure investment are crucial to raising the
productive capacity of workers and enhancing economic growth. Public sector
investment will continue to provide much of the key infrastructure needed to
allow business to operate more efficiently.
Capital outlays are estimated to be around $5.3 billion in 2003-04, representing
an 8% increase on 2002-03 estimated actual expenditure, and continuing the
four-year Priority Infrastructure Package introduced last financial year.
General Government capital expenditure per capita in Queensland remains higher
than in any other state.
The Government is focusing on more effective and innovative ways of encouraging
increased private sector infrastructure investment, as well as fostering greater
public and private sector collaboration on major infrastructure projects.
Initiatives aimed at achieving these objectives include the second round of
funding for the Smart State Research Facility Fund to be announced in early
2003-04. These
Page 26
funds will be channelled directly into assisting in the construction of
world-class science and technology research and development infrastructure. The
Government is also pursuing the Public Private Partnerships initiative,
encouraging private sector involvement in public sector infrastructure projects
in instances where it will result in more efficient outcomes for Queensland
taxpayers.
The energy sector, in particular, has seen significant private sector
involvement in Queensland in recent years. Of the $5 billion invested in the
National Electricity Market since the State joined in December 1998, $3.4
billion has been in Queensland, and 70% of that has involved the private sector.
This private sector involvement includes Intergen's $1.5 million Millmerran
power station and the 50% interest in CS Energy's $887.2 million Callide C power
station, as well as Tepco-Mitsui's 50% stake in Tarong Energy's $652 million
Tarong North power project.
Improving Industry Efficiency
The continued emphasis on improving the efficient operation of key industries,
particularly essential services such as energy, water, and transport, is vital
if Queensland industries are to become more productive.
Where clear public benefits arise, the Government will continue to implement
national reforms aimed at reducing the cost of inputs and removing impediments
to the creation of new firms. Increasing the efficiency of these industries is
particularly important as they provide significant inputs to production in
virtually all other industries. These reforms will ultimately help create more
efficient and productive firms and industries throughout the State, leading to
lower prices for Queensland consumers.
Improving the efficiency of our essential services is vital, not only for the
cost effectiveness of Queensland industry, but also to ensure the long-term
sustainability of Queensland's vast natural resources. Changes to the State's
water and energy policies over recent years demonstrate the Government's active
and effective management of these scarce resources. The following are some of
the more significant industrial reforms which have been introduced in recent
years or are currently being implemented in Queensland:
Water. The Government has made major advances in water reform over recent years,
including the corporatisation of SunWater and commercial reforms to the water
and sewerage businesses of the 18 largest local Governments. The Government has
also introduced the Water Act 2000, which makes provision for the trading of
water allocations to encourage an efficient market for water, while
consumption-based cost reflective pricing has also been introduced in recent
years. These reforms are collectively aimed at improving both the productivity
and environmental sustainability of the water industry.
Energy. The Government is committed to ensuring Queensland households and
industry have access to competitively priced electricity and gas, while ensuring
the greenhouse impacts of energy generation are appropriately managed. In
particular, the Government is taking a lead role in developing policies to
ensure investment in electricity transmission between the States is optimal,
facilitating electricity trade across jurisdictions and enhancing the
competitiveness of the industry.
Transport. Important recent reforms in the transport industry include the
approval of Queensland Rail's Access Undertaking, which allows third party
access to Government-owned rail lines and promotes greater competition in
Queensland's above-rail market. The Government has also committed to an
inter-governmental agreement, ensuring that the safety accreditation of
Queensland Rail operators will be recognised in other states. This allows for a
greater ease of movement for railway operators across state borders. The
efficiency of the State's public transport services will also be greatly
enhanced through the establishment of Translink, as an agency within Queensland
Transport, for the introduction of a coordinated and integrated public transport
system in South East Queensland.
Page 27
Sugar. In consultation with the sugar industry, the Government is currently
seeking to introduce a range of reforms to create a business environment that
will promote productivity gains and ensure the future sustainability of this
vital industry.
Focusing on Regulatory Reform
Regulatory reform promotes economic growth by removing or improving regulations
that hinder investment or competition and thereby impede business activity. The
State's regulatory reform process ensures that market regulation is in the
public interest, with reforms aimed at minimising the administrative burden on
Queensland businesses and structuring regulation so it provides the appropriate
incentives for investment. By June 2003, the Government will have completed a
substantial seven-year review of 140 pieces of legislation, aimed at eliminating
restrictions on competition.
Sound economic fundamentals are also crucial to supporting other key drivers of
economic growth, such as innovation. For instance, regulatory reform and
improving the efficiency and competitiveness of industries creates greater
incentives for firms to be more innovative and to learn from, adapt or use new
technologies. Fostering innovation forms the second key component of the
Queensland Government's economic strategy.
Innovation
Innovation involves the development of new and improved products or services and
their use throughout the wider economy. Private sector firms innovate by
creating new or improved products for consumers or developing more efficient
production processes. In both cases, innovation generates greater output from
given resources, and is thus a primary source of productivity growth, improved
living standards and better job opportunities. Public sector innovation is
generally focused on areas of important social benefit, such as the environment
and health, again providing a crucial source of improvement in people's standard
of living.
In addition to direct public sector innovation, the Government has an important
role to play in fostering a broader environment conducive to successful
innovation. This includes addressing incentives to innovate through intellectual
property rights, taxation and subsidy arrangements, and fostering a competitive
environment. It also involves raising the institutional capacity of the broader
innovation system by improving the availability of infrastructure, adequate
skills and opportunities for collaborative links between researchers, financiers
and entrepreneurs.
Recent international trends have highlighted the importance of innovation to
growth. The information and communication technologies (ICT) boom provides the
most recent example, boosting productivity growth in the United States and
spawning the New Economy era. The Organisation for Economic Cooperation and
Development (OECD) has also stressed the role ICT has played in raising
productivity and incomes in ICT-using, as well as ICT-producing countries. In
fact, the OECD singles out Australia as a case in point, where the latest
technologies have been used to work smarter across both traditional and new
industries.
Several indicators suggest that innovative activity has grown faster in
Queensland than in the rest of Australia in recent years.
For instance, research and development (R&D) spending represents an important
input to the innovation process. Chart 3.3 shows Queensland outperformed the
rest of Australia in terms of growth in R&D by business, higher education
institutions, and the Commonwealth and state governments over the decade to
2001-02. Significantly, businesses recorded the fastest R&D growth of any sector
over the period.
Chart 3.3
GROWTH IN R&D EXPENDITURE, 1992-93 TO 2001-02
(average annual % change)
Source: ABS 8112.0.
Page 28
The Drivers of Economic Growth project highlighted the importance of business
innovation in explaining interstate differences in economic performance. This
research showed that on average growth in business R&D spending could explain up
to 60% of labour productivity growth across the Australian states over the past
15 years, with the states that recorded the highest growth in business R&D, such
as Queensland and Western Australia, generating the highest productivity growth.
While R&D is an important input to innovation, patents provide one of the key
indicators of innovative output. In particular, the number of patents granted
per head of the population is often used to indicate the 'inventiveness' of
individual economies. Chart 3.4 illustrates that while Queensland scored
slightly lower on this ratio relative to the rest of Australia over the five
years to 1996-97, Queensland surpassed the rest of Australia in terms of the
number of patents per capita over the five years to 2001-02.
Fostering innovation is at the heart of the Smart State strategy. This strategy
aims to support the development and adoption of new technologies in order to
raise productive capacity and competitiveness in established industries, such as
mining and agriculture. It also aims to diversify the economy by fostering
innovation in emerging areas of technological opportunity where the State has a
competitive advantage, such as biotechnology.
Chart 3.4
Patents granted per Head of Population, Queensland vs Rest of Australia (average
annual patents per 100,000 residents)
Source: Intellectual Property (IP) Australia, ABS 3101.0.
Queensland's innovation strategy promotes economic growth and diversification by
providing R&D infrastructure to increase the innovative capacity of the economy,
forging private-public partnerships that ensure public sector innovations are
developed into commercial products that benefit the wider community, and
ensuring an environment conducive to successful private sector innovation. Major
initiatives include:
.. The Queensland BioIndustries Strategy. In May 1999, the Government
announced a $270 million 10-year BioIndustries Strategy to position
Queensland as a centre of excellence in biotechnology. This reflects
Queensland's competitive edge in this emerging growth industry.
Queensland's diverse natural resources provide the State with an advantage
in the development of products that will benefit society in areas of health
care, disease prevention and cure, food production and the protection of
the environment.
As part of this strategy, $15 million has been committed to infrastructure costs
and $77.5 million in operational funding over 10 years for the Institute of
Molecular Bioscience. This institute was officially opened in May 2003, as part
of the launch of the Queensland Bioscience Precinct at the University of
Queensland. The Institute is a world-class research facility that will provide
economic and social benefits across industries, including agriculture, health,
food, mining, environmental management and manufacturing.
.. The Smart State Research Facility Fund (SSRFF). This five-year $100 million
fund was established in 2001-02 to assist the construction of world-class
science and technology R&D infrastructure. The SSRFF reflects international
evidence that emerging areas of technological opportunity, such as
biotechnology and ICT, are dependent on strong public research foundations.
It also reflects Australian evidence that suggests funding for research
infrastructure is being outpaced by growing demand for research facilities.
Funding was allocated to six projects during the first round (2001-02). This
included up to $22.5 million toward a $70 million Institute of Health and
Biomedical
Page 29
Innovation at the Queensland University of Technology. This institute will
conduct research into injury prevention or rehabilitation, health development,
advanced diagnostics, molecular farming, tissues bio-regeneration and vision
improvement. The second funding round for the SSRFF is to be announced in early
2003-04.
.. Cooperative Research Centres (CRCs). CRCs bring together universities and
private and public sectors to maximise the community benefits from public
R&D. The Government has set up a competitive fund to assist State
applications to the Commonwealth CRC Program, with almost one-quarter of
national CRCs now having their headquarters in Queensland. Most recently,
$1.8 million has been provided over seven years to a CRC for Sugar Industry
Innovation through Biotechnology. Queensland CRCs cover industries such as
manufacturing, ICT, mining, energy, agriculture and medical science.
.. ICT Industry Development Strategy. This strategy includes initiatives such
as facilitating the development of industry clusters in multimedia,
e-learning, e-security and spatial information; expanding export
opportunities for ICT firms through the International Tradeshow Assistance
Program; and support for building the capacity of the regional ICT
industry. This strategy reflects both the direct importance of the ICT
industry as a source of employment and exports, but also its crucial role
as an enabling technology and source of competitive advantage across all
industries.
.. Innovation Start-Up Scheme (ISUS). This scheme provides pre-seed funding to
assist highly innovative start-up companies in commercialising their new
technology products or services. To date, funding has been awarded to 40
projects across areas such as ICT, biotechnology, electronics, mining,
environment, health and medicine, with almost half the recipients from
regional Queensland. The establishment of ISUS reflects growing evidence
that a lack of venture capital presents a major impediment to high
technology start-ups - a crucial part of the commercialisation and broader
innovation process.
Shortly after the State Budget, the Queensland Government will release a
document which details the State's investments in science, research and
innovation over the past five years and evaluates Queensland's performance in
achieving the Smart State vision. The document will also announce a
comprehensive four-year $100 million Smart State strategy, to be launched early
in 2003-04. Key areas of investment will include:
.. research - medical, cancer, biodiscovery, microtechnology
.. tropical marine science
.. clean coal technology
.. e-health and e-security
.. supercomputing
.. business incubation
.. skills development
.. developing existing industries
.. strategic partnerships
.. precinct for knowledge industries and community living
.. sports science.
Human Capital
Human capital reflects the skills that individuals have developed through formal
education, work experience and informal training, as well as their personal
characteristics. Increases in human capital are a crucial driver of better
employment outcomes, productivity growth and higher living standards in an
economy.
Table 3.2 shows that people with relatively higher education qualifications tend
to achieve better labour force outcomes. For instance, persons who only complete
education up to or below Year 10 are estimated to have unemployment and work
force participation rates of 10.2% and 60.5% respectively. This compares with
2.9% and 87.5% for persons holding a bachelor degree.
Page 30
Table 3.2
LABOUR FORCE OUTCOMES BY EDUCATION LEVEL, AUSTRALIA, 2001 Highest level of
education attainmentLabour force outcomesUnemployment rateParticipation
ratePostgraduate degree2.991.0Bachelor degree2.987.5Advanced diploma /
diploma4.882.4Year 127.076.4Year 10 or below10.260.5
Source: ABS 6227.0.
The Drivers of Economic Growth project highlighted the important role human
capital plays in explaining differences in per capita output across the
Australian states. In particular, the results indicated that interstate
variations in educational profiles could explain up to 87% of the difference in
per capita output between some states.
The importance of R&D and education in explaining interstate differences in
economic performance in the Drivers of Economic Growth project also highlighted
the interrelationship between innovation and human capital. Human capital
influences productivity growth through its effect on innovation, as it is
people's analytical and creative skills that determine the rate at which an
economy can create better products or absorb and improve upon technology
developed elsewhere. Similarly, innovation adds to human capital, either
directly through R&D activity, or indirectly by attracting highly skilled people
into the economy.
The importance of human capital as a driver of innovation, productive capacity
and economic growth forms a core part of the Government's Smart State strategy.
This strategy focuses on educating and skilling people so they have the best
opportunity to compete for and create jobs in new and emerging fields, as well
as applying their skills to revitalise and advance the growth prospects of
traditional industries. The following are major strategies fostering human
capital:
.. The Queensland State Education 2010 Strategy. This strategy outlines a
vision to advance public education to meet the unique challenges posed by
the transition to a globalised knowledge economy and society. The key
objective of this strategy is raising the completion rate for Year 12 from
68% in 1998 to 88% by 2010.
This focus reflects strong evidence that those who complete secondary school are
more likely to find employment and be productive workers. The Drivers of
Economic Growth project highlighted the importance of this particular stage of
education, with the results indicating that up to 66% of the differences in per
capita output between states could be explained by interstate differences in
secondary level education profiles alone.
.. Education and Training Reforms for the Future (ETRF). This package of
reforms provides funding to operationalise the Queensland State Education
2010 vision. It aims to implement initiatives in the early, middle and
senior years of schooling to raise high school completion rates and advance
the quality of secondary education, with trials beginning in selected areas
across the State over the first half of 2003-04.
Early years of schooling. A full-time preparatory year before Year 1 of school
is being trialled as part of the ETRF reforms. This initiative reflects research
indicating the importance of early childhood education to lifelong learning,
whereby early investment in human capital promotes investment in education and
skills upgrading through later stages in life.
Middle years of schooling. A new target for Queensland students to achieve
national Year 7 literacy and numeracy benchmarks by 2005, along with a greater
focus on the learning needs of students, will be introduced for the middle years
of schooling. This reflects growing evidence of the importance of basic literacy
and analytical skills as a foundation for innovation and economic growth.
Senior years of schooling. Legislation will be introduced that makes it
compulsory
Page 31
for youth to be 'learning or earning' up until 17 years of age. This involves
students staying in school until they complete Year 10 and then participating
for a further two years of study to obtain a Senior Certificate or Certificate
III vocational qualification. Young people engaged in full-time work provide the
only exception.
The ETRF strategy also aims to broaden pathways to further education and work,
by providing more flexible options for students, such as offering a wider range
of tailored courses and more school-based apprenticeships. This strategy
recognises that while the traditional route from a curriculum-based Senior
Certificate to university will still provide the main pathway for youth into
employment, it will not be suitable for all students or fields of study. The
reform package seeks to expand the Senior Certificate to include a broader range
of learning, including vocational education and school-based apprenticeships and
traineeships.
The reforms also provide more ICT for schools and professional development
training in ICT for teachers. The Government has met its objective of achieving
a ratio of one computer per five students on a statewide basis for Years 8 to 12
by 2002, and is making progress towards a similar ratio for Years 3 to 7 by
2005. The Government's commitment to ICT in schools not only reflects the
importance of being able to use and apply ICT as a source of greater
productivity and living standards, but also reflects growing evidence that ICT
has positive effects on student attitudes toward learning.
.. The Breaking the Unemployment Cycle initiative. This initiative encompasses
labour market programs aimed at improving the employment opportunities for
the long-term unemployed, groups at risk of long-term unemployment,
including young and mature aged individuals, and other disadvantaged job
seekers. Box 3.2 outlines the outcomes and rationales of several of the
Breaking the Unemployment Cycle labour market programs.
Box 3.2
Breaking the Unemployment Cycle ProgramsCommunity Employment Programs
These programs provide disadvantaged job seekers, including youth, the disabled
and people with non-English speaking or indigenous backgrounds, with a job in
community projects. The program gives participants the opportunity to gain
skills and work experience that will help them obtain ongoing employment. The
program also funds public and community organisations to provide assistance to
these groups in overcoming barriers to finding work. This assistance includes
vocational training, work experience and job search assistance.
The programs' focus on long-term unemployed persons reflects strong evidence
that long unemployment spells have both a de-skilling effect and impact on a
person's motivation or ability to search for work. A review of the Breaking the
Unemployment Cycle initiative found the Community Employment Programs
outperformed similar Commonwealth programs in terms of the share of participants
achieving ongoing employment.
Worker Assistance Program
The Worker Assistance Program is an early intervention program that provides
assistance for workers made redundant through large-scale retrenchments to find
alternative employment. Assistance includes training and skills development to
meet local labour market needs, job preparation assistance, wage subsidies and
relocation assistance. Nearly 4,000 people have been assisted since the
program's inception in 1999, with over 70% of those assisted living in regional
Queensland. The Program played an integral part in assisting Queenslanders
affected by the collapse of Ansett, with 1,021 of the 1,550 people who were laid
off receiving assistance in order to explore new job opportunities and avoid
long-term unemployment.
This program is consistent with research that highlights the importance of
supporting retrenched employees to re-skill and find new employment or
entrepreneurial opportunities and to avoid serious losses of human capital. It
also
Page 32
reflects evidence that nearly 40% of all entries into long-term unemployment
result from retrenchment.
Public Sector Employment Program
This program provides apprenticeships and traineeships for youth and other
disadvantaged job seekers in Government agencies, councils and other community
organisations. The program reflects evidence that traineeships provide a
successful path to ongoing employment in situations where a lack of experience
is a significant obstacle to finding work. The recent Breaking the Unemployment
Cycle review suggested such a program held particular value in regional
communities, by providing local job opportunities and delivering vital services.
Community Training Partnerships
This program provides accredited training and skill development in areas such as
literacy and numeracy, and support in accessing further training or job
opportunities. It is aimed at people who would benefit from an informal and
supportive learning environment that is often best offered in community-based
settings. The program engages industries and communities to identify local
skills and training requirements to develop training responses that address the
skills needs of a diverse range of disadvantaged job seekers and communities.
The initiative plays a crucial role in increasing human capital and productive
capacity in Queensland. By providing disadvantaged job seekers with
opportunities to develop skills through on-the-job training, the initiative
provides more Queenslanders the opportunity to make valuable contributions to
society and share in the benefits of economic progress. The initiative's focus
on long-term unemployment also reflects evidence that long spells of
unemployment can have a de-skilling effect.
The Government is committing $255 million in funding to extend the Breaking the
Unemployment Cycle initiative through to 2006-07. The Breaking the Unemployment
Cycle initiative's current target is to provide 56,000 apprenticeships,
traineeships and job placement opportunities over the six years to June 2004.
The initiative is on track to exceed this target, with almost 55,000 placements
secured by April 2003.
POSITIONING QUEENSLAND'S ECONOMIC FUTURE
The Government faces many challenges and opportunities as it positions
Queensland for the future. Evolving intergenerational issues, greater
globalisation and a diverse industry structure mean more traditional approaches
to fostering growth need to be complemented by forward-looking policies to
ensure continued improvement in living standards and greater job opportunities
for Queenslanders.
The State's changing demographics, as the population slowly ages over the first
half of the century, present a particular challenge. In this context, the ETRF
package for secondary schooling is an investment in the productive capacity of
the current generation of Queensland youth who will form the basis of the
workforce as the baby-boomer generation retires. This will help ensure
sustainable growth in living standards during demographic change. Similarly,
employment programs under the Breaking the Unemployment Cycle initiative aim to
skill and educate people at risk of repeated or long unemployment spells,
helping to boost the long-term potential for labour market participation and
raise individual living standards.
Queensland has an opportunity to overcome traditional constraints associated
with its geographical position and lower population density, with trade flows
becoming increasingly complemented by knowledge flows in the modern, globalised,
knowledge-based economy. Economies that will prosper in this environment are
those that develop intellectual property as a source of wealth creation and,
more importantly, are able to apply technologies developed elsewhere to bolster
growth in domestic industries. The Government's commitment to fostering human
capital, R&D and commercialisation as sources of innovative capacity will help
Queensland capitalise on the many growth opportunities offered by the
international economy.
An increasingly globalised economy also highlights the importance of a
diversified domestic economy, with Queensland showing resilience in the face of
recent external shocks such as the Asian crisis and geopolitical tension.
Diverse natural resources have provided the State with a competitive advantage
in traditional industries such
Page 33
as mining and agriculture, but also in emerging industries such as
biotechnology. The State's Smart State Strategy aims to build on these
advantages by investing in the productive capacity of people to continue to grow
the economy. It aims to skill individuals so they have the best opportunity to
advance growth prospects of traditional industries and to compete for and create
jobs in new fields. It also aims to support the development and adoption of new
technologies, such as ICT, in increasing productivity in established industries
and fostering growth in emerging areas of technological opportunity.
By complementing sound economic fundamentals with a strong investment in the
human capital and innovative capacity of its people, the State Government's
economic strategy aims to provide continued growth in employment opportunities
and to improve living standards for both current and future generations of
Queenslanders.
4. BUDGET PRIORITIES
KEY POINTS
.. Key areas for service enhancements in the 2003-04 Budget include health
services, a major increase in funding for disability services and increased
investment to foster innovation.
.. The health budget will increase by $300 million or almost 7% on last year's
budget including additional investment and service enhancements in acute
hospital care, elective surgery, home and community care and mental health.
Over the four years to 2006-07, the annual health budget will grow by over
$1 billion.
.. An additional $200 million in State funding over four years will enhance
disability services, including $35 million in 2003-04 to address service
viability and sustainability and a range of new and enhanced support
services. In addition, $90.5 million is provided over four years for grant
indexation, enterprise bargaining and other cost factors.
.. A Smart State Strategy will be launched early in 2003-04 which will include
a $100 million four-year package of initiatives with areas of investment
including medical and biodiscovery research, tropical marine science and
clean coal technology.
.. The Budget also provides for service developments and initiatives across a
range of other portfolios consistent with the Government's five key policy
priorities.
INTRODUCTION
This chapter details:
.. the Government's policy priorities which underpin the 2003-04 Budget
.. service delivery highlights for each of the Government's five key policy
priorities
.. Queensland's financial management and governance framework.
GOVERNMENT POLICY PRIORITIES
As part of its commitment to developing Queensland the Smart State, and ensuring
a better quality of life for all Queenslanders, the Government has a clear
agenda targeting five key policy priorities. These priorities were developed in
consultation with the community and underpin the continuing delivery of
Government services and development of new initiatives.
Underlying these policy priorities for the community, the Government remains
committed to high standards of accountability, leadership and innovation in
delivering services to the community and managing available resources.
The priorities continue to provide focus for the development of the Government's
Budget for 2003-04 across all portfolio areas. For each of the last three
financial years, the Government has formally assessed the efficiency and
effectiveness of its
Page 34
policies and activities in pursuing each of its key priorities. An assessment
has been published, in accordance with the Charter of Social and Fiscal
Responsibility, in the Government's Priorities in Progress Report. This ongoing
monitoring of the Government's services and policies is an important element in
guiding the Government in delivering ongoing services to the community and
developing new policy initiatives.
Box 4.1
Government's Five Key Policy PrioritiesMore Jobs for Queensland - Skills and
Innovation - the Smart State
The Government's Smart State strategy aims to diversify and strengthen the
Queensland economy, to encourage research and innovation, and to maximise
opportunities for Queenslanders to possess appropriate skills and knowledge. The
Government recognises that access to learning significantly enhances employment
opportunities and shared prosperity.
Safer and more supportive communities
The impact of crime and accidents on the community cannot be overstated. The
Government makes it a priority to address crime against people and property, to
reduce accidents, to protect children and to create a sense of safety within
Queensland's communities.
Community engagement and a better quality of life
The Government is committed to strengthening its engagement with the community
and working to ensure quality of opportunity and equitable access to high
standards of health, housing, family services, transport, and support for people
with a disability.
Valuing the environment
The State's natural resources and ecology are essential to its future. The
Government will protect Queensland's natural and cultural heritage to ensure
current and future generations enjoy a clean, liveable and healthy environment
that supports sustainable development.
Building Queensland's regions
Queensland is the most decentralised state in mainland Australia. The Government
will work with the regions to capitalise on their unique assets and resources to
provide economic growth, regional infrastructure and improve the liveability of
cities, towns, regions and remote communities.
SERVICE DELIVERY HIGHLIGHTS
This section provides a summary of key service delivery developments and
initiatives provided for in the Budget to support the achievement of the
Government's policy priorities. Although highlights of the Budget have been
described in terms of their primary impact on the community, many will assist
the Government in pursuing more than one key priority. More details on service
delivery development and initiatives can be found in individual Ministerial
Portfolio Statements.
More Jobs for Queensland - Skills and Innovation - the Smart State
The Government's Smart State strategy is about creating a stronger and
diversified economy and industries with jobs for the new century. Queenslanders
should be well educated and skilled to take up these jobs, now and in the
future, as well as having the life and social skills that enrich Queensland's
communities.
To contribute to this priority, this Budget provides for the following service
developments and initiatives:
Economic Development, Capacity Building and Job Creation
.. $82.9 million in grants and subsidies in 2003-04 through the Breaking the
Unemployment Cycle initiative which includes an additional $3.8 million
($19 million over four years) for the employment of 300 public sector
apprentices in targeted skill shortage areas. The Breaking the Unemployment
Cycle initiative will also be extended beyond 2003-04 to 2006-07 at a cost
of $85 million per annum.
Page 35
.. $26 million over four years ($6.9 million in 2003-04) to implement Making
Queensland's Future - A Manufacturing Development Plan to expand the
State's manufacturing base and improve international competitiveness, by
combining new initiatives with a refocusing and enhancement of existing
programs.
.. $8.7 million over three years ($2.7 million for 2003-04) for Indigenous
economic development by assisting to establish Indigenous businesses and
promoting Indigenous art exports.
.. Adopt new measures for the Smart State strategy, to enhance the innovative
capacity of the Queensland economy. Shortly after the Budget, the
Queensland Government will release a document, Queensland - Smart State -
Investing in Science, Research and Innovation which will detail a package
of $100 million over four years for a range of initiatives in areas
including medical and biodiscovery research, clean coal technology and
tropical marine science.
.. $1.8 million over seven years to establish a Co-operative Research Centre
for Sugar Industry Innovation through Biotechnology.
.. Facilitate the development of world-class science and technology
infrastructure through the second round of projects supported by the $100
million Smart State Research Facilities Fund.
.. An additional $3.3 million in 2003-04 to develop options for implementing a
new Queensland driver license. This will provide an opportunity to lead
Australia in the introduction of the latest developments for driver
licensing technology and potential to offer secure on-line transactions.
The Government is investigating whether delivering the project through a
Public Private Partnership will provide better value for money.
.. $10.8 million in 2003-04 to support continued operation of the Lexmark Indy
300 motor race on the Gold Coast.
Skilling Queenslanders
.. The 2003-04 Budget continues initiatives that will make the Education and
Training Reforms for the Future a reality. $18 million over three years has
been allocated to support the trial of a preparatory year of schooling in
addition to the funding for the reform package of $162 million over four
years which includes a substantial investment in information and
communication technologies (ICTs), and reforms to the senior phases of
learning that lead to further education, training or work.
Highlights include:
.. the extension of the trial of a preparatory year of schooling to better
prepare children before they enter school so they can achieve more in their
early years. These trials will be expanded in 2003-04 to an additional 25
schools including 20 State schools at a cost of $6.8 million;
.. A total of $67 million for ICTs including $35.6 million in funds through
the Education and Training Reforms for the Future ICTs for Learning
strategy which brings funding to a total of $67 million for ICTs for
2003-04. These funds will improve ICT access and ICT skills for students
and teachers; A total of $67 million for ICTs including $35.6 million in
funds through the Education and Training Reforms for the Future ICTs for
Learning strategy which brings funding to aof for 2003-04. These funds will
improve ICT access and ICT skills for students and teachers.
.. as part of this commitment the Government will provide an additional $1
million over two years to fund improved ICTs for non-State schools as part
of the Education and Training Reforms for the Future. This brings funding
for ICTs for the non-State schooling sector to a total of $4.7 million; and
.. $40.3 million for a three-year package to significantly improve outcomes
for all
Page 36
students and support students at risk of leaving school early. The first
tranche of $7.3 million will fund a range of initiatives for youth support
and local initiatives to improve opportunities in the senior phase of
learning.
.. In total, 636 additional teachers will be employed from Semester 1, 2004.
These are comprised of:
.. 327 teachers as the final stage of the Government commitment to employ an
additional 800 teachers over four years;
.. 249 teachers for enrolment growth; and
.. 60 teachers representing the second stage of the $60 million initiative
over four years to support students with disabilities.
This will bring the total number of additional teachers appointed since 1998 to
around 3,000.
.. $7 million as the first tranche of $45 million over three years for renewal
projects in primary and secondary State schools to support improved
educational services. This new program will build on the successful
Secondary Schools Renewal and Building Better Schools programs.
.. Continue airconditioning projects in 99 schools that were successful in
round four of the Cooler Schools program at an estimated cost of $16.7
million. These projects fulfill and exceed the Government's election
commitment to the Cooler Schools program. In addition 50 non-State schools
will be provided with a total of $2.7 million in 2003-04 under the
Government's Cooler Schools Program.
.. $149.7 million to construct three new schools, undertake staged work at 11
schools, acquire land for new schools and provide additional classrooms at
existing schools in growth areas throughout the State for the commencement
of the 2004 school year.
.. $63.2 million to replace and enhance facilities at existing schools, and to
provide additional and replacement toilet facilities.
.. $2.3 million to continue planning and examine private sector investment in
the development of the Southbank Education and Training Precinct which
incorporates the Southbank campus of the Southbank Institute of TAFE.
.. $5.5 million to establish a new Arts and Environmental Tourism campus at
Cooloola Sunshine Institute of TAFE at Noosa.
Safer and More Supportive Communities
Queenslanders live in safe communities by Australian standards. The Government
wants all Queenslanders to live in communities where they are protected from
harm, where the differences between people are respected, and where everyone is
treated fairly and with dignity. Safety and security, including services to
respond to incidents, are a critical priority for the Government.
A number of service developments and initiatives in the Budget contribute to
this priority:
Criminal Justice and Crime Prevention
.. The number of police officers will increase by approximately 300 in 2003-04
as the Service progresses towards the achievement of 9,100 officers by
2005.
.. An additional $30 million over two years commencing in 2003-04 to allow the
Queensland Police Service to continue implementation of the Service's
Information Management Strategic Plan 2001-10. The upgrade to existing
Police IT systems includes incident recording systems and the roll-out of
an Investigation Management System.
Page 37
.. An additional $5.3 million over the next two years for the South East
Queensland Drug Court trial.
.. $107.1 million in 2003-04 for the commencement of construction of a new
courthouse in Caloundra, the continuation of construction of new
courthouses in Brisbane, Richlands, and Thursday Island, and the upgrade
and refurbishment of courthouses at Hervey Bay, Mackay and Cooktown.
.. $1.7 million per annum to continue the expanded urinalysis drug testing
regime in community supervision across the State.
.. $8.2 million in 2003-04 for the finalisation of contracts and minor works
at the new correctional centre at Maryborough. The total cost of this
facility is $97 million.
.. $1 million in 2003-04 for the continuation of the trial of the Queensland
Aboriginal and Torres Strait Islander Police initiative in the Woorabinda,
Badu Island and Yarrabah communities.
.. Additional $0.9 million per annum commencing in 2003-04 for the
establishment of a DNA Sample Management Unit and to allow for the sharing
of DNA information with the Commonwealth and other jurisdictions through
the national DNA database.
.. $4.5 million per annum to continue community supervision programs including
activities such as advisory services to courts and boards and the
facilitation of offender intervention programs throughout the State.
.. $3.9 million in 2003-04 to build a modern, purpose-built accommodation
facility at the Cleveland Youth Detention Centre.
Personal and Public Safety
.. $32 million in 2003-04 as part of last Budget's $188 million four year
initiatives package aimed at achieving better outcomes for children, young
people and families, including strengthening the child protection system.
.. Additional funding of $16.1 million in 2003-04 to implement the Road Safety
Initiatives Package through activities of Queensland Transport, Queensland
Police Service and Department of Justice and Attorney-General. Funding will
cover administration and operational costs, speed camera capital items and
road safety, policy and legislation reviews.
.. An additional $6.3 million to the Queensland Ambulance Service (QAS) to
cater for increased demand. Funding includes an additional $2.7 million
towards employment of 110 extra officers and $3.6 million for buildings and
equipment.
.. Capital investments by the QAS in 2003-04 of $27.1 million, which includes
the commencement or completion of 17 replacement ambulance stations and
four new stations and $9.9 million for replacement ambulances.
.. Capital investments by the Queensland Fire and Rescue Service in 2003-04 of
$37.5 million, which includes $10.4 million for replacement of seven
stations and upgrade of a further nine stations or facilities. The Service
will invest $1.9 million for land purchases for future stations, $14
million in new or replacement urban vehicles as part of its fleet
replacement program to meet enhanced service delivery requirements, and
$3.8 million investment in 74 rural vehicles.
.. $1.7 million in 2003-04 of the $39.5 million project for works to improve
public safety on the Citytrain network throughout South East Queensland.
.. $3 million under the SchoolBUS program to assist with the purchase of
rollover compliant school buses less than five years old in non-urban areas
of the State.
Community Engagement and a Better Quality of Life
Page 38
The Government aims to deliver services that enable people to maintain and
improve the quality of their lives. The Government wants all Queenslanders to
take part in the rich cultural, social and economic life of the State.
The Government places a high priority on improving health service delivery to
the community.
The 2003-04 Budget also places a high priority on more effectively responding to
the needs of Queenslanders with a disability, their families, carers, advocates
and service providers.
Service developments and initiatives provided for in the 2003-04 Budget to
contribute to this priority include:
Health
.. Increased State funding of $7.5 million to bring total funding in 2003-04
for the Home and Community Care program to approximately $224 million. This
funding will increase the capacity of non-government organisations to
provide services such as domestic assistance, respite care, transport
assistance and community based nursing. An additional $1.2 million will
also be provided to assist non-government organisations to meet increasing
costs of service delivery.
.. An $8 million ($2 million in 2003-04) investment in additional medical
inpatient services at the Logan and Caboolture hospitals to relieve
pressure on accident and emergency departments. This funding is in addition
to a further $1 million provided to the Logan Hospital in 2003-04 for the
full-year effect of enhanced medical services.
.. An additional $10 million for the continuation of the Elective Surgery
Enhancement Initiative in Queensland's public hospital system. With the
funding allocation in 2003-04, Queensland Health will have spent an
additional $30 million since 2001-02 targeting waiting times for elective
surgery.
.. $40 million in increased funding to manage demand pressures for oncology
and cancer care services ($13.2 million), hospital inpatient and home care
renal dialysis services ($13.1 million), intensive care services ($6.2
million), cardiac services ($3.2 million), emergency services ($2.2
million) and patient transport assistance ($3.6 million).
.. $5 million to manage the increasing demand for dental care including
improved access and better management of waiting lists.
.. Increased funding of $8.4 million for mental health services including
funding for 40 additional community mental health staff and adult acute
services at the Princess Alexandra, Nambour and The Prince Charles
Hospitals, and psycho-geriatric inpatient services at the Townsville
Hospital.
.. $3 million to manage the increasing costs of a sufficient and safe supply
of quality blood and blood products.
.. $29 million for the redevelopment of State Government Residential Aged Care
facilities with planning, design and construction continuing in 2003-04.
.. $26.7 million for hospital redevelopment at the Ayr, Gympie, Herston
(Education Centre and demolitions) and Gold Coast (mental health) hospitals
in 2003-04.
.. $7.3 million in 2003-04 for the Queensland Health Skills Development Centre
at the Herston Campus to provide skills enhancement opportunities for
clinical, technical and procedural staff.
.. $29.8 million to commence the roll-out of replacement clinical and patient
administration systems. In addition, $2 million has been allocated
recurrently to the pilot of Queensland HealthLinks, an information
management project to replace
Page 39
the current patient information management system, which will provide a
clinical information system and promote patient focused, integrated care.
Community Support
.. An additional $200 million to Disability Services Queensland over four
years to implement Funding Reform Project initiatives. Of this, $35 million
is allocated in 2003-04 including:
.. $13.5 million ($79 million over four years) to enhance the viability and
sustainability of service provision to people with a disability, their
family and carers;
.. $4.5 million ($30.5 million over four years) for Support for Young Adults;
.. $5.5 million ($32 million over four years) for Urgent and Unavoidable Care
for Adults;
.. $7.5 million ($39 million over four years) to enhance support for children
and families; and
.. $3 million ($15.5 million over four years) for community enhancement
initiatives and Local Area Coordination.
.. An additional $90.5 million over the next four years to cover expenditure,
including indexation of existing grants to non-Government organisations,
depreciation, capital grants to service providers and the delivery of
disability services by the State.
.. $8 million over two years to allow Disability Services Queensland to
develop and establish a disability information system.
.. $12.5 million capital investment in 2003-04 to enhance disability services
delivered within the government and non-government sectors. This is part of
the Government's 2001-02 Budget commitment of $20 million capital funding
over three years for initiatives, including innovative accommodation
options for people with high support needs and new respite and family
support services.
.. $15.5 million for homelessness initiatives including the provision of an
additional 60 dwellings for transitional housing to provide improved
options for homeless people in crisis.
.. $48.9 million in capital grants to 34 discrete Aboriginal and Torres Strait
Islander Community Councils for constructing new houses and upgrading
existing dwellings.
.. $171.5 million for public rental housing allowing for the commencement of
300 dwellings, the completion of 239 dwellings and upgrades to existing
dwellings.
.. $12.5 million in funding and property to the Brisbane Housing Company for
the second year of the commitment by the Queensland Government which will
total $50 million over four years.
.. Redevelopment of the $15.7 million Cultural Centre busway station has
commenced with $12 million to be expended on construction during 2003-04.
The redevelopment is expected to be completed during 2003-04.
.. Construction of the Inner Northern Busway between Gilchrist Avenue and Roma
Street will continue with $42 million to be expended during 2003-04. This
stage is expected to be completed by December 2003 with a total project
cost of $135 million.
.. The Transit Development project was approved in the 2001-02 Budget to
progress to the introduction of an integrated ticketing system in South
East Queensland. This initiative will encompass standardised public
transport fares, zones and concessions. It will also include a new
contracting regime with transport operators in South East Queensland.
Funding of $21.4 million is provided in 2003-04 for
Page 40
capital expenditure to develop systems associated with the introduction of
a smartcard ticketing, due for implementation in 2004.
.. $10.9 million in 2003-04 to improve access to trains and train stations for
people with a disability across the Citytrain network in South East
Queensland and the Traveltrain long distance train network.
.. $1.5 million in capital funding in 2003-04 to upgrade the neighbourhood
centres and community facilities at a number of regional locations in a
three year program totalling $5.3 million.
Sense of Community and Fairness
.. $92.6 million for ongoing capital works for the Millennium Arts Project
including $3.8 million for the Musgrave Park Indigenous Cultural Centre.
.. $9.8 million recurrent funding for the Millennium Arts Project towards new
jobs, systems and equipment in preparation for the opening of new
facilities, including:
.. $4.8 million for the Queensland Gallery of Modern Art; and
.. $0.88 million for the Queensland Theatre Company, the Queensland Museum,
and regional initiatives.
.. An additional $2.1 million over four years for Queensland arts and cultural
organisations towards the provision of essential infrastructure and
operating funding and the extension of successful Arts Queensland programs.
.. An additional $1.1 million over four years to the Queensland Orchestra, the
Queensland Opera, the Queensland Theatre Company and the Queensland Ballet
as part of the Major Performing Arts Company funding agreements with the
Commonwealth Government aimed at ensuring the long term financial viability
of these organisations.
.. $4 million to the State Library of Queensland over four years towards the
continued acquisition of new book stock.
.. Additional funding of $1.9 million in 2003-04 to the Queensland Museum for
operational support for the Workshops Rail Museum, Ipswich.
.. $1.7 million to the State Library of Queensland, over three years, to
continue the Online Public Access in Libraries program. This program will
extend access to online databases and services as well as increasing the
digitisation of unique local pictures from regional and remote Queensland
communities.
.. Following a positive result from consultation with potential claimants, in
November 2002 the Government decided to proceed with its May 2002 Offer of
Reparation to Aboriginal and Torres Strait Islander Queenslanders whose
wages and savings were controlled from the 1890s to the 1980s under the
Protection Acts. The Government offer is a total of up to $55.4 million
($18 million in 2003-04) for individual reparation payments to people
assessed as eligible.
.. $3.1 million in 2003-04 as part of an ongoing funding initiative in the
2002-03 Budget to continue the implementation of Meeting Challenges, Making
Choices, the Government's response to the Cape York Justice Study. Over a
three-year period, government-community partnerships will be established to
address priority areas for Aboriginal and Torres Strait islander
communities, including alcohol and substance abuse, local crime and
justice, and community governance.
Valuing the Environment
Sustainable use of Queensland's natural resources, including maintenance of its
natural biodiversity, is critical to Queensland's social, economic and
environmental objectives. Queensland's strong population growth and diverse
economic development continue to place pressure on the State's natural
environment. The Government is committed to ensuring the State's air, water and
land quality provides a clean, liveable and healthy environment for
Queenslanders.
Page 41
Service developments and initiatives in the 2003-04 Budget build on recent
strategies, policies and reforms to address environmental priorities including:
.. An additional $75 million in State funding over five years as part of the
recently announced $150 million Commonwealth-State tree clearing reduction
package. The proposed package includes $130 million in financial incentives
to assist landholders with the transition, or for exit assistance if
necessary, $12 million in incentives to improve the management of more
valuable remnant vegetation, and $8 million to develop best practice for
farm management plans.
.. An additional $8 million over four years ($2 million in 2003-04) to support
the assessment, monitoring and enforcement of existing legislation
concerning vegetation, water, land and pests.
.. Additional $1.8 million in 2003-04 for the Great Artesian Basin
Sustainability Initiative. This will enable further bore capping, bore
rehabilitation and bore drain replacement projects to contribute to
enhanced environmental outcomes and improved water infrastructure
management practices.
.. An additional $3.5 million over four years ($0.5 million in 2003-04) to
resource the introduction and implementation of new cultural heritage
legislation which seeks to provide effective recognition and protection of
Aboriginal and Torres Strait Islander cultural heritage and establish
practical and workable processes for managing cultural heritage impacts.
.. $11 million in 2003-04 as part of the State's total funding of $81 million
over seven years for the National Action Plan for Salinity and Water
Quality which includes the Salinity Work Plan, the Water Quality Work Plan,
the Community Capacity Building Activities, and statewide social and
economic activities.
.. An additional $15.9 million over four years ($3.9 million for 2003-04)
towards the Statewide Forests Process, including funding for regional
assessments, industry restructuring and stakeholder engagement.
.. $19 million in 2003-04 for research and development, targeting the
sustainable productivity of primary industries.
.. $0.5 million for the investigation of the tenure change process in
association with the expansion of the conservation estate from forest
estate.
.. $0.5 million to provide a high standard of facilities in national parks on
Cape York to enhance visitation growth.
.. $3.2 million in 2003-04 for the continued development of Great Walks of
Queensland projects in the Mackay Highlands, the Sunshine Coast and Gold
Coast Hinterlands, Fraser Island, the Whitsunday region and the Misty
Mountains (Wet Tropics) areas, as part of a five year $10 million plan.
.. $1.3 million for the continuing acquisition of parcels of land for the
State's protected estate.
Building Queensland's Regions
More than one-third of all Queenslanders live in regional areas of the State.
The Government is committed to supporting Queensland's regions, capitalising on
their unique assets and resources. The Budget maintains the Government's
commitment to building Queensland's regions, involving the growth of regional
economies, regional infrastructure and improving the livability of cities,
towns, regions and remote communities.
Service developments and initiatives supporting this priority in the Budget
include:
Regional Economies and Infrastructure
Page 42
.. An additional $30 million over four years for sugar industry initiatives,
subject to the Commonwealth Government's continued commitment to the
Memorandum of Understanding on the sugar industry. The State's package
includes a $10 million Sugar Industry Innovation Fund, a $10 million Sugar
Industry Change Management Program and a $10 million Farm Consolidation
Loan Program. The Commonwealth Government's component of $120 million will
be funded from the sugar levy.
.. $25 million in 2003-04 for drought assistance activities including
resourcing and administering the Drought Relief Assistance Scheme,
Exceptional Circumstances Assistance and activities including farm
financial counselling, drought management and recovery workshops, climate
modelling and research into drought resistant plants.
.. $39 million in 2003-04 for the continued risk management of biosecurity
threats including $5.8 million for market assurance services, $10.2 million
for animal and plant health risk analysis and surveillance, and $23 million
for biosecurity responses.
.. $30.1 million over six years ($5.1 million in 2003-04) on a new Future
Directions Strategy for hardwood plantations and forest management
services, including investment to expand the hardwood plantation estate on
private and state-owned land in South East Queensland by a further 5,000
hectares.
.. $49.8 million for the Rockhampton - Townsville - Cairns Track Upgrade
project to renew life-expired track to enable freight trains to run more
efficiently between Rockhampton, Townsville and Cairns. The works include
resleepering, flood proofing, curve easing earthworks, formation and
drainage.
.. $2.4 million for the Cairns Tilt Train project in 2003-04 to finalise the
$138 million project to build two diesel tilt trains that will operate
between Cairns and Brisbane. The new trains are expected to come into
service in June 2003, further reducing travelling time by rail between the
two cities.
.. $94 million for the upgrading and acquisition of new coal and freight
rolling stock including $30 million for the acquisition of 11 x 4000 Class
Diesel Electric Locomotives to be built in Maryborough. The current program
is for the first locomotive to be commissioned mid-2004 and the final
locomotive commissioned mid-2005.
.. $30 million towards widening the Bruce Highway to six lanes between Dohles
Rocks Road and Boundary Road.
.. $26.9 million to continue construction of the Douglas Arterial in
Townsville between University Road and Upper Ross River Road.
.. $25 million towards planning and construction of the four lane Tugun Bypass
on the Pacific Motorway.
.. $13.7 million to complete the duplication of the Gatton Bypass on the
Warrego Highway.
.. $14.5 million to complete the Kawana Arterial on the Nicklin Way, Sunshine
Motorway.
.. $9 million to construct the South Johnstone bridge and approaches on the
Innisfail-Japoon Road.
.. $60.5 million in 2003-04 for Burnett Water Infrastructure Development,
including the Burnett River Dam, and the Eidsvold, Barlil and Jones (stage
2) Weir developments, to underpin substantial regional development in the
Wide Bay-Burnett region.
Page 43
.. $60.8 million in 2003-04 for common user infrastructure in Gladstone to
facilitate major industrial developments, including the Comalco Alumina
Refinery.
.. $64.4 million in 2003-04 for the completion of the Gold Coast Convention
and Exhibition Centre.
Regional Liveability
.. $50 million over four years (2003-04 to 2006-07) to extend the Regional
Centres Program to assist local governments with populations of more than
15,000 on a wide range of infrastructure and community facilities.
.. Capital grants of $14.5 million for water supply and sewerage upgrades and
the Torres Strait Major Infrastructure Program. This includes $3 million in
2003-04 as part of a $12 million four-year commitment in the 2002-03 Budget
to improve environmental health-related infrastructure in Indigenous
communities.
.. $1.8 million for construction and enhancements to council chambers at
Doomadgee, Lockhart River, Mapoon, New Mapoon and Woorabinda.
.. $2 million for regional capital projects as part of the ongoing Regional
Millennium Arts program, including a number of Indigenous projects.
FINANCIAL MANAGEMENT AND GOVERNANCE
Overview
High standards of financial management and governance are critical to the
Government's pursuit of its social and fiscal objectives. The Government's
financial regulatory and administrative framework supports the development and
management of its budget and ensures accountability to the community. The
foundation of financial management and accountability across the Queensland
Government is the Financial Administration and Audit Act 1977. This Act in turn
gives effect to the Government's Charter of Social and Fiscal Responsibility and
the Financial Management Standard 1997.
The Charter of Social and Fiscal Responsibility outlines the broad objectives
and priorities of the Government. This includes the Government's priorities for
the community in delivering its services, as well as the Government's fiscal
objectives. The Charter also outlines the requirements of the Government in
outlining its progress and achievements against its priorities for the community
outlined in the Charter.
The alignment of the Government's desired outcomes for the community, including
relevant indicators, and its key priorities is shown in Box 4.2 below. The
Government directs service delivery and other policies towards these priorities.
Ministerial Portfolio Statements prepared as part of Budget documents illustrate
how Department outputs, and more specific activities, contribute to these
priorities of the Government.
The Financial Administration and Audit Act 1977 and the associated Financial
Management Standard 1997 put in place a comprehensive framework of governance
and accountability for the Queensland Government and its agencies. This
legislation ensures that all Government departments and statutory bodies operate
within the boundaries of sound corporate governance and transparent
accountability to Parliament and the wider community. Key requirements of the
Government and its agencies include full compliance with relevant provisions of
Australian Accounting Standards, comprehensive planning and management of
organisational resources and services, and in-depth review of activities and
reporting of all Government entities by the Queensland Auditor-General.
The Charter of Social and Fiscal Responsibility and the current financial
management legislation reflect the financial management and accountability
reforms implemented across the Queensland Government under the Managing for
Outcomes framework. Building on that framework, a number of other major
initiatives have commenced to ensure that the Government's policy decisions and
agency activities continue to better focus on social, economic and environmental
outcomes for Queensland.
Page 44
Box 4.2
Alignment of the Government's Outcomes for the Community and Key Policy
PrioritiesPriority - More Jobs for Queensland - Skills and Innovation - the
Smart StateOutcomes
.. A community of well skilled and knowledgeable people
.. A strong, diversified economyIndicators of Success
.. Educational status of the community
.. Life skills, social skills and knowledge
.. Economic performance
.. Capacity building
.. Business diversity
Priority - Safer and more supportive communitiesOutcomes
.. Safe and secure communitiesIndicators of Success
.. Safety and security
Priority - Community engagement and a better quality of lifeOutcomes
.. Healthy, active individuals and community
.. A fair, socially cohesive and culturally vibrant society
.. Improved standard of living for all Queenslanders
Indicators of Success
.. Longevity
.. Health status
.. Sense of community
.. Community support
.. Fairness
.. Household income
.. UnemploymentPriority - Valuing the environmentOutcomes
.. A clean, liveable and healthy environment
.. Maintenance of the natural resource baseIndicators of Success
.. Air, water and land quality
.. Noise levels
.. Sustainable use of natural resources
.. Maintenance of biodiversity
Priority - Building Queensland's Regions
The Government is committed to ensuring that Queensland's regional communities
enjoy a level of community amenity appropriately equitable to that achieved for
the State capital for each of the above indicators and that Queensland can
capitalise on its unique regional assets and resources.
Managing For Outcomes
The Managing for Outcomes (MFO) framework is the Government's financial planning
and management model to ensure that allocation of the Government's resources is
efficiently and effectively aligned with the Government's priorities for the
community. Based on the implementation of output-based accrual budgeting and
management across the general government sector of the State Government, the
framework integrates planning, budgeting, performance management, and external
reporting.
The MFO framework emphasises the importance of a focused effort across the
Queensland Government towards setting and achieving the Government's priorities
and ensuring resources are being best directed to areas of greatest need and
benefit.
Page 45
In doing so, MFO encourages accountability for results, rather than the more
traditional reliance on compliance, and a more active and integrated approach to
managing service delivery and financial performance.
Aligning Services and Priorities
The Aligning Services and Priorities (ASAP) program commenced in 2001 and has
continued throughout 2002-03. ASAP was established by the Government to review
its operations and ensure that services provided by agencies are aligned with
the priorities the Government seeks to achieve for the community.
The objectives of ASAP are to:
.. align the corporate objectives and directions of departments with the
strategic outcomes sought by Government
.. identify opportunities to realign activities and resources to achieve the
Government's outcomes and to improve efficiency
.. review departments' current and planned activities that involve
cross-agency responsibility to ensure Government outcomes are effectively
achieved.
The overriding aim of this process is to ensure that Queensland Government
service delivery continues to provide value and meet the needs of the community,
and to provide greater flexibility in the allocation of resources to meet
emerging priorities.
The ASAP program consists of a number of agency specific and cross-agency
reviews, as well as whole-of-Government reviews including strategic information
management and corporate services.
Agency specific reviews are being pursued by most agencies to meet the ASAP
objectives listed above. Cross agency reviews are being progressed across
agencies to provide better alignment of agencies' activities where a number of
agencies contribute to individual outcomes. Activity relating to existing agency
specific and cross-agency reviews, and the identification of additional work as
required, will continue throughout 2003-04.
The whole-of-Government review of corporate services has progressed to
implementation to become the Shared Service Initiative.
Shared Service Initiative
The Shared Service Initiative is a whole-of-Government approach to corporate
services delivery. The vision is to provide high-quality and cost-effective
corporate support services to agency customers from centres of excellence. The
shared service approach standardises business processes, consolidates technology
and pools resources and expertise to deliver seamless, cost-effective and
client-focussed service. This initiative is expected to yield savings of over
$100 million per annum once fully implemented. These savings will be allocated
by the Government to key priority service delivery activities.
The initiative will be achieved through consolidating corporate services
functions across Government into five large-scale and two smaller-scale shared
service providers and a technology centre of skill. These providers will be
hosted by existing Government departments and provide services to a cluster of
client agencies.
Initial establishment of the shared service providers will occur on 1 July 2003.
Many corporate services professionals in agencies who provide corporate services
functions including finance, human resources (including payroll), and corporate
systems support, will transition to the agency's shared service provider or
technology centre of skill on this date.
In addition, applicable assets and liabilities associated with the delivery of
corporate services will be transferred to the new providers.
The details of the resources to be transferred are currently being finalised. As
a consequence, the 2003-04 Budget documentation including the Ministerial
Portfolio
Page 46
Statements reflects the resourcing arrangements in place prior to the
implementation of the Shared Service Initiative.
Priorities in Progress
A critical part of government accountability is the requirement to publish
regular, informative reports on the outcomes of the Government's activities
against previously announced priorities. The Charter of Social and Fiscal
Responsibility establishes a framework for assessing the Government's overall
performance in achieving progress towards its priorities, and ensures that
performance is not assessed purely against economic and financial criteria, but
that the social and environmental consequences are considered as well.
As a result, the Government has released the Priorities in Progress report to
inform the community about the efficiency and effectiveness of its activities in
delivering its priorities and community outcomes.
The third Priorities in Progress report, released in December 2002, informs the
community about the impact of the Government's policies and initiatives in the
2001-02 financial year. The report highlights areas where Queensland is
performing well, and identifies opportunities for improvement.
The Priorities in Progress Report 2002-03 may be viewed online at
www.treasury.qld.gov.au around December 2003.
5. REVENUE
KEY POINTS
.. Total General Government sector revenue is expected to increase by $1.469
billion (or 7.4%) over the estimated actual for 2002-03, to $21.382 billion
in 2003-04.
.. The previously announced Community Ambulance Cover, to commence from
2003-04, will replace the current ambulance subscription scheme and ensure
a secure funding base for the Queensland Ambulance Service.
.. From 2003-04, the land tax statutory deduction for residents will be
increased from $200,000 to $220,000. The exemption threshold for companies,
trustees and absentees will be increased from $150,000 to $170,000. In
addition, the minimum required payment for land tax will be increased from
$100 to $350. As a result, there will be 6% fewer land tax payers in
2003-04 than in 2002-03.
.. Per capita tax collections (on a GFS basis) are estimated at $1,480 in
2003-04 compared to an estimated average of $1,892 for the other states.
INTRODUCTION
This chapter provides an overview of General Government sector revenue for the
estimated actual outcome for 2002-03, forecasts for the 2003-04 Budget year and
projections for 2004-05 to 2006-07.
The forward estimates are based on the economic projections outlined in Chapter
2 and are formulated on a no policy change basis.
Table 5.1
General Government Revenue12002-03
Budget2002-03
Est. Actual2003-04
Budget2004-05
Projected2005-06
Projected2006-07
Projected$ million$ million$ million$ million$ million$ millionRevenueTaxation
Revenue4,9095,5115,6645,9516,1176,454Current Grants and
Subsidies9,47710,07110,38910,84711,41711,958Capital Grants462477480419331316
Sales of Goods and Services1,8141,8801,9141,9181,9582,002Interest
Income1,116(247)1,0381,1091,1741,238Other2,4022,2211,8971,9422,1102,129Total
Page 47
Revenue20,18119,91321,38222,18623,10724,097
Note:
1. Numbers may not add due to rounding.
General Government revenue in 2002-03 is estimated to be $268 million or 1.3%
less than the 2002-03 Budget estimate. Significant variations include:
.. interest income in 2002-03 down by $1.363 billion, reflecting the poor
performance of domestic and international equity markets which has impacted
on the returns from the State's substantial employee entitlement
investments
.. taxation revenue exceeded the Budget estimate in 2002-03 by $602 million,
primarily due to higher revenue from duty on property transfer transactions
resulting from significant growth within the housing and non-residential
property sector
.. grants from the Commonwealth Government were higher than budgeted,
reflecting additional specific purpose payments and higher GST payments,
following upward revisions in the Commonwealth Budget
.. other revenue was lower than the Budget estimate, reflecting lower royalty
payments due to an increase in the exchange rate, lower than expected coal
production, and lower than expected prices for base metals, precious metals
and coal.
In addition, revenue related to industry and community contributions has been
reclassified from other revenue to current and capital grants since the 2002-03
Budget.
General Government revenue in 2003-04 is estimated to be $21.382 billion, an
increase of $1.469 billion or 7.4% over the 2002-03 estimated actual of $19.913
billion. This is largely due to:
.. increased interest income, based on the return to the long term average
earnings rate of 7.5% on investments
.. moderate taxation revenue growth, despite a forecast reduction in duty
revenues associated with an anticipated slowdown in property market
activity
.. moderate growth in grants from the Commonwealth Government.
REVENUE BY OPERATING STATEMENT CATEGORY
A major source of General Government revenue is Current Grants and Subsidies
(49% of revenue). State Taxation Revenue comprises a further 26% of revenue.
Chart 5.1 illustrates the composition of General Government revenue.
Chart 5.1
Revenue by Operating Statement Category 2003-04
Note:
1. The major components of Other Revenue are dividends (3.0%), royalties (3.4%)
and tax equivalent payments from public corporations (1.2%).
Chart 5.2 compares the composition of General Government revenue, based on
2002-03 estimated actuals and 2003-04 estimates.
Overall growth primarily reflects anticipated increases in interest income,
together with modest growth in taxation revenue, and grants and subsidies.
Chart 5.2
Revenue by Operating Statement Category for 2002-03 and 2003-04
TAXATION REVENUE
One of the Queensland Government's key social and fiscal objectives is to
maintain a competitive tax environment while raising sufficient revenue to meet
the infrastructure and Government service delivery needs of the people of
Queensland.
Page 48
Total revenue from taxation is expected to increase by 2.8% in 2003-04. Despite
the impact of an anticipated slowdown in property market activity on transfer
duties, strong economic and employment outcomes are expected to lead to solid
growth across a range of other taxes in 2003-04.
Taxation can impact on business decisions regarding investment and employment.
It is important therefore to maintain a tax system that minimises distortions to
private sector economic activity and maximises equity. By maintaining
competitive tax rates, Queensland provides a competitive advantage to business
and a moderate tax burden for its citizens.
The maintenance of Queensland's competitive tax status is fundamental to the
Government's commitment to job creation and economic development.
Although total taxation revenue is expected to increase due to factors such as
economic and population growth, the State continues to maintain competitive tax
levels in relation to other states. This reflects the Government's Charter
commitment to ensure that state taxes and charges remain competitive with the
other states.
Box 5.1 discusses a range of comparative measures of tax competitiveness, all of
which indicate that the Queensland state tax system is amongst the most
competitive in Australia.
Chart 5.3 shows that Queensland's taxation revenue raising effort, as assessed
by the Commonwealth Grants Commission, has remained below the Australian policy
standard (equal to 100%) for some time. The moderate increase in effort from
2000-01 primarily reflects the abolition of taxes in other states which
Queensland did not collect (for example, financial institutions duty).
Chart 5.3
Taxation Revenue Raising Effort Ratios for Queensland
Note:
1. Financial Assistance Grant relativities are used to 1999-00, GST relativities
from 2000-01.
Source: Commonwealth Grants Commission.
Box 5.1
Measuring Queensland's Tax CompetitivenessThe competitiveness of a state's tax
system is usually assessed by using one of the following measures:
.. taxation revenue on a per capita basis
.. taxation relativities based on Commonwealth Grants Commission methodology
.. taxation revenue expressed as a percentage of gross state product.
Queensland's competitive tax position is confirmed by all three measures, as
shown in Table 5.2.
Table 5.2
Queensland's Tax CompetitivenessQLDNSWVICWASATASACTNTAvg4Taxation per Capita1
($)1,4802,0531,9101,8001,5511,1221,9801,2401,892Taxation Effort2
(%)85.7100.7107.897.5110.792.897.696.5n.a.Taxation % of GSP3
(%)4.05.34.83.84.74.34.12.54.8
Notes:
1. 2003-04 data. Estimates are on a GFS basis.
Sources: State Budget Papers and Mid-Year Review papers for NSW, SA and NT.
2. 2001-02 data. GST relativities are used to reflect states' post-tax reform
revenue capacities.
Source: Commonwealth Grants Commission: 2003 Update.
3. 2001-02 data. Source: ABS 5506.0 and ABS 5220.0.
4. Weighted average of other states, excluding Queensland.Taxation Revenue Per
Capita
Per capita collections of state taxation, on a GFS basis, in Queensland in
2003-04
Page 49
are estimated at $1,480, compared with an estimated $1,813 for the national
average. The average tax burden of all the other states, excluding Queensland,
is $1,892, or 28% higher than Queensland's per capita taxation for 2003-04.
Per capita comparisons only provide a partial measure of tax competitiveness
since low per capita taxation may reflect limited revenue capacity rather than a
policy intent to maintain low rates of taxation. For this reason, measures which
adjust for the varying capacities of states to raise revenue are more indicative
of the underlying tax policy settings of states.
Commonwealth Grants Commission's Revenue Raising Effort Ratios
The Commonwealth Grants Commission's revenue raising effort ratios provide an
impartial and independent assessment of relative state tax competitiveness by
isolating policy impacts from revenue capacity impacts. Revenue raising effort
ratios are calculated as the ratio of actual revenue to standardised revenue,
where standardised revenue is determined by the application of national average
tax rates to a state's assessed revenue base.
Queensland's taxation effort ratio of 85.7% in 2001-02 indicates the State's
taxation effort was considerably less than the national policy standard. This
confirms Queensland's taxation policies are competitive when compared with those
of other states.
Taxation Revenue Relative to Gross State Product
A third way of comparing relative tax burdens is taxation revenue measured as a
proportion of gross state product (GSP) - that is, as a proportion of the value
of goods and services produced in the state. This measure broadly relates the
tax burden to the economy's capacity to pay and thereby is an indicator of the
tax impost on the economy. Table 5.2 compares taxation revenue as a percentage
of GSP across all states for 2001-02 - the latest published ABS data. The
analysis confirms Queensland's competitive tax status against the other states,
with Queensland state taxation at 4.0% of GSP compared to the weighted average
of the other states (excluding Queensland) of 4.8%.Revenue from State taxes is
summarised in Table 5.3.
Table 5.3
Taxation Revenue12001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Payroll
Tax1,202.01,287.01,363.56.0DutiesTransfer21,055.81,370.01,220.0(10.9)Vehicle
Registration3184.3210.0219.54.5Insurance4238.0286.8299.34.4Mortgages
143.8180.0158.0( 12.2)Other Duties5106.096.399.73.6Total
Duties1,727.92,143.11,996.6(6.8)Gambling Taxes and Levies6Gaming Machine Tax and
Levies7322.2373.3404.28.3Lotteries Taxes159.6171.0177.84.0Wagering
Taxes27.328.930.35.0Casino Taxes and Levies52.853.255.95.0Keno
Tax6.811.412.05.0Total Gambling Taxes and Levies568.8637.8680.26.6Other
TaxesLand Tax230.8277.9314.513.2Debits Tax199.8190.0185.0(2.6)Motor Vehicle
Registration595.5645.0676.64.9Fire Levy191.8205.7215.64.8Community Ambulance
Covern.a.n.a.105.0n.a.Guarantee Fees57.966.074.112.2Other
Taxes40.458.253.1(8.6)Total Taxation4,814.85,510.65,664.22.8
Notes:
1. Numbers may not add due to rounding.
2. With the commencement of the Duties Act 2001, Conveyancing Duty has been
renamed Transfer Duty.
3. With the commencement of the Duties Act 2001, Motor Vehicle Transfers Duty
has been renamed Vehicle Registration Duty.
4. Includes accident insurance premiums (formerly referred to as workers
compensation premiums).
5. Includes duty on leases, rental arrangements, credit business, marketable
Page 50
securities and life insurance premiums.
6. Includes community benefit levies.
7. Includes the Major Facilities Levy.
Payroll Tax
Payroll tax collections are estimated to increase by 6.0% in 2003-04, reflecting
growth in employment and wages.
The payroll tax rate has been reduced in recent years from 5% to its current
level of 4.75%. Queensland's payroll tax rate is overall the lowest of any
state. Further, an employer paying taxable wages of less than $850,000 per annum
is not liable for payroll tax. This threshold is one of the highest of any
state.
Duties
Duties are levied on a range of financial and property transactions. Overall,
total revenue from duties is forecast to decrease by 6.8% in 2003-04. This is
largely driven by declining revenues from transfer and mortgage duty due to an
anticipated moderation in housing and non-residential property transactions from
very high levels of activity in 2002-03.
Vehicle registration duties and insurance duties are expected to achieve
positive growth in 2003-04 in line with projections for activity within these
sectors. Receipts from other duties are estimated to increase in line with
market activity.
Gambling Taxes and Levies
A range of gambling activities are subject to state taxes and levies. Total
gambling tax and levy collections are estimated to increase by 6.6% in 2003-04.
Land Tax
Land tax is estimated to grow by 13.2% in 2003-04 due to increases in land
valuations across the State. The Government's application of three-year
averaging - whereby the land value is determined by averaging the unimproved
property values for the current and preceding two years, rather than simply
using the current year valuation - has mitigated the impact of these valuation
increases on land tax payers. It is estimated that the revenue foregone as a
result of three-year averaging was approximately $33 million in 2002-03.
Queensland is the only state to apply three-year averaging to land tax.
From 2003-04, the land tax statutory deduction for residents will be increased
by $20,000, from $200,000 to $220,000. The exemption threshold for companies,
trustees and absentees will also be increased by $20,000, from $150,000 to
$170,000. In addition, the minimum required payment for land tax will be
increased from $100 to $350.
The measures will increase the value of land holdings before residents become
liable for land tax from $221,665 to $275,997. The deduction for the principal
place of residence and the 15% land tax rebate will remain. The increase in the
exemption threshold to $170,000 for companies, trustees and absentees will be
accompanied by the extension of the phasing-in rebate from its current expiry at
$215,000 to a new expiry of $235,000.
The measures will reduce the number of resident taxpayers in 2003-04 by around
11,400 relative to the number of taxpayers in the absence of these changes.
There will be approximately 3,050 fewer resident taxpayers in 2003-04 compared
to 2002-03.
Further, all resident tax payers will receive a tax benefit from the increase in
the statutory deduction.
The measures will also limit the increase in the number of company, trustee and
absentee taxpayers to 450. Without the threshold increase, the number of
company, trustee and absentee taxpayers would have grown by approximately 2,750.
In addition, another 4,660 companies, trustees and absentees will receive a tax
benefit from the extension of the phasing-in rebate.
Page 51
In total there will be a 6% decline in the number of land tax payers in 2003-04
compared to 2002-03. Tax paying companies, trustees and absentees with land
holdings of less than $235,000 and all resident land tax payers will benefit
from the changes.
Debits Tax
Debits tax is levied on debits to accounts with a cheque drawing facility.
Debits tax revenue is expected to decline by 2.6% in 2003-04. This decline
reflects an increasing trend towards the use of non-cheque payment mechanisms.
Motor Vehicle Registration Fees
Motor vehicle registration is influenced primarily by the growth of the vehicle
fleet and fee adjustments related to the consumer price index (CPI).
Fire Levy
Fire levy revenue, which is used to fund the Queensland Fire and Rescue
Authority, is expected to increase in line with the growth of contributors and
CPI.
Community Ambulance Cover
The previously announced Community Ambulance Cover, to commence from 2003-04,
will replace the current ambulance subscription scheme and ensure a secure
funding base for the Queensland Ambulance Service.
Community Ambulance Cover will replace the voluntary Queensland Ambulance
Service Subscription Scheme and transport charges for non-subscribers, reported
under Sales of Goods and Services in 2002-03. It will be collected through a
payment of $22 per quarter on electricity accounts.
Guarantee Fees
Guarantee fees are revenues collected by Queensland Treasury Corporation (QTC)
on behalf of the State and comprise performance dividends, competitive
neutrality fees and credit margin fees. These fees promote competitive
neutrality between public sector agencies and those in the private sector, and
ensure that the benefits accruing from the financial backing and superior
borrowing performance of the State (through QTC) are shared between the borrower
and the State. Guarantee fee revenues are expected to grow moderately in
2003-04.
Other Taxes
Revenue from other taxes includes the Statutory Insurance Scheme Levy, the
Nominal Defendant Levy and other sundry taxes.
Tax Expenditures
Taxation expenditures are reductions in tax revenue that result from the use of
the taxation system as a policy tool to deliver Government policy objectives.
Taxation expenditures are provided through a range of concessions, including:
.. tax exemptions
.. the application of reduced tax rates to certain groups or sectors of the
community
.. tax rebates
.. tax deductions
.. provisions which defer payment of a tax liability to a future period.
Appendix A provides details of tax expenditure arrangements set in place by the
Queensland Government.
GRANTS AND SUBSIDIES
Current grants and subsidies comprise revenues from the Commonwealth, grants
from the community and industry, and other miscellaneous grants.
The moderate growth of 3.1% in 2003-04 largely reflects the expected growth in
Commonwealth grants.
Table 5.4
Grants and Subsidies12001-02
Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
Page 52
$ millionChange
Budget over Est. Actual
%Current Grants and SubsidiesCommonwealth Grants9,126.19,712.410,063.13.6Other
Grants and Contributions394.3358.1326.1(8.9)Total Current Grants and
Subsidies9,520.410,070.510,389.23.2Capital Grants and SubsidiesCommonwealth
Grants511.7456.7456.80.0Other Grants and Contributions184.620.323.415.4Total
Capital Grants and Subsidies696.3477.1480.20.7Total Grants and
Subsidies10,216.710,547.610,869.43.1
Note:
1. Numbers may not add due to rounding.
Commonwealth Payments
Commonwealth payments to Queensland in 2003-04 are expected to total $10.52
billion, an increase of $350.7 million or 3.4% over payments in 2002-03.
Commonwealth payments to Queensland in 2003-04 will comprise:
.. General purpose payments, which include GST revenue grants, Budget
Balancing Assistance (BBA) and National Competition Policy (NCP) payments.
General purpose payments are "untied" and are used for both recurrent and
capital purposes.
.. Specific purpose payments (SPPs), including grants for health, education
and transport, which are used to meet Commonwealth and shared policy
objectives.
Table 5.5
Commonwealth Payments12001-02
Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%General Purpose PaymentsGST Revenue Grants5,018.65,880.86,193.45.3Budget
Balancing Assistance524.437.90.0(100.0)National Competition Policy
Payments2147.9138.9146.25.3Total General Purpose
Payments5,690.96,057.66,339.64.7Specific Purpose Payments3Health
1,543.71,681.31,722.92.5Education1,064.51,165.01,239.86.4Local Government and
Planning258.5274.6285.54.0Employment and Training
184.7193.9188.5(2.8)Housing200.6201.7179.6(11.0)Treasury155.473.467.9(7.6)
Disability Services Queensland97.3102.8106.13.2Main
Roads255.3222.8255.914.9Families27.728.528.2(0.9)Other159.1167.5105.8(36.8)Total
Specific Purpose Payments3,946.94,111.64,180.31.7Total Commonwealth
Payments9,637.810,169.210,519.93.4
Notes:
1. Numbers may not add due to rounding.
2. The 2001-02 payment includes the reinstatement of $12.9 million suspended
from 2000-01 payments.
3. Specific Purpose Payments are shown below by relevant Queensland Government
department.
The estimates are generally consistent with estimates provided in the 2003-04
Commonwealth Budget. However, small differences between SPPs in this Chapter and
Commonwealth Budget estimates can arise and generally reflect the outcome of
agency to agency discussions and negotiating between the State and the
Commonwealth. Chapter 8 provides more detailed background on Commonwealth-State
financial arrangements.
General Purpose Payments
Page 53
GST Revenue Grants
The GST revenue grant to Queensland in 2003-04 is expected to be $6.193 billion
which represents an increase of $312.6 million since 2002-03.
GST revenue projections are based on consumption estimates, which incorporate
assumed growth in the outyears. The distribution of these revenues is based on
the recommendations of the Commonwealth Grants Commission in accordance with the
application of horizontal fiscal equalisation principles.
Budget Balancing Assistance
Under the Intergovernmental Agreement on the Reform of Commonwealth-State
Financial Relations (IGA), the Commonwealth guaranteed that no state would be
worse off as a result of national tax reform. The guaranteed minimum amount
(GMA) has been used by Commonwealth and state governments as a benchmark for the
funding each state would have received had national tax reform not been
implemented.
To meet this guarantee, any shortfall between a state's GMA and its share of GST
revenue is met by BBA funded by the Commonwealth.
Queensland is not expected to receive any BBA in 2003-04, since GST revenue
grants are expected to exceed the GMA.
National Competition Policy Payments
The distribution of NCP payments is population based and payments depend on the
states making satisfactory progress with the implementation of the specified
reforms. NCP payments to Queensland are expected to be $146.2 million in
2003-04.
Specific Purpose Payments
SPPs for Queensland in 2003-04 are estimated at $4.180 billion, an increase of
1.7% from 2002-03. Table 5.5 provides the distribution of SPPs by Queensland
Government department.
Health
Queensland receives funding for public hospital and other health services from
the Commonwealth under the Australian Health Care Agreement (AHCA). The AHCA
provides the majority of Queensland Health's revenue from the Commonwealth, and
is adjusted each year for population growth and increases in costs and
utilisation of hospitals. The 1998-2003 AHCA is due to expire on 30 June 2003.
States are currently negotiating the terms of the 2003-2008 AHCA with the
Commonwealth. Based on the Commonwealth's offer received in April 2003,
Queensland will receive AHCA payments of approximately $1.4 billion in 2003-04,
an increase of approximately 6% on 2002-03. The AHCA payments include $51.3
million to cover mental health, palliative care and quality programs as well as
the Commonwealth's Pathways Home Program. The Commonwealth's offer is contingent
on the State meeting a number of conditions including matching funding and
performance reporting requirements. States are continuing to negotiate the
overall AHCA package including the various terms and conditions. Further
discussion of the AHCA is contained in Chapter 8.
In 2003-04, Queensland Health will also receive an estimated $262.4 million in
recurrent and capital funding from the Commonwealth for a range of specific
health programs. These include home and community care, public health and
high-cost drugs. Queensland Health will also receive an estimated $46.0 million
for nursing home benefits.
Education
Commonwealth SPPs to the Department of Education comprise recurrent education
grants for distribution to state and non-state schools and other organisations.
A 6.8% increase in recurrent grants in 2003-04 reflects enrolment growth and
commencement of new programs. Capital SPPs, received for capital expenditure on
state schools and capital grants to non-state schools, will remain broadly in
line with the 2002-03 estimated actuals.
Local Government and Planning
Commonwealth recurrent SPPs to the Department of Local Government and Planning
are grants to Queensland Local Government Authorities (formerly grants to Local
Page 54
Authorities Trust Fund).
Employment and Training
In 2003-04, the Department of Employment and Training will receive $188.5
million in SPP funding from the Commonwealth for a range of vocational education
and training programs. This represents a decrease of 2.8% on 2002-03. The
decrease in funding can be predominately attributed to cessation of funding for
Industry Training Advisory Bodies, Access to Prevocational Training and
Australian National Training Authority (ANTA) Strategy, and one-off payments for
National Priority programs being received in 2002-03.
Housing
Whilst negotiations with the Commonwealth on the next Commonwealth-State Housing
Agreement are still being finalised, the Budget estimate reflects the
Commonwealth's funding offer which represents a decrease of 11% over estimated
payments in 2002-03. This is principally due to the cessation of Commonwealth
funding compensation for the impact of the GST on the costs of providing public
housing assistance.
Treasury
Treasury receives payments from the Commonwealth for joint Commonwealth-State
natural disaster relief measures, concessions for Pensioner Concession Card
Holders and to compensate the State for foregone revenue on the establishment of
the Australian Securities Commission. The extended First Home Owners Grant
(FHOG) scheme for first homebuyers who contract to build or buy a newly built
dwelling was also funded by a SPP from the Commonwealth. The fall in payments to
Treasury is primarily due to the cessation of the scheme.
Disability Services Queensland
Commonwealth funding for Disability Services Queensland is estimated to increase
by 3.2% in 2003-04. Negotiations are continuing between the states and the
Commonwealth regarding funding arrangements to apply for disability services
from 2002-03, following the expiry of the existing Commonwealth-State Disability
Agreement at the end of 2001-02.
Main Roads
Funding is received from the Commonwealth for infrastructure and maintenance
works on the National Highway System, Roads of National Importance and for Black
Spot Road Safety projects. Funding is forecast to increase by 14.9% in 2003-04
primarily due to increases in Commonwealth funding for Roads of National
Importance (an additional $5.3 million), national highway maintenance ($7
million) and capital work on national highways ($43.7 million).
Families
The Department of Families is expected to receive SPPs of $28.2 million in
2003-04 representing a small decrease from estimated payments in 2002-03. The
payments from the Commonwealth relate to the Supported Accommodation Assistance
Program. This program is a State-Commonwealth funded program which provides
support to homeless men, women and young people as well as to women and children
escaping from intolerable domestic circumstances.
Other
SPPs to other agencies are expected to decline in 2003-04 by $62 million in
2003-04. A major component is a reduced grant to the Department of Natural
Resources and Mines due to the wind down of the first phase of the Natural
Heritage Trust (NHT). Discussions are continuing with the Commonwealth with
regard to the second phase of the NHT.
Other Grants and Contributions
Grants and contributions are funds received from other state and local
government agencies, other bodies and individuals where there is no direct
benefit to the provider. Contributions exclude Commonwealth grants and user
charges. The main sources of contributions are:
.. those received from private enterprise and community groups to fund
research projects and community services, including the contributions of
Parents and Citizens Associations to state schools
.. contributed assets and goods and services received for a nominal amount
.. revenues received from statutory authorities outside the General Government
Page 55
sector, where that money is used to meet Government policy objectives, for
example, community service obligation payments.
TABLE 5.6
Other Grants and Contributions
2001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Other Grants and Contributions578.9378.4349.5(7.6)
Other Grants and Contributions revenue is expected to decrease by 7.6% in
2003-04.
Revenues will vary from year to year based on the number and size of research
projects, assets transferred between the Government and the private sector, and
contributed assets and services.
SALES OF GOODS AND SERVICES
Sales of goods and services revenue comprises cost recoveries from the provision
of goods or services. Revenue from this source is expected to increase by 1.8%
in 2003-04.
Table 5.7
Sales of Goods and Services1
2001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Fee for Service Activities2999.9963.4964.70.1Rent Revenue236.4235.9245.84.2Sale
of Land Inventory 9.836.446.427.5Hospital Fees145.5151.4146.9(3.0)Transport and
Traffic fees130.6147.0155.25.6Other Sales of Goods and
Services314.3345.8354.72.6Total Sales of Goods and
Services1,836.51,879.81,913.71.8
Note:
1. Numbers may not add due to rounding.
2. Formerly Sales of Goods and Services in Budget Paper No.3 2002-03.
Fee for Service Activities
Major items of fee for service activities across the General Government sector
include:
.. recoverable works carried out by both the Department of Main Roads and the
commercialised arm of the department
.. fees charged by Technical and Further Education (TAFE) colleges
.. water charges for rural and industrial users
.. fees charged by CITEC for information and telecommunications services to
the private sector.
From 1 July 2003 ambulance subscription fees and user charges have been replaced
by Community Ambulance Cover (discussed in the section on Taxation Revenue). As
a result, a negligible increase in fee for service revenue is forecast for
2003-04.
Rent Revenue
Rent revenue is earned on the rent or lease of Government buildings, housing,
plant and equipment, motor vehicles and car parks. Major items under this
category include public housing rentals and rents charged for Government
buildings.
Page 56
Sale of Land Inventory
Sale of land inventory comprises land sales undertaken by agencies, where the
buying and selling of land is a core business activity of the agency, such as
the Department of State Development's Property Services Group. As such, it is
distinct from property disposals undertaken by most Government agencies.
Hospital Fees
Hospital fees are collected by public hospitals for chargeable bed
days. In 2003-04, hospital fee revenue is expected to decrease by 3% on 2002-03
collections. This reduction is largely due to a decrease in private patient
revenue and third party payments.
Transport and Traffic Fees
This category comprises State transport fees, the Traffic Improvement Fee,
drivers' licence fees and various marine licence and registration fees.
Other Sales of Goods and Services
Revenues from other sales of goods and services are expected to increase by 2.6%
in 2003-04.
The Government provides concessions in the form of discounts, rebates and
subsidies to improve access to and the affordability of a range of services for
individuals or families based on eligibility criteria relating to factors such
as age, income and special needs or disadvantage.
Appendix B provides details of the concession arrangements set in place by the
Queensland Government.
INTEREST INCOME
Interest income primarily comprises interest earned on the Treasurer's Cash
Balances and investments held to finance future employee entitlements, for
example superannuation and long service leave.
TABLE 5.8
INTEREST INCOME
2001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Interest Income1(463.7)(247.4)1,037.6n.a.
Note:
1. Formerly Investment Earnings in Budget Paper No.3 2002-03.
Queensland Treasury Corporation manages the State's short term investments, such
as the Treasurer's Cash Balances, while Queensland Investment Corporation
manages the State's long-term investments, primarily employee entitlement
provisions. The State's investment portfolio includes a diversified holding of
equities, property and fixed interest.
The poor performance of domestic and international equity markets adversely
impacted interest income in 2002-03.
Interest income in 2003-04 is based on the assumed long term average earnings
rate of 7.5% on investments.
OTHER REVENUE
Other Revenue comprises dividends, tax equivalent payments, royalties, fines and
forfeitures, and other sundry revenues. Other Revenue is expected to decrease in
2003-04, largely due to an expected decrease in dividends.
TABLE 5.9
OTHER REVENUE1
2001-02 Actual
$ million2002-03
Page 57
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Dividends983.1867.3631.7(27.2)Tax
Equivalents303.8251.2260.93.9Royalties769.2730.5725.8(0.7)Fines and
forfeitures133.1140.4152.48.6Revenue nec263.9231.5126.7(45.3)Total Other
Revenue2,453.02,220.81,897.4(14.6)
Note:
1. Numbers may not add due to rounding.
Dividends
Dividends are received from the State's equity in Public Non-financial
Corporations (PNFCs) and Public Financial Corporations. These include, for
example, the Queensland Electricity Supply Industry, Queensland Investment
Corporation, Port Authorities, Queensland Rail and Golden Casket.
TABLE 5.10
DIVIDENDS1
2001-02
Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Electricity Sector2663.9537.0414.7(22.8)Transport Sector (Rail and
Ports)228.4184.23183.0(0.7)Other490.8146.134.0(76.7)Total
Dividends983.1867.3631.7(27.2)
Notes:
1. Numbers may not add due to rounding.
2. Includes the following special dividends: 2001-02 Actual - $150 million from
Energex; 2002-03 Est. Actual - $30 million from Energex and $20 million from
Ergon; 2003-04 Budget - $30 million from Energex and $20 million from Ergon.
3. Includes $25 million special dividend related to the lease of Dalrymple Bay
Coal Terminal.
4. Includes Forestry, Golden Casket Corporation, Queensland Treasury Corporation
and Queensland Investment Corporation. 2001-02 Actual also includes $26 million
related to the Goodwill Games. 2002-03 Estimated Actual also includes $74
million dividend from the sale of Brisbane Market Corporation.
Dividends are forecast to decline by 27.2% to $631.7 million in 2003-04. This
primarily reflects a one-off dividend payment from the Brisbane Market
Corporation following its sale, and reduced dividends from the electricity
sector due to forecast lower electricity pool prices.
The dividend payout ratio set by the Government for its public enterprises does
not impact on the capacity and requirement of these entities to carry out
necessary maintenance and repairs and asset replacement (via provision for
depreciation). Dividends are paid after providing for such costs.
In total, dividends account for less than 3% of total General Government revenue
in 2003-04.
Tax Equivalent Payments
Tax equivalent payments comprise payments by Government-owned corporations in
lieu of state and Commonwealth taxes and levies from which they are exempt.
These payments arise from an agreement reached between the Commonwealth and
state governments in 1994 to establish a process for achieving tax uniformity
and competitive neutrality between public sector and private sector trading
activities.
TABLE 5.11
TAX EQUIVALENT PAYMENTS1
Page 58
2001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Electricity Sector217.1209.3148.6(29.0)Transport Sector (Rail and
Ports)106.065.981.123.1Other2(19.3)(24.0)31.2n.a.Total Tax Equivalent
Payments303.8251.2260.93.9
Note:
1. Numbers may not add due to rounding.
2. Negative payments in 2001-02 and 2002-03 primarily reflect the impact of poor
investment returns on WorkCover tax equivalent payments in those years.
Tax equivalent payments are expected to increase by 3.9% in 2003-04.
Net Revenue from Public Enterprises
Revenue from Public Non-financial Corporations (PNFCs) and Public Financial
Corporations (PFCs) includes dividends and tax equivalents as outlined above and
also competitive neutrality fees.
Competitive neutrality fees promote neutrality in borrowing costs between the
public and private sectors. Details of competitive neutrality fees are shown in
Table 5.12.
TABLE 5.12
COMPETITIVE NEUTRALITY FEES1
2001-02 Actual
$ million2002-03
Est. Actual
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Electricity Sector28.124.932.028.5Transport Sector (Rail and
Ports)29.138.739.31.6Other0.81.10.9(18.2)Total Competitive Neutrality
Fees57.964.772.211.6
Note:
1. Numbers may not add due to rounding.
Government also makes payments to PNFCs in the form of community service
obligations (CSOs).
CSO payments are made by Government to government owned corporations (GOCs) as a
way of purchasing products and services that would otherwise not be undertaken
(or undertaken at a higher price) in a commercial environment. They allow
Government to purchase services in line with the Government's priorities and
community needs, whilst at the same time ensuring the lines of accountability
for performance are not blurred. In Queensland, CSO payments are mainly provided
for rail (eg. passenger transport) and electricity services (eg. maintenance of
uniform tariffs).
Table 5.13 shows how CSO payments are distributed across sectors.
TABLE 5.13
COMMUNITY SERVICE OBLIGATIONS1
2001-02
Actual
$ million2002-03
Est. Actual
Page 59
$ million2003-04
Budget
$ millionChange
Budget over Est. Actual
%Electricity Retailers2191.5136.885.8(37.3)QRail
611.4663.4694.04.6SunWater14.99.58.1(14.7)Total Community Service
Obligations817.7809.6787.8(2.7)
Note:
1. Numbers may not add due to rounding.
2. The decrease in 2003-04 reflects an anticipated fall in electricity pool
prices in that year, which is expected to lead to a reduction in CSO payments
required to support the Uniform Price Tariff.
Chart 5.4 illustrates that the General Government sector is forecast to receive
a small net return above the community service obligations paid to the PNFC and
PFC sectors over the forward estimates.
Chart 5.4
Net Revenues from Public Corporations
Royalties
The State earns royalties from the extraction of coal, base and precious metals,
bauxite, petroleum, mineral sands and other minerals. In addition, royalty
revenue includes rents received by the State from pastoral holdings, mining and
other leases. Royalties return some of the proceeds for the extraction of
non-renewable resources to the community.
Estimates of mining royalties are based predominantly on forecasts of production
compiled by the Department of Natural Resources and Mines. Royalties are
expected to decline slightly in 2003-04 in line with the recent rise in the
Australian dollar relative to the US dollar.
Fines and Forfeitures
The major fines included in this category are traffic and court fines. There is
a forecast increase of 8.6% in collections of fines and forfeitures in 2003-04,
partly due to increased enforcement activity associated with road safety
initiatives.
Revenue nec
Revenue nec includes other revenues not included elsewhere. These revenues are
estimated to decrease by 45.3% in 2003-04 reflecting a number of one-off
receipts across agencies in 2002-03.
6. EXPENSES
KEY POINTS
.. Total General Government sector expenses are budgeted to increase by 5.3%
over the 2002-03 Budget, to $21.229 billion in 2003-04.
.. Growth in expenses includes a range of service developments and initiatives
with a particular focus in the areas of disability services and health.
.. The major areas of expenditure are education and health which together
constitute some 48% of General Government sector expenses.
INTRODUCTION
This chapter provides an overview of the operating statement expenses for the
General Government sector for the estimated actual outcome for 2002-03, the
forecast for the 2003-04 Budget year, and projections for 2004-05 to 2006-07.
The forward estimates are based on the economic projections outlined in Chapter
2 and are formulated on a no policy change basis.
Page 60
The Ministerial Portfolio Statements and Appendix F provide details on total
expenditure for departments. Detailed information on new spending initiatives is
provided in Chapter 4.
Table 6.1
General Government Sector Expenses1
2002-03
Budget2002-03
Est. Act.2003-04
Budget2004-05
Projected2005-06
Projected2006-07
Projected$ million$ million$ million$ million$ million$ millionExpensesGross
operating expenses Employee expenses 9,0859,2449,96210,29110,82411,493 Other
operating expenses3,4223,4923,6143,8793,9784,099
Depreciation1,5441,3961,4291,4461,4611,474Current
transfers4,6704,7524,8044,9705,1335,172Capital
transfers471512422347320308Nominal superannuation
interest715642751804857910Other interest250225247287336358Total
Expenses20,15720,26321,22922,02422,90923,814
Note:
1. Numbers may not add due to rounding.
General Government expenses in 2002-03 are estimated to be $20.263 billion,
compared to the Budget estimate of $20.157 billion, a within-year variation of
only 0.5%.
Significant areas of variation in 2002-03 include:
.. Parameter and policy changes implemented during the year contributing
towards higher employee and grants expenses.
.. A reclassification from nominal superannuation interest expense to a
superannuation expense item within employee expenses. This reclassification
relates to changes in superannuation liability for non-defined benefit
liabilities such as post-retirement investment linked accounts.
.. A reduction in depreciation expense primarily due to a review of asset
lives by the Departments of Main Roads and Housing.
The General Government operating statement provides for aggregate expenses of
$21.229 billion in 2003-04, representing an increase of $1.072 billion (or 5.3%)
over the 2002-03 Budget. Factors influencing the growth in expenses include the
service enhancements outlined in Chapter 4 and cost increases including recent
enterprise bargaining agreements.
EXPENDITURE BY CATEGORY
This section provides a breakdown of the General Government operating statement
in 2003-04 by category and discusses the significant variances between 2002-03
estimated actual and 2003-04 Budget by these expense categories.
Chart 6.1 indicates that the single largest expense category in the General
Government sector is employee expenses - reflecting the direct service provision
nature of State Government activities, followed by current transfers which
include community service obligation payments to Government-owned corporations
and the fuel subsidy scheme.
Chart 6.1
Expenses by Operating Statement Category for 2003-04
Note:
Page 61
1. Includes Nominal Superannuation Interest Expense.
Chart 6.2 compares the 2002-03 estimated actual expenses for each operating
statement category with the 2003-04 Budget.
Chart 6.2
Expenses by Operating Statement Category for 2002-03 and 2003-04
Note:
1. Includes Nominal Superannuation Interest expense.
DETAILS OF EXPENSES
Employee expenses
Employee expenses include salaries and wages, annual leave, long service leave
and superannuation expense. Superannuation expense represents the employer's
contribution to the superannuation of Government employees in the General
Government sector.
Employee expenses are forecast to increase by $718 million or 7.8% to $9.962
billion in 2003-04.
The 2003-04 Budget and forward estimates include a provision for wage increases
consistent with an outcome of approximately 3.5% per annum or, where an
agreement has been reached, the expected cost of implementing that agreed
outcome.
The 2003-04 Budget also provides funding for additional staffing for the
implementation of expanded and enhanced services, particularly in relation to
the departments of Education, Health and Police (for example, the Budget
provides funding for over 600 additional teachers and approximately 300
additional police). Together, these portfolios account for 64% of General
Government employee expenses.
The reclassification from nominal superannuation interest expense to employee
expenses referred to earlier in this chapter had the effect of increasing
employee expenses by approximately $130 million.
Other operating expenses
Other operating expenses comprise the non-labour costs of providing services
such as repairs and maintenance, consultancies, contractors, electricity,
communications and marketing.
The moderate increases in the forward years reflect projected increases in these
input costs and also reflects a growth in service provision.
Depreciation
Depreciation expense is an estimate of the progressive consumption of the
State's assets through normal usage, wear and tear and obsolescence. As noted
earlier, the Departments of Main Roads and Housing undertook reviews of asset
lives to ensure that the depreciation expense fully reflected the progressive
consumption of their assets. The reviews found that useful asset lives were
longer than previously assumed and this has lead to a reduction in depreciation
expense.
Notwithstanding this reduction, Queensland's depreciation expense as a
percentage of fixed assets is generally higher than that of other states,
reflecting a more conservative provision for asset replacement over time.
Although this results in lower operating surpluses, over time it will lead to a
younger asset base. It is also more sustainable by making available larger
amounts of funding from recurrent sources to finance capital expenditure.
Current transfers
Current transfers include grants and subsidies to the community (such as to
schools, hospitals, benevolent institutions, and local governments), personal
benefit
Page 62
payments, and Commonwealth taxes such as Fringe Benefits Tax. Grants and
subsidies include the First Home Owners Grant scheme, community service
obligation payments to Government-owned corporations and payments made under the
State's fuel subsidy scheme. Information on concessions provided in the form of
subsidies and rebates to organisations and individuals are provided in Appendix
B.
Various recipients of current transfers include grants to non-Government schools
(24%), CSO payments to public non-financial corporations (16%), fuel subsidies
(10%), and payments for first home owners (4%).
Current transfers are estimated to increase by $52 million in 2003-04 as a
result of additional local government financial assistance grants from the
Commonwealth for local councils and additional funding for housing assistance
programs.
Chart 6.3 indicates the composition of current transfers by recipient.
Chart 6.3
Current transfers by recipient 2003-04
Capital transfers
Capital transfers represent grants by the Government for capital works to local
governments, non-profit institutions and other non-government entities, such as
businesses. The primary purpose of capital transfers in 2003-04 relates to
funding for Aboriginal and Community housing projects, road and water and
sewerage projects undertaken by local governments and transfers to
non-government schools for infrastructure.
Movements from year to year in capital transfers are influenced by the timing of
capital projects and the progressive completion of approved projects. Donations
of capital assets are also included as capital transfers.
Capital transfers are forecast to decline $90 million relative to the 2002-03
estimated actual. The decrease is primarily the result of the transfer of the
Bureau of Sugar Experiment Stations (BSES), a statutory body, to an
industry-controlled corporate structure in 2002-03. The transfer of the BSES
(valued at $42 million) is treated as a grant to the sugar industry. Also
contributing to the reduction in capital transfers is the substantial completion
of the Queensland Heritage Trails Network grants program during 2002-03.
Chart 6.4 provides a breakdown of capital transfers by recipients. The major
recipient of capital transfers by the Government is local government (56%).
Further information on grants to local government authorities is provided in
Chapter 8.
Chart 6.4
Capital transfers by recipient 2003-04
Interest
The nominal superannuation interest expense represents the imputed interest on
the Government's accruing defined benefit superannuation liability.
The other interest expense includes interest paid by agencies, principally to
the Queensland Treasury Corporation, on borrowings to acquire capital assets and
infrastructure such as roads and government buildings. The growth in this
expense over the forward estimates reflects moderate growth in borrowings for
capital asset acquisitions.
Page 63
Nominal superannuation interest expense is estimated to grow consistently in
2003-04 and the forward years, relative to the 2002-03 amount, due to factors
including actuarial estimates of the liabilities, enterprise bargaining
agreements and increases in the number of public sector employees associated
with planned growth in services.
OPERATING EXPENSES BY PURPOSE
Chart 6.5 indicates the proportion of expenditure by major purpose
classification for the 2003-04 Budget. Education accounts for the largest share
of expenses (26%), followed by Health (22%) and Transport and Communications
(12%).
Chart 6.5
General Government Expenses By Purpose 2003-04
A comparison of General Government expenditure by purpose growth from 2002-03 to
2003-04 Budget is outlined in Chart 6.6.
Chart 6.6
General Government Expenses By Purpose for 2002-03 and 2003-04
LEVEL OF SERVICE PROVISION
Over the last ten years, successive Governments have responded to Queensland's
social and economic challenges by increasing expenditure effort and altering the
mix of resources to meet changing community needs. Enhancements to service
delivery are reflected in Queensland spending more than previously in key social
service delivery areas.
One method for measuring the aggregate level of service provision is to utilise
the assessments undertaken by the Commonwealth Grants Commission (CGC) for the
determination of the distribution of GST funding grants to the states.
Expenditure effort, as shown in Chart 6.7, is a measure calculated by the CGC.
More detail on how this measure is derived is provided in Box 6.1.
In general terms, Chart 6.7 indicates that Queensland's level of aggregate
expenditure (relative to the Commission's assessment of that required to provide
an Australian average level of service) has increased from 85% in 1991-92 to 98%
in 2001-02. As Queensland is often recognised as an efficient low-cost provider
of services a ratio of less than 100% does not necessarily mean a lesser level
of services is being provided (see Box 6.1).
Chart 6.7
Level of Service Provision Ratio
Note:
1. Financial Assistance Grant relativities are used to 1999-00 and GST
relativities from 2000-01.
Source: Commonwealth Grants Commission
Page 64
Box 6.1
Commonwealth Grants Commission's Level of Service Provision RatiosThe Grants
Commission assesses a state's need for Commonwealth financial assistance by
taking into account its revenue capacities and expenditure needs (what a state
is required to spend to provide an Australian average level of service). These
assessments are prepared on a policy neutral basis, which means that only those
factors that are beyond a state's control are considered.
The level of service provision ratio measures both the level of services
provided in a state relative to what is required to provide a policy standard
level of service, given conditions outside a state's control, or the relative
efficiency with which they are provided.
Ratios of greater than 100% indicate above standard effort and ratios of less
than 100% indicate below standard effort, assuming a standard level of
efficiency and effectiveness in the provision of services.
7. BALANCE SHEET AND CASH FLOWS
KEY POINTS
.. The Queensland Government's already strong financial position is expected
to strengthen further in 2003-04. State net worth is projected to rise by
$1.62 billion through the year to $60.3 billion.
.. Net worth is also forecast to increase each year over the forward estimates
period, meeting the Government's commitment in its Charter of Social and
Fiscal Responsibility to maintain and seek to increase total State net
worth.
.. The General Government sector is well placed to meet all its present and
future liabilities. Financial assets are projected to exceed liabilities by
$10.657 billion in the General Government sector at 30 June 2004,
consistent with another of the Government's Charter principles.
.. The General Government sector is estimated to record a cash surplus of $152
million in 2003-04, after allowing for $2.3 billion in net asset purchases.
.. The General Government sector is budgeted to achieve strong cash surpluses
in the forward years.
INTRODUCTION
The 2003-04 balance sheet shows the projected assets, liabilities and net worth
of the General Government sector as at 30 June 2004. It is important for the
Government to maintain a strong and growing balance sheet to provide it with the
stability, flexibility and capacity to deal with any emerging financial and
economic pressures.
The assets and liabilities in the balance sheet are defined according to the
Government Finance Statistics (GFS) standard of the Australian Bureau of
Statistics.
Detailed balance sheet and cashflow information for the General Government
sector and the rest of the public sector is contained in Appendix E.
Table 7.1 provides a summary of the key balance sheet measures for the General
Government sector.
Table 7.1
General Government Sector: Summary of Budgeted Balance Sheet1 2001-02
Page 65
Outcomes
$ million2002-03
Est. Act.
$ million2003-04
Budget
$ million2004-05
Projected
$ million2005-06
Projected
$ million2006-07
Projected
$ millionFinancial assets31,61531,87832,93534,69136,56138,400Non-financial
assets45,48547,39549,65551,54153,28954,968Total
Assets277,10079,27382,59086,23289,85093,368Borrowings3,4593,6834,3834,8935,2705,
403 Superannuation10,06211,66812,72213,79114,85915,935Other provisions and
liabilities5,4865,2305,1735,1525,0855,018Total
Liabilities19,00720,58122,27823,83625,21426,356Net
Worth58,09358,69260,31262,39664,63667,012Net
Debt(11,032)(10,636)(10,800)(11,336)(11,972)(12,864)
Notes:
1. Numbers may not add due to rounding.
2. For GFS purposes, the State's assets are classed as either financial or
non-financial assets.
BALANCE SHEET
Financial Assets
The General Government sector holds the full equity of the State's public
enterprises, principally its shareholding in Government-owned corporations, in
much the same manner as the parent or holding company in a group of companies.
The estimated net investment in public enterprises ($13.484 billion at 30 June
2004) is included in the General Government sector's financial assets5.
In the year to 30 June 2004, financial assets are projected to increase by
$1.057 billion, attributable principally to increased investment in
superannuation assets. The modest growth in financial assets in 2002-03 reflects
the impact of negative earnings on investments in that year. Investment earnings
in 2003-04 and the outyears are based on long term rate of return assumptions.
Chart 7.1 shows General Government sector financial assets by category at 30
June 2004. Investments held to meet future liabilities for superannuation and
long service leave comprise the major part of the State's financial assets.
Chart 7.1
General Government Financial Assets by Category as at 30 June 2004
Non-Financial Assets
General Government non-financial assets are projected to total $49.655 billion
at 30 June 2004. The majority of these non-financial assets are roads, schools,
hospitals and other infrastructure used to provide services to Queenslanders.
Other non-financial assets held by the State include intangibles (mainly
computer software and licences), inventories and land.
After allowing for the purchase and/or construction of replacement or new
assets, asset revaluations, depreciation and disposals, physical assets in the
year ending 30 June 2004 are expected to grow by $2.26 billion during 2003-04.
The Government has traditionally funded new infrastructure at levels well beyond
that of the other states. Over the last decade, Queensland purchases of
non-financial assets as a percentage of Gross State Product have exceeded that
of all other major states (see Chart 7.2).
Chart 7.2
Page 66
General Government Purchases of Non-Financial Assets as a Percentage of Gross
State Product
Sources: ABS 5512.0, 5501.1.55.001, 5501.2.55.00, 5501.3.55.00, 5501.4.55.00,
5501.5.55.00, 5501.6.55.00, 5220.0
Queensland Treasury Outcomes Report for the year ended 30 June 2002.
Liabilities
The largest single accruing liability in the General Government sector is
employee entitlements (principally superannuation and long service leave) which,
as at 30 June 2004, is projected to total $15.074 billion. Other liabilities
include borrowings and advances received.
Liabilities are budgeted to increase by $1.697 billion in 2003-04, largely on
account of normal growth in the General Government superannuation liability and
borrowings for capital purposes.
Other non-equity liabilities include payables, unearned revenue and other
liabilities excluding borrowings and provisions.
The composition of the General Government sector's liabilities is illustrated in
Chart 7.3.
Chart 7.3
General Government Liabilities by Category as at 30 June 2004
Net Financial Assets
The net financial assets (net financial worth) measure is an indicator of
financial strength. Net financial assets are defined as financial assets less
all existing and accruing liabilities. Financial assets include cash and
deposits, advances, financial investments, loans, receivables and equity in
public enterprises.
The net financial assets measure is broader than the alternative measure, net
debt, which measures only cash, advances and investments on the assets side and
borrowings and advances on the liabilities side. Because of its comprehensive
nature, the net financial assets measure is more appropriate in an accrual
accounting framework.
The net financial assets of the General Government sector for 2003-04 are
forecast at $10.657 billion, reflecting the cumulative impact of sound fiscal
policies and indicate that the State is capable of meeting all its current and
recognised future obligations, without recourse to material adjustments in
fiscal policy settings.
The second key Charter principle relating to balance sheet management
specifically requires that the State's financial assets cover all accruing and
expected future liabilities of the General Government sector.
The State's net financial asset position remains extremely sound. Based on
current projections, the General Government sector will continue to meet the
commitment in the Government's Charter to ensure that financial assets cover all
accruing and expected future liabilities in all the years through to 30 June
2007.
Queensland has consistently pursued sound long-term fiscal policies such as the
full funding of employee superannuation entitlements. The strong balance sheet
and high levels of liquidity in the General Government sector clearly
demonstrate the success of these policies.
Queensland's level of liquidity is well in excess of that of other states as
illustrated in Chart 7.4.
Page 67
Chart 7.4
Ratio of Financial Assets to Liabilities (excluding Investments in Public
Enterprises) as at 30 June 2004
General Government Sector
Source: State budget papers for QLD, VIC, WA and TAS. NSW and SA Mid-Year
Review.
Net Worth
The Charter of Social and Fiscal Responsibility specifically requires the
Government to maintain and seek to increase total State net worth.
The net worth, or equity, of the State is the amount by which the State's assets
exceed its liabilities (which is equivalent to General Government net worth).
This is the value of the investment held on behalf of the people of Queensland
by public sector instrumentalities. Changes in the State's net worth occur for a
number of reasons including:
.. operating surpluses (deficits) that increase (decrease) the Government's
equity
.. revaluation of assets and liabilities as required by accounting standards.
Some financial liabilities are revalued on a regular basis. For example,
the Government's accruing liabilities for employee superannuation and long
service leave are determined by actuarial assessments
.. movements in the net worth of the State's investments in the Public
Non-financial Corporations and Public Financial Corporations sectors
.. gains or losses on disposal of assets. Government agencies routinely buy
and sell assets. Where the selling price of an asset is greater (less) than
its value in an agency's accounts, the resultant profit (loss) affects net
worth. In the year ending 30 June 2003, the financial position of the
General Government sector has been impacted by a number of events, in
particular low returns on investments.
Despite these impacts, the net worth of the General Government sector is
expected to grow by $599 million over the 2001-02 actual net worth. This is due
to increases in assets as a result of revaluations of assets as part of the
State's asset revaluation cycle. During the year, the departments of Natural
Resources, Main Roads, and Housing carried out major revaluations.
Chart 7.5 illustrates the State's strong net worth compared with the other
states. Queensland's per capita net worth is 16% greater than the average per
capita net worth of the other states.
Chart 7.5
Interstate Comparison of Per Capita Net Worth as at 30 June 2004
Note:
1. Western Australia values land under roads as part of its overall asset base.
This has been adjusted to allow comparison with other jurisdictions which do not
value land under roads.
Source: State Budget Papers for QLD, VIC, WA and TAS. NSW and SA Mid-Year Budget
Review. Population data from Commonwealth Budget Paper 3.
Net Debt
Net debt is the difference between gross debt and financial assets (less equity
in
Page 68
public enterprises and non-equity assets). The extent of accumulated net debt
is currently the most common measure used to judge the overall strength of a
jurisdiction's fiscal position. High levels of net debt impose a call on future
revenue flows to service that debt and meeting these payments can limit
government flexibility to adjust outlays. Excessive net debt can call into
question the ability of government to service that debt. As seen in Chart 7.6,
the Queensland General Government sector has negative net debt, that is, a
surplus of financial assets over financial liabilities, in comparison to other
states, thus indicating the strength of Queensland's financial position relative
to the other states.
Queensland's negative net debt of $2,821 per capita (net financial assets),
compares to the average net debt of $364 per capita (net financial liabilities)
in the other states.
Chart 7.6
Net Debt Per Capita as at 30 June 2004
Source: Net debt from State Budget Papers for QLD, VIC, WA and TAS. SA and NSW
are Mid-Year Review.
Population Data from Commonwealth Budget Paper 3.
CASH FLOWS
The cash flow statement provides information on the Government's estimated cash
flows from its operating, financing and investing activities.
The cash flow statement records estimated cash payments and cash receipts and
hence differs from accrued revenue and expenditure recorded in the operating
statement. In particular, the operating statement often records revenues and
expenses that do not have an associated cash flow (for example, depreciation
expense). Also the timing of recognition of accrued revenue or expense in the
operating statement may differ from the actual cash disbursement or receipt (for
example, tax equivalents). A detailed reconciliation between the cash flows from
operations and the operating statement is provided later in this chapter.
The cash flow statement also records cash flows associated with investing and
financing activities that are otherwise reflected in the balance sheet. For
example, purchases of capital equipment are recorded in the cash flow statement
and impact on the balance sheet through an increase in physical assets.
The cash flow statement provides the cash surplus (deficit) measure, which is a
key aggregate or fiscal indicator used by a number of financial and economic
commentators and analysts. The cash (deficit) measure is comprised of the net
cash flow from operating activities plus the net cash flow from investment in
non-financial assets (or physical capital). This measure is also used to derive
the Loan Council Allocation nomination, provided in Appendix E.
Table 7.2 provides summary cash flow information for the General Government
sector for 2002-03, 2003-04 and the outyears. Detailed cash flow tables are
included in Appendix E.
Table 7.2
General Government Sector: Summary of Budgeted Cash Flows1
2002-03
Est. Act.
$ million
2003-04
Page 69
Budget
$ million
2004-05
Projected
$ million
2005-06
Projected
$ million
2006-07
Projected
$ millionCash receipts from operating activities
20,21621,77222,40023,20724,261Cash payments for operating activities
(18,342)(19,300)(20,003)(20,889)(21,768)Net cash flow from operating activities
1,8742,4722,3972,3182,493Net cash flows from investing activities
(2,056)(3,264)(2,817)(2,665)(2,550)Net cash flows from financing activities
168570469354109Net increase/(decrease) in cash held (14)(222)49752
Derivation of GFS cash surplus (deficit)
Net cash flow from operating activities
1,874
2,472
2,397
2,318
2,493
Less net cash flow from investments in non-financial assets
Less Finance leases and similar arrangements
1,823
...
2,320
...
1,876
...
1,696
...
1,608
...Equals GFS cash surplus (deficit)
51152521622885
Note:
Numbers may not add due to rounding.
Cash Flows from Operating Activities
Page 70
Table 7.3 provides a disaggregation of operating cash flows.
Table 7.3
General Government Sector: Cash Flows from Operating Activities 2002-03
Est. Act.
$ million2003-04 Budget
$ million
Receipts from operating activities
Taxes received
Grants and subsidies received
Sales of goods and services
Other receipts
5,511
10,527
2,086
2,092
5,664
10,865
2,155
3,088Total receipts from operating activities20,21621,772Payments for operating
activities
Payments for goods and services
Grants and subsidies
Interest
Other payments
(12,326)
(4,814)
(227)
(975)
(13,365)
(4,806)
(245)
(884)Total payments for operating activities(18,342)(19,300)Net cash inflows
from operating activities1,8742,472
Cash inflows from operating activities include receipts from taxes, grants from
the Commonwealth Government, fees and charges levied on the provision of goods
and services, interest receipts from investments, and dividend and tax receipts
from Public Financial and Non-financial Corporations.
Taxes received by the General Government sector are forecast at $5.664 billion
in 2003-04, up marginally on the 2002-03 estimated actual of $5.511 billion. In
2003-04, taxation revenue is expected to moderate as a result of a projected
fall in stamp duty on property conveyancing transactions relative to 2002-03
levels, in line with expectations of an easing in the property market.
Grants and subsidies receipts are expected to increase modestly in 2003-04 to
$10.865 billion, of which Commonwealth grants are expected to account for
$10.528 billion.
Other receipts include investment earnings, dividends and tax equivalents
received from Government-owned corporations (GOCs) and royalties. Other receipts
are expected to increase in 2003-04 by $996 million to $3.088 billion. This
largely
Page 71
reflects the flow through of higher investment earnings in 2003-04 based on the
return to the long term average earnings rate of 7.5% on investments. The lower
investment earnings in 2002-03 are largely the result of forecast negative
investment return of -3% on investments held to meet future employee liabilities
such as superannuation.
Cash outflows represent payment for goods and services, wages and salaries,
finance costs and grants and subsidies paid to households, businesses and other
Government agencies. In 2003-04 the largest cash disbursement is employee
expenses, at $9.570 billion or 50% of total cash payments from operating
activities.
The 2003-04 estimate for payments for goods and services, which includes wages
and salaries, is expected to increase by 8.4% to $13.365 billion. This reflects
the estimated payments pertaining to employer superannuation (accumulation
scheme) contributions and State share of superannuation beneficiary payments,
increased employee entitlements in line with enterprise bargaining agreements,
and growth related to new and enhanced services.
Cash payments for grants and subsidies are expected to remain relatively
constant at $4.806 billion in 2003-04. This item includes recurrent grants paid
by the Commonwealth through the State to non-state schools, grants paid to
industry, and grants to non-profit institutions. This item also includes capital
grants which are largely paid to local government authorities to fund capital
works.
Other payments mainly comprise personal benefit payments and other transfer
payments. This item is estimated to decline by 9.3% in 2003-04 to $884 million.
This is primarily attributable to lower First Home Owner Grant scheme and HIH
Insurance Compulsory Third Party claim expenditures.
Cash Flows from Investments
Cash flows from investments include both financial and non-financial assets.
Table 7.4 provides a disaggregation of investment cash flows into the different
types.
Table 7.4
General Government Sector: Cash Flows from Investing Activities 2002-03
Est. Act.
$ million2003-04 Budget
$ millionNet payments for investments in non-financial assets
(1,823)(2,320)Net cash flows from investing activities in financial assets for
policy purposes
(367)3Net cash flows from investing activities in financial assets for liquidity
purposes134(947)
Net increase/(decrease) in cash held from investing activities
(2,056)(3,264)
The largest cash disbursement for the Government, outside of recurrent
operations, is investments in non-financial assets. This represents the
Government's capital works program, which provides for infrastructure such as
schools, hospitals, roads, etc.
Cash outflows from investing in non-financial assets are expected to increase to
$2.320 billion in 2003-04 from $1.823 billion in 2002-03 reflecting increased
net capital purchases in 2003-04.
The cash expenditure on investment in non-financial assets differs from the
estimates of capital works expenditure in Budget Paper No. 3 - Capital
Statement.
The estimates contained in that paper are on a gross basis and incorporate both
departmental agencies and GOCs. In addition, Budget Paper No. 3 includes capital
grants and does not offset proceeds from asset sales.
Page 72
Apart from investing in new capital expenditure, governments also manage
financial assets in order to finance overall expenditures. In addition,
Queensland manages financial assets set aside to provide for future employee
benefits (for example superannuation and long service leave). The Government
manages its financial assets through a combination of borrowing or investing
funds and selling or acquiring equity in government or private sector entities.
Investment activities in financial assets include activities relating to both
policy and liquidity.
Investments for policy purposes include net equity injections into Government
and other business enterprises and the net cash flow from disposal or return of
equity in Government business enterprises.
Cash outflows from investments for policy purposes for 2002-03 of $367 million
reflect equity transactions by the General Government sector with Public
Non-financial Corporations. In 2002-03, this includes the injection of $300
million into Enertrade to facilitate its recapitalisation and $25 million to
Queensland Motorways. In addition, net assets of $48 million from the cessation
of the Stadium Redevelopment Authority will be injected into the Major Sports
Facility Authority (located in the Public Non-financial Corporations sector).
These outflows are partially offset by a $15 million share buy-back payment
instigated by the Ports Corporation of Queensland to return surplus funds to the
Government as its shareholder.
Cash inflows from investments for policy purposes for 2003-04 of $3 million
reflect equity transactions with public enterprises, in particular a further $15
million share buy-back by the Ports Corporation of Queensland, offset by an
equity injection of $12 million into Queensland Motorways.
Cash flows from investments for liquidity purposes represent net investment in
financial assets such as to cover superannuation and other employee
entitlements.
Estimated cash inflows from investments in financial assets for liquidity
purpose of $134 million in 2002-03, reflect the impact of negative investment
earnings on superannuation investments and the payment of employee entitlements.
These cash inflows are partially offset by the investment of defined benefit
employer contributions during the year.
Cash outflows from investments in financial assets for liquidity purposes are
estimated to be $947 million in 2003-04, a net purchase of investments. This
primarily reflects the re-investment of interest earnings and the investment of
contributions set aside for the Government's defined benefit superannuation
scheme.
Cash Flows from Financing Activities
Cash flows generated from financing activities are outlined in Table 7.5 below.
Table 7.5
General Government Sector: Cash Flows from Financing Activities2002-03
Est. Act.
$ million2003-04 Budget
$ millionNet cash flows from advances received (net)....Net cash flows from
borrowing (net)168570Net cash flows from other financing....Net
increase/(decrease) in cash held from financing activities168570
Cash flows from financing activities include cash flows from net borrowing
(increase in borrowing less redemption), net advances (gross investment in new
loans less redemption of loans issued) and other financing (net movement in
government securities on issue). Cash flows from borrowings are estimated to
increase in 2003-04 to $570 million, reflecting borrowings to fund capital
projects. The lower level of borrowings in 2002-03 reflects a reduced borrowing
requirement as a result of stronger cash receipts, particularly taxation
receipts.
RECONCILIATION OF OPERATING CASH FLOWS TO THE OPERATING STATEMENT
Table 7.6 provides a reconciliation of the cash flows from operating activities
to the operating result for the General Government sector for the Budget year.
Page 73
Table 7.6
General Government Sector: Reconciliation of Cash Flows from Operating
Activities to Accrual Operating Activities2002-03
Est. Act.
$ million2003-04
Budget
$ millionGFS accrual revenue19,91321,382Add/(less) movement in dividend and
taxation receivable(72)(41)Add GST receipts from ATO327351Add/(less) movement in
other receivables4880Equals GFS cash receipts20,21621,772GFS accrual
expense20,26321,229LESS NON-CASH ITEMSDepreciation and amortisation
expense1,3961,429Accrued superannuation expense1,2951,583Accrued employee
entitlements486496Other accrued costs7123Add/(less) movement in employee
entitlement provisions679952Add/(less) GST paid to ATO348369Add/(less) movement
in other provisions and payables299281Equals GFS cash expenditure18,34219,300
The main difference between the accrual operating statement and the cash flow
relates to the timing of cash payments and receipts and their recognition in
accrual terms, and the inclusion of non-cash expenses and revenues. The largest
difference is on the expenses (expenditure) side, with large non-cash expenses
associated with depreciation and superannuation.
Differences due to the timing of receipt or payment of amounts are recorded as
either a receivable or payable in the balance sheet.
8. INTER-GOVERNMENTAL FINANCIAL RELATIONS
KEY POINTS
.. Following the introduction of the GST in 2000 and the abolition of a number
of state taxes, states have become increasingly reliant on Commonwealth
funding.
.. Queensland has been a long standing supporter of the principle of
horizontal fiscal equalisation and is an active participant in the
Commonwealth Grants Commission's 2004 Review of State Revenue Sharing
Relativities.
.. In 2003-04, Queensland is expected to receive 18.9% of the total
Commonwealth funding to the states or $147 million less than a per capita
share.
.. Queensland is currently negotiating several major specific purpose payment
agreements worth in excess of $2 billion to the State.
.. In 2002-03, the Queensland Government will provide 61% of all grants to
Queensland local government.
COMMONWEALTH-STATE FINANCIAL RELATIONS
Two major issues continue to dominate Commonwealth-state financial relations.
The first relates to states' increased reliance on the Commonwealth for funding,
a factor which was significantly aggravated with the abolition of a number of
state taxes and the implementation of the Goods and Services Tax (GST).
The second issue concerns the Commonwealth's implementation of specific purpose
payment (SPP) agreements which reduces the ability of states to provide
appropriate and adequate services across a range of areas.
Commonwealth-state financial relations are characterised by a mismatch between
states' expenditure responsibilities and access to sufficient own-source
revenues. The Commonwealth collects the major share of taxation revenues, with
the result that states must rely on grants from the Commonwealth to meet
expenditure requirements.
Chart 8.1 shows states' funding sources for 1998-99 and 2003-04 and demonstrates
the states' increased reliance on Commonwealth funding since the introduction of
the Commonwealth's national tax reforms in 2000. In 1998-99 the states received
35% of
Page 74
their revenues from the Commonwealth. This increased to an estimated 49% in
2003-04. In contrast, the proportion of states' revenues from state taxes has
reduced from 39% in 1998-99 to an estimated 32% in 2003-04.
Queensland's reliance on Commonwealth funding as shown in Chart 8.2, has
increased from 36% in 1998-99 to an estimated 49% in 2003-04. Consistent with
the all state trend, Queensland's taxation revenue share has decreased from 29%
in 1998-99 to an estimated 26% in 2003-04. Queensland's lower than average
proportion of taxation revenue reflects Queensland's competitive taxation
policy.
Chart 8.1
Revenue Sources, All States, 1998-99 and 2003-041
Notes:
1. 2003-04 data are estimates.
2. Includes user charges, interest earnings, contributions from trading
enterprises and mining revenue.
Source: ABS Government Financial Statistics Cat No. 5512.0 and State Budget
Papers.
Chart 8.2
Revenue Sources, Queensland, 1998-99 and 2003-041
Notes:
1. 2003-04 data are estimates.
2. Includes user charges, interest earnings, contributions from trading
enterprises and mining revenue.
Source: ABS Government Financial Statistics Cat No. 5512.0 and Queensland Budget
estimates.
COMMONWEALTH FUNDING TO THE STATES
Commonwealth payments to the states in 2003-04 are expected to total $55.774
billion, an increase of $1.87 billion or 3.5% more than 2002-03 levels. Table
8.1 compares estimated Commonwealth payments to the states in 2003-04 with those
for 2002-03.
Table 8.1
Estimated Commonwealth Payments to the States, 2002-03 and 2003-0412002-03
$ million2003-04
$ millionChange
Nominal
Terms %Change
Real2
Terms %Change
Real2 Per
Capita % General Purpose Payments GST Revenues30,465.131,700.04.11.30.0 Budget
Balancing Assistance1,004.0820.1(18.3)(20.5)(21.5) NCP
Payments739.9764.83.40.6(0.6) Total General Purpose
Payments32,209.033,284.93.30.6(0.6) Specific Purpose Payments SPPs "to" the
States16,203.516,593.42.4(0.3)(1.5) SPPs "through" the
States5,491.25,895.67.44.53.2 Total Specific Purpose
Payments21,694.722,489.03.70.9(0.3) Total Commonwealth Payments
53,903.755,773.93.50.7(0.5)Notes:
1. Numbers may not add due to rounding.
2. Deflated by 2003-04 year-average national forecast inflation of 2.75% and
Australian population growth of 1.23%.
Source: Commonwealth Budget Paper No.3, 2003-04.
Page 75
General Purpose Payments
General purpose payments comprise GST revenue, budget balancing assistance (BBA)
and National Competition Policy (NCP) payments. General purpose payments from
the Commonwealth are expected to increase from $32.209 billion in 2002-03 to
$33.285 billion in 2003-04, an increase of 3.3% in nominal terms. However, in
real per capita terms, general purpose payments are expected to decrease by
0.6%.
GST Revenue
The Commonwealth distributes GST to states based on the principles of horizontal
fiscal equalisation (HFE), which are embodied in the per capita relativities
recommended by the Commonwealth Grants Commission (CGC). Queensland continues to
support the principle of HFE and the methods used by the CGC to determine each
state's share of GST revenue (see Box 8.1).
GST collections for 2003-04 are expected to be $31.7 billion, an increase of
$1.235 billion compared with 2002-03.
Budget Balancing Assistance
Under the Intergovernmental Agreement on the Reform of Commonwealth-State
Financial Relations (IGA), the Commonwealth guaranteed that no state would be
worse off as a result of national tax reform. Since the introduction of the GST,
any shortfall between a state's guaranteed minimum amount and its share of GST
revenue is met by BBA funded by the Commonwealth. Each state's guaranteed
minimum amount includes Commonwealth revenues foregone, abolished state taxes
and the costs of new expenditure responsibilities.
Total BBA for 2003-04 is expected to be $820 million, a reduction of 18.3%
compared with 2002-03. This is a result of the underlying growth of GST revenues
from 2002-03 to 2003-04.
Further, only New South Wales, Victoria and South Australia will require BBA
reflecting the higher tax regimes prevailing in these states when national tax
reform was implemented.
National Competition Policy Payments
NCP payments to the states are expected to be $764.8 million in 2003-04. The
distribution of NCP payments is based on states' population shares and their
progress with the implementation of specified reforms. States' performances are
subject to review by the National Competition Council which will release its
report mid-2003.
Specific Purpose Payments
SPPs are provided by the Commonwealth to states for particular purposes and
under conditions negotiated between Governments. Separate agreements are
negotiated for each SPP, with the agreements covering both funding and policy
issues.
SPPs include grants "to" and "through" the state. SPPs "to" a state assists in
funding areas of state responsibility, for example, health and disability
services. Payments "through" the state are passed to other service providers and
comprise mainly payments to non-government schools and grants to local
government.
Total SPPs in 2003-04 are expected to be $22.489 billion. This represents an
increase of $794.3 million or 3.7%, in nominal terms over 2002-03. Payments "to"
the states increased by 2.4% which represents a real decrease of 1.5% when
inflation and population growth are taken into account. In contrast, SPPs
"through" the states are expected to increase by 7.4%. The main reason for this
increase is an increase in the Commonwealth's contribution to non-government
schools of an expected 10.7%.
STATE SHARES OF COMMONWEALTH FUNDING
Relative Shares of Funding to the States
Table 8.2 shows the expected shares of total Commonwealth payments to each state
for 2003-04 compared with each state's population share. Queensland's
Commonwealth funding share of 18.9% is less than its population share of 19.1%.
Chart 8.3 shows the percentage by which each state's per capita share of total
Commonwealth payments in 2003-04 is expected to differ from a per capita
distribution.
Page 76
Table 8.2
Relative Shares of Payments to the States, 2003-041
Share of Payments
%Share of Population
%Relative Share2
%New South Wales31.533.693.7Victoria22.024.888.9Queensland18.919.198.6Western
Australia310.09.8102.2South Australia8.87.7114.6Tasmania3.42.4141.4Australian
Capital Territory1.91.6114.4Northern Territory33.61.0359.0
Notes:
1. Numbers may not add due to rounding.
2. A state's relative share is measured as its funding share expressed as a
percentage of its population share.
3. Includes grants paid in lieu of royalties.
Source: Commonwealth Budget Paper No. 3, 2003-04.
Chart 8.3
Total Commonwealth Payments - All States, Deviation from Population Share,
2003-041
Note:
1. The chart does not include the Northern Territory which has a corresponding
deviation from population share of 259%.
Queensland, in addition to New South Wales and Victoria, receives less than a
per capita share of total Commonwealth funding. Queensland's share of total
payments is expected to be 1.4% less than its population share.
QUEENSLAND'S SHARE OF FUNDING
Table 8.3 details Queensland's share of estimated Commonwealth payments in
2003-04 and the difference from a population share. (Detailed revenue data are
provided in Chapter 5.)
Table 8.3
Queensland's Share of Estimated Commonwealth Payments, 2003-041Queensland's
Share %Difference from Population Share
$ millionGeneral Purpose Payments GST Revenues19.7172.3 Budget Balancing
Assistance0.0(156.8) NCP Payments19.10.0Total General Purpose
Payments19.215.5Specific Purpose Payments SPPs "to" the State18.5(108.5) SPPs
"through" the State18.2(53.6)Total Specific Purpose Payments18.4(162.1)Total
Commonwealth Payments18.9(146.5)
Note:
1. Numbers may not add due to rounding.
Queensland is expected to receive $172.3 million more than a per capita share of
GST in 2003-04. However, in terms of total Commonwealth funding, Queensland will
receive $146.5 million less than its per capita share.
Any future benefits to Queensland from GST are contingent on a number of factors
including the following:
.. Growth in private final consumption expenditure and the effectiveness of
ongoing GST compliance.
.. The outcome of the Commonwealth Grants Commission's 2004 Review of State
Revenue Sharing Relativities, which will affect the distribution of the GST
revenue grants from 2004-05. Past reviews have resulted in a reduction in
Queensland's share of general revenue funding (see Chart 8.4).
.. Future reviews of state taxes and Commonwealth compensation for revenues
forgone. Debits tax is scheduled for review by 2005, and in the same year
Ministerial Council
Page 77
will review the need for retention of stamp duties on:
.. non-residential property conveyancing
.. non-quotable marketable securities
.. leases
.. mortgages, bonds, debentures and other loan securities
.. credit arrangements, instalment purchase arrangements and rental
arrangements
.. cheques, bills of exchange and promissory notes.
INSTITUTIONAL ARRANGEMENTS
The institutions that provide the framework for Commonwealth-state financial
arrangements are:
.. the Ministerial Council for the Reform of Commonwealth-State Financial
Relations
.. the Australian Loan Council
.. the Commonwealth Grants Commission.
Ministerial Council
The Ministerial Council for Commonwealth-State Financial Relations comprises
Commonwealth and State Treasurers and was established to oversee the operation
of the IGA. The Ministerial Council met on 28 March 2003 to consider payments to
the states in 2003-04 where the following issues were considered:
.. GST administration issues
.. GST revenue and transitional assistance
.. monitoring the level of SPPs
.. a review of horizontal fiscal equalisation.
GST Administration Issues
The Australian Taxation Office (ATO) collects all GST revenue on behalf of the
states. The costs of collection and compliance are borne by the states and
administered under the GST Administration Performance Agreement.
The Ministerial Council considered a report from the GST Administration
Subcommittee (GSTAS) about GST administration issues. The Council endorsed both
the ATO's budget for 2003-04 and a set of targets and benchmarks for monitoring
ATO performance in its administration of the GST.
In addition to the GSTAS, Queensland is represented on the GST Rulings Panel and
the States GST Policy Group. This group monitors and researches issues relating
to the application and administration of GST in Australia. The group reports to
States Heads of Treasury on potential risks to the GST revenue base.
GST Revenue and Distribution
The Ministerial Council noted estimated GST revenue for 2003-04 and endorsed the
revised Commonwealth Grants Commission's (CGC) 2003 Update of State Revenue
Sharing Relativities as the basis for the distribution of the GST general
revenue to the states in 2003-04.
Monitoring the Level of Specific Purpose Payments
The Commonwealth undertook in the IGA not to reduce aggregate SPPs as a result
of national tax reform. The Commonwealth has met this undertaking in real per
capita terms when current payments are compared with the level of SPPs in
1999-2000. However, SPPs "through" states have increased more than SPPs "to"
states. In 2003-04, SPPs "to" the states are estimated to decline in real per
capita terms by 1.5% compared with estimated actual payments in 2002-03 (see
Table 8.1).
The position taken by the Commonwealth Government in negotiating SPPs with the
States represents a significant risk to the provision of essential services,
particularly health and disability services in Queensland. The Queensland
Government's concerns in this area are discussed later in this chapter.
Review of Horizontal Fiscal Equalisation
New South Wales, Victoria and Western Australia jointly proposed a review of
Page 78
Commonwealth-state funding arrangements.
The 2003 Ministerial Council noted that a major review of revenue sharing
methodology is currently being undertaken by the CGC, with a report due in 2004.
It was also noted that all states agreed to current HFE arrangements in 2000,
and in the absence of any agreement to a new review of HFE by the majority of
states, the Commonwealth Treasurer decided not to pursue further the issues
raised by New South Wales, Victoria and Western Australia.
Australian Loan Council
The Australian Loan Council comprises Commonwealth and State Treasurers. Its
2003 meeting was held immediately following the March 2003 Ministerial Council
meeting. Loan Council Allocations (LCAs) nominations for 2003-04 reflected
current best estimates of non-financial public sector deficits or surpluses. For
2003-04, the Loan Council endorsed total LCAs of $3.876 billion (a projected
public sector surplus). This amount reflects a surplus of $5.715 billion for the
Commonwealth and a net deficit of $1.839 billion for the states. Queensland's
projected LCA deficit for 2003-04 was estimated at $190 million.
Commonwealth Grants Commission
The role of the CGC is to advise the Commonwealth Government on the distribution
of the GST revenue among the states. Under its terms of reference the CGC is
required to base its recommendations on the basis of HFE (see Box 8.1). The CGC
reviews its methods every five years. During the interim period it updates
annually the financial, economic and demographic data that underpin its
recommendations.
Box 8.1
Horizontal Fiscal EqualisationGST revenue grants are distributed to the states
on the basis of HFE. The principle of HFE is that state governments should
receive funding from the Commonwealth such that, if each made the same effort to
raise revenue from its own sources and operated at the same level of efficiency,
each would have the capacity to provide services at the same standard.
HFE provides the capacity for all communities to enjoy a similar level of state
government services regardless of where they are located. This is a key feature
of the Australian Federation, made necessary because the Commonwealth generally
imposes taxes at uniform rates across Australia. If the distribution of these
taxes to the states were on any basis other than HFE, some taxpayers would be
forced to accept either a lower standard of state services or a higher level of
state taxation than other taxpayers in similar circumstances.
2003 Update
In its determinations of the distribution of GST, the CGC assessed Queensland as
having a higher fiscal need compared with the average of all states. This higher
fiscal need takes into account Queensland's below average share of SPPs, it's
dispersed population, socio-demographic profile and relative capacity to raise
revenue. Accordingly, in 2003-04, Queensland is expected to receive a higher
percentage of GST revenue grants (19.7%) compared with its population share
(19.1%), to ensure Queenslanders are not disadvantaged.
In the CGC's 2003 Update, Queensland was assessed as requiring a marginally
increased share of GST revenue in 2003-04. This additional revenue accrued
largely because Queensland had a relatively lower capacity to raise revenue from
state taxation over the previous five years. The largest contribution arose from
a reduced capacity to raise stamp duty on conveyances relative to other states.
Despite this increase, the CGC has assessed Queensland's funding need as
declining over the medium term. Chart 8.4 highlights the overall decline in
Queensland's share of financial assistance grants/GST compared with a per capita
share since 1981-82.
Chart 8.4
Queensland's Relative Share (%) of Funding1
Notes:
Page 79
1. Relative share is measured as funding share expressed as a percentage of
population share. Source: Commonwealth Grants Commission.
2004 Review
The outcomes of the CGC's 2004 Review of State Revenue Sharing Relativities will
apply from 2004-05 to 2008-09. The CGC's review involves an extensive
consultation process with the states and other interested parties. In this
context, during 2001-02 the CGC visited Queensland for Workplace Discussions and
Queensland lodged its main submission with the CGC.
During 2002-03, Queensland's continuing contribution to the process has included
attendance at a Heads of Treasuries conference convened by the CGC, a major
rejoinder submission and bilateral discussions between the CGC and senior
officers from a number of Queensland Government Departments. Queensland will
continue to participate in the 2004 Review with further conferences and a final
submission scheduled for completion in October 2003.
Queensland's arguments to the CGC have focussed on important issues relating to
the costs and demands of service provision and Queensland's revenue capacity.
These issues include:
.. Input Costs - The CGC assesses comparative state wages such that those
states with high private sector wage levels are assessed as requiring more
general revenue funding than those states with low private sector wage
levels. Queensland contends the use of private sector wage levels is not
representative of public sector wage levels. Further, there is no evidence
of significant differences among states in actual public sector wage
levels, in particular, those of nurses, teachers and police.
.. Location Specific Disabilities - The provision of services to Queensland's
dispersed population, in particular isolated communities, is more costly
than urban communities. Further, increased use of technology to deliver
services to rural and isolated communities has enhanced service provision
and raised expectations.
.. Mining Revenue - The CGC's assessment of states' capacities to raise
royalty revenue is based on mining profits whereas for most mining products
royalty revenue is based on mining production.
.. Depreciation and Debt Charges - The CGC's assessment is based on states'
borrowing requirements and is influenced by a range of factors including
construction costs. There are recognised flaws in the current assessment
and all states are working with the CGC towards an improved method.
.. Economic Development - Some states contend that revenue capacities should
be adjusted to account for state expenditures towards the infrastructure
used in developing the revenue source, for example mining infrastructure
and its nexus with royalty revenue. The flaw in this argument is that soft
economic development, for example the Queensland Government's Smart State
policies and low tax policies, may not be accorded the same treatment as
expenditure on hard infrastructure.
The financial impact to Queensland of the 2004 Review is uncertain, making it
difficult to predict GST forward estimates for 2004-05 and following years. The
CGC will report its preliminary outcomes of the 2004 Review in July 2003 and the
final report will be released in February 2004.
SPECIFIC PURPOSE PAYMENTS
Current Issues
In July 2002 the Commonwealth informed states it would place greater emphasis on
its own policy objectives through SPP funding. Current negotiations are proving
protracted and problematic, resulting in agreements not being finalised, with
associated uncertainty about final outcomes.
All states have expressed concerns with the emerging trends in negotiations and
some aspects of the Commonwealth's proposals. These concerns include:
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.. the Commonwealth extending the conditions of eligibility for SPP funding to
include new requirements that states agree to commit either prescribed
amounts or percentage growth in states-own funding in the area of the SPP
.. the Commonwealth's focus on control over states' inputs such as matching
funding arrangements, rather than a focus on outcomes and outputs in an
attempt to improve service delivery
.. a trend for the Commonwealth to promote its policy objectives in SPP
agreements, rather than consensus national objectives
.. proposals by the Commonwealth to withhold some funding in SPP agreements
contingent on states meeting Commonwealth objectives
.. where SPP agreements provide for cost indexation, broad, general inflation
factors are proposed by the Commonwealth rather than industry specific
indexation that reflect real cost pressures.
Australian Health Care Agreements
The current Australian Health Care Agreements (AHCAs) expire on 30 June 2003.
The AHCAs provide Commonwealth financial support for the provision of public
hospital services. States received the Commonwealth's offer for the new
agreements in April 2003. For Queensland, the Commonwealth's offer is $8 billion
over five years, which represents a reduction against a straight roll-over of
the current agreement of $160 million over the life of the new agreement.
The funding growth rate in the Commonwealth's offer is lower than the current
agreement and cannot sustain the existing quality of services or infrastructure
over the life of the new agreement. This is due to cost and other indexation
factors not matching actual cost and demand pressures. Further, the
Commonwealth's offer includes additional conditions, to which states would have
to agree if they are to receive the full amount of proposed Commonwealth
funding. These conditions include matching the growth rate of Commonwealth
funding for public hospitals which has not been a provision in previous
agreements. The difficulty for Queensland, as for many states, is that the
Commonwealth's proposal, while imposing new conditions, does not accept any
funding risk during the life of the agreement effectively shifting the risk of
cost and demand increases onto the states.
The states have responsibility for broader community health services, and so the
Commonwealth's demand for matched funding for public hospitals can limit the
capacity for states to allocate appropriate priorities across all health
services. In addition, the Commonwealth's offer is silent on a range of health
reform areas identified by Health Ministers over the last year including
workforce, the interface between acute and residential care, the health of
Aboriginal and Torres Strait Islander people and the interface between emergency
departments and general practitioners.
Commonwealth State/Territory Disability Agreement
The Commonwealth State/Territory Disability Agreement (CSTDA) expired on 30 June
2002 and has been extended while negotiations on a new agreement are conducted.
The delay is partly due to concerns relating to the Commonwealth's offer of
limited growth funds for accommodation and specialist support services, which
are provided by states with financial assistance from the Commonwealth under the
CSTDA. The Commonwealth's offer is not adequate to meet increased demand and
real increases in the cost of delivering services.
Despite states being responsible for the delivery of these services and the
primary funder, the Commonwealth is attempting to prescribe how much states will
allocate from own sources for disability services over the period of the
agreement.
Commonwealth State Housing Agreement
The current Commonwealth State Housing Agreement (CSHA) expires on 30 June 2003.
The Commonwealth's offer for the new agreement represents a significant
reduction in funding. This is largely due to the discontinuation of compensation
for the impact
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of the GST on the costs of providing public housing assistance.
The Commonwealth has agreed to include for the first time in the CSHA some
provision for cost increases, but not for increased demand for assistance.
However, the impact of the Commonwealth's offer is diminished by the
continuation of a 1% per annum reduction in funding for an efficiency dividend.
The Commonwealth also proposes up to 5% of the Commonwealth's funding will be
withheld if states do not comply with specified Commonwealth reporting and
policy requirements.
Natural Heritage Trust 2
The Commonwealth has proposed a five-year extension of the Natural Heritage
Trust (NHT2) from 2002-03 to 2006-07. NHT2 will be directed towards conservation
of biodiversity, sustainable use and management of land and water, and capacity
building for individuals, industry and communities. Negotiations for an
agreement between Queensland and the Commonwealth are nearing completion. The
Commonwealth has agreed that the NHT2 grant can be matched by Queensland through
in-kind support, but details are not finalised.
STATE-LOCAL GOVERNMENT RELATIONS
While local government has a responsibility to deliver various facilities and
services to their individual communities, the Queensland Government has an
interest in helping local government across the State achieve and improve
delivery standards, and enhance equitable access to services and facilities,
particularly in smaller communities. To do this, the Queensland Government
provides considerable financial assistance to local government through a variety
of grants and program funding. The Commonwealth also provides funding to local
government through financial assistance grants and specific purpose payments.
There is a relatively complex funding relationship among local government, state
governments and the Commonwealth. This arises from the nature of institutional
arrangements in Australia and the respective roles and responsibilities of the
three levels of government. In recognition of this complex funding relationship,
details of state assistance to local government in Queensland are being reported
in budget papers for the first time.
Grant Assistance
There is a wide disparity in local governments' ability to raise revenue due to
large differences in the tax base (rating ability) and differential ability to
levy user charges among urban, regional and rural/remote councils. Of
Queensland's 157 councils, 17 are located in the south east corner of the State
(Noosa Shire to the New South Wales border), eight regional city councils are
located along Queensland's eastern seaboard (Cook Shire to Noosa Shire), while
the remaining 132 are located in rural parts of the State and the Torres
Strait6. In this context, grants are a significant source of income to many
local governments, especially in regional or rural communities. For some
councils, grants can comprise more than 50% of their total revenue7.
In 2001-02, $878 million in grants was provided to Queensland's local
governments. Of this amount, 58% was provided by the Queensland Government with
the balance being provided by the Commonwealth. Current estimates for 2002-03
indicate the proportion of funding provided by the Queensland Government will
increase to 61%, and remain at that level in 2003-04. Table 8.4 details State
and Commonwealth grants to Queensland local government.
Table 8.4
Grants to Local Government in Queensland12001-02
Actual
$'0002002-03 Estimated Actual
$'0002003-04 Estimate2
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$'000Queensland GrantsAboriginal and Torres Strait Islander
Policy31,24931,79535,076Arts Queensland19,83023,82619,730Emergency
Services1,9714,0514,659Employment and
Training25,18329,63423,969Families47,79854,80556,180Health7,5358,1247,141
Housing39,65456,66759,891Local Government and Planning3214,316185,143188,506Main
Roads45,79138,15140,927Natural Resources and Mines4,5043,7449,100Queensland
Transport40,44537,751101,162Sport and Recreation
Queensland15,46519,66214,676Other14,5668,5802,341Total Queensland Grants
508,307501,933563,358Commonwealth GrantsCommonwealth - through the
state258,400274,600285,200Commonwealth - direct to local
government111,29550,43674,327Total Commonwealth Grants
369,695325,036359,527Total Grants to Local Government Authorities and Aboriginal
and Torres Straight Islander Councils878,002826,969922,885
Notes:
1. Grants for current and capital purposes to local government authorities and
Aboriginal and Torres Strait Islander councils.
2. Numbers yet to be confirmed and may be subject to revision.
3. Includes National Competition Payments.
Source: Queensland Treasury and Commonwealth Budget Paper No.3, 2002-03 and
2003-04.
The reduction in grants by some Queensland Government agencies in 2003-04
compared with previous years reflects the completion, or near completion, of
several projects including:
.. Cairns Esplanade Enhancement (Premier and Cabinet)
.. Regional Landscape Strategy (Environmental Protection Agency)
.. Burdekin Rangelands Reef Initiative (Primary Industries)
.. Youth for the Environment and Local Communities Program (Employment and
Training)
.. Queensland Heritage Trails Network (Arts Queensland).
Further, several agencies provide responsive, demand driven programs where local
government has the opportunity of pursuing funding.
Grant Purposes
The composition of Queensland's grants to local government can vary from year to
year. Nonetheless, the major areas of ongoing annual funding remain:
.. general public services including contribution to the costs of providing
local government services where councils are unable to levy land rates
.. public library schemes where funding is provided to purchase books, upgrade
equipment and increase the community use of library services
.. employment and training programs to support and mentor trainees and
apprentices, and enhance community employment
.. the provision of rate subsidies to eligible pensioners
.. bus service funding to the Brisbane City Council to support urban bus
services
.. capital works subsidies provided towards the costs of local public
infrastructure
.. road subsidies for local roads, networks and drainage.
Chart 8.5 highlights the broad range of purposes that local government grants
are provided for by the Queensland Government.
Page 83
Chart 8.5
State Grants to Local Government in Queensland by Purpose 2002-03
Future Developments
Review by the Local Government Grants Commission
The Queensland Local Government Grants Commission (the Commission) is an
independent body created under the Local Government Act 1993. The Commission's
primary role is to make recommendations to the State Local Government Minister
on the distribution of financial assistance grants made available to local
government under the Commonwealth Local Government (Financial Assistance) Act
1995.
The method for recommending the distribution of Commonwealth grants to local
government was recently reviewed by the Commission and a new distribution
methodology is due to commence in 2003-04. Agreement is still to be reached with
the Commonwealth regarding an appropriate phase-in period for this new
distribution methodology.
The Commission will undertake further research to refine its methodology on
issues that were not resolved in this review. These issues include local
government revenue raising capacity, inconsistencies in traffic volume data and
cost weightings.
QUEENSLAND AS A TAXPAYER
Queensland, like other states, is liable for certain Commonwealth taxes
including the GST and Fringe Benefits Tax (FBT). In addition, the National Tax
Equivalents Regime (NTER) for Government Owned Corporations (GOCs) and selected
business units imposes the equivalent of an income tax on these entities. Based
on these taxes, the Queensland Government's annual Commonwealth tax exposure is
over $1 billion.
This exposure means there is a requirement to manage any liability associated
with these taxes and the flow-on effects to Queensland's operating position and
balance sheet. Proper management of these Commonwealth and other tax liabilities
ensures there is minimal impost to the Queensland community.
GST Input Tax Credits and GST Liabilities
Overall there are some 3,300 Queensland Government bodies registered for the
GST, of a total of almost 19,000 government bodies registered nationwide. This
has created an ongoing compliance requirement for Queensland Government bodies
to ensure all steps are being taken to accurately account for the GST, including
claiming input tax credits and accounting for GST liabilities.
For 2002-03 the major Queensland Government departments and agencies are
expected to generate a GST exposure of over $1 billion, comprising gross GST
input tax credits and gross GST liabilities. In 2001-02, the major Queensland
Government departments and agencies GST exposure was $1.041 billion, comprising
$805 million in gross GST credits and $236 million in gross GST payable.
The Queensland Government's GST exposure is largely driven by the departments of
Health, Transport, Education (including schools), Main Roads, Public Works and
Families. This reflects the size of these agencies and their dealings with other
Queensland Government departments.
Fringe Benefits Tax
In 2002-03, Queensland's FBT liability is estimated to be in the order of
previous annual FBT liabilities (in 2001-02 the FBT liability was approximately
$22 million).
The Education, Justice and Attorney-General, Police, Main Roads and Health
portfolios are major contributors to Queensland's total FBT liability,
collectively comprising 40% of the total FBT liability in 2001-02. Vehicle
related expenses continue to be a major generator of FBT liabilities, currently
comprising approximately 60% of the 2001-02 total FBT liability.
Page 84
National Tax Equivalents Regime
The NTER is an administrative arrangement between the Commonwealth and the
states under which Commonwealth income tax laws are applied to certain
government bodies, namely GOCs and commercialised business units (CBUs). The
NTER regime is administered by the ATO which charges the Queensland Government
on a fee-for-service basis.
The primary objective of the NTER is to promote competitive neutrality, through
a uniform application of income tax laws, between NTER entities and their
privately held counterparts.
In 2001-02, Queensland's NTER entities generated $79.7 million in income tax
equivalent receipts. GOCs comprised 91% of these receipts, with the remainder
coming from CBUs.
Commonwealth Tax Management
Further emphasis will be placed on agencies' corporate governance arrangements
where the GST is concerned, to ensure Queensland Government agencies registered
for the GST meet their Commonwealth tax obligations. In addition, there will be
a continuing review of aspects of the Queensland Government's other Commonwealth
tax liabilities.
APPENDIX A - TAX EXPENDITURE STATEMENT
OVERVIEW
Governments employ a range of policy tools to achieve social and economic
objectives. These include use of direct budgetary outlays, regulatory mechanisms
and taxation. As required by the Charter of Social and Fiscal Responsibility,
this Tax Expenditure Statement (TES), details revenue foregone as a result of
Government decisions relating to the provision of tax concessions.
The TES is designed to improve transparency in the use of tax expenditures and
increase public understanding of the fiscal process.
Tax expenditures are reductions in tax revenue that result from the use of the
taxation system as a policy tool to deliver Government policy objectives. Tax
expenditures are provided through a range of concessions, including:
.. tax exemptions
.. the application of reduced tax rates to certain groups or sectors of the
community
.. tax rebates
.. tax deductions
.. provisions which defer payment of a tax liability to a future period.
Labelling an exemption or concession as a tax expenditure does not necessarily
imply any judgement as to its appropriateness. It merely makes the amount of the
exemption or concession explicit and thereby facilitates its scrutiny as part of
the annual Budget process.
Methodology
Revenue Foregone Approach
The method used almost exclusively by governments to quantify the value of their
tax expenditures is the revenue foregone approach. This method estimates the
revenue foregone through use of the concession by applying the benchmark rate of
taxation to the volume of activities or assets exempted by the concession. One
of the deficiencies of the revenue foregone approach is that the effect on
taxpayer behaviour resulting from the removal of the particular tax expenditure
is not factored into the estimate. Consequently, the aggregation of costings for
individual tax expenditure items presented in the TES will not necessarily
provide an accurate estimate of the total level of assistance that is provided
through tax expenditures.
Page 85
Measuring tax expenditures requires the identification of:
.. a benchmark tax base
.. concessionally taxed components of the benchmark tax base such as a
specific activity or class of taxpayer
.. a benchmark tax rate to apply to the concessionally taxed components of the
tax base.
Defining the Tax Benchmark
The most important step in the preparation of a TES is the establishment of a
benchmark for each tax included in the statement. The benchmark provides a basis
against which each tax concession can be evaluated. The aim of the benchmark is
to determine which concessions are tax expenditures as opposed to structural
elements of the tax. The key features of a tax benchmark are:
.. the tax rate structure
.. any specific accounting conventions applicable to the tax
.. the deductibility of compulsory payments
.. any provisions to facilitate administration
.. provisions relating to any fiscal obligations.
By definition, tax expenditures are those tax concessions not included as part
of the tax benchmark.
Identification of benchmark revenue bases and rates requires a degree of
judgement and is not definitive. Furthermore, data limitations mean that the tax
expenditures are approximations and are not exhaustive. This statement does not
include estimates of revenue foregone from exemptions or concessions provided to
charities, religious organisations or Government agencies. Very small exemptions
or concessions are also excluded.
THE TAX EXPENDITURE STATEMENT
This year's statement includes 2002-03 estimates of tax expenditures for payroll
tax, land tax, stamp duties and gambling taxes. A summary of the major tax
expenditures valued on the basis of revenue foregone is presented in Table A.1.
Not all expenditures can be quantified at this time. Accordingly, the total
value of tax expenditures should be considered as indicative only.
TABLE A.1
TAX EXPENDITURE SUMMARY12001-022
$ million2002-03
$ millionPayroll Tax Exemption Threshold718.3768.9 Deduction
Scheme386.893.0Offshore Banking Units and Regional Headquarters Concession0.80.9
Section 10 Exemptions4Local
Government62.066.4Education56.661.9Hospitals89.695.9Total Payroll
Tax1,014.11,087.0Land Tax Liability Thresholds5144.8162.9 Graduated Land Tax
Scale94.578.9 Primary Production Deduction48.150.1 Section 13 Exemptions Not
Included Elsewhere429.226.7 General Land Tax Rebate41.35.8 Additional Land Tax
Rebate2.02.0 Land Developers' Concession6.13.1Total Land Tax366.0329.5Duties
Transfer Duty on Residential PropertyHome Concession237.9287.5First Home
Concession45.955.5 Insurance Duty on General InsuranceNon-life
Insurance148.4175.4Workcover18.225.4Health Insurance109.7109.9Total
Duties560.1653.7Taxes on Gambling Gaming Machine Taxes90.894.0 Casino
Taxes11.610.3Total Gambling Tax102.4104.3
Notes:
1. Numbers may not add due to rounding.
2. 2001-02 estimates may have been revised since last year's Budget.
3. Deduction of $0.85 million, which reduces by $1 for every $3, is applicable
to employers with an annual payroll between $0.85 million and $3.4 million.
4. Applicable but not limited to religious bodies, public benevolent
institutions and other exempt charitable institutions.
Page 86
5. Land tax is payable only on the value of taxable land above a threshold which
depends on the ownership structure.
DISCUSSION OF INDIVIDUAL TAXES
Payroll Tax
The benchmark tax base for payroll tax is assumed to be all wages, salaries and
supplements (including employer superannuation contributions) paid in
Queensland, as defined in the Pay-roll Tax Act 1971. The benchmark tax rate for
payroll tax is assumed to be the statutory rate applying in each financial year.
Payroll Tax Exemption Threshold
Sole employers who employ in Queensland (not those who are part of a group for
payroll tax purposes) with an annual payroll of $0.85 million or less are exempt
from payroll tax. On the basis of average weekly earnings, this threshold
corresponds to approximately 23 full time equivalent employees. This concession
is designed to assist small business.
Deduction Scheme
Sole employers who employ in Queensland with payrolls between $0.85 million and
$3.4 million benefit from a deduction of $0.85 million, which reduces by $1 for
every $3 by which the annual payroll exceeds $0.85 million. There is no
deduction for employers with an annual payroll in excess of $3.4 million.
Offshore Banking Units (OBUs) and Regional Headquarters Concessions (RHQs) Under
the Offshore Banking Units and Regional Headquarters Act 1993 and Offshore
Banking Units and Regional Headquarters Regulation 1994, offshore banking units
and regional headquarters are exempted from paying payroll tax on payrolls
relating directly to Queensland-based activities for the period.
Section 10 Exemptions
A number of organisations are provided with exemptions from payroll tax under
Section 10 of the Pay-roll Tax Act 1971. The activities for which estimates have
been calculated are wages paid by public hospitals, non-tertiary private
educational institutions and local governments (excluding commercial
activities).
Land Tax
The benchmark tax base is assumed to be all freehold land within Queensland,
excluding residential land used as a principal place of residence and land owned
by individuals with a value for that year below the threshold. The benchmark tax
rate for land tax is assumed to be the top rate of land tax applicable in
Queensland in each financial year.
Liability Thresholds
Land tax is payable on the value of taxable land above a threshold which depends
on the land's ownership. Residential land owned by individuals is excluded from
the estimate.
Graduated Land Tax Scale
A graduated (concessional) scale of land tax rates is applicable to land with a
taxable value of less than $1.5 million.
Primary Production Deduction
The taxable value of land owned by an individual, trustee or some absentees and
companies does not include all or part of the land that is used for the business
of agriculture, pasturage or dairy farming.
Section 13 Exemptions (not elsewhere included)
A number of land tax exemptions are granted under Section 13 of the Land Tax Act
1915 to eligible organisations. These include, but are not limited to, public
benevolent institutions, religious institutions and other exempt charitable
institutions, retirement villages, trade unions and show grounds.
General Land Tax Rebate
A general rebate on land tax of 15% is provided to non-absentee individual land
tax payers. The rebate was available to company, trustee and absentee land tax
payers in 2001-02.
Additional Land Tax Rebate
In 2001-02, an additional phasing-in rebate was available to trustees and
companies where the taxable land value was less than $165,000, with a schedule
of rebates offered according to the taxable value of the land. In 2002-03, the
phasing-in rebate was expanded to include absentees and adjusted to a maximum of
36%, reducing
Page 87
by 0.5 percentage points for every $1000 of taxable value over $150,000.
Land Developers' Concession
From 1 July 1998, land developers have been charged land tax on 60% of the
unimproved value of (undeveloped) land subdivided in the previous financial year
and which remains unsold at 30 June of that year. This concession is outlined in
Section 3CA of the Land Tax Act 1915.
Transfer Duty Concession on Residential Property
The benchmark tax base is assumed to be all sales of residential property within
Queensland. The benchmark tax scale is assumed to be the scale that actually
applied in each financial year.
Home Concession
A concessional rate of duty applies to purchases intended to be a principal
place of residence. A concessional rate of 1% applies on values up to $250,000
compared to the normal schedule of rates between 1.5% and 3.25%. For properties
valued greater than $250,000, the scheduled scale of conveyancing duty applies
on the excess.
First Home Concession
Where a purchaser has not previously owned a residence in Queensland or
elsewhere, a stamp duty rebate in addition to the home concession is applicable
on properties valued up to $160,000. (This concession is not applicable if the
purchase price is less than the full market value of the property.) The size of
the rebate depends on the value of the property and ranges in value from $800
for properties valued under $80,000 to $200 for properties valued between
$155,000 and $160,000.
Insurance Duty
The benchmark tax base is assumed to be all premiums for general insurance
policies (except for life assurance). The benchmark tax scale is assumed to be
the scale that actually applied in each financial year.
The rate of duty applicable to general insurance is 8.5%. However, concessional
rates apply to other insurance types (5% for motor vehicle other than compulsory
third party (CTP), workers' compensation and professional indemnity insurance
and 10c on a premium for CTP insurance). Data limitations mean that these
insurance types are categorised into non-life insurance cover and WorkCover. An
exemption from duty is also provided for private health insurance.
Duty on Mortgages - Home concessions and First home concessions
The benchmark tax base is assumed to be all mortgages and loans taken out in
Queensland. The benchmark tax scale is assumed to be the scale that actually
applied in each financial year.
A concession from duty is allowed where a home mortgage secures an advance
attributable to the purchase or construction of the borrower's home. The
mortgage is exempt up to an amount of $100,000 advanced for a first home and
$70,000 advanced for others with mortgage duty payable on the balance of the
amount secured. Similarly, a concession from mortgage duty is also available of
an amount up to the first $100,000, for refinancing an amount outstanding under
a mortgage on the borrower's home.
The data required to estimate the revenue foregone are not available.
Gambling Taxes
Gaming Machine Tax Concessions for Licensed Clubs
The benchmark tax base is assumed to be all gaming machines operated by clubs
and hotels in Queensland. The benchmark tax scale is assumed to be the rate of
taxation that applies to gaming machines in hotels in each financial year (which
is 35.91% of the monthly metered win).
A concessional graduated tax rate scale applies to gaming machines operated by
licensed clubs. The tax rate is calculated on the gaming machine monthly metered
win and the full tax rate (as applies to hotel gaming machines) is only applied
to gaming machine revenue where the monthly metered win exceeds $1.4 million for
any licensed club.
Casino Tax Concessions
The benchmark tax base is assumed to be all casinos operating in Queensland. The
benchmark tax scale is assumed to be the flat rate of 20% of casino gross
revenue
Page 88
that applies for standard transactions in the Brisbane and Gold Coast casinos.
A concessional tax rate of 10% applies for normal gross revenue for the Cairns
and Townsville casinos. In addition concessional rates also apply for revenue
from high rollers in all casinos. High roller revenue is taxed at 10% for the
Brisbane and Gold Coast casinos and 8% for the Cairns and Townsville casinos.
APPENDIX B - CONCESSIONS STATEMENT
INTRODUCTION
The Government provides concessions in the form of discounts, rebates and
subsidies to improve access to and the affordability of a range of services for
individuals or families based on eligibility criteria relating to factors such
as age, income and special needs or disadvantage.
This concessions statement serves to highlight the cost and nature of
concessions covering both concessions which are reflected as outlays in the
Budget (eg. direct subsidy payments) and revenue foregone through fees and
charges which are set at a rate lower than that applying to the wider community.
Varying methods have been used to estimate the cost of concessions depending on
the nature of the concession, including:
.. direct Budget outlay cost (eg. direct subsidy or rebate payments)
.. revenue foregone (eg. concessional fees and charges)
.. cost of goods and services provided.
As this represents the first presentation of a concessions statement it is
likely to be subject to future refinement, development and revision. As such the
total value of concessions should be considered as indicative only.
Table B.1 sets out the cost of concessions by agency. The total value of
concessions is estimated at $739 million in 2003-04.
Table B.1
Concessions by Agency1Agency2002-03
Est. Act
$million2003-04
Estimate
$millionDepartment of ArtsConcessional Entry Fees0.30.4Department of
EducationLiving Away from Home Allowances Scheme5.65.8School Transport
Assistance for Students with Disabilities20.722.8Non-State School Transport
Assistance Scheme3.73.8Department of Emergency ServicesProvision of Free
Ambulance Services to Pensioners and Seniors116.0124.5Urban Fire Levy
Concession4.74.9Department of Employment and TrainingTAFE
Concessions9.69.9Environment Protection AgencyConcessions Entry and Tour
Fees0.10.2Department of FamiliesElectricity Rebate Scheme43.947.7Electricity
Life Support Scheme0.50.5Pensioner Rate Subsidy Scheme45.346.7Rail Concession
Scheme31.735.2Department of HealthSpectacles Supply Scheme3.33.3Medical Aids
Subsidy Scheme12.913.0Patient Travel Subsidy Scheme1.51.6Oral
Health73.578.3Department of HousingATSI Housing Rental Rebate7.68.0Public Rental
Housing Rebate122.6130.0Department of Justice and Attorney-GeneralPublic Trust
Office - Rebates for Fees7.98.2Department of the Premier and CabinetSouth Bank
Corporation - Venue Hire Discounts and Car Park Student Concession
0.2
0.2Department of TransportTransport Concessions incl. Taxi
Subsidies38.139.5Motor Vehicle Registration Concession45.048.2Boat Registration
Concessions0.60.7School Transport Assistance Scheme104.5106.2Total700.9739.3
Note:
1. Numbers may not add due to rounding.
Page 89
DEPARTMENT OF ARTS
Concessional ticket entry fees apply to a variety of concession card holders,
students, children and families for special exhibitions at the Queensland Art
Gallery and the Queensland Museum.
DEPARTMENT OF EDUCATION
The Department of Education provides a living away from home allowance to
students in Years 1 to 12 in State and non-State schools whose homes are
geographically isolated from local schools. The allowances offset the costs
associated with boarding away from home to attend school on a daily basis and
include tuition costs and travel costs.
The department also offers assistance to students with disabilities to access
school programs able to meet their educational needs. Assistance is in the form
of the provision of taxis or specialised contracted minibuses, payment of fares
on regular buses or trains, or an allowance for parents who drive their children
to school.
The Non-State School Transport Assistance Scheme assists families of students
attending non-State schools outside Brisbane whose bus fare is over a weekly
threshold amount. The program also assists families of students with
disabilities who attend a non-State school.
DEPARTMENT OF EMERGENCY SERVICES
Since the beginning of the first term of the current Government, Pensioners and
Seniors Card holders have been provided with access to free ambulance and
patient transport services through the Queensland Ambulance Service. Pensioners
and Seniors card holders will continue to receive this free service following
the commencement of Community Ambulance Cover on 1 July 2003.
Pensioners are eligible for a 20% discount on the Urban Fire Levy payable on
prescribed properties of which they are the owner or part owner.
DEPARTMENT OF EMPLOYMENT AND TRAINING
Concessions on TAFE tuition fees for Government funded subjects are offered to a
range of concession card holders, students of Aboriginal and Torres Strait
Islander descent and students who can demonstrate extreme financial hardship.
ENVIRONMENT PROTECTION AGENCY
The department offers concessional entry ticket prices on specified national
parks including St Helena Island, David Fleay Wildlife Park and Mon Repos
Conservation Park.
DEPARTMENT OF FAMILIES
The Department of Families has responsibility for the Queensland Government
Electricity Rebate Scheme and reimburses the electricity retail corporations for
rebates provided. The scheme provides a rebate to eligible pensioners and
Seniors Card holders throughout Queensland.
The Electricity Life Support Concession Scheme is aimed at assisting seriously
ill people who use home-based life support systems (oxygen concentrators and
kidney dialysis machines).
The Pensioner Rate Subsidy Scheme alleviates the impact of Local Government
rates and charges on pensioners, thereby assisting them to live in their own
homes.
The Queensland Rail Concessions Scheme assists pensioners, veterans and seniors
to reduce the cost of public transport and to maintain an active and health
lifestyle.
DEPARTMENT OF HEALTH
The Spectacles Supply Scheme assists eligible Queensland residents by providing
a comprehensive range of free basic prescription spectacles.
The Medical Aids Subsidy Scheme subsidises the cost of a range of aids and
equipment from an approved list to assist eligible people with stabilised or
permanent disabilities to remain living at home.
The Patient Travel Subsidy Scheme (PTSS) provides subsidised assistance for both
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travel and accommodation to all eligible Queensland patients and in some cases
their carers to enable patients to access specialist medical services from which
they are isolated. Concession card holders qualify for a level of accommodation
assistance through the PTSS and this is the sole expenditure reflected in Table
B.1.
The Oral Health Scheme provides free dental care to eligible clients and their
dependents who possess a current Health Care Card, Pensioner Concession Card or
Queensland or Commonwealth Seniors Card. In rural and remote areas where no
private dental practioner exists, access to dental care for the general public
is provided at a concessional rate.
DEPARTMENT OF HOUSING
The Aboriginal and Torres Strait Islander Housing Rental Rebate concession
represents revenue foregone in rental agreements with Indigenous households in
targeted public housing. The target group is low to moderate income Indigenous
households.
The Public Rental Housing Rebate targets low to moderate income families and
individuals and represents the difference between market rent and the rent that
is charged based on the tenant's income.
DEPARTMENT OF JUSTICE AND ATTORNEY-GENERAL
The Public Trust Office offers fee rebates for clients who, because of financial
circumstances, cannot pay the full amount of a fee charged by the Office.
DEPARTMENT OF THE PREMIER AND CABINET
Community groups and charities are given discounted charges for the hire of
venues within the South Bank parklands.
Discounted charges apply to students when they park in the South Bank carpark.
DEPARTMENT OF TRANSPORT
Transport concessions are provided by Government to ensure a reasonable level of
access and mobility for people who are transport disadvantaged. Eligible
categories include Pensioner Concession Card holders, Seniors Card holders,
children and secondary students. Transport concessions include the payment of
taxi subsidies for people with an eligible disability.
Motor vehicle and boat registration concessions are provided to holders of a
Pensioner Concession Card, Seniors Card and Totally or Permanently Incapacitated
Card as a means to making the cost of travel more affordable for people who are
transport disadvantaged.
The School Transport Assistance Scheme is a program for students whose access to
school is disadvantaged by distance or are from defined low-income groups.
Assistance is provided towards the cost of travel on bus, rail and/or ferry with
allowances for private vehicle transport.
APPENDIX C - STATEMENT OF RISKS AND SENSITIVITY ANALYSIS
INTRODUCTION
The Queensland State Budget, like those of other States, is based in part on
assumptions made about future elements of uncertainty both internal and external
to the State which can impact directly on economic and fiscal forecasts.
Operating results achieved in recent years reflect the fact that the actual
fiscal result achieved depends on the direction of such variables.
Consistent with the Charter of Social and Fiscal Responsibility, this section
analyses the sensitivity of the estimates to changes in the economic and other
assumptions used in developing the Budget and forward estimates. This analysis
is provided, as required under the Charter, to enhance the level of transparency
and accountability of the Government.
Notwithstanding the risks associated with the Budget, Queensland is in a strong
position to manage adverse impacts. Queensland's AAA credit rating, based on its
low tax status and low debt position, means it has greater capacity than any
other jurisdiction in Australia to withstand the risks that are normally
associated with any State or Territory Budget.
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The forward estimates in the Budget are framed on a no policy change basis. That
is, the expenditure and revenue policies in place at the time of the Budget
(including those announced in the Budget) are applied consistently throughout
the forward estimates period.
The following discussion provides details of some of the key assumptions and
risks associated with revenue and expenditure forecasts and, where a direct link
can be established, the indicative impact on forecasts resulting from a movement
in those variables.
SENSITIVITY OF EXPENDITURE ESTIMATES AND EXPENDITURE RISKS
Public Sector Wage Costs
Salaries and wages form a large proportion of General Government operating
expenditure. Increases in salaries and wages are negotiated through Enterprise
Bargaining Agreements.
The 2003-04 Budget and forward estimates include a provision for wage increases
consistent with an outcome of approximately 3.5% per annum or, where an
agreement has been reached, the expected cost of implementing that agreed
outcome.
All other things being equal, a one percentage point variation in public sector
wage outcomes for the General Government sector broadly equates to $110 million
in 2003-04 (assuming a full-year impact).
Electricity Pool Prices - Impact on Community Service Obligation Payments
The Queensland Government is committed to a policy of uniform electricity
tariffs. This policy provides that all franchise customers of the same class in
Queensland pay the same rate for electricity no matter where they are located in
the State. The Government gives effect to this policy through the provision of
Community Service Obligation (CSO) payments to Queensland electricity retailers.
The quantum of these payments in any given year is influenced in part by the
electricity pool price, which is the prevailing wholesale electricity price in
the national electricity market.
Depending on whether the electricity is being sourced from Queensland Government
owned or private sector/interstate generators, there is the scope for
increases/(decreases) in CSO payments to be offset by higher/(lower) dividend
and tax equivalent payments from the electricity supply industry.
The assumption used in the Budget is that pool prices will decrease over the
course of 2003-04 reflecting the commissioning of a number of new generation
projects.
In practice, the level of contract cover held by Queensland electricity
retailers is an important factor in determining whether a variation in pool
prices translates to a change in CSO expense. However, holding all other
assumptions constant, a $1 per MWh variation in electricity pool prices would
lead to a change in CSO expenses of approximately $25 million.
Interest Rates
The General Government sector has a very moderate level of debt with a total
debt servicing cost forecast at $247 million in 2003-04.
The current average duration of General Government debt is approximately four
years. Accordingly, a one percentage point variation in interest rates would
lead to a very modest change in debt servicing costs in 2003-04.
Actuarial Estimates of Superannuation and Long Service Leave
Liabilities for superannuation and long service leave are estimated by the State
Actuary with reference to, among other things, assumed rates of investment
returns, salary growth and inflation. These liabilities are therefore subject to
changes in these parameters. Similarly, the long service leave liabilities are
subject to the risk that the actual rates of employee retention will vary from
those assumed in the liability calculation.
While these impacts have been estimated and allowances made in the Budget and
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forward estimates to accommodate them, the actual outcome may differ from the
estimates calculated for the Budget.
Demographic and Demand Based Risks
Unforeseen changes in the size, location and composition of Queensland's
population can impact on the demand for goods and services, and therefore the
cost of maintaining existing policies. This is particularly evident in the
health, education, community services and criminal justice sectors.
State Government expenditure is often more closely associated with
socio-demographic factors, such as the number of school age children or the
number of elderly residents, than with economic activity. However, such changes
are unlikely to impact significantly in the short term (i.e. within a given
Budget year).
For this reason, the composition, size and location of the State's population is
critical in projecting the State's expenditure needs across the forward estimate
period.
Unforeseen Events
It is almost inevitable that some events will occur during the year which will
require additional expenditure but could not be foreseen or quantified at the
time of the Budget.
Contingency funding for such events is provided in the Budget through the
Treasurer's Advance. The Treasurer's Advance (TA) is an amount of appropriation
within Treasury's administered Budget as a whole-of-Government provision for
potentially emergent costs, for example natural disasters, and also contains
some items that have not been finalised for inclusion in agency estimates at the
time of the Budget.
In 2003-04, the Treasurer's Advance allocation is $86 million.
SENSITIVITY OF REVENUE ESTIMATES AND REVENUE RISKS
The rate of growth in tax revenues is dependent on a range of factors that are
linked to the rate of growth in economic activity in the State. Some taxes are
closely related to activity in specific sectors of the economy, whilst others
are broadly related to the general rate of economic growth, employment,
inflation and wages. A change in the level of economic activity, resulting from
economic growth differing from forecast levels, would impact upon a broad range
of taxation receipts.
Other revenue items are influenced by external variables such as the exchange
rate or the performance of financial markets.
Performance of Financial Markets - Investment Returns
Investment earnings are based on the assumption of long-term average market
returns for an acceptable level of risk. These investments principally cover the
superannuation investment funds. The Government's financial investments are held
in a portfolio comprising property, domestic and offshore equities and fixed
interest.
The assumed long run rate of return used in Budget estimates is 7.5%. Actual
returns will depend on the performance of sectors which comprise the portfolio.
Given Queensland's large holding of financial assets, actual revenues are highly
sensitive to small variations from the assumed long run rate of return.
A one percentage point variation in investment earnings on assets held to meet
future employee entitlements would lead to a change in investment revenue of
approximately $100 million.
Exchange Rate and Coal Prices and Volumes - Royalties Estimates
Estimates of mining royalties are sensitive to movements in the A$/US$ exchange
rate, and commodity prices and volumes.
Contracts for the supply of commodities are generally written in US$.
Accordingly, a change in the exchange rate impacts on the A$ price of
commodities and therefore
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expected royalties collections.
The 2003-04 Budget royalty estimates are based on a year average A$/US$ exchange
rate of around 65 cents.
A one cent variation in the A$/US$ would lead to a change in royalties revenue
of approximately $10 million in 2003-04.
Also impacting on royalty estimates are volume effects. A large component of
Queensland's royalty collections is derived from coal. A 1% variation in export
coking and thermal coal volumes would lead to a change in royalty revenue of
approximately $5 million.
The 2003-04 Budget assumptions for export coal prices are derived taking into
account various price forecasts made by coal companies. A US$1 variation in the
price of export coal would lead to a change in royalty revenue of approximately
$14 million.
Property Prices and Volumes - Transfer Duty Estimates
Over recent years, strong growth in State taxation receipts has been a result of
high levels of activity in the residential property market through its impact on
transfer duty receipts. The increase in stamp duty receipts flowing from
residential property market activity has two elements, the price of properties
changing hands, and the volume of properties changing hands.
For 2003-04, an easing in the property market is forecast. The assumption
underpinning the expected reduction in stamp duties is for property prices to
remain at current levels, but for a reduction in transaction volumes.
A one percentage point variation in the average value of property transactions
would change transfer duty collections by approximately $12.5 million in
2003-04.
A one percentage point variation in the volume of transactions would change
transfer duty revenues by approximately $10.5 million in 2003-04.
Wages and Employment Growth - Payroll Tax Collections
Wages and employment growth have a direct impact on payroll tax collections. The
2003-04 Budget assumptions are for average earnings growth of 4.25% and
employment growth of 2.25%.
A one percentage point variation in average earnings growth would change payroll
tax collections by approximately $8 million.
A one percentage point variation in employment growth would change payroll tax
collections by approximately $16 million.
Parameters Influencing Commonwealth GST Payments to Queensland
The Commonwealth Government's national tax reform package was introduced with
effect from 1 July 2000. As part of this package, the Commonwealth and all State
and Territory Governments signed an Intergovernmental Agreement on the Reform of
Commonwealth - State Financial Relations (IGA). Under this agreement, there have
been substantial changes to the funding arrangements for states and territories,
including compensation for certain costs and revenue foregone.
Estimates of Commonwealth GST revenue grants to States and Territories are
dependent on GST revenue collection which is likely to be closely correlated
with the general level of economic activity. The Commonwealth Government has
provided estimates of GST collections in its Budget Papers. In 2003-04,
Queensland's Budget will bear the risks of fluctuations in GST revenues and the
other components of the package (First Home Owners Grant scheme, administrative
costs associated with the GST, gambling tax losses, etc).
The Commonwealth's estimate of collections in 2003-04 is based on its forecast
of national GDP growth of 3.25% and consumption growth of 3.25%. As with all
other tax estimates, there is a risk of lower collections than estimated by the
Commonwealth if economic growth and consumption is weaker than expected.
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There is not enough information provided in the Commonwealth Budget Papers to
prepare indicative forecasts of the sensitivity of GST estimates to key
variables. However, based on current Commonwealth estimates, Queensland's
maximum exposure in 2003-04 is presently $197 million, which represents the
amount GST revenue would need to reduce by before the Guaranteed Minimum Amount
provisions would be activated.
Commonwealth Grants (Specific Purpose Payments)
Specific Purpose Payments (SPPs) are payments made by the Commonwealth to
promote its policy objectives. Indexation arrangements and distribution among
the States vary for each SPP. The Commonwealth reviews the payments each year
and it has guaranteed it will not reduce SPPs as a result of national tax
reform. However, the State has no guarantee that the Commonwealth will not
reduce SPPs for other purposes.
CONTINGENT LIABILITIES
Contingent liabilities represent items that are not included in the Budget as
significant uncertainty exists as to whether the Government would sacrifice
future economic benefits in respect of these items. Nevertheless, such
contingencies need to be recognised and managed wherever possible in terms of
their potential impact on the Government's financial position in the future.
The State's quantifiable and non-quantifiable contingent liabilities are
detailed in the Consolidated Financial (AAS31) Report (Note 34).
A summary of the State's quantifiable contingent liabilities as at 30 June 2002
is provided below.
Table C.1
Contingent Liabilities2002
$ millionNature of Contingent Liability
Guarantees and indemnities
QTC - stock loans
Training agreement
Grants and subsidies
Other
Total
6,412
1,181
47
9
117,660
APPENDIX D - DEMOGRAPHIC TRENDS
Trends in government service delivery reflect the general social and economic
trends affecting the State and the fiscal strategies adopted by the Government.
Changes in the size and structure of the population affect overall economic
growth and the demand for government services and subsequently have an impact on
the State Budget.
The Queensland Government has long recognised the importance of demographic
change and the challenges it poses to effective service delivery and
sustainability of the State's sound fiscal position. Preliminary indications
from Queensland Treasury's Intergenerational Research Project8 are that
demographic change will generate increased fiscal pressure in the years ahead.
It is imperative that state funds continue to be directed to areas of emerging
need in a timely and appropriate manner. To achieve this, the Queensland
Government has developed a capacity to generate state-of-the-art demographic
projections and to analyse demographic issues and impacts. The principal
demographic issues likely to impact on state service delivery and finances are
described below.
POPULATION GROWTH
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Since the early 1970s, Queensland's population has consistently grown at a
faster rate than the larger states of New South Wales and Victoria, as shown in
Table D.1. Over the past five years, Queensland has recorded the fastest growth
rate of any state. At 30 June 2002, Queensland's share of the national
population reached 18.9% compared with 18.3% five years ago (expected to reach
19.1% by June 2004). The State's share of the nation's population growth over
this five-year period was 27.3%.
Table D.1
Proportion of National Population and Population Growth
Five Years Ending 30 June 2002Share of Population as at 30 June 2002
(%)Share of Population Growth Over Five Years
(%)Average Annual Growth Rate Over Five Years
(%)StateNew South Wales 33.8 31.71.1Victoria 24.8 24.01.2Queensland 18.9
27.31.8Western Australia 9.8 11.61.4South Australia 7.7 3.40.5Tasmania 2.4
(0.1)0.0Australian Capital Territory 1.6 1.10.8Northern Territory 1.0
1.01.2Australia100.0100.01.2
Source: ABS 3101.0.Migration
Interstate and overseas migration has been the major contributor to Queensland's
population growth over the past five years. Net migration has accounted for 61%
of Queensland's population growth over the five years ending 30 June 2002, with
the remaining 39% accounted for by natural increase (births less deaths).9 Chart
D.1 shows that net migration has accelerated over the past five years to reach
53,900 persons in 2001-02, the highest level since 1989-90. The strong growth in
Queensland's population over the past year has been due to growth in both
interstate and overseas migration.
Chart D.1
Components of Net Migration Growth in Queensland
Source: ABS 3101.0.
Ageing Population
The main demographic change affecting all Australian states is the changing age
structure of the population. Chart D.2 indicates that the traditional age
pattern will change substantially in coming decades as the proportion of older
people increases and the proportion of young people decreases.
Chart D.2
Age and Sex Distribution, Queensland, 2001 and 2031
Source: ABS 3201.0; and OESR, unpublished population projections
In 2001, more Queenslanders were aged under 15 years (21.3%) than 65 years and
over (11.6%). As shown in Table D.2, this is expected to change over the next 30
years, with people aged 65 years and over living in Queensland projected to
increase three-fold in number, and to nearly double their share of population to
22%. While the number of people aged under 15 years is projected to increase
slightly, their share of population is expected to decline to 15.8% in 2031.
By 2031, the dependency ratio, i.e. the ratio of the dependent population (those
aged 0-14 years plus those 65 years and over) to the working age population
(those aged 15-64 years), is expected to be similar to that in 1971, but with
the majority of the dependent group being aged people rather than younger people
as was the case earlier.
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Table D.2
Queensland's population: Past (1971), Present (2001) and Future (2031)1
Proportion by Age Group and Dependency Ratio
1971
2001
2031Age Group0-14 years29.821.315.815-64 years61.567.162.265 years and over
8.811.622.0Dependency Ratio62.749.160.8
Note:
1. Numbers may not add due to rounding.
Source: ABS 3101.0; and OESR, unpublished projections
The ageing of the population will place increasing demands on government
services, particularly health and community services, placing strong pressure on
state governments to build the capacity to deliver social services to those in
the older age groups.
Indigenous Demographics
Indigenous Australians comprise 3% of the Queensland population and Queensland's
Indigenous population represents 27% of the total Indigenous population
nationally.10
The age distribution of the Aboriginal and Torres Strait Islander population in
Queensland is very different to the Queensland population as a whole. The
Indigenous population is relatively young, with 40% being aged under 15 years
compared with 21% of the general population.11 Indigenous Queenslanders have a
life expectancy more than 20 years less than that for non-Indigenous people,12
while only 3% of the Indigenous population are older than working age (65 years
and over) compared with 12% for the entire population.13
Queensland Indigenous women have higher rates of fertility (2.1 babies per
woman) than all Queensland women (1.7 babies per woman), with fertility rates of
young Indigenous women (aged 20-24 years) more than twice that of non-indigenous
women in the same age group. The health status of Indigenous babies tends to be
poorer as indicated by low birth weight.14
REGIONAL DISPERSION
Queensland is the least centralised of the Australian mainland states. At 30
June 2002, 54% of the State's population lived outside the Brisbane metropolitan
area (Brisbane Statistical Division) whereas in the other states combined, only
32% of the population lived outside the metropolitan areas (capital city
statistical divisions).15 While the growth rate in Brisbane's population was
slightly higher than in the rest of Queensland over the past five years, the
rate of growth in the State's population outside the metropolitan area exceeded
the growth in population living outside the other states' metropolitan areas.
There has been a trend for people to leave Queensland's rural western areas and
move to the State's coastal centres, the south-east corner or interstate. One of
the effects of young people and persons of working age, leaving rural parts of
the State is the change in the mix of age groups who choose to remain in rural
areas. One result is an increase in the proportion of older people in rural
areas. Changes such as this have implications for service providers such as
those associated with health care.
While population growth and associated urban development demand attention in
terms of infrastructure and service provision, so does the spatial distribution
of particular population characteristics such as increasing proportions of aged,
unemployed and low income people in many communities that are not experiencing
rapid population growth. Certain areas of the State have a high proportion of
people with low levels of education, which has implications for the economic
development of these regions. This education status is then mirrored by the
distribution of persons earning relatively low incomes. In turn, this has
implications for service providers, especially those associated with income
support, community safety,
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training and health.
Temporary Populations
Available evidence suggests that temporary movements of people from the southern
states generate a substantial redistribution of population to Queensland.
Temporary movers are people who are seasonal or fly-in/fly-out workers, those on
extended holidays, and students.
These movements have significant implications for the cities and regions that
attract temporary migrants. An influx of temporary migrants can radically alter
the size and composition of the population and hence the demand for services and
facilities.
Temporary movers contribute to the economies of their destinations through
demand for goods and services and, in the case of production-related moves,
through provision of labour. Temporary movements also have other implications.
Visitors place pressure on the local environment and have social impacts on the
communities with which they interact. Equally important is the demand exerted on
local infrastructure, services and facilities.
COMPOSITION OF FAMILIES AND HOUSEHOLDS
Average family size is declining as a result of declining fertility rates and
increasing numbers of divorces, single parent families and aged people living
alone. Australian Bureau of Statistics medium household projections, shown in
Table D.3, indicate that couple-only families will become the dominant family
type in Queensland within the next 10 years. These factors will contribute to
the growth in the number of households significantly exceeding forecast
population growth.
Table D.3
Queensland's Families: Projected Number of Families by Family Type, 2001 to
20211 (Medium Series)
2001
2011
2021'000%'000%'000%Family TypeCouple Families With Children 435.8 43.2 468.3
38.7 524.2 37.1Couple Families Without Children 393.1 39.0 519.9 43.0 638.7
45.2One Parent Families 161.7 16.0 198.6 16.4 226.4 16.0Other 18.7 1.9 22.0 1.8
24.1 1.7Total1,009.2100.01,208.8100.01,413.4100.0
Note:
1. Numbers may not add due to rounding.
Source: ABS 3236.0.
IMPLICATIONS OF DEMOGRAPHIC TRENDS
Demographic changes will have social, economic, fiscal and environmental
implications including:
.. growing demand for services, and therefore growing fiscal pressure, for all
three tiers of government, particularly in areas such as health and aged
care
.. additional demands for infrastructure including transport, water, sewerage,
energy, community centres and recreational facilities
.. changes in the mix of service demands including an increased demand for
lifelong education and training
.. changing production and consumption patterns linked to an ageing population
.. environmental impacts from increased resource use and urbanisation.
APPENDIX E - GOVERNMENT FINANCE STATISTICS
INTRODUCTION
Government Finance Statistics (GFS) data is used extensively in the presentation
of financial statement information in the Budget Papers.
Page 98
This appendix contains detailed financial statements for the Queensland Public
Sector based on Australian Bureau of Statistics (ABS) Government Finance
Statistics standards. These tables provide financial information prepared under
the Uniform Presentation Framework of reporting as required under the Australian
Loan Council arrangements. In line with these requirements, budgeted financial
information for the Public Financial Corporations sector is not included.
In addition, the appendix provides background information on GFS, including the
conceptual basis for GFS and its relationship with Australian accounting
standards, sector definitions and a list of reporting entities.
The following tables present the operating statement, balance sheet and cash
flow statements for the General Government, Public Non-financial Corporations
(PNFC) and Non-financial Public sectors on an accrual GFS basis.
General Government Sector
For detailed analysis of the General Government sector readers
should refer to Chapter 5 - Revenue, Chapter 6 - Expenses, and Chapter 7 -
Balance Sheet and Cash Flows.
Public Non-financial Corporations Sector
The Public Non-financial Corporations (PNFC) sector is projected to have a net
operating deficit in 2003-04 of $176 million ($216 million deficit in 2002-03).
The deficit partly reflects the inclusion in the sector of some entities which,
in the course of their normal operation, do not operate in surplus. In addition,
some dividends are paid from prior year surpluses, capital restructuring and
gains on the sale of assets. Under GFS conventions, proceeds from these sources
are not included in revenues and hence dividend payments arising from these
sources produce negative operating results.
The PNFC sector is expected to produce a net operating surplus of $87 million in
2004-05 and continue to improve in the outyears.
Payments for investments in non-financial assets, which represents capital
expenditure less sales of physical assets, are projected to increase by $441
million from the estimated actuals to $2,193 million in 2003-04. This is partly
due to the Fisherman Island expansion facility and development of a new gas
fired power station in Townsville. Electricity entities will be carrying out
replacement and upgrade of infrastructure supporting the electricity network,
and Queensland Rail will enhance its rail network while the Government's ports
will also be making significant investments.
The PNFC sectors net worth was $12.169 billion in 2001-02, and is expected to
increase to $12.644 billion in 2002-03 and $12.802 billion in 2003-04. Further
increases in net worth are expected across all the outyears.
UNIFORM PRESENTATION FRAMEWORK FINANCIAL INFORMATION
The following tables present operating statements, balance sheets and cash flow
statements prepared on an accrual GFS basis for the General Government, Public
Non-financial Corporations and Non-financial Public sectors.
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OTHER GFS DATA
Expenses by Function
Data presented in Table E.10 provides details of General Government sector
expenses by function. The data is presented in accordance with GFS and Uniform
Presentation Framework guidelines which presents data on a consolidated basis.
Table E.10
General Government Sector Expenses by Function (1)
2002-03
Est. Actual
$ million2003-04
Budget
$ millionGeneral public services (2)519767Public order and
safety1,9812,084Education5,3105,480Health4,3644,564Social security and
welfare864908Housing and community amenities 1,016977Recreation and
culture477464Fuel and energy626591Agriculture, forestry, fishing and
hunting767669Mining, manufacturing and construction108111Transport and
communications2,3252,446Other economic affairs752710Other
purposes1,1541,458Total Expenses20,26321,229
Note:
1. Numbers may not add due to rounding.
2. The increase relative to 2002-03 reflects negative returns on post retirement
accounts in 2002-03.
Taxes
Data presented in Table E.11 provides details of taxation revenue collected by
the General Government sector. The data is presented in accordance with GFS and
Uniform Presentation Framework guidelines, which presents data on a consolidated
basis.
Table E.11
General Government Sector Taxes (1)
2002-03
Est. Actual
$ million2003-04
Budget
$ millionTaxes on Employers' Payroll and Labour Force1,2871,364Taxes on Property
Land Taxes278314 Stamp Duties on Financial and Capital Transactions1,5931,424
Financial Institutions' Transaction Taxes256259 Other5354Taxes on the Provision
of Goods and Services Excises and Levies206321 Taxes on Gambling638680 Taxes on
Insurance333349Taxes on Use of Goods and Performance of Activities Motor
Vehicles855896 Other123Total Taxes5,5115,664
Note:
1. Numbers may not add due to rounding.
Loan Council Allocation
The Australian Loan Council requires all jurisdictions to prepare Loan Council
Allocations (LCA) to provide an indication of each government's probable call on
financial markets over the forthcoming financial year.
Table E.12 presents the State's revised LCA nomination for 2003-04 and the
estimated
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outcome for 2002-03.
Table E.12
Queensland Loan Council Allocation 12002-03
Est. Actual
$ million2003-04
Budget
$ millionGeneral Government sector Cash Deficit (Surplus)2(51)(152)PNFC sector
Cash Deficit (Surplus) 2583966Non-financial Public Sector Cash Deficit
(Surplus)2530815Net cash flows from investments in financial assets for policy
purposes
9
...Memorandum Items3(187)(157)Loan Council Allocation 352658
Notes:
1. Numbers may not add due to rounding.
2. Figures in brackets represent surpluses.
3. Other memorandum items are operating leases.
The State's revised LCA nomination for 2002-03 is a deficit of $352 million.
This compares to the Mid Year Review estimate of $329 million.
In 2003-04, the State's Budget LCA is a deficit of $658 million, compared with
the LCA nomination in March of $190 million. The variation mainly reflects
higher net borrowing requirements by the Public Non-financial Corporation sector
as a result of increased spending on capital infrastructure.
BACKGROUND AND INTERPRETATION OF GOVERNMENT FINANCE STATISTICS
Accrual GFS Framework
The GFS reporting framework, developed by the Australian Bureau of Statistics
(ABS), is based on international statistical standards (the International
Monetary Fund Manual on Government Finance Statistics and the United Nations
System of National Accounts). This allows comprehensive assessments to be made
of the economic impact of government.
Nature of the GFS framework
The accrual GFS framework is based on an integrated recording of stocks and
flows. Stocks refer to a unit's holdings of assets, liabilities and net worth at
a point in time, whilst flows represent the movement in the stock of assets and
liabilities between two points in time. Flows comprise of two separate types,
transactions and other economic flows. Transactions come about as a result of
mutually agreed interactions between units or within a single unit. Other
economic flows would include revaluations and destruction or discovery of assets
that do not result from a transaction. In GFS operating statements, other
economic flows, being outside of the control of government, are excluded and do
not affect the net operating result.
The GFS statements reported in the budget are the operating statement, balance
sheet and cash flow statement.
Operating Statement
This statement is designed to capture the details of transaction flows of GFS
revenue and GFS expense items as well as net acquisition of non-financial assets
for an accounting period. Unlike operating statements prepared on Australian
Accounting Standard principles, a GFS operating statement reports two major
fiscal measures - the GFS net operating balance and GFS net lending (otherwise
known as fiscal balance).
Net operating balance is represented by GFS revenues less GFS expenses and
excludes any other economic flows such as revaluations, gain or loss on assets
disposals and allowances for doubtful debts.
Page 101
Net lending is the net operating balance less net acquisition of non-financial
assets. It also is referred to as the fiscal balance. It measures, in accrual
terms, the gap between government savings plus net capital transfers and
investment in non-financial assets. A surplus indicates that the state
government is placing financial resources at the disposal of other sectors of
the economy, whilst a deficit reflects the state utilising the financial
resources of other sectors.
Balance Sheet
The balance sheet shows stocks of financial and non-financial assets and
liabilities. Key indicators in the balance sheet are net debt and net worth.
Net debt is represented by the sum of selected financial liabilities (such as
deposits held and borrowings) minus the sum of selected financial assets (cash
and deposits, loans and placements). It provides an indication of the strength
of a government's financial position.
Net worth, known as net assets, is defined as total assets less total
liabilities. It provides a more comprehensive picture of a government's position
as all assets and liabilities are taken into account.
Net financial worth, on the other hand, is calculated as financial assets minus
total liabilities. It measures a government's net holdings of financial assets.
Cash Flow Statement
"Cash" means cash on hand (notes and coins held and deposits held at call with a
bank or financial institution) and cash equivalents (highly liquid investments
readily convertible to cash and overdrafts considered integral to the cash
management functions). The cash flow statement demonstrates how cash is
generated and applied in a single accounting period.
The GFS surplus/deficit is the cash counterpart of the fiscal balance as
disclosed in the GFS operating statement. A surplus reflects the availability of
cash to the state to increase its financial assets or decrease its liabilities,
whilst a deficit reflects the requirement for cash either by running down the
state's financial assets or by drawing on the cash reserves of other sectors of
the economy. It comprises net cash received from operating activities and from
sales and purchases of non-financial assets less cash from financing activities,
finance leases and similar arrangements.
SECTOR CLASSIFICATION
GFS data is presented by institutional sector, distinguishing between the
General Government sector and the Public Non-financial Corporations (PNFC)
sector.
Budget reporting focuses on the General Government sector that provides
regulatory services or goods and services of a non-market nature, that are
charged at less than cost or at no cost. These services are largely financed by
general revenue (taxation). This sector comprises government departments and
certain statutory bodies.
The PNFC sector comprises bodies that provide goods and services that are mainly
market, non-regulatory and non-financial in nature. PNFCs are financed through
sales to consumers of their goods and services and may be supplemented by
explicit government subsidy to satisfy community service obligations. In
general, PNFCs are legally distinguishable from the governments that own them.
Examples of PNFCs include Queensland Rail and the electricity entities.
Together, the general government sector and the PNFC sector comprise the
Non-financial Public sector.
Further discussions of the GFS framework of reporting, including definitions of
GFS terms can be obtained from the webpage of the Australian Bureau of
Statistics at www.abs.gov.au.
Page 102
REPORTING ENTITIES
The reporting entities included in the General Government and PNFC sectors are
detailed below.
General GovernmentDepartmentsAboriginal and Torres Strait Islander Policy Arts
QueenslandCorrective ServicesDisability Services QueenslandEducationElectoral
Commission of QueenslandEmergency ServicesEmployment and Training Environmental
Protection AgencyFamiliesHealthHousing Industrial RelationsInnovation and
Information Economy, Sport and Recreation QueenslandJustice and
Attorney-GeneralLegislative Assembly of QueenslandLocal Government and
PlanningMain RoadsNatural Resources and MinesOffice of the GovernorOffice of the
Public Service CommissionerOmbudsmanPolicePremier and CabinetPrimary
IndustriesPublic Trust OfficePublic Works Queensland Audit OfficeState
Development Tourism, Racing and Fair TradingTransportTreasury Statutory
AuthoritiesAnti-Discrimination Commission QueenslandAustralian College of
Tropical AgricultureBureau of Sugar Experiment Stations (ceased
2002-03)Commission for Children and Young PeopleCouncil of the Queensland
Institute of Medical ResearchCrime and Misconduct CommissionDalby Agricultural
College BoardEmerald Agricultural College BoardLegal Aid QueenslandLibrary Board
of QueenslandLongreach Pastoral College BoardMotor Accident Insurance
CommissionNickel Resources North QueenslandNominal DefendantProstitution
Licensing AuthorityQueensland Art GalleryQueensland Building Services
AuthorityQueensland Events Corporation Pty LtdQueensland Institute of Medical
Research Trust (ceased 2002-03)Queensland MuseumQueensland Performing Arts Trust
Queensland Rural Adjustment Authority Queensland Studies Authority Queensland
Theatre CompanyQueensland Treasury Holdings Residential Tenancy AuthorityRoyal
Children's Hospital FoundationSGH LimitedSouth Bank Corporation Stadium
Redevelopment Authority (ceased 2002-03)Tourism Queensland
Commercialised Business UnitsCitecGoPrintMain Roads - Road TekProject
ServicesProperty Services GroupQ-BuildQ-FleetSales and DistributionPublic
Non-financial CorporationsBrisbane Market Corporation (ceased 2003-04)Bundaberg
Port AuthorityCairns Port AuthorityCS Energy LtdDBCT Holdings Pty Ltd DPI
Forestry EnergexErgon EnergyEungella Water Pipeline Pty LimitedGladstone Area
Water BoardGladstone Port AuthorityGold Coast Events CorporationGolden Casket
Lottery Corporation Limited2001 Goodwill Games Brisbane Ltd Mackay Port
AuthorityMajor Sports Facilities Authority Mt Isa Water BoardNorth West
Queensland Water Pipeline Pty LimitedPioneer Valley Water BoardPort of Brisbane
CorporationPorts Corporation of QueenslandPowerlink QueenslandQueensland
Abattoir Corporation (ceased 2002-03)Queensland Motorways LimitedQueensland
Power Trading CorporationQueensland RailRockhampton Port AuthorityStanwell
Corporation LtdSun WaterTarong Energy Corporation LtdTownsville Port
AuthorityTrustees of the Albion Park Paceway
APPENDIX F - DEPARTMENTAL EXPENSES
1 The timing of the presentation of the State Budget has meant actual data on
gross state product and its components, and other measures of State economic
performance are not available for all quarters of the 2002-03 fiscal year.
Consequently, the 2002-03 growth rates represent estimated actuals. Decimals
have been used to describe actual outcomes, with fractions used for estimated
actuals, forecasts and projections.
2 Exchange rates calculated on an end of month basis. For May 2003, the exchange
rate is based on the latest available data at the time of preparation of the
Budget Papers.
Page 103
3 Exchange rates calculated on an end of month basis. For May 2003, the exchange
rate is based on the latest available data at the time of preparation of the
Budget Papers.
4 The Intergenerational Research Project is a component of a broader Treasury
research agenda on the drivers of economic growth in Queensland. It is being
conducted by the Office of Economic and Statistical Research, to ascertain the
potential future effects of demographics and other economic and fiscal factors
on the Queensland economy and Budget.
5 Some credit rating agencies and analysts set aside the equity investment in
public enterprises in assessing net financial assets. Their view is that as
these investments are held for policy purposes and are not readily realisable,
they cannot, in practice, be used to offset liabilities.
6. Department of Transport and Regional Services 2001-02 Report on the operation
of the Local Government (Financial Assistance)
Act 1995 - Appendix F
7. Ibid -Chapter 1 Page 13.
8 The Intergenerational Research Project is a component of a broader Treasury
research agenda on the drivers of economic growth in Queensland. It is being
conducted by the Office of Economic and Statistical Research, and its aim is to
ascertain the potential future effects of demographics and other economic and
fiscal factors on the Queensland economy and budget.
9 ABS 3101.0.
10 ABS 4705.0.
11 ABS 2001 Census of Population and Housing.
12 ABS 3302.0.
13 ABS 2001 Census of Population and Housing.
14 ABS 3301.0.
15 ABS 3201.0.
??
Budget Strategy and Outlook 2003-04 1
85
Budget Strategy and Outlook 2003-04
95
Budget Strategy and Outlook 2003-04
130
Budget Strategy and Outlook 2003-04
141
Budget Strategy and Outlook 2003-04
Page 104
175
Budget Strategy and Outlook 2003-04
Page 105
STATE BUDGET
2003-04
CAPITAL STATEMENT
Budget Paper No. 3
TABLE OF CONTENTS
1. Overview 1
Introduction 1
Planning for Queensland's Future 2
Capital Outlays 2003-04 2
Employment Generation 3
Key Concepts, Scope and Coverage 8
2. Engaging the Private Sector in Infrastructure Delivery 9
Queensland's Public Private Partnership Policy 9
Private Sector Contribution to the Delivery of Public Infrastructure 9
Value for Money Framework Process 10
Current Value for Money Evaluations 11
Other Projects Involving the Private Sector 12
3. Capital Outlays by Entity 15
Aboriginal and Torres Strait Islander Policy 15
Arts 17
Corrective Services 20
Disability Services 21
Education 22
Electoral Commission 27
Emergency Services 28
Employment and Training 32
Environmental Protection Agency 34
Families 35
Health 36
Housing 41
Industrial Relations 46
Innovation and Information Economy, Sport and Recreation 47
Justice and Attorney-General 55
Legislative Assembly of Queensland 57
Local Government and Planning 58
Main Roads 59
Natural Resources and Mines 65
Office of the Governor 68
Office of the Ombudsman and Information Commissioner 69
Office of the Public Service Commissioner 70
Police 71
Premier and Cabinet 73
Primary Industries 75
Public Works 77
Queensland Audit Office 80
State Development 81
Tourism, Racing and Fair Trading 84
Transport 86
Treasury 95
4. Total Capital Outlays by Region 99
Page 1
South East 99
Wide Bay-Burnett 108
Darling Downs and South West 111
Fitzroy and Central West 115
Mackay and Northern 120
Far North and North West 126
Appendix A - Entities included in Capital Outlays 131
1. OVERVIEW
KEY POINTS
.. Capital outlays in 2003-04 are estimated to be $5.273 billion, net of the
capital contingency reserve. This represents an increase of 8%, or $392
million, on estimated actual outlays in 2002-03.
.. Capital outlays will contribute to the net provision of some 44,500
full-time jobs.
.. The capital outlays of public trading enterprises constitute approximately
41% of total outlays including significant capital investment by
Queensland's Government-owned electricity corporations, port authorities
and Queensland Rail.
.. There are notable increases in capital outlays in a number of individual
departments including Justice and Attorney-General, State Development,
Housing, Public Works, Natural Resources and Mines, and Emergency Services.
.. $1.751 billion is provided for capital funding of transport and main roads,
$359 million for education and training, $283 million for health and $324
million for law, order and public safety.
.. Capital outlays in 2003-04 reflect an ongoing regional commitment, with
62.5% of capital expenditure occurring outside the Brisbane Statistical
Division.
.. In addition to its direct provision of public infrastructure, the
Queensland Government will continue to foster an increasing private sector
involvement in the provision of public infrastructure.
INTRODUCTION
This Capital Statement presents an overview of proposed capital outlays by the
Queensland Government in 2003-04 and beyond, as well as a summary of the State
Government's approach to infrastructure provision. Capital outlays in 2003-04
are estimated to be $5.273 billion, net of a capital contingency reserve of $200
million. This represents an increase of 8% on estimated actual outlays in
2002-03, and continues the four year Priority Infrastructure Package introduced
in last year's capital program.
In addition to the 2003-04 capital program, there are projects involving private
sector provision of infrastructure as discussed in Chapter 2.
The Government's increased capital outlays in 2003-04, combined with the growth
of private sector involvement in public infrastructure projects, reflects the
Government's commitment to broadening Queensland's infrastructure base, in order
to better meet the social and economic needs of Queensland's growing population.
PLANNING FOR QUEENSLAND'S FUTURE
The Queensland Government is committed to investing in the future of the State,
ensuring sustainable economic and employment growth for current and future
Page 2
Queenslanders.
Capital infrastructure is recognised as an important Government economic
strategy, which supports the State's productive capacity, as detailed in Chapter
3. Investment in capital infrastructure directly and indirectly helps support
the development of Queensland's regions, creates a better quality of life for
people throughout the State and provides more job opportunities for
Queenslanders.
The Government recognises enhancing the State's long-term productive capacity in
a modern service based economy requires a broader, more holistic approach than
that which may normally be associated with traditional capital infrastructure
programs. In particular, the Government needs to ensure the people and
technology are available in Queensland to maximise the potential of any future
capital infrastructure investment. This is particularly important as, while
traditional industries will continue to make an essential economic contribution
to the State, much of Queensland's future employment and income growth will come
from service industries.
Therefore, along with the provision of capital or 'hard' infrastructure such as
roads, dams and bridges, the Government maintains a strong commitment in
investing in 'soft' infrastructure, such as education and training. This is as
well as policies aimed at fostering innovation and the development and use of
information and communication technologies - the major focus of the Government's
Smart State policy.
In order to effectively meet the needs of a rapidly growing and spatially
dispersed State the Government is actively pursuing opportunities to partner
with the private sector to produce innovative, value for money solutions in the
provision of public infrastructure.
This Public Private Partnership approach to the provision of public
infrastructure will be explored and adopted whenever it provides a more
efficient and better value for money outcome for the Queensland taxpayer.
Such an approach will provide the community with a greater level of
infrastructure than would have otherwise been possible, resulting in both
short-term and long-term positive employment outcomes, and ultimately leading to
a greater quality of life for all Queenslanders.
CAPITAL OUTLAYS 2003-04
The capital outlays of Queensland's public trading enterprises will constitute
41% of total outlays in 2003-04. This includes capital investment by
Queensland's Government-owned electricity corporations of $1.25 billion,
Queensland Rail of $615 million and Queensland Port Authorities of $256 million.
There are significant increases in capital outlays in a number of departments
including Disability Services, Justice and Attorney-General, Natural Resources
and Mines, State Development, Housing, and Emergency Services. Increases in
capital outlays for individual departments are discussed in detail in the
following chapters of this Capital Statement.
Expenditure in 2003-04 is highest in the Brisbane Statistical Division - the
most populous area of the State - at $2.052 billion. However, consistent with
the Government's commitment to building Queensland's regions, 62.5% of capital
expenditure is expected to occur outside the Brisbane Statistical Division.
Capital outlays by purpose in 2003-04 are detailed in Chart 1.1. Capital outlays
by State Government departments are listed in Table 1.1. Table 1.2 shows the
composition of capital outlays by source of funding, while Table 1.3 details
estimated capital outlays by State Government department in each of the State's
statistical divisions.
Chart 1.1
Page 3
Capital Outlays by Purpose, 2003-04
EMPLOYMENT GENERATION
The 2003-04 capital program will have a significant effect on employment,
supporting some 44,500 full-time jobs, directly and indirectly. Estimated
employment generation from budgeted capital expenditure in 2003-04 is less than
that forecast in the 2002-03 Capital Statement. This decrease is due to reduced
expenditure on employment generating capital and an increase in expenditure on
items such as information technology, consistent with the Government's Smart
State Policy. Employment generating capital does not include expenditure on land
purchases and plant and equipment. The 2002-03 capital program included a
greater proportion of this type of asset.
The remaining chapters of this Budget paper provide further details of State
Government capital outlays. Chapter 2 provides an update on the role of the
private sector in providing public infrastructure in Queensland. Chapter 3 lists
capital outlays on a project basis by department. Chapter 4 presents a
desegregation of capital outlays by region.
Table 1.1
Capital Outlays by Entity1,2
2002-03
2003-04
Entity
Est. Actual
Budget
$'000
$'000
Aboriginal and Torres Strait Islander Policy
22,416
17,511
Arts
65,204
124,688
Corrective Services
26,945
23,332
Disability Services
6,702
22,441
Education
291,165
300,446
Emergency Services
59,505
77,725
Employment and Training
59,622
58,376
Environmental Protection Agency
27,774
20,061
Families
16,824
14,850
Health
256,239
282,768
Page 4
Housing
261,217
333,765
Innovation and Information Economy, Sport and Recreation Portfolio
Innovation and Information Economy, Sport and Recreation
262,034
105,343
Government Owned Electricity Corporations
1,205,260
1,250,204
Justice and Attorney-General
47,867
123,334
Legislative Assembly of Queensland
2,203
2,250
Local Government and Planning
163,774
158,601
Main Roads
737,082
777,804
Natural Resources and Mines
70,438
112,606
Police
103,161
99,447
Premier and Cabinet
20,166
9,959
Primary Industries
29,079
33,615
Public Works
192,730
222,495
State Development
198,521
283,339
Tourism, Racing and Fair Trading
13,311
8,872
Transport Portfolio
Queensland Transport
142,075
101,743
Port Authorities
223,269
256,409
Queensland Rail
450,000
614,780
Treasury3
24,007
34,857
Other4
1,997
1,304
Page 5
Anticipated Capital Contingency Reserve5
- -100,000
- -200,000
Total Capital Outlays6,7
4,880,587
5,272,925
Notes to Table 1.1
Capital Outlays by Department
1. Includes associated statutory bodies.
2. Abstract 31 issued by the Australian Accounting Research Foundation deals
with accounting for the Goods and Services Tax (GST). This Abstract states that
in relation to acquisitions of assets, any recoverable GST (in the form of GST
input tax credits) would not be included in the cost of acquiring an asset. On
this basis, capital works projects are shown on a GST-exclusive basis - that is,
net of any recoverable GST input tax credits. The current exception to this is
where an agency, because of its GST status, is unable to recover some GST input
tax credits, for example the Department of Housing.
3. Includes the Department of Treasury, the Motor Accident Insurance
Administration, and the Golden Casket Lottery Corporation.
4. Includes the Department of Industrial Relations, Electoral Commission of
Queensland, Office of the Governor, Office of the Public Service Commissioner,
Office of the Ombudsman and Information Commissioner and the Queensland Audit
Office.
5. 2003-04 adjustment recognises that individual agencies may budget to fully
expend their capital works allocations, however on a whole-of-Government basis
there is likely to be underspending, resulting in a carryover of capital
allocations.
6. Numbers may not add due to rounding.
7. Capital works outside of Queensland are not included in the 2003-04 capital
program.
Table 1.2
Sources of Funding for Capital1
2002-03
Table 1.3
Total Capital Outlays by Entity within Statistical Division for 2003-04
KEY CONCEPTS, SCOPE AND COVERAGE
Consistent with the approach adopted in previous years, a capital contingency
reserve has been included. This reserve recognises that while departments budget
to fully utilise their capital works allocation, circumstances such as poor
weather or production delays may prevent full utilisation. On a
whole-of-Government basis, there is likely to be underspending, resulting in a
carryover of capital allocations.
Under accrual output budgeting, capital is the stock of assets including
property, plant and equipment, intangible assets and inventories that an agency
owns and/or controls and uses in the delivery of services, as well as capital
grants made to other entities. For the purpose of this Budget paper, capital
outlays refer to the gross acquisition of these assets. The following
definitions are applicable throughout this document:
.. Total capital outlays - property, plant and equipment outlays, other
capital expenditure and capital grants
Page 6
.. Property, plant and equipment outlays - property, plant and equipment
outlays as per the financial statements excluding asset sales, depreciation
and revaluations
.. Other capital expenditure - intangibles, inventories, and self-generating
and regenerating assets
.. Capital grants - all capital grants to other entities (excluding grants to
other Government departments and statutory bodies).
Capital outlays include information for all bodies defined as reporting entities
for the purpose of whole-of-Government financial reporting requirements,
excluding Public Financial Corporations. Projects without a recorded total
estimated cost are ongoing. The entities included in this Capital Statement are
listed in Appendix A.
Capital Works and the GST
Abstract 31 issued by the Australian Accounting Research Foundation deals with
accounting for the Goods and Services Tax (GST). This Abstract states that in
relation to acquisitions of assets, any recoverable GST (in the form of GST
input tax credits) would not be included in the cost of acquiring an asset. On
this basis, capital works projects are shown on a GST -exclusive basis, that is,
net of any recoverable GST input tax credits. The exception to this is where an
agency is unable to recover some GST input tax credits because of their GST
status, for example the Department of Housing.
1
1
Capital Statement 2003-04
7
Capital Statement 2002-03
8
Capital Statement 2003-04
2. ENGAGING THE PRIVATE SECTOR IN INFRASTRUCTURE DELIVERY
QUEENSLAND'S PUBLIC PRIVATE PARTNERSHIP POLICY
The Queensland Government launched its Public Private Partnership Policy -
achieving value for money in public infrastructure and service delivery in
September 2001. Supporting guidance material, Public Private Partnership Value
for Money Framework, was released in August 2002. The latter provides a
disciplined framework for assessing how value for money can best be achieved in
the delivery of major public infrastructure and infrastructure-related non-core
services.
Queensland's Public Private Partnership Value for Money Framework is consistent
with similar initiatives being pursued nationally and internationally. It
recognises the public and private sectors can each play an important role in
delivering effective and efficient infrastructure and infrastructure-related
services for the State. Experiences from elsewhere in Australia and abroad
suggest governments can deliver superior service outcomes in the provision of
many types of infrastructure and services through an appropriate and properly
structured partnership with the private sector.
The private sector in Queensland has a strong interest in contributing to the
provision of the State's public infrastructure.
PRIVATE SECTOR CONTRIBUTION TO THE DELIVERY OF PUBLIC INFRASTRUCTURE
Major government infrastructure and service projects have a number of distinct,
but related phases, each with its own risks and costs - planning, design,
financing,
Page 7
construction, maintenance and refurbishment. To optimise value for money in the
provision of infrastructure, it is necessary to identify and manage a project's
whole-of-life costs and risks. In many instances, government can achieve the
best outcome in terms of whole-of-life costs and risks when one entity is
responsible for all phases of a project, and is given the incentive to optimise
outcomes in each phase.
The private sector may be able to assist in delivering value for money in the
provision of public infrastructure where it can better manage the risks and
whole-of-life costs through superior innovation, supply arrangements, investment
accountability and/or management systems. The private sector may also add value
to major government infrastructure projects by improved resource utilisation and
identifying other commercial opportunities for the infrastructure.
The Government is of the view greater private sector participation in the
provision of public infrastructure will assist the timely delivery of efficient
and effective infrastructure to the Queensland community. However, it is
recognised that Public Private Partnerships (PPP) can introduce new risks, and
that there is a need for careful analysis and management before any commitment
to a PPP delivery is made.
VALUE FOR MONEY FRAMEWORK PROCESS
The PPP Value for Money Framework provides a clear, transparent and accountable
methodology for achieving value for money in the delivery of Government
infrastructure and services. The Framework is designed to provide State
Government agencies with a comprehensive process to assess major infrastructure
proposals, and receive clear directions from Government as proposal analysis
progresses towards final commitment. The rigorous approach to investigation of
risks, costs and policy issues can allow the Government to constructively engage
the private sector in developing effective commercial arrangements.
The Framework involves the following six stages.
Service Identification
The Service Identification stage of a project is used to identify and scope
Government's infrastructure and infrastructure-related service needs, and
includes an initial analysis of options for meeting these needs.
Preliminary Assessment
The Preliminary Assessment is used to undertake an initial evaluation of service
requirements, affordability and priority of the project. Tasks completed during
this stage includes the identification of options for delivering the desired
infrastructure and services, preparation of an initial feasibility study,
including benefit cost analyses and financial modelling of the proposed project,
assessment of project risks and public policy issues and a preliminary
evaluation of whether private sector involvement has the potential to provide a
better value for money outcome than traditional government delivery. At the
completion of the Preliminary Assessment stage, Government will make an initial
assessment of the priority and affordability of the project and, on the basis of
this assessment, determine whether the project should proceed to the PPP
Business Case Development stage.
PPP Business Case Development
If the Government approves proceeding to the Business Case Development stage,
the objective of the business case is to undertake a detailed analysis of the
project and determine the delivery method that offers the best value for money
throughout the life of the infrastructure. During this stage, a detailed
assessment is made of the proposal's whole-of-life costs, risks and potential
revenue streams under various delivery options, including the PPP option.
Tasks in this stage include developing an output specification for the service
requirement, identifying and allocating risks and constructing detailed
financial models for comparing traditional delivery options against the public
private
Page 8
partnership option. During this stage, a detailed public interest assessment is
completed, environmental and cultural planning studies are undertaken and
employee, employment and skills development issues are assessed. At the
completion of the Business Case Development stage, Government will confirm (or
otherwise) the priority and affordability of the project and, if the project is
to proceed, will approve the preferred delivery option and funding for that
delivery option.
Expressions of Interest
If the Government determines that the project is to proceed as a PPP,
expressions of interest will be sought for private sector involvement in the
project. The purpose of the Expressions of Interest stage is to develop a
shortlist of proponents who demonstrate, in their expression of interest, the
technical and financial capabilities to deliver the Government's service
requirement on a value for money basis. At the completion of this stage
Government will either approve a shortlist of proponents to proceed to the
Binding Bid stage, or approve proceeding with traditional delivery should the
expressions of interest received indicate the PPP alternative would not deliver
best value for money.
Binding Bid
The purpose of the Binding Bid stage is to seek binding bids, identify whether
bids offer the best value for money outcome, and if so, enter into binding
project agreements with the preferred proponent for delivery of the project. If
the PPP alternative as proposed by the market does not demonstrate that it would
provide best value for money, Government would progress the project using a
traditional delivery option.
Management of Project Agreements
The purpose of the subsequent project management stage is to ensure the private
sector partner and the Government fulfil their respective obligations under the
project agreements. This ensures the infrastructure and infrastructure-related
service is delivered in accordance with the output specification.
CURRENT VALUE FOR MONEY EVALUATIONS
The Queensland Government does not commit to delivering a project until after
completion of the Business Case Development stage. Accordingly, this section
does not provide specific details of projects in the Business Case Development
stage or earlier stages.
Service Identification and Preliminary Assessment Stages
Government is progressing five major infrastructure projects through the Service
Identification stage and investigating a further nine in the Preliminary
Assessment stage. These projects span infrastructure interests including roads,
transport, buildings and facilities, information and communication technology,
port facilities, water supply and wastewater management.
A number of the projects currently being progressed through the Preliminary
Assessment stage could progress to the Business Case Development stage by the
end of 2003.
PPP Business Case Development Stage
Government is analysing five major infrastructure projects in the Business Case
Development stage. These include initiatives in transport, research facilities,
knowledge-based industry development and information technology. If approved to
proceed, the projects will collectively involve capital investments up to $1.5
billion.
The preliminary market sounding undertaken to date and the Preliminary
Assessment analyses for these projects have identified a potential for a PPP to
deliver better value for money through optimal risk allocation, innovation in
design, construction and operation, economies of scale and adding value
throughout the life of the infrastructure.
Page 9
It is expected that the Business Case Development stage for three of these
projects will be completed by the end of 2003.
Expressions of Interest Stage
Government currently has one major project, the Southbank Education and Training
Precinct, in the Expressions of Interest stage of the PPP Value for Money
Framework. The precinct will be Queensland's first large-scale multi-sectoral
campus and will incorporate the redevelopment of Southbank Institute of
Technical and Further Education and elements of Brisbane State High School.
The private sector has been invited to submit expressions of interest for the
design, construction, financing, operation (of non-core activities) and
maintenance of the facilities required for the precinct. Core service delivery,
for example teaching and curriculum, will remain the responsibility of the
State.
The Government anticipates private sector involvement in the delivery of the
Southbank Education and Training Precinct will deliver a value for money outcome
for the State, through factors such as optimal risk allocation, innovation,
whole-of-life costing, economies of scale and value adding. This expectation
will be tested as the project progresses through the Expression of Interest and
Binding Bid stages of the PPP Value for Money Framework.
The Government expects the Expressions of Interest stage will be completed in
mid-2003. If the decision is made to proceed to the Binding Bid stage, and a
successful outcome is achieved, project agreements may be executed by mid-2004.
OTHER PROJECTS INVOLVING THE PRIVATE SECTOR
Dalrymple Bay Coal Terminal
The Queensland Government has entered into a long-term lease over the Dalrymple
Bay Coal Terminal with the private sector. Under the lease agreement, the lessee
is required to expand the facility over time to meet current and future needs.
This expansion work includes future development of Stage 6 of the terminal,
estimated to cost approximately $400 million over the next decade.
Tarong North
The Tarong North power station is a 450 mega Watt, coal-fired, base-load
generator, which cost in the vicinity of $650 million to construct. It is 50%
owned by Tarong Energy Corporation Limited, a Government owned corporation, and
50% owned by a consortium of Tokyo Electric Power Company Inc and Mitsui and
Company Ltd. Electricity generation at the power station represents some 4.8% of
the State's capacity.
Other
In addition to the projects detailed above, the Government is progressing a
number of major projects with private sector involvement that were commenced
prior to release of the PPP Policy. These include partnership arrangements for
the supply of building, carpark, power supply and general support facilities at
12 hospitals throughout the State worth some $230 million.
9
Capital Statement 2003-04
3 CAPITAL OUTLAYS BY ENTITY
ABORIGINAL AND TORRES STRAIT ISLANDER POLICY
In 2003-04 the Department of Aboriginal and Torres Strait Islander Policy will
outlay $17.5 million for capital infrastructure. Infrastructure development is
important to support effective services to Indigenous communities across the
State. Capital grants of $16.3 million will be made during 2003-04 to support of
programs and services. A further $1.2 million is provided for capital
acquisitions for the
Page 10
department.
Infrastructure investment forms a vital part in delivering key departmental
outputs including Community Development and Community Governance.
.. Community Development - provides and brokers support and resources for
Aboriginal and Torres Strait Islander Councils, community organisations and
local governments to support the development of healthy, self-determining
communities.
Capital grants of $14.5 million are budgeted for water supply and sewerage
upgrades and the Torres Strait Major Infrastructure Program.
.. Community Governance - provides support and resources to foster and
maintain an autonomous, efficient and accountable system of local
government that responds to Aboriginal and Torres Strait Islander community
needs.
Funds of $1.8 million are budgeted for construction and enhancements to council
chambers at Doomadgee, Lockhart River, Mapoon, New Mapoon and Woorabinda.
ARTS
Total capital expenditure for the Arts portfolio (Arts Queensland, Queensland
Performing Arts Trust, Queensland Museum, Library Board of Queensland and
Queensland Art Gallery) in 2003-04 is $124.7 million.
Arts Queensland's capital expenditure program for 2003-04 is $97.2 million. The
Millennium Arts Program in 2003-04 will fund $92.6 million as part of the
five-year redevelopment of the Queensland Cultural Centre site at South Brisbane
and associated projects. This year will see the commencement of the construction
program for the Queensland Gallery of Modern Art and the redevelopment of the
State Library of Queensland. Regional Queensland will benefit from the
continuation of the Regional Millennium Arts grants program ($2 million), and
the completion of the State-Commonwealth partnership project of the Queensland
Heritage Trails Network in 2003 ($2.5 million - Commonwealth).
Library Board of Queensland
The capital outlays for 2003-04 include continued enhancements of the State
Library of Queensland's collection and plant and equipment replacements and
grants provided to local governments through the Queensland Public Library
Grants Scheme for the purchase of library collections.
Queensland Museum
The construction of a new Sciencentre and an Aboriginal and Torres Strait
Islander Cultural Centre at Queensland Museum South Bank will revitalise the
flag ship campus of the Queensland Museum network. The new Sciencentre will
provide a new, state of the art science discovery and educational facility. The
Aboriginal and Torres Strait Islander Cultural Centre will contribute to the
Museum's continuing programs of repatriation and reconciliation. An enhanced
collection database system will facilitate access to this important resource.
Queensland Performing Arts Trust
The Trust's capital expenditure program for 2003-04 is $2.3 million and includes
a major redevelopment of the catering facilities offered to patrons at the
Queensland Performing Arts Centre, the replacement of major items of production
theatre equipment and the replacement of general equipment and furniture.
Arts
Statistical
Total
Expenditure
Budget
Post
Page 11
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
ARTS QUEENSLAND
Property, Plant and Equipment
Millennium Arts Program
Gallery of Modern Art
05
87,140
4,393
21,488
61,259
Millennium Library
05
55,326
3,568
17,854
33,904
Page 12
Plaza Development - Common
05
72,834
12,593
45,261
14,980
infrastructure works at South
Bank
Queensland Museum
05
10,000
4,865
4,250
885
Musgrave Park Cultural Centre
05
5,000
1,247
3,753
Sub-total Millennium Arts Program
92,606
Other plant and equipment
05
100
Ongoing
Total Property, Plant and Equipment
92,706
Capital Grants
Page 13
Millennium Arts Regional Initiatives
Various
15,000
11,000
2,000
2,000
Queensland Heritage Trails Network
Various
73,450
70,950
2,500
Total Capital Grants
4,500
TOTAL ARTS QUEENSLAND
97,206
QUEENSLAND PERFORMING ARTS TRUST
Property, Plant and Equipment
South Bank QPAC redevelopment
05
1,250
450
Page 14
800
of catering facilities
Minor works
05
1,450
Ongoing
Total Property, Plant and Equipment
2,250
TOTAL QUEENSLAND PERFORMING ARTS TRUST
2,250
QUEENSLAND MUSEUM
Property, Plant and Equipment
Collection Management System
05
1,000
Page 15
500
500
New Sciencentre at South Bank
05
4,000
300
3,500
200
Aboriginal and Torres Strait Islander
05
1,000
50
500
450
Cultural Centre
Other plant and equipment
Various
300
348
Ongoing
Total Property, Plant and Equipment
4,848
TOTAL QUEENSLAND MUSEUM
4,848
LIBRARY BOARD OF QUEENSLAND
Page 16
Property, Plant and Equipment
Plant and equipment - General
05
850
Total Property, Plant and Equipment
850
Other Capital Expenditure
Library expenditure
05
5,213
Total Other Capital Expenditure
5,213
Capital Grants
Page 17
Queensland Public Library Funding
Brisbane
05
7,004
Moreton
10
2,982
Wide Bay-Burnett
15
916
Darling Downs
20
558
Fitzroy
30
625
Mackay
40
446
Northern
45
907
Far Northern
50
Page 18
780
North West
55
103
Total Capital Grants
14,321
TOTAL LIBRARY BOARD OF QUEENSLAND
20,384
TOTAL ARTS
124,688
CORRECTIVE SERVICES
The Department of Corrective Services' capital works program of $23.3 million
brings to a conclusion the expansion of prison infrastructure necessitated by a
doubling of prisoner numbers since 1993.
An allocation of $8.2 million is provided in 2003-04 to complete the new
correctional centre at Maryborough. The total cost of this facility is $97
million.
Corrective Services
Statistical
Total
Expenditure
Budget
Post
Division
Page 19
Estimated
to
2003-04
2003-04
Project
Cost
30-6-03
$'000
$'000
$'000
$'000
DEPARTMENT OF CORRECTIVE SERVICES
Property, Plant and Equipment
Capricornia Correctional Centre (CC)
30
89,500
85,100
4,400
Maryborough CC
15
97,000
88,800
8,200
Woodford CC Expansion
10
68,800
68,675
125
Other Acquisitions of Property,
Various
7,207
Ongoing
plant and equipment
Page 20
Total Property, Plant and Equipment
19,932
Other Capital Expenditure
Integrated Offender Management
05
9,206
5,806
3,400
System
Total Other Capital Expenditure
3,400
Page 21
TOTAL CORRECTIVE SERVICES
23,332
DISABILITY SERVICES
Investment in capital infrastructure forms a vital part of delivering the three
outputs for Disability Services Queensland - Support for Adults, Support for
Children and Families, and Community Infrastructure. As a human services
provider and funder, the agency invests in capital infrastructure in cases where
it is required for government service provision. Capital infrastructure is also
utilised to accommodate and support departmental staff and in targeted community
sector infrastructure (usually in partnership with non-government service
providers) accommodation for people with an intellectual disability and respite
centres. The major portion of non-government service delivery utilises existing
community sector capital infrastructure.
The 2003-04 Budget commits $22.4 million in new capital funding to enhance
disability services delivered within the government and non-government sectors.
These funds are being applied to strategies including:
.. significant capital and equipment upgrades for existing services such as
those operated by Disability Services Queensland and community-based
services
.. innovative accommodation options for people with high support needs
.. new respite and family support services.
Disability Services
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DISABILITY SERVICES QUEENSLAND
Page 22
Property, Plant and Equipment
Capital upgrades for services
Various
13,622
1,132
12,490
Minor works
Various
39
30
9
Other Property, plant and equipment
Brisbane West Area Office
05
100
100
Ipswich East Area Office
05
50
50
Toowoomba Area Office
20
350
350
Rockhampton Regional/Area Office
30
100
100
Page 23
Office Fit-outs
Various
179
55
124
Asset purchases
Various
1,777
Ongoing
Total Property, Plant and Equipment
15,031
Other Capital Expenditure
Software Development (including
05
8,058
98
4,105
3,855
Disability Information System)
Total Other Capital Expenditure
4,105
Capital Grants
Page 24
Capital grants to enhance
Various
6,378
3,218
3,160
disability services
Community Renewal Project
05
315
170
145
Total Capital Grants
3,305
TOTAL DISABILITY SERVICES
22,441
EDUCATION
The 2003-04 schools capital works program allocates $257.2 million to school
accommodation and employee housing, including $39 million in capitalised
expenses. The program supports the Preschool Education, Primary Education,
Secondary Education and Students with Special Needs outputs. Other plant and
equipment of $37.1 million provides for information technology infrastructure
and schools based plant and equipment outlays. In addition, capital grants of
$45.1 million are provided for non-State education facilities.
Program Highlights
.. $149.7 million to construct three new schools, further staged work at 11
schools, land acquisitions and provision of additional classrooms at
existing schools in growth areas throughout the State for the commencement
of the 2004 school year. Of this funding, $27.8 million will be used to
complete construction of new schools at Chancellor on the Sunshine Coast
and Somerset Drive Mudgeeraba and the relocation of the school at Welcome
Creek to Moore Park in 2003-04.
.. $63.2 million to replace and enhance learning facilities at existing
schools, and to provide additional and replacement toilet facilities.
.. $16.7 million to continue airconditioning facilities in 99 Queensland State
schools under the continuing Cooler Schools program (this does not include
grants to
Page 25
non-State schools for Cooler Schools). These projects fulfil and exceed the
Government's election commitment to the Cooler Schools program.
.. $6 million to acquire new employee accommodation and refurbish existing
housing stock.
.. Capital expenditure of $6.3 million in relation to Education and Training
Reforms for the Future (Information and Communication Technologies).
Education 1,2,3,4
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF EDUCATION
Key to Abbreviations
EEC - Environmental Education Centre
Page 26
GLAB - General Learning Area Block
SPS - Special School
Property, Plant and Equipment
Brisbane Statistical Division
Albany Creek (8 - 12), GLAB
05
769
769
6 spaces
Belmont (P - 7), GLAB - 2 storey -
05
1,737
73
1,664
8 spaces and additional toilets
Page 27
Bracken Ridge (8 - 12), Multi-
05
676
68
608
purpose centre
Brisbane Central (P - 7), Replace
05
270
270
toilet block
Calamvale Community College
05
470
470
(P - 12), 2 x 2 space relocatables
Calamvale Community College
05
12,285
879
11,406
Page 28
(P - 12), Stage 2 - Years 10-12
Cleveland District (8 - 12), Renewal
05
2,820
1,880
940
Program Phase 3
Coorparoo (1 - 7), Master Plan -
05
2,115
2,115
Stage 3 -3 Storey block open under, Amenities block, staff parking and
associated works
Earnshaw State College (P - 12),
05
7,520
2,494
2,894
2,132
SSRP - New middle school
Page 29
Edens Landing (P - 7), GLAB - 2
05
378
378
spaces
Flagstone State Community College
05
1,821
137
1,684
(8 - 12), Stage 3 - Year 10
Flagstone State Community College
05
10,920
1,092
9,828
(8 - 12), Stage 4 - Years 11-12
Forest Lake (7 - 12), Stage 2 -
05
580
286
294
External infrastructure
Forest Lake (7 - 12), Stage 4 -
05
10,556
Page 30
637
9,919
Years 11-12
Greenbank (P - 7), GLAB - 2 spaces
05
353
353
Kelvin Grove State College (P - 12),
05
585
585
Preschool relocation
Kelvin Grove State College (P - 12),
05
5,609
4,875
734
Site redevelopment
MacGregor (8 - 12), Renewal
05
2,820
2,462
358
Program Phase 3
Page 31
MacGregor (P - 7), 2 storey GLAB
05
1,620
1,620
Manly (1 - 7), Administration block
05
585
585
Marsden (8 - 12), GLAB - 8 spaces
05
1,075
1,075
Marshall Road (P - 7), Replace toilet
05
270
270
block
Narangba Valley (8 - 12), Stage 5 -
05
7,007
539
6,468
Years 11-12
Norman Park (P - 7), Additional
05
1,470
1,470
classrooms
Page 32
North Lakes (P - 12), Stage 3A -
05
2,730
91
2,639
Extend junior school
North Lakes (P - 12), Stage 3B -
05
3,367
3,367
Shared senior facilities
North Lakes (P - 12), Stage 4 - Years
05
13,650
1,929
11,721
7-9 Middle School
Patricks Road (P - 7), GLAB - 2
05
966
84
882
storey open under - 4 spaces
Page 33
Redcliffe (8 - 12), Upgrade Special
05
475
355
120
Education Unit
Shorncliffe (1 - 7), Toilet block
05
336
336
replacement
Taigum (P - 7), GLAB - 2 spaces
05
336
336
Tullawong (8 - 12), 2 x 2 space
05
470
470
relocatables
Victoria Point (8 - 12), Stage 5 -
05
1,548
137
1,411
Performing Arts block
Page 34
Virginia (P - 7), Administration upgrade
05
270
270
Wellington Point (8 - 12), GLAB - 8
05
1,596
146
1,450
spaces, toilets and conversions
Windaroo Valley (8 - 12), 2 x 2 space
05
470
470
relocatables
Woodcrest College (P - 12), New
05
23,431
22,820
611
School Stages 1 and 2
Woodridge (6 - 12), Renewal
05
2,820
2,126
694
Page 35
Program Phase 3
Sub-total Brisbane Statistical Division
63,241
Moreton Statistical Division
Chancellor State College (7 - 12),
10
16,744
1,092
15,652
Stage 1 - Years 7-9
Chancellor State College (7 - 12),
10
2,457
2,457
Stage 1b - Shared facilities
Nambour (SPS), 2 space relocatable
10
356
Page 36
356
Pacific Pines (8 - 12), Stage 4 - Year 12
10
5,169
357
4,812
Pacific Pines (8 - 12), Stage 5
10
4,096
410
3,686
Pacific Pines (P - 7), GLAB - 2 storey -
10
1,260
1,260
8 spaces
Somerset Drive - Mudgeeraba (P - 7),
10
12,740
3,485
9,255
New school
Somerset Drive - Mudgeeraba (P - 7),
10
2,730
273
2,457
Stage 2
Talara Primary College (P - 7), GLAB -
Page 37
10
790
84
706
2 storey open under - 4 spaces
Tamborine Mountain (8 - 12), Planned
10
1,574
1,216
358
conversions and extensions
Upper Coomera (P - 12), Stage 2 -
10
9,100
1,547
7,553
Years 10-11
Varsity College (P - 12), Stage 4 -
10
4,323
246
4,077
Year 12
Sub-total Moreton Statistical Division
41,163
Page 38
Wide Bay-Burnett Statistical Division
Agnes Water (P - 7), Administration
15
765
765
block
Moore Park (P - 7), Initial planning and
15
443
79
364
resourcing
Yarrilee (P - 7), GLAB - 4 spaces
15
613
613
Sub-total Wide Bay-Burnett Statistical Division
1,742
Page 39
Darling Downs Statistical Division
Allora (P - 10), Relocatable Home
20
333
333
Economics block
Drayton (P - 7), Provide Administration
20
450
450
block
Highfields (P - 7), Extend Resource
20
270
270
Centre
Stanthorpe (P - 7), Replace toilet block
Page 40
20
360
360
Taroom (P - 10), Rectify/replace
20
450
450
secondary school building
Sub-total Darling Downs Statistical Division
1,863
Mackay and Northern Statistical Divisions
Mackay North (8 - 12), Renewal
40
2,820
2,416
404
Program Phase 3
Page 41
Annandale (P - 7), GLAB - 4 spaces
45
849
849
Magnetic Island (P - 7), Administration
45
454
130
324
upgrade
Millchester (P - 7), 2 space relocatable
45
281
281
The Willows (P - 7), 2 space relocatable
45
281
281
Sub-total Mackay and Northern Statistical Divisions
2,139
Far North Statistical Division
Bamaga (P - 12), Administration and
50
1,361
212
Page 42
1,149
Resource Centre
Bentley Park College (P - 12), Stage 4 -
50
5,214
455
4,759
Years 11-12
Daradgee EEC, Additional toilets
50
432
432
Freshwater (P - 7), GLAB - 2 spaces
50
252
252
Holloways Beach EEC, Replace
50
360
360
student toilet and shower block
Ravenshoe (P - 12), Relocate Manual
50
630
630
Page 43
Arts to Secondary campus
Saibai Island (P - 7), Replace
50
400
400
Administration block
Sub-total Far North Statistical Division
7,982
North West Statistical Divisions
Mount Isa Central (P - 7), Replace
55
360
360
toilet block
Spinifex College - Mount Isa - Junior
55
817
137
680
Page 44
Campus (8 - 10), Spinifex - Junior Campus Stage 1A &B
Spinifex College - Mount Isa - Senior
55
635
91
544
Campus (11 - 12), Spinifex - Senior Campus Stage 1A & B
Sub-total North West Statistical Division
1,584
Minor works
Various
33,990
12,858
15,708
5,424
Additional accommodation
Various
9,515
Ongoing
Land acquisition
Various
12,009
Ongoing
General works
Various
61,222
Ongoing
Page 45
Other Acquisitions of Property, plant and Equipment
Plant and equipment
Various
21,000
Ongoing
Information Technology infrastructure
Various
14,570
Ongoing
Sub-total Other Acquisitions of Property, Plant and Equipment
35,570
Total Property, Plant and Equipment
253,738
Other Capital Expenditure
Major software development
Various
500
Ongoing
Page 46
Intellectual property
Various
1,000
Total Other Capital Expenditure
1,500
Capital Grants
Non-State Government grants
Various
45,096
Ongoing
Total Capital Grants
45,096
TOTAL EDUCATION DEPARTMENT
300,334
Page 47
QUEENSLAND STUDIES AUTHORITY
Queensland Studies Authority
Various
112
112
Ongoing
TOTAL QUEENSLAND STUDIES AUTHORITY
112
TOTAL EDUCATION
300,446
Notes: Notes:
1. The amounts quoted in the text above (and in the Ministerial Portfolio
Statement) are the full financial cost of projects (i.e. they include some
expensed capital items). The amounts quoted in the table reflect the estimated
portion of project costs that will be capitalised.
2. Projects contained in the table have been included on the basis of projected
enrolments. If projected enrolments do not eventuate, then listed projects may
be deferred or stopped, or new projects added during the course of the financial
year.
3. Project budgets listed in the table are in some cases indicative and are
subject to refinement as projects are further developed.
4. Numbers outlined in project description represent year level with "P"
Page 48
representing Preschool - for example, (P-12) represents Preschool to Year 12.
ELECTORAL COMMISSION
An amount of $0.24 million is allocated to the acquisition of computer hardware
for the next State general election and the replacement of plant and equipment
in 2003-04. This will provide for the ongoing operational requirements
associated with the efficient and effective provision of electoral services for
Queensland.
Electoral Commission
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
ELECTORAL COMMISSION OF QUEENSLAND
Property, Plant and Equipment
Plant and equipment
05
240
Page 49
Ongoing
Total Property, Plant and Equipment
240
TOTAL ELECTORAL COMMISSION
240
EMERGENCY SERVICES
The Department of Emergency Services' capital program (inclusive of the
Queensland Ambulance Service and the Queensland Fire and Rescue Service) will
see $77.7 million invested in new capital acquisitions in 2003-04.
The capital acquisition plan provides for essential infrastructure and
information technology investment to support operations and management, and to
achieve economic and operational effectiveness through contemporary asset
management strategies. The capital investment program reflects the Government's
ongoing commitment to the provision of essential emergency services and is
fundamental to the Government's priority for achieving Safer and More Supportive
Communities.
The department will invest $3 million in essential Information Technology
infrastructure, equipment and information systems as well as $5.6 million to
finalise purchase of the replacement Queensland Rescue Squirrel helicopter.
Queensland Ambulance Service
Capital investments by the Queensland Ambulance Service in 2003-04 total $27.1
million.
Seventeen replacement ambulance stations, one replacement workshop and four new
stations will be commenced or completed in 2003-04.
Queensland Ambulance Service will invest $9.9 million in replacement ambulance
vehicles as part of its vehicle replacement program and $4.6 million on its
program of continued improvement in technical communications and operational
equipment across the State.
Queensland Fire and Rescue Service
Capital investments by the Queensland Fire and Rescue Service in 2003-04 total
$37.5 million.
Seven stations will be replaced and a further nine stations or facilities
upgraded at a cost of $10.4 million. A further $2 million is provided for land
purchases for future stations.
Queensland Fire and Rescue Service will invest $14 million in new or replacement
urban vehicles as part of its fleet replacement program and to meet enhanced
service delivery requirements. A further $3.8 million will be invested in 74
rural vehicles.
A further $7.4 million will be spent on equipment to develop or enhance
operational support systems and associated infrastructures.
Joint Projects
$1.9 million is provided for a joint emergency services complex in North Mackay.
Emergency Services
Page 50
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF EMERGENCY SERVICES
Property, Plant and Equipment
QUEENSLAND AMBULANCE SERVICE
Building/General Works
Atherton replacement station
50
550
135
415
Page 51
Balmoral replacement station
05
650
36
614
Birkdale new station
05
300
300
Boonah replacement station
10
550
50
500
Boyne Island replacement station
30
450
20
430
Boyne Island residence
30
150
150
Burnett Coast replacement station
15
840
144
696
Calen replacement station
40
450
250
200
Chinchilla replacement station
20
480
285
195
Dirranbandi replacement station
25
250
106
144
Page 52
Hervey Bay replacement station
15
900
50
850
Howard new station
15
625
139
486
Hughenden replacement station
55
485
150
335
Innisfail replacement station
50
550
29
521
Kowanyama new station
50
300
280
20
Logan West replacement station
05
1050
203
847
Minor works
Various
1,400
1,400
Mt Garnet replacement station
50
400
250
150
Narangba new station
05
700
700
Page 53
Project development
Various
1,325
1,325
Redbank replacement station
05
650
650
Rockhampton replacement workshop
30
50
50
South Mackay replacement station
40
750
20
730
Springwood replacement station
05
620
120
500
Theodore replacement station
30
300
300
Sub-total Building/General works
11,848
Land Purchases
Atherton land
50
Page 54
120
120
Ayr replacement station
45
150
150
Kowanyama land
50
25
1
24
Minor land purchases
Various
150
150
Rockhampton workshop land
30
100
100
South Mackay land
40
200
1
199
Sub-total Land Purchases
743
Other Plant and Equipment
Ambulance vehicle purchases
Various
9,850
Page 55
9,850
Operational and communications equipment
Various
4,644
4,644
Sub-total Other Plant and Equipment
14,494
TOTAL QUEENSLAND AMBULANCE SERVICE
27,085
Emergency Services
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
QUEENSLAND FIRE AND RESCUE SERVICE
Page 56
Building/General works
Balmoral Fire Station
Replacement and special operations
05
4,000
50
3,950
Cairns workshops
50
250
250
Gladstone Fire Station refurbishment
30
350
350
Mackay Fire Station refurbishment
40
200
100
100
Maryborough Fire Station refurbishment
15
250
250
Maryborough Regional Office refurbishment
15
720
520
200
Minor works
Various
2,025
2,025
Mooloolah Fire Station replacement
10
Page 57
210
100
110
Morven Fire Station replacement
25
120
120
Mt Gravatt Fire Station replacement
05
1,400
50
1,350
Petrie Fire Station refurbishment
05
950
50
900
Rockhampton Communication Centre refurbishment
30
250
50
200
Rockhampton Fire Station refurbishment
30
245
45
200
Roma St Fire Station refurbishment
05
2,050
1,200
850
Woodford Fire Station replacement
05
200
200
Wulguru Fire Station replacement
45
300
300
Wynnum Fire Station replacement
05
Page 58
1,400
200
1,200
Sub-total Building/General Works
10,405
Land Purchases
Airlie Beach land
40
150
150
Balmoral land
05
1,000
1,000
Emerald land
30
200
200
Oxley land
05
500
500
Rural service land
Various
100
100
Sub-total Land Purchases
1,950
Page 59
Other Plant and Equipment
Rural fire appliances
Various
3,750
3,750
Urban fire appliances
Various
14,000
14,000
Operational and communications equipment
Various
7,406
7,406
Sub-total Other Plant and Equipment
25,156
TOTAL QUEENSLAND FIRE AND RESCUE SERVICE
37,511
JOINT EMERGENCY SERVICE PROJECTS
Page 60
Mackay North complex
40
2,000
150
1,850
QAS/QFRS/QPS Computer Aided
Various
1,500
1,500
Despatch Initiative
TOTAL JOINT EMERGENCY SERVICE PROJECTS
3,350
Emergency Services
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
OTHER DEPARTMENTAL
Page 61
Squirrel Helicopter replacement
05
8,000
2,400
5,600
Plant and equipment
Various
240
240
IT infrastructure
Various
861
861
TOTAL OTHER DEPARTMENTAL
6,701
Total Property, Plant and Equipment
74,647
Other Capital Expenditure
Page 62
QUEENSLAND FIRE AND RESCUE SERVICE
Training Intellectual Property
Various
620
620
TOTAL QUEENSLAND FIRE AND RESCUE SERVICE
620
OTHER DEPARTMENTAL
Information Systems Development
Various
2,178
2,178
TOTAL OTHER DEPARTMENTAL
2,178
Page 63
Total Other Capital Expenditure
2,798
Capital Grants
Rural Fire Brigades
Various
150
150
Ongoing
State Emergency Service units
Various
130
130
Ongoing
Total Capital Grants
280
TOTAL EMERGENCY SERVICES
77,725
EMPLOYMENT AND TRAINING
The 2003-04 capital program for the Department of Employment and Training is
$58.4 million. The department has made productivity and efficiency improvements
by improving the usage and quality of physical and technological infrastructure.
The department will continue to pursue a value for money capital investment
strategy directed at ensuring all necessary functions are provided at the
required levels of quality and performance and at the lowest total cost.
Capital expenditure in 2003-04 is directed through four broad strategies:
Page 64
.. refurbishment or construction of physical facilities
.. supporting Technical and Further Education (TAFE) Queensland in improving
and maintaining sustainable information and communication technology
infrastructure
.. identifying and disposing of surplus or under utilised property
.. working with Government, industry and community agencies to maximise local
and regional responses.
Program Highlights
.. $5.5 million to establish a new Arts and Environmental Tourism campus at
Noosa.
.. $2.9 million to commence the construction of a new Health and Social
Services facility in Toowoomba.
.. $17.4 million for continued investment in information and communication
technology infrastructure, including the development of the new Institute
Student Administration System.
.. $2.3 million to continue planning and determine private sector investment
in the development of the Southbank Education and Training Precinct which
incorporate the Southbank campus of the Southbank Institute of TAFE.
The department will contribute to the Education and Training Reforms for the
Future, the Smart State initiative and Building Queensland's Regions by pursuing
investment strategies that support flexible training delivery, cross-sector
collaboration, and community capability and sustainability. This will be
achieved by ensuring the training infrastructure provided in regional
communities is accessible and responsive to meet changing demands and
challenging business environments. Investment in larger communities with
increasing populations will supply the infrastructure necessary to provide a
quality, innovative service to their existing workforce, and the chance for
young people to develop entry level skills that will lead to opportunities for
employment and enhanced quality of life.
Employment and Training
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 65
$'000
$'000
$'000
$'000
DEPARTMENT OF EMPLOYMENT AND TRAINING
Property, Plant and Equipment
TAFE Institutes
Brisbane and Northpoint Institute of TAFE
Institute consolidation
05
800
100
700
Co-location - Caboolture
05
4,000
500
3,500
Cooloola Sunshine Institute of TAFE
redevelopment Stage II - Mooloolaba
10
13,860
13,663
197
Page 66
Arts and Environmental Studies -
10
6,000
500
5,500
Tewantin
Logan Institute of TAFE
New Western Campus - Browns Plains
05
4,070
1,517
2,553
Moreton Institute of TAFE
Campus consolidation - Mt Gravatt
05
10,890
268
1,122
9,500
Mount Isa Institute of TAFE
Education Precinct - Mount Isa
55
400
150
250
Open Learning Institute of TAFE
Campus redevelopment - Brisbane
05
2,950
Page 67
300
2,650
Southbank Institute of TAFE
Public Private Partnership
05
9,224
345
2,345
6,534
redevelopment - South Brisbane
Southern Queensland Institute of TAFE
Consolidation - Toowoomba
20
17,820
870
2,930
14,020
The Bremer Institute of TAFE
new campus - Inala
05
4,200
943
3,257
Wide Bay Institute of TAFE
consolidation - Maryborough
15
5,934
1,627
4,307
Information and communication
Various
Page 68
10,409
Ongoing
technology
Minor capital works
Various
3,093
Ongoing
Infrastructure equipment
Various
3,066
Ongoing
Disability Adaptive equipment
05
49
Ongoing
Other Plant and equipment
05
1,999
Ongoing
Total Property, Plant and Equipment
41,977
Other Capital Expenditure
Institute Student and Administration
05
21,400
14,430
6,970
Page 69
System
Document Management Program
05
3,429
3,429
Total Other Capital Expenditure
10,399
Capital Grants
Agricultural Colleges
Backlog Maintenance Reduction
Various
1,000
Ongoing
Other Capital Grants
Skill Centre Program
Various
5,000
Ongoing
Total Capital Grants
6,000
Page 70
TOTAL EMPLOYMENT AND TRAINING
58,376
ENVIRONMENTAL PROTECTION AGENCY
The 2003-04 capital program for the Environmental Protection Agency is $20.1
million. This provides for the continuing protection of Queensland's natural and
cultural heritage through the acquisition of land and the ongoing construction
of infrastructure and improvements on Queensland's parks and forests.
Additional funding of $0.5 million is provided in the 2003-04 Budget for the
construction of added infrastructure on Cape York in National Parks. Upgrading
and constructing new facilities will ensure a better experience for tourists
travelling to Cape York and encourage enhancement of Cape York tourist
attractions.
Capital works on parks, forests and administrative buildings account for $11.1
million of the total allocation and provides the ongoing funding required to
enhance and improve facilities and infrastructure on protected areas and other
land tenure. Projects vary from major visitor facilities to fencing and fire
trails. Also included in this allocation is provision for construction and
improvements to ranger housing.
The Great Walks of Queensland project ($10 million over five years) designed to
create a world-class network of walking tracks and visitor facilities in parks
and forests continues into its third year with an allocation of $3.2 million in
2003-04.
The agency continues its commitment to the acquisition of selected properties
representing high biodiversity values to Queensland's community through the
provision of an allocation of $1.3 million.
Environmental Protection Agency
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 71
$'000
$'000
$'000
$'000
ENVIRONMENTAL PROTECTION AGENCY
Property, Plant and Equipment
Plant and Equipment
Various
3,963
Ongoing
Capital Works on parks,
Various
11,127
Ongoing
forests and administrative building works
Great Walks of Queensland
Various
10,000
2,820
3,180
4,000
Acquisition of land for parks,
Various
1,291
Ongoing
forests
Page 72
Additional Cape York
50
500
500
infrastructure on parks
Total Property, Plant and Equipment
20,061
TOTAL ENVIRONMENTAL PROTECTION AGENCY
20,061
FAMILIES
The Department of Families' estimated capital expenditure in 2003-04 is $14.9
million. Typically, investment is made in capital infrastructure where it is
required for Government service provision, to accommodate and support
departmental staff and in targeted community sector infrastructure (usually in
partnership with non-government service providers).
Highlights include expenditure of $1.5 million to continue the upgrade of
neighbourhood centres and community facilities at a number of regional locations
in a three-year program totalling $5.3 million and $3.9 million for the
construction of new accommodation units at the Cleveland Youth Detention Centre,
Townsville.
Plant and equipment will be targeted to the ongoing replacement of office
equipment and information technology, property refurbishment and minor works
across the State.
Capital grants of approximately $2 million will be spent in 2003-04 to continue
the Outside School Hours Care program.
Families
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
Page 73
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF FAMILIES
Property, Plant and Equipment
Youth Detention Centre
Cleveland - new accommodation
45
4,120
220
3,900
units
Reforming Queensland Protection
and Care of Children
Page 74
Various
384
Ongoing
Upgrade Neighbourhood Centres
Bohlevale District
45
525
25
500
Combined Women's Service
40
384
184
200
Mackay
Charters Towers
45
500
200
300
Cooktown and District
50
695
195
500
Other Property, plant and equipment
Minor works
Various
1,000
Ongoing
Asset purchases
Various
Page 75
6,036
Ongoing
Total Property, Plant and Equipment
12,820
Capital Grants
Child Care Grants
Outside School Hours Care
Various
2,030
Ongoing
Total Capital Grants
2,030
TOTAL FAMILIES
14,850
HEALTH
The total Health capital program expenditure for 2003-04 is estimated to be
$282.7 million (including $1.7 million for Queensland Institute of Medical
Research acquisitions). The $2.8 billion Statewide Health Building Program was
effectively completed in 2002-03.
The major focus for Queensland Health's capital program over the next four years
will be information technology, medical equipment, rural health services,
community health centres and continuation of the five-year $120 million State
Government
Page 76
Residential Aged Care Facilities Program.
Program Highlights
.. Investment in information and communication technology enables the delivery
of health care services through the timely provision of information at the
point of care. Funding of $63.7 million is provided in 2003-04. This
investment is directed towards development of clinical information systems
in hospitals and community care settings and maintenance, and continuing
development of the information and communications infrastructure.
.. Continuing provision of medical equipment as one of the fundamental tools
for the effective delivery of health services. In 2003-04, $47.5 million
will be spent on health technology.
.. Following the completion of the redevelopment for all acute hospitals, the
emphasis is shifting to rural facilities through ongoing projects such as:
.. hospital redevelopments at Ayr, Innisfail and Gympie;
.. refurbishment projects at Atherton, Bundaberg and Winton;
.. multi-purpose health services at Springsure, Texas and Inglewood; and
.. Primary Health Care Centres at Mabuiag, Mua and Iama Islands.
.. Integrated health care through new Community Health Centres at Cardwell,
Townsville, North West Brisbane, Nundah, Rosemount and Logan Central.
.. Major residential aged care facilities at Maryborough, Redcliffe, Redland,
Sandgate and Townsville with each of these projects moving into the
construction phase during 2003-04.
.. Leading edge projects at the Herston campus including a Skills Development
Centre for all Health Clinicians, the major Queensland Health Pathology
Laboratory providing a high throughput laboratory combined with a statewide
referral service and an Information Technology Data Centre consolidation
including the relocation and consolidation of the majority of Information
Services staff in Brisbane.
The Capital Works Program is a major input to the delivery of health services
and outputs that supports the Government's priorities of Safer and More
Supportive Communities and Community Engagement and a Better Quality of Life.
Following the approval of the Smart State: Health 2020 Directions Statement by
the Queensland Government, the capital works program will now be prioritised to
meet the demands of an integrated health care system as it evolves over the next
few years with an increasing focus on prevention, promotion, integration and
partnerships.
QUEENSLAND INSTITUTE OF MEDICAL RESEARCH
The Queensland Institute of Medical Research will continue its ongoing
replacement of equipment in 2003-04. The field of medical research is highly
competitive and scientific competitiveness is enhanced by the availability of
leading-edge research equipment.
In 2003-04, funding will be allocated for the replacement of old scientific
equipment and purchase of new scientific equipment and a range of specialist
equipment.
Health
Statistical
Total
Expenditure
Page 77
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF HEALTH
Property, Plant and Equipment
Community Health Centres (CHC)
Cardwell CHC
50
750
314
436
Emerald CHC and staff
Page 78
accommodation
30
1,000
100
700
200
Logan Central CHC
05
7,500
1,900
4,010
1,590
Nambour Hospital Breastscreen
10
1,900
500
1,400
North West Brisbane CHC
05
4,690
300
3,490
900
Nundah CHC
05
5,865
500
5,365
Rosemount CHC
05
1,400
500
900
St Paul's Tce Centre,
Airconditioning (Lutwyche)
05
700
700
Townsville CHC consolidation
Page 79
Kirwan
45
5,800
160
900
4,740
North Ward
45
2,900
676
1,703
521
Rural Hospitals, emergent work
Various
500
Sub-total Community Health Centres
13,939
Multi-Purpose Health Service
Springsure MPHS redevelop
30
5,345
120
3,500
1,725
Projects finalisation
20
770
Sub-total Multi-Purpose Health Service
Page 80
4,270
Primary Health Care (PHC)
Torres Strait PHC Centres
Mabuiag Island
50
2,267
268
1,999
Mua (Kubin Community) Island
50
2,067
249
1,818
Iama Island
50
2,123
251
1,872
Projects finalisation
30
275
Sub-total Primary Health Care
5,964
Page 81
Hospitals
Atherton Hospital refurbishment
50
1,024
231
793
Ayr Hospital redevelopment
45
11,300
731
9,920
649
Brisbane Oral Health, Non-
Discriminatory access
05
500
100
400
Bundaberg Hospital - relocation
of Birthing Services
15
250
Page 82
250
Caboolture Hospital - road
access and car park
05
500
500
Gympie Hospital redevelopment
15
5,500
500
3,500
1,500
Herston Hospitals, Education
Centre and demolitions
05
15,000
12,000
3,000
Halwyn Centre redevelopment
05
1,200
200
1,000
Innisfail Hospital redevelopment
50
16,000
653
2,714
12,633
Mackay Hospital, Specialist
Outpatients upgrade
Page 83
40
1,800
324
1,476
Nambour Hospital redevelopment
10
25,850
24,850
1,000
Princess Alexandra Hospital
redevelopment
05
353,433
342,104
11,329
Toowoomba delivered energy
20
3,500
1,401
2,099
Winton Hospital refurbishment
35
200
200
Building engineering services
Various
500
Health technology replacement
Northern Zone
Various
10,944
Page 84
Central Zone
Various
20,862
Southern Zone
Various
12,781
Public Health Services
05
34
Pathology and Scientific
05
2,858
Services
Capital Planning System
05
12,262
7,368
4,894
Sterilising equipment
Various
2,400
400
500
1,500
Planning and management studies
Various
850
Page 85
Program management
05
850
Skills Development Centre -
Herston
05
11,000
7,000
4,000
Sterilising Services, Instrument
Tracking System
05
600
220
380
Projects Finalisation
05
6,310
Sub-total Hospitals
115,144
Mental Health Service (MHS)
Page 86
Bayside MHS
05
997
120
877
Gold Coast Hospital MHS
10
1,456
200
1,256
Thursday Island MHS and
pathology staff accommodation
50
910
560
350
The Park, water mains replace -
Wolston Park
05
1,500
750
750
Projects finalisation
05
100
Sub-total Mental Health Service
3,333
Page 87
Residential Care
State Government Residential
Aged Care Facilities Program
Dalby
20
12,322
52
567
11,703
Maryborough
15
14,249
573
5,661
8,015
Redcliffe
05
8,415
654
7,471
290
Redland
05
18,945
1,270
3,393
14,282
Roma
25
7,338
78
253
7,007
Sandgate
05
Page 88
11,026
776
3,617
6,633
Townsville
45
13,182
207
7,622
5,353
Warwick
20
6,416
53
152
6,211
Wondai
15
6,777
49
180
6,548
Miscellaneous upgrade works
Various
889
439
50
400
Sub-total Residential Care
28,966
Other Acquisitions of Property, Plant and Equipment
Minor capital projects and
acquisitions1
Various
Page 89
25,490
Sandgate Dental Clinic2
05
910
910
Herston Block 7 refurbishment
05
47,861
1,383
4,340
42,138
Herberton, sewerage upgrade
50
350
24
326
Support service facilities and
05
6,239
1,219
500
4,520
corporate accommodation
refurbishment
Staff accommodation
Bowen Program Initiative
40
800
500
300
Page 90
Bundaberg Program Initiative
15
2,000
750
1,250
Mackay Program Initiative
40
1,500
1,000
500
Mount Isa Program Initiative
55
2,750
1,775
975
North Burnett
15
400
200
200
South Burnett
15
500
200
300
Emergent accommodation
Various
500
Sub-total Other Acquisitions of Property, Plant and Equipment
35,591
Total Property, Plant and Equipment
207,207
Page 91
Other Capital Expenditure
Inventory movement
05
1,473
Information and communication technology
Clinical enablement
Community-based health
05
4,738
772
3,966
care systems
Hospital-based health care
Various
143,109
270
25,854
116,985
systems3
Page 92
Resource management enablement
Asset maintenance system
Various
5,700
1,225
2,275
2,200
Health records management
Various
5,532
341
310
4,881
Decision support enablement
Health Information Centre
05
1,190
1,114
System
Decision Support Centre
Various
550
550
IT Infrastructure
Page 93
Workstation management4
Various
26,763
14,429
7,834
4,500
Communications and networks
Various
7,993
8,214
Data Centre Program4
Various
43,606
14,088
7,069
22,449
Telecommunications
Various
500
500
Replacements
Infrastructure
I-Net Infrastructure4
Various
11,425
3,500
1,700
6,225
Security Services
Various
14,188
6,138
2,050
6,000
Page 94
IT Service Support
Various
5,747
1,755
IT Emergent Needs
Various
189
548
Sub-total Information and Communication Technology
63,739
Total Other Capital Expenditure
65,212
Capital Grants
Corporate Capital Grants
Home and Community Care
Various
8,625
Total Capital Grants
8,625
Page 95
TOTAL DEPARTMENT OF HEALTH
281,044
QUEENSLAND INSTITUTE OF MEDICAL RESEARCH
Property, Plant and Equipment
Other Plant and equipment
05
1,724
Total Property, Plant and Equipment
1,724
TOTAL QUEENSLAND INSTITUTE OF MEDICAL RESEARCH
1,724
TOTAL HEALTH
282,768
Page 96
Notes:
1. Amount is net of Capital Expense - $13.6 million.
2. Minor capital project funded from the Oral Health Unit.
3. $38.7 million included in Hospital-based Health Care Systems is funded from
the Commonwealth for QIEP projects.
4. Commonwealth funding of $5.9 million provided in 2002-03 toward these
projects via the National Health Development Fund.
HOUSING
The Department of Housing's capital expenditure program for 2003-04 is $333.8
million. The capital program contributes to the achievement of the department's
outputs, providing solutions including public housing, Aboriginal and Torres
Strait Islander housing, community housing and private housing assistance.
Program Highlights
.. Capital grants of $48.9 million allocated to 34 Aboriginal and Torres
Strait Islander communities. This is for the construction of new houses to
reduce overcrowding, and to provide for major upgrades to ensure existing
buildings are safe and structurally sound.
.. $13.5 million will be invested to commence the construction of 48 new
dwellings (including six on Thursday Island), complete dwellings commenced
in previous years, purchase land, and continue major redevelopment and
expansion of housing on Thursday Island under the Aboriginal and Torres
Strait Housing output. Upgrades will also commence to 200 rental dwellings
totalling $5 million.
.. $5.7 million will be expended through the Community Housing output for
crisis accommodation initiatives including:
.. commence preliminary design on three youth shelters in regional centres;
.. commence new construction of 16 accommodation units and complete
construction of 15 units, for young people and women and children escaping
domestic and family violence;
.. acquire five units of accommodation for women and children escaping
domestic and family violence and five units to replace existing stock; and
.. provide upgrades to 50 Department of Housing properties.
.. $15 million is allocated to provide of additional transitional
accommodation responses statewide to assist people who are homeless or at
risk of homelessness including assisted households. An additional $1.3
million will be allocated to commence construction and upgrades on three
women's shelters in remote Aboriginal and Torres Strait Islander
communities under the Community Housing output.
.. Under the Private Housing Assistance output, the department will be
marketing lots for sale throughout the Kelvin Grove Urban Village in a
staged process. Four sites have been earmarked for the provision of social
housing through the Brisbane Housing Company. Affordable housing in private
residential developments is also planned.
.. Under the Public Rental Housing output $65.1 million is allocated to
commence 300 new dwellings and complete 239 dwellings commenced in 2002-03
or previous years. Of the 300 dwelling commencements, 185 will be built to
adaptable standards, with an estimated 24 being specifically adapted for
clients with a disability.
.. Six dwellings will be acquired for future public rental housing solutions
at a cost of $2 million and land purchased to facilitate future
construction of approximately 180 units of accommodation at a cost of $15.9
million.
.. The condition of existing public rental housing dwellings will be enhanced
through a $106.4 million upgrade program and the continuation of urban
renewal across Queensland and Area Office accommodation upgrades. Two new
urban renewal projects will also commence in Mooroobool and Loganlea.
Page 97
.. An estimated 706 full-time equivalent (FTE) jobs directly sustained in the
residential construction sector and a further 765 FTE jobs in related
supply sectors, will be generated based on construction related capital
investment of $171.5 million.
Housing
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
PUBLIC HOUSING
Property, Plant and Equipment
New Construction and Acquisition
Page 98
Brisbane
Detached houses
05
4,501
Ongoing
Medium density
05
14,860
Ongoing
Seniors' units
05
9,938
Ongoing
Moreton
Detached houses
10
2,337
Ongoing
Medium density
10
1,577
Ongoing
Seniors' units
10
6,929
Ongoing
Page 99
Wide Bay-Burnett
Detached houses
15
603
Ongoing
Medium density
15
181
Ongoing
Seniors' units
15
279
Ongoing
Darling Downs
Detached houses
20
947
Ongoing
Medium density
20
2,840
Ongoing
Seniors' units
20
844
Ongoing
South West
Page 100
Detached houses
25
681
Ongoing
Seniors' units
25
559
Ongoing
Fitzroy
Detached houses
30
1,007
Ongoing
Medium density
30
3,738
Ongoing
Mackay
Detached houses
40
558
Ongoing
Medium density
40
Page 101
2,038
Ongoing
Seniors' units
40
282
Ongoing
Northern
Detached houses
45
148
Ongoing
Medium density
45
5,124
Ongoing
Seniors' units
45
1,190
Ongoing
Far North
Detached House
50
426
Ongoing
Medium density
50
Page 102
1,494
Ongoing
Seniors' units
50
1,461
Ongoing
North West
Seniors' units
55
587
Ongoing
Sub-total New Construction and Acquisition
65,129
Capital Works On existing dwellings
Brisbane
05
Page 103
57,370
Ongoing
Moreton
10
11,324
Ongoing
Wide Bay-Burnett
15
2,185
Ongoing
Darling Downs
20
4,518
Ongoing
Fitzroy
30
8,345
Ongoing
Central West
35
125
Ongoing
Mackay
40
3,074
Ongoing
Northern
45
11,375
Ongoing
Far North
50
4,160
Ongoing
North West
55
Page 104
2,841
Ongoing
Sub-total Capital Works on existing dwellings
105,317
Land Purchases and Development
Various
15,940
Ongoing
Spot Purchases
Various
2,000
Ongoing
Other Buildings
05
1,100
Ongoing
Total Property, Plant and Equipment
189,486
TOTAL PUBLIC HOUSING
189,486
Page 105
PRIVATE HOUSING
Property, Plant and Equipment
Capital Works on existing dwellings
30
135
Ongoing
Land Purchases and Development
05
11,045
Ongoing
Total Property, Plant and Equipment
11,180
Other Capital Expenditure
Inventory
05
10,394
Total Other Capital Expenditure
Page 106
10,394
Capital Grants
Residential Service Industry
Various
Conditional Grant
1,100
Ongoing
Total Capital Grants
1,100
TOTAL PRIVATE HOUSING
22,674
ABORIGINAL AND TORRES STRAIT ISLANDER HOUSING
Page 107
Property, Plant and Equipment
New Construction
Brisbane
05
1,853
Ongoing
Moreton
10
260
Ongoing
Wide Bay-Burnett
15
346
Ongoing
Darling Downs
20
250
Ongoing
Fitzroy
30
1,039
Ongoing
Mackay
40
690
Ongoing
Northern
Page 108
45
1,610
Ongoing
Far North
50
5,902
Ongoing
North West
55
550
Ongoing
Sub Total New Construction
12,500
Capital Works on existing dwellings
Brisbane
05
1,166
Ongoing
Moreton
10
12
Ongoing
Wide Bay-Burnett
15
93
Page 109
Ongoing
South West
25
222
Ongoing
Fitzroy
30
467
Ongoing
Mackay
40
200
Ongoing
Northern
45
1,000
Ongoing
Far North
50
1,130
Ongoing
North West
55
710
Ongoing
Sub-total Capital Works on
5,000
existing dwellings
Page 110
Purchase of Land
Fitzroy
30
300
Ongoing
Mackay
40
145
Ongoing
Northern
45
405
Ongoing
Far North
50
150
Ongoing
Sub-total Purchase of Land
1,000
Total Property, Plant and Equipment
18,500
Capital Grants
Page 111
Capital Grants to Aboriginal and Torres Strait Islander Councils
Wide Bay-Burnett
15
487
Ongoing
Fitzroy
30
725
Ongoing
Northern
45
4,227
Ongoing
Far North
50
40,223
Ongoing
North West
55
3,226
Ongoing
Total Capital Grants
48,888
TOTAL ABORIGINAL AND TORRES STRAIT ISLANDER HOUSING
67,388
Page 112
COMMUNITY HOUSING
Property, Plant and Equipment
New Construction
Brisbane
05
3,156
Ongoing
Moreton
10
4,476
Ongoing
Wide Bay-Burnett
15
530
Ongoing
Fitzroy
30
430
Ongoing
Far North
50
Page 113
349
Ongoing
Statewide
Various
3,000
Ongoing
Sub-total New Construction
11,941
Capital Works on existing dwellings
Various
915
Ongoing
Spot Purchase
Various
13,940
Ongoing
Land Acquisition
Various
2,709
Ongoing
Total Property, Plant and Equipment
29,505
Capital Grants
Page 114
Brisbane
05
461
Ongoing
Moreton
10
636
Ongoing
Wide Bay-Burnett
15
538
Ongoing
Darling Downs
20
378
Ongoing
South West
25
254
Ongoing
Fitzroy
30
2,137
Ongoing
Central West
35
120
Ongoing
Mackay
40
919
Ongoing
Northern
45
Page 115
1,529
Ongoing
Far North
50
2,942
Ongoing
North West
55
555
Ongoing
Other
Various
2,616
Ongoing
Total Capital Grants
13,085
TOTAL COMMUNITY HOUSING
42,590
COMMUNITY RENEWAL
Page 116
Capital Grants
Brisbane
05
3,400
Ongoing
Northern
45
2,990
Ongoing
Far North
50
932
Ongoing
Total Capital Grants
7,322
TOTAL COMMUNITY RENEWAL
7,322
HOME PURCHASES ASSISTANCE
Page 117
Property, Plant and Equipment
Rental Purchase Plan
Various
200
Ongoing
Total Property, Plant and Equipment
200
TOTAL HOME PURCHASES ASSISTANCE
200
PLANT AND EQUIPMENT
Property, Plant and Equipment
Page 118
Property, plant and equipment
Various
780
Ongoing
Total Property, Plant and Equipment
780
Other Capital Expenditure
Intangibles
Various
3,325
Ongoing
Total Other Capital Expenditure
3,325
TOTAL PLANT AND EQUIPMENT
4,105
TOTAL HOUSING
333,765
Page 119
INDUSTRIAL RELATIONS
In 2003-04 expenditure on capital items for the Department of Industrial
Relations will amount to $0.69 million and will be used to acquire or replace
minor items of office equipment and furniture.
The department will continue to place a high priority on improving systems to
support service delivery, including its internal business processes. The
development of these systems will be undertaken on behalf of the department by
the Department of Employment and Training. The costs will be met through service
charges negotiated between the two departments.
Industrial Relations
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF INDUSTRIAL RELATIONS
Property, Plant and Equipment
Plant and equipment
Various
Page 120
687
Ongoing
Total Property, Plant and Equipment
687
TOTAL INDUSTRIAL RELATIONS
687
INNOVATION AND INFORMATION ECONOMY, SPORT AND RECREATION
The capital program for Innovation and Information Economy, Sport and Recreation
Queensland (including the department, Major Sports Facilities Authority, and
Government Owned Energy Corporations) is $1.356 billion in 2003-04. The
department's capital program seeks to improve the delivery of services and
products to clients and to further the Government's policy priorities. The
department's capital program, including the Major Sports Facility Authority, for
2003-04 is $105.3 million.
Program Highlights
.. Continued development and deployment of products supporting the transaction
of Government business in an electronic environment and providing the
infrastructure to support integrated service delivery.
.. Supporting the enhancement of telecommunications infrastructure under the
Island Watch project for 16 islands of the Torres Strait to improve
training and medical service delivery in the Torres Strait.
.. Capital grants to sport and recreation organisations and local governments
to assist them build and improve sport and recreation infrastructure in the
built and natural environments.
.. Funding provided under the Smart State Research Facility Fund for the
development of world-class science and technology research and development
facilities, and infrastructure in areas of comparative advantage that would
otherwise not be possible.
.. Capital works in outdoor recreation centres and ongoing plant and equipment
acquisitions to improve the standard of facilities within these centres.
This includes the planned upgrade over a three year period of the
Tallebudgera Outdoor Recreation Centre and the construction of a Sports
House at Townsville.
.. CITEC's investment in information and communication infrastructure and
information management services to its clients. CITEC is a fully
commercialised business unit of the Queensland Government that delivers
information and communication infrastructure and information management
services to its clients.
.. The planned, cyclical replacement of the departmental asset base consisting
primarily of computer equipment and other information network technology.
Major Sports Facilities Authority
The 2003-04 capital program for the Major Sports Facility Authority comprises
$41.8
Page 121
million being the balance of redevelopment funds for the 52,500 seat Suncorp
Stadium. The redevelopment of Suncorp Stadium will deliver a world class
rectangular stadium that will position Queensland to attract major international
sporting events which will generate significant economic and social returns for
the State.
The capital program for the Major Sports Facilities Authority for 2003-04 also
reflects the capital maintenance program for the Brisbane Cricket Ground.
GOVERNMENT OWNED ENERGY CORPORATIONS
CS Energy Limited
CS Energy Limited's proposed capital program in 2003-04 is $70.3 million.
Program highlights include the refurbishment and upgrade of the 500MW Swanbank B
plant. This upgrade will complement the new state-of-the-art 385MW gas-fired
Swanbank E generating unit which has been operational since November 2002.
Stanwell Corporation Limited
Stanwell Corporation's expected capital expenditure program for 2003-04 is
$159.2 million. In particular, Stanwell will continue to consider renewable
energy projects including wind and biomass cogeneration and will further
investigate low emissions coal-fired technology. A significant component of
2003-04 capital expenditure will be directed at maintaining and improving the
efficiency of existing assets to meet increasing energy demand in Queensland.
Tarong Energy Corporation Limited
Tarong Energy's proposed capital expenditure program for 2003-04 is $67.6
million. This relates predominantly to maintaining operations at Tarong and
Wivenhoe Power Stations, ensuring existing plant continues to deliver maximum
availability to meet market demand.
Major highlights include $9.9 million for the construction of a trench around
the existing ash dam at Tarong (in accordance with Environmental Protection
Agency requirements), $3.9 million for final construction and commissioning of
the dense phase ash plant at Tarong, and $12.5 million in overhaul expenditure
at Tarong and Wivenhoe Power Stations.
Queensland Power Trading Corporation (trading as Enertrade)
Enertrade's proposed capital program for 2003-04 is $105.4 million. Enertrade
won the right to provide a gas-fired base load power station in North Queensland
following a competitive selection process. The project will see the existing
Townsville Power Station at Yabulu converted to combined-cycle operation using
natural gas as its fuel. Enertrade will commence construction of the associated
pipeline between Moranbah and Townsville in September 2003 and complete works in
late 2004.
The Enertrade project delivers on the Government's Queensland energy policy,
Cleaner Energy Strategy, which is aimed at ensuring adequate, reliable and
competitively-priced energy is available to users throughout Queensland. The
project will also create employment, improve the environment and provide
industrial and commercial development opportunities in the region.
Queensland Electricity Transmission Corporation Limited (trading as Powerlink
Queensland)
Powerlink Queensland is the transmission entity for Queensland. Its core
business includes the delivery of a secure, reliable transmission service to
electricity market participants via open, non-discriminatory access to the
Queensland transmission grid.
The proposed capital expenditure program for 2003-04 is $159.3 million excluding
financing costs during construction. The major highlights include $27.9 million
to develop 275kV transmission lines from Belmont substation to reinforce supply
to Brisbane area. An allocation of $20 million is provided to reinforce the
transmission system in Central Queensland to supply industry development in the
Gladstone area. A second 275kV transmission line from Broadsound to Lilyvale
will be constructed at a cost of $17 million to reinforce electricity supply to
Central Queensland. Additionally, $8.9 million will be spent to establish a
275kV substation at Molendinar to supplement supply to the Gold Coast.
Page 122
ENERGEX Limited
ENERGEX continues to commit to higher levels of expenditure on the electricity
and gas networks to cater for the load growth in South East Queensland, and
maintain system performance and reliability. ENERGEX's proposed capital program
in 2003-04 is $316 million.
ENERGEX has an extensive condition-monitoring program to ensure aging portions
of the franchise license-area infrastructure are identified in time to implement
cost-effective replacement and upgrade projects with minimal effect on customer
supply. The majority of expenditure for 2003-04 is on maintaining and upgrading
the existing distribution network.
Major highlights include $9.3 million allocated for Coomera substation works to
meet the increasing demand in the area north of the Gold Coast and south of
Brisbane. This will also contribute to an improved level of reliability of
supply.
$3.5 million has been allocated for the Molendinar 110kV feeder. This is the
commencement of a $14 million project to establish a 110kV feeder between
Molendinar and Southport, contributing to the reinforcement of supply to the
Gold Coast area.
$5.7 million has been allocated for the Newstead underground 110kV river
crossing to replace aging overhead river cables. This will reduce reliability
risk, contribute to a positive environmental impact and contribute to the
community expectation of undergrounding high voltage cables. To meet expected
demand growth $4.5 million has been allocated to establish a new 33/11kV
substation at Heathwood (Forest Lake, Forestdale and Greenbank).
$3.1 million has been allocated to establish two 110kV circuits in Belmont. This
is the foundation work of a $66.3 million project spanning three financial
years, critical to reinforce supply to Brisbane CBD due to expected load growth.
Other capital works include $10 million for business development opportunities
in the non-regulated business.
Ergon Energy Corporation Limited
During the 2003-04 financial year Ergon Energy proposes to undertake capital
expenditure totalling $373 million. A significant portion (approximately $169
million or 45%) of the capital expenditure in 2003-04 relates directly to the
construction, refurbishment, replacement and augmentation of Ergon Energy's
electrical network infrastructure, which is located throughout regional
Queensland. The capital expended on network assets will enhance the network and
reduce the frequency and duration of interruptions to supply. This will result
in an increase in the reliability of supply to customers and the satisfaction of
household and business customers.
The forecast capital expenditure in 2003-04 also includes a number of major
projects, which are primarily related to the electrical network and its
associated infrastructure. This includes $23.3 million to augment electricity
supply to Goondiwindi and $19.8 million to supply electricity to the Mount Isa
Mines/Rolleston Coal Mine.
Innovation and Information Economy, Sport and Recreation
Statistical
Total
Expenditure
Budget
Post
Page 123
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF INNOVATION AND INFORMATION, SPORT
AND RECREATION QUEENSLAND
Property, Plant and Equipment
Departmental plant and equipment
05
11,963
Ongoing
(includes CITEC)
Electronic Service Delivery Strategy
05
2,541
1,900
148
493
Page 124
Redevelopment of Tallebudgera
10
18,000
11,000
7,000
Recreation Centre
Townsville Sports House
45
2,000
50
1,950
Recreation Centre minor works
Various
3,084
Ongoing
Island Watch Project
50
2,678
1,921
757
Total Property, Plant and Equipment
24,902
Other Capital Expenditure
Electronic Service Delivery Strategy
05
10,832
7,745
987
2,100
Access Queensland
05
11,081
10,778
303
Queensland Government Electronic
Page 125
05
2,580
362
1,438
780
Marketplace
CITEC internally developed software
05
3,284
Ongoing
Total Other Capital Expenditure
6,012
Capital Grants
Sport and Recreation Development
Major Facilities
Various
10,520
Ongoing
National Standard Sports Facilities
Various
9,850
Ongoing
Minor Sport Recreation Facilities
Various
Page 126
5,255
Ongoing
Sub-total Sport and Recreation Development
25,625
Innovation
Australian Computational Earth
05
1,500
1,500
Systems Simulator
Centre of Excellence in Engineered
20
2,500
2,500
Fibre Composites
Australian Tropical Forest Institute
50
2,605
2,605
Sub-total Innovation
6,605
Page 127
Total Capital Grants
32,230
TOTAL DEPARTMENT OF INNOVATION AND INFORMATION
63,144
ECONOMY, SPORT AND RECREATION QUEENSLAND
MAJOR SPORTS FACILITIES AUTHORITY1
Property, Plant and Equipment
Redevelopment of Suncorp Stadium
05
279,700
237,910
41,790
Minor works
05
1,474
409
Ongoing
Total Property, Plant and Equipment
Page 128
42,199
TOTAL MAJOR SPORTS FACILITIES AUTHORITY
42,199
GOVERNMENT OWNED ENERGY CORPORATIONS
CS ENERGY LIMITED
Property, Plant and Equipment2
Callide
30
24,606
Ongoing
Page 129
Swanbank including refurbishment
05
19,862
Ongoing
Mica Creek
55
11,304
Ongoing
Business Development / Other
Various
14,533
Ongoing
Total Property, Plant and Equipment
70,305
TOTAL CS ENERGY LIMITED
70,305
STANWELL CORPORATION LIMITED
Property, Plant and Equipment
Page 130
Corporate IT capital projects
05
809
Ongoing
Minor works
05
396
Ongoing
Rocky Point works and modifications
05
10,819
Ongoing
Stanwell Power Station
works and modifications
30
107,126
28,838
67,792
10,496
(including AMC)
Overhauls and minor works
30
27,694
Ongoing
Barron Gorge
Works and modifications
50
5,410
5,410
Minor works
Page 131
50
1,603
Ongoing
Kareeya
Works and modifications
50
7,950
7,950
Minor works
50
1,285
Ongoing
Koombooloomba capital works
50
200
Ongoing
and modifications
Mackay Gas Turbine capital Works
40
1,843
Ongoing
and modifications
Total Property, Plant and Equipment
125,801
Page 132
Other Capital Expenditure
Stanwell Power Station minor works
30
1,024
Ongoing
Atherton High Road Feasibility Project
50
875
430
445
Corporate
Coal Supply exploration
05
367
Ongoing
Business development - Prefeasibility
30
Page 133
27,648
Ongoing
Generic Thermal Energy - Feasibility
05
250
Ongoing
project
Generic Wind Feasibility Project
05
2,813
Ongoing
Generic Renewables Feasibility
05
824
Ongoing
Project
Total Other Capital Expenditure
33,371
TOTAL STANWELL CORPORATION LIMITED3
159,172
Page 134
TARONG ENERGY CORPORATION LIMITED
Property, Plant and Equipment
Power Station
Tarong works and overhauls
15
72,377
16,650
32,384
23,343
New Wivenhoe Generator
10
9,266
3,358
4,408
1,500
Transformer
Land Acquisition TPS - Capital
15
4,229
666
3,563
component
Page 135
Minor works
15
3,332
Ongoing
Overhauls
Tarong Power Station
15
11,120
Ongoing
Wivenhoe power station
10
1,350
Ongoing
Information technology
05
85
3,667
Ongoing
Other corporate
05
1,428
170
1,128
130
Total Property, Plant and Equipment
60,952
Other Capital Expenditure
Glen Wilga Project
Page 136
20
34,864
10,561
4,139
20,164
Coal Transportation Project - Capital
20
23,971
2,165
2,500
19,306
Total Other Capital Expenditure
6,639
TOTAL TARONG ENERGY CORPORATION LIMITED3
67,591
QUEENSLAND POWER TRADING CORPORATION (trading as ENERTRADE)
Property, Plant and Equipment
North Queensland Gas Pipeline Project
05
123
123
North Queensland Gas Pipeline Project
40
100,456
4,596
Page 137
72,639
23,221
North Queensland Gas Pipeline Project
45
44,769
2,048
32,372
10,349
Minor works
05
721
123
Ongoing
Total Property, Plant and Equipment
105,257
Other Capital Expenditure
Minor works
05
239
127
Ongoing
Total Other Capital Expenditure
127
TOTAL QUEENSLAND POWER TRADING CORPORATION
105,384
Page 138
QUEENSLAND ELECTRICITY TRANSMISSION CORPORATION LIMITED (Trading as POWERLINK
QUEENSLAND)4
Property, Plant and Equipment
Belmont 275 kilovolt (kV) line
05
76,629
48,774
27,855
reinforcement
Molendinar 275kV establishment
10
22,937
14,082
8,855
(Teed Sub Only)
Bulli Creek 330/132kV extension
20
6,110
2,950
3,160
(Goondiwindi)
Calvale - Gladstone area transmission
30
50,157
157
20,000
30,000
Page 139
reinforcement
Broadsound - Lilyvale 275kV
30
24,000
400
17,000
6,600
reinforcement
Ross -Chalumbin Substation additions
45
6,517
254
5,263
1,000
Alan Sherriff 132/11kV Substation
45
11,056
4,756
6,300
establishment
Easement acquisitions
20
4,850
527
2,820
1,503
Calvale 275 kV transformer
30
3,200
3,000
200
Other
Various
65,008
Total Property, Plant and Equipment
159,261
Page 140
TOTAL QUEENSLAND ELECTRICITY TRANSMISSION CORPORATION
159,261
LIMITED
ENERGEX LIMITED
Property, Plant and Equipment
Major Corporation Initiated works
Substation related works
05/15
104,357
22,165
47,349
34,843
Feeder related works
Various
181,173
152
69,767
Page 141
111,254
Transformer related works
05/10
30,437
2,039
14,849
13,549
Sub-total Major Corporation Initiated Works
131,965
Customer Works - Domestic/rural
Various
41,530
Ongoing
Customer Works - Commercial/
Various
19,776
Ongoing
industrial/traction
Customer Works - Service connections
Various
28,280
Ongoing
Public lighting
Various
8,306
Ongoing
Distribution works
Various
7,910
Ongoing
Other works
Various
20,666
Page 142
Ongoing
Other Property, plant and equipment
Various
57,517
Total Property, Plant and Equipment
315,950
TOTAL ENERGEX LIMITED
315,950
ERGON ENERGY CORPORATION LIMITED
Property, Plant and Equipment
Major Projects
Bundaberg City - Establish 66/11kV
15
5,615
135
5,480
Page 143
substation
Lakeland Switching Station
50
6,600
5,008
285
1,307
Redevelop substation in
15
5,418
2,588
2,409
421
Maryborough
Establish Master System Control
45
5,248
5,248
and Data Acquisition System
Bamaga - New power station
50
9,679
3,096
6,583
Lockhart River - New power station
50
5,254
245
Page 144
5,009
Augment supply to Goondiwindi
20
24,093
813
23,280
Supply to Mount Isa Mines/
30
20,016
228
19,788
Rolleston Coal Mine
Sub-total Major Projects
54,486
Other Network Capital Expenditure
Capricornia
30/35
32,017
Ongoing
Far North
50
30,805
Ongoing
Mackay
40/55
25,868
Page 145
Ongoing
Northern
45
54,503
Ongoing
South West
20/25
47,268
Ongoing
Wide Bay
15
31,648
Ongoing
Regions
Various
23,471
Ongoing
Sub-total Other Network Capital Expenditure
245,580
Fixed Asset Acquisition
Various
72,475
Ongoing
Total Property, Plant and Equipment
372,541
Page 146
TOTAL ERGON ENERGY CORPORATION LIMITED
372,541
TOTAL GOVERNMENT OWNED ENERGY CORPORATIONS
1,250,204
TOTAL INNOVATION AND INFORMATION
1,355,547
ECONOMY, SPORT AND RECREATION
Notes:
1. The Stadium Redevelopment Authority, which undertook expenditure on the
redevelopment of Suncorp Stadium in 2001-02 and 2002-03, ceased to operate at
the end of May 2003. From this time expenditure in relation to the project has
transferred to the Major Sports Facility Authority.
2. Includes overhauls and capitalised interest.
3. Total does not include capital works outside of Queensland.
4. Excludes financing costs during construction.
JUSTICE AND ATTORNEY-GENERAL
The 2003-04 capital expenditure program for Justice and Attorney-General
(Department of Justice and Attorney-General, the Public Trust Office and Legal
Aid Queensland) is $123.3 million.
The Department of Justice and Attorney-General's capital expenditure program for
2003-04 is $119.1 million. This includes the construction of new courthouses,
the upgrading and refurbishing of existing courthouses and minor works to
existing facilities. Construction will commence on a courthouse at Caloundra and
continue at Brisbane, Richlands and Thursday Island courthouses. Upgrade of the
existing courthouse at Hervey Bay will commence and the upgrades at Mackay and
Cooktown will continue. Property, plant and equipment expenditure will be
allocated towards the ongoing requirements of the department throughout
Queensland and expenditure will also be allocated towards the final stages of
the State Penalties Enforcement Registry.
The Public Trust Office will spend $1.7 million in 2003-04 to ensure it can
continue
Page 147
to provide services to Queenslanders. Expenditure will include $1.1 million to
upgrade its Brisbane head office and $0.6 million on computer hardware, software
and ancillary equipment.
Legal Aid Queensland will invest $2.5 million in capital in 2003-04. In line
with its Information Technology Strategic Plan, Legal Aid Queensland proposes to
further develop core systems and information technology infrastructure. It will
also continue to enhance and replace the organisation's other physical assets.
Justice and Attorney-General
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF JUSTICE AND ATTORNEY-GENERAL
Property, Plant and Equipment
Brisbane, new magistrates
05
135,500
29,628
90,402
15,470
Page 148
courthouse
Caloundra, land purchase,
10
7,040
1,210
2,400
3,430
and new courthouse
Cooktown, courthouse upgrade
50
1,055
200
855
Richlands, new courthouse
05
4,500
707
3,793
Mackay, extend courthouse
40
11,400
2,202
8,418
780
Thursday Island, new courthouse
50
2,400
400
600
1,400
Hervey Bay, Courthouse upgrade
15
1,700
650
1,050
Minor works
Various
1,428
Ongoing
Court Improvement Program
Various
1,400
Ongoing
Other Plant and Equipment
Page 149
Various
4,490
Ongoing
Total Property, Plant and Equipment
114,436
Other Capital Expenditure
State Penalties Enforcement
05
10,680
9,299
1,381
Registry Project
Integrated Justice Information Strategy
05
3,291
3,291
Total Other Capital Expenditure
4,672
TOTAL DEPARTMENT OF JUSTICE AND ATTORNEY-GENERAL
119,108
Justice and Attorney-General
Page 150
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
PUBLIC TRUST OFFICE
Property, Plant and Equipment
Refurbishment of Premises
05
1,110
Ongoing
Upgrade of computer hardware
05
268
Ongoing
Minor works
Page 151
45
142
Ongoing
Total Property, Plant and Equipment
1,520
Other Capital Expenditure
Development of accounting system
05
185
Ongoing
and software support
Total Other Capital Expenditure
185
TOTAL PUBLIC TRUST OFFICE
1,705
Page 152
LEGAL AID QUEENSLAND
Property, Plant and Equipment
Brisbane
05
203
203
Regional offices
Various
190
190
Motor vehicle replacements
05
530
530
Information technology projects
Various
1,598
1,598
Total Property, Plant and Equipment
2,521
TOTAL LEGAL AID QUEENSLAND
Page 153
2,521
TOTAL JUSTICE AND ATTORNEY-GENERAL
123,334
LEGISLATIVE ASSEMBLY OF QUEENSLAND
The Legislative Assembly consists of 89 Members of Parliament who discharge
legislative and constituency responsibilities. These responsibilities include
the enactment of legislation, privileged debate on Government policy, serving on
Parliamentary Committees, providing advice and assistance to constituents, and
acting as advocates of local interests.
Capital outlays in the area of property, plant and equipment are critical to the
delivery of the Legislative Assembly and Parliamentary Service output. The
output provides:
.. direct and indirect entitlements (including equipment) afforded to Members
pursuant to the Members' Entitlements Handbook and the Members' Office
Support Handbook
.. accommodation, security, hospitality, advisory and information services to
support the activities of Members within the Parliamentary precinct and in
Electorate Offices.
Capital outlays for 2003-04 will focus on an upgrade to conference and media
room facilities within the Parliamentary precinct, and deliver information
technology enhancements designed to improve electronic communication between
Members' electorate offices and Parliament House, and improve current archiving
and audio capture procedures associated with Parliamentary proceedings.
Legislative Assembly
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 154
$'000
$'000
$'000
$'000
LEGISLATIVE ASSEMBLY OF QUEENSLAND
Property, Plant and Equipment
Parliament House stonework
05
12,384
2,104
100
10,180
restoration
Plant and Equipment
05
1,194
Ongoing
Conference/Media Room
05
956
956
improvements
Total Property, Plant and Equipment
2,250
Page 155
TOTAL LEGISLATIVE ASSEMBLY OF QUEENSLAND
2,250
LOCAL GOVERNMENT AND PLANNING
The majority of capital expenditure incurred by the Department of Local
Government and Planning relates to capital grants and subsidies provided to
local governing bodies. These grants provide for infrastructure to:
.. improve the quality of life in communities
.. promote economic and social development
.. improve access to services.
A further $50 million is provided over four years (2003-04 to 2006-07) to extend
the Regional Centres Program. This program assists local governments with
populations of more than 15,000 on infrastructure and community facilities. In
2003-04, it is expected that $10 million will be provided to local governing
bodies.
Other capital expenditure by is provided to ensure the ongoing maintenance and
provision of an appropriate level of office equipment and information technology
hardware for technical and administrative staff in Brisbane and five regional
offices.
Local Government and Planning
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
Page 156
$'000
$'000
DEPARTMENT OF LOCAL GOVERNMENT AND PLANNING
Property, Plant and Equipment
Plant and equipment
Various
649
Ongoing
Total Property, Plant and Equipment
649
Capital Grants
Local Government infrastructure
Roads
Various
55,550
Ongoing
Water
Various
35,007
Page 157
Ongoing
Sewerage
Various
45,047
Ongoing
Other works
Various
22,348
Ongoing
Total Capital Grants
157,952
TOTAL LOCAL GOVERNMENT AND PLANNING
158,601
MAIN ROADS
Main Roads strategically manages, plans, develops, operates and maintains the
State's road network, while recognising and taking into account the wider
transport task, community and industry needs and the environment.
The State's investment in the road network provides the people of Queensland
with a safe and efficient mode of transport, and contributes to the Government's
objectives, particularly job creation, by:
.. promoting economic development, especially in regional areas
.. assisting the competitiveness of Queensland industry through improved
transport efficiency
.. upgrading the standard of life for the Queensland public, especially in
rural communities and remote areas.
The five-year Roads Implementation Program, which is published annually,
reflects some $5 billion for roads funding in Queensland over each rolling
five-year period (including in excess of $3 billion in roads capital projects),
generating sustainable employment and training opportunities for some 17,000
people each year.
The road network plays a vital role in the economic well-being of the State.
Road transport forms a significant input cost to many industries and the
availability and cost of access can have a major impact on their future
viability. An efficient network of major urban and rural roads reduces these
industries' transport costs and facilitates their competitive position in the
domestic and global marketplace.
Program Highlights
.. $30 million towards widening the Bruce Highway to six lanes between Dohles
Rocks Road and Boundary Road provided under the Federal Government's
Centenary of Federation fund.
Page 158
.. $20 million towards construction of bridges and approaches at Inca Creek,
Mount Isa to the Camooweal section of the Barkly Highway.
.. $26.9 million to continue construction of the Douglas Arterial in
Townsville between University Road and Upper Ross River Road.
.. $25 million towards planning and construction of the four-lane Tugun Bypass
on the Pacific Motorway.
.. $13.7 million for complete the duplication of the Federally-funded Gatton
Bypass on the Warrego Highway.
.. $14.5 million to complete the Kawana Arterial on the Nicklin Way, Sunshine
Motorway.
Main Roads
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF MAIN ROADS
Property, Plant and Equipment
Page 159
Corporate buildings
Relocate pavement testing Nundah
05
250
250
Roma, airconditioning replacement
25
500
10
490
Townsville District Office refurbishment
45
1,400
200
1,200
Minor works
Various
1,210
Sub-total Corporate buildings
3,150
National Highways
Barkly Highway
Page 160
Mount Isa - Camooweal,
55
55,350
7,326
20,000
28,024
Bridges and approaches
Bruce Highway
Brisbane - Gympie, Dohles
05
40,000
2,365
30,000
7,635
Rocks Road to Boundary
Road, Widen to 6 lanes
Brisbane - Gympie, Yandina -
10
110,000
101,000
9,000
Cooroy, Duplicate 2 to 4 lanes
Gin Gin - Benaraby, Fairbairn
Page 161
15
8,700
580
7,000
1,120
Flats - Bariveloe Road,
Re-align 2 lanes
Gympie - Maryborough,
Glenorchy Straight,
15
10,000
1,326
8,674
Maryborough turn-off,
Re-align 2 lanes
Cunningham Arterial
Ipswich Motorway, Granard
05
66,000
12,000
Page 162
10,000
44,000
Road - Riverview, Planning
Widen 4 to 6 lanes (stage 1)
Warrego Highway
Ipswich - Toowoomba, Gatton
10
46,000
32,262
13,738
bypass, Duplicate 2 to 4 lanes
Ipswich - Toowoomba,
Toowoomba bypass, Planning
20
26,250
21,530
4,720
and land acquisition
Page 163
Other construction
Various
44,228
Ongoing
Sub-total National Highways
147,360
Other State-controlled roads
Bruce Highway, Ayr -
45
53,295
13,386
26,880
13,029
Townsville, Douglas Arterial,
University Road - Upper
Ross River Road, Construct
to new sealed 2 lane standard
Page 164
Caloundra - Mooloolaba Road,
10
22,500
8,000
14,500
Kawana Arterial, Nicklin Way,
Sunshine Motorway Link,
Construct to new sealed
2 lane standard
Capalaba, Victoria Point Road,
05
4,665
782
1,419
2,464
Windemere Road - Vienna
Road, Duplicate 2 to 4 lanes
Page 165
Capricorn Highway, Emerald -
30
4,069
1,569
2,500
Alpha, Taraborah - Gemfields
turnoff, Widen and overlay
Carnarvon Highway, Roma -
25
2,530
52
2,478
Injune, 63.66 - 71.2 km, Seal
shoulders
Cooktown Developmental Road,
50
7,529
939
5,956
634
Cooktown - Butchers Hill,
Page 166
West Normanby River - Boggy
Creek, Construct to
sealed standard
Currajah - Pin Gin Hill Road,
50
9,658
2,081
3,940
3,637
1.5 - 6.82 km from Palmerston
Highway, Re-align 2 lanes
D'Aguilar Highway, Caboolture -
05
33,250
30,000
3,250
Kilcoy, Caboolture Northern
Page 167
Bypass, Construct 2 lane
bypass
D'Aguilar Highway, Caboolture -
10
5,400
619
2,500
2,281
Kilcoy, Scrubby and Sandy
Creeks, Replace bridges and
approaches
Dawson Highway, Gladstone -
30
4,992
2,959
2,033
Biloela, Monto turnoff -
Page 168
Scrubby Creek, Rehabilitate
pavement
Dawson Highway, Rolleston -
30
3,893
2,308
1,585
Springsure, Staircase -
Rodda's Lookout, Widen
shoulders and sealing
Diamantina Developmental Road,
35
1,800
0
1,800
Bedourie - Boulia, Bedourie -
Page 169
Crownwheel Creek, 0 - 17.0 km,
Pave and seal
Flinders Highway, Richmond -
55
3,250
1,370
1,880
Julia Creek, Chatfield Creek
approaches, Widen and overlay
Flinders Highway, Richmond -
55
6,400
2,644
2,797
959
Julia Creek, 132.0 - 145.6 km,
Widen shoulder(s) and sealing
Gladstone Port Access Road,
Page 170
30
15,000
5,100
9,900
Construct to new sealed 2 lane
standard
Gregory Highway, Emerald -
30
4,561
424
4,137
Clermont, Gordonstone Creek
South, Widen and overlay
Hervey's Range Developmental Road
45
10,200
3,352
6,848
Townsville - Battery, Devils Marbles
45.4 - 70km, Construct to new 2
Page 171
lane standard
Hervey's Range Developmental Road,
45
9,600
380
2,984
6,236
Townsville - Battery, Ella Creek -
Gregory Developmental Road,
Construct to new sealed 2
lane standard
Innisfail - Japoon Road, South
50
10,000
988
Page 172
9,012
Johnstone Bridge (near mill),
construct bridge and approaches
Isisford - Blackall Road, 49.7 -
35
1,800
1,077
723
60.7 km, Pave and seal
Kennedy Developmental Road,
55
5,300
274
1,971
3,055
Hughenden - Winton, 4.5 - 16.8 km,
Widen shoulder(s) and sealing
Leichhardt Highway, Miles -
20
1,950
780
1,170
Page 173
Goondiwindi, 54.5 - 57.8 km
Widen and seal
Mackay - Bucasia Road,
40
6,400
2,706
3,694
Wallmans and Eimeo Roads,
At-grade intersection improvement
Maryborough - Hervey Bay Road,
15
2,516
108
2,408
Phillip Court - Saltwater
Creek, 10.8 - 12.0 km,
Page 174
Construct overtaking lanes
Millmerran - Inglewood Road,
20
1,900
130
570
1,200
Clontarf Deviation, 13.38 -
15.54 km
Mount Lindesay Highway,
05
43,741
14,741
13,000
16,000
Brisbane - Beaudesert,
Middle - Green Road/
Fedrick Street, Duplicate 2 to
4 lanes
Page 175
New England Highway,
20
1,015
85
930
Yarraman - Toowoomba, Mt
Kynock - Highfield, 107.01 -
109.4 km
Pacific Highway, Pacific
10
240,000
15,000
25,000
200,000
Motorway, Tugun - Tweed
Heads, Construct 4 lane bypass
Peak Downs Highway, Nebo -
40
3,500
Page 176
112
1,941
1,447
Mackay, Stockyard Creek -
Spring Creek, Widen existing
pavement
Peninsula Developmental Road,
50
6,999
460
2,739
3,800
Mt Molloy - Laura,
Coalseam - Laura River,
Construct to sealed standard
Redland Sub-arterial, Gateway
05
8,400
850
7,550
Page 177
Motorway - Mount Cotton
Road, At-grade intersection
improvement
Samford Sub-arterial, Arbor
05
4,175
875
3,300
Street - Ferny Way,
Duplicate 2 to 4 lanes
Warwick - Killarney Road, 34.5 -
20
2,563
1,846
717
37.13 km, Widen and overlay
Page 178
Other construction
Various
384,408
Ongoing
Sub-total Other State-controlled Roads
556,520
Plant and Equipment
6,500
Total Property, Plant and Equipment
713,530
Other Capital Expenditure
Information Technology
2,120
Total Other Capital Expenditure
2,120
Page 179
Capital Grants
Transport Infrastructure Development Scheme
Arcturus Road, Bauhinia Shire,
30
380
190
190
15.6 - 23.5 km, Pave and seal
Barratta Road, Burdekin Shire,
45
880
440
220
220
Reconstruct road and new bridges
Birmingham Road, Carrara,
10
255
200
55
Emmanuel College, Bus set-
down and car park
Page 180
Bokarina and Kawana State
10
225
105
120
Schools, Parking area
Bollon - Dirranbandi Road,
25
200
13
100
87
Balonne Minor River Bridge
Darnley Island Access Road,
50
1,100
260
840
Upgrade sections to bitumen
seal and improve drainage
Dauan Island Access Road,
50
950
250
700
Pave and seal
Page 181
Eastmere Road, Aramac Shire,
35
190
100
90
38.5 - 47.0 km, Stage 1,
Pave and seal
Fingerboard Road, Miriam Vale
15
2,100
700
700
700
Shire, Upgrade and seal
Geaney Lane, Townsville,
45
500
200
300
Upgrade
Golden Mile Road, Broadsound
40
380
190
Page 182
190
Shire, Pave and seal
Hopevale Access Road, sealing
50
3,415
1,039
850
1,526
Inverai Road, Wambo Shire,
20
390
194
168
28
Construct new road
Kenlogan Road, Belyando Shire,
40
190
190
Pave and seal
Kerwee Road, Eidsvold Shire,
15
358
228
124
6
Bitumen standard
Page 183
Kondar Road, Walter Gunn Bridge,
20
300
168
102
30
Waggamba Shire,
Re-align and widen
Kowanyama access, Floodway,
55
400
200
200
Formation and road safety
improvements
Miscamble/Short/George
25
226
16
200
10
Streets, Roma, Drainage
improvements
Page 184
One Mile Bridge, West Ipswich
05
7,500
1,515
2,685
3,300
and Six Mile Creek, Redbank,
Construct new bridges and
approaches
Palm Island, road and drainage
45
1,000
50
500
450
upgrading works
Range - Baranga Road, Duaringa
30
380
190
190
Shire, Gravel formation
Page 185
Rosevale - Aratula Road,
10
600
400
200
Boonah Shire, Upgrading
St Pauls Airstrip Access Road,
50
1,997
1,447
500
50
Upgrade formation and drainage
Topsy Creek and Kowanyama
50
1,500
700
300
500
access roads, Upgrade
Toowong Bikeway, Extend
05
9,220
7,775
1,290
155
Willows and Rutland Road,
Page 186
30
380
190
190
Emerald Shire, Pave and seal
Wollogorang Road, Doomadgee,
55
930
230
400
300
Formation
Other Capital Grants
Various
23,454
Ongoing
Sub-total Transport Infrastructure Development Scheme
35,093
Federal Black Spot
Various
8,923
Ongoing
Total Capital Grants
44,016
Page 187
TOTAL DEPARTMENT OF MAIN ROADS
759,666
ROADTEK
Plant Hire Services
Hire plant
Various
12,271
RoadTek Services
Plant and equipment
Various
867
TOTAL ROADTEK
Page 188
13,138
QUEENSLAND MOTORWAYS LIMITED
Property Plant and Equipment
Minor works
05
5,000
TOTAL QUEENSLAND MOTORWAYS LIMITED
5,000
TOTAL MAIN ROADS
777,804
Page 189
NATURAL RESOURCES AND MINES
Estimated capital expenditure for Natural Resources and Mines (Department of
Natural Resources and Mines, SunWater and various water boards) in 2003-04 is
$112.6 million.
The department's capital expenditure program for 2003-04 principally comprises
expenditure which supports the planning and management of the State's land,
water and native vegetation resources, and which facilitates the development of
the State's mineral resources.
The replacement of plant and equipment, the continuing local office
accommodation upgrade, and the investment in the development of information
technology systems, will provide the necessary departmental infrastructure to
support the delivery of services throughout the State. An amount of $20.5
million is identified for this purpose in 2003-04. The department's role in
supporting the development of water infrastructure continues with $6 million to
be spent in 2003-04 on the acquisition of land affected by proposed future water
infrastructure projects.
Capital grant expenditure estimated at $7.5 million will be directed towards the
Regional Flood Mitigation Program. This program is to be transferred to the
Department of Local Government and Planning.
The Gladstone Area Water Board proposes to spend $23.5 million on capital
projects in 2003-04. The majority of this expenditure relates to the Mt Miller
Pipeline.
SunWater proposes to spend $40.7 million on capital projects in 2003-04. The
most significant projects are the Burdekin Scheme, Mareeba Scheme, Tinaroo Hydro
Capital Project, Barlil Weir Capital Project, Jones Weir Capital Project and
Callide Extension Capital Project.
Natural Resources and Mines
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
Page 190
DEPARTMENT OF NATURAL RESOURCES AND MINES
Property, Plant and Equipment
Government Land Register
Various
2,000
Ongoing
redevelopment
Helidon Explosive Magazine
10
825
126
324
375
Landcentre Office fit-outs
05
4,570
1,187
3,383
Land purchases
10/20
6,000
6,000
Mareeba Office extension
50
1,800
250
500
1,050
Minor works
Various
798
Ongoing
Plant and Equipment
Various
Page 191
14,413
Ongoing
Upgrade of Greviella Weir
30
20
20
Upgrade of Thangool Weir
30
20
20
Upgrade of Proston Weir
15
10
10
Upgrade of East Leichhardt Dam
55
70
70
Upgrade of Corella Dam
55
570
570
Toowoomba - Tor St Office Fit-out
20
250
250
Total Property, Plant and Equipment
26,162
Other Capital Expenditure
Automated Titling System
05
462
Page 192
462
Co-ordinated Land Asset Management
05
3,050
2,000
1,050
System
Mines Tenure Administration System
05
440
440
redevelopment
Science related systems
05
251
251
Other minor systems
05
882
85
797
Total Other Capital Expenditure
3,000
Capital Grants
Page 193
Regional Flood Mitigation Program
Various
7,512
Ongoing
Sugar Industry Infrastructure
45/50
3,198
1,398
1,800
Herbert Cane Area
Total Capital Grants
9,312
TOTAL DEPARTMENT OF NATURAL RESOURCES AND MINES
38,474
GLADSTONE AREA WATER BOARD
Property, Plant and Equipment
Page 194
Aldoga pipeline and reservoir
30
5,000
1,000
4,000
Clarifier upgrade
30
500
500
Clearwater Reservoir
30
900
900
Calliope Shire Council treated
30
1,500
1,500
water assets
Telemetry and metering upgrades
30
560
350
210
Mt Miller pipeline
30
17,200
737
16,463
Recreational facilities
30
400
100
300
Toolooa to Golegumma pipeline
30
500
100
400
Yarwun Water Treatment Plant
30
300
Page 195
300
Customer connections
30
550
400
150
South Gladstone to Toolooa Pipeline
30
2,422
1,608
814
Other capital expenditure
30
950
650
300
Total Property, Plant and Equipment
23,077
Other Capital Expenditure
Administration
30
700
400
300
Total Other Capital Expenditure
400
TOTAL GLADSTONE AREA WATER BOARD
23,477
Page 196
MOUNT ISA WATER BOARD
Property, Plant and Equipment
Purchase of MIM assets
55
3,250
1,625
1,625
Replace Submersible pump
55
2,500
2,500
Chlorination upgrade
55
860
860
Lake Moondarra to Mount Isa Terminal
55
300
300
Reservoir (MITR) pipeline upgrade
MITR Pump Station upgrade
55
3,000
Page 197
2,000
1,000
Transport Bay upgrade
55
800
300
500
MITR storage upgrade
55
4,000
300
3,700
Col Popple Pump Station upgrade
55
4,000
1,500
2,500
Minor works
55
1,250
615
635
Total Property, Plant and Equipment
10,000
TOTAL MOUNT ISA WATER BOARD
10,000
SUNWATER
Property, Plant and Equipment
Page 198
Brisbane office miscellaneous
05
4,823
Ongoing
Bowen Broken Scheme
40
29
Ongoing
Burdekin Scheme
45
1,955
Ongoing
Eton Scheme
45
137
Ongoing
Proserpine Scheme
45
5
Ongoing
Pioneer Scheme
45
205
Ongoing
Ayr office
45
60
Ongoing
Awoonga Callide Scheme
30
76
Ongoing
Callide Scheme
30
137
Ongoing
Dawson Scheme
30
355
Ongoing
Page 199
Fitzroy Scheme
30
41
Ongoing
Nogoa Mackenzie Scheme
30
593
Ongoing
Three Moon Creek Scheme
30
60
Ongoing
Barker Barambah Scheme
15
66
Ongoing
Boyne Scheme
15
20
Ongoing
Bundaberg Scheme
15
802
Ongoing
Mary Scheme
15
194
Ongoing
Upper Burnett Scheme
15
46
Ongoing
Central Lockyer Scheme
05
45
Ongoing
Logan Scheme
05
145
Ongoing
Lower Lockyer Scheme
05
Page 200
630
Ongoing
Macintyre Brook Scheme
05
90
Ongoing
Upper Condamine Scheme
05
75
Ongoing
Warrill Valley Scheme
05
95
Ongoing
Mareeba Scheme
50
2,632
Ongoing
St George Scheme
25
197
Ongoing
Tinaroo Hydro capital project
50
3,808
888
2,920
Burdekin Hydro capital project
45
21,159
250
500
20,409
Swanbank Treatment Plant project
05
10,631
85
220
10,326
Barlil Weir capital project
15
3,857
402
2,185
1,270
Jones Weir capital project
15
7,348
485
3,766
3,097
Page 201
Callide Extension capital project
30
17,593
692
16,901
Pipeline subsidiaries capital
55
75
Ongoing
Pipeline subsidiaries capital
40
125
Ongoing
Total Property, Plant and Equipment
40,205
Other Capital Expenditure
Brisbane office miscellaneous
05
450
Ongoing
Total Other Capital Expenditure
450
TOTAL SUNWATER
40,655
Page 202
TOTAL NATURAL RESOURCES AND MINES
112,606
OFFICE OF THE GOVERNOR
Total capital expenditure of the Office of the Governor in 2003-04 is estimated
to be $0.04 million. The expenditure relates to capital acquisitions,
particularly vehicles and office equipment.
Continuing maintenance and enhancement of the facilities at Government House
enables the Governor to undertake the full range of duties expected of a Head of
State, including those that promote and support whole-of-Government priorities.
Office of the Governor
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
OFFICE OF THE GOVERNOR
Page 203
Property, Plant and Equipment
Asset replacement
05
42
42
Ongoing
Total Property, Plant and Equipment
42
TOTAL OFFICE OF THE GOVERNOR
42
OFFICE OF THE OMBUDSMAN AND INFORMATION COMMISSIONER
The Office of the Ombudsman and Information Commissioner is responsible for:
.. investigating and, if necessary, redressing administrative illegality,
unfairness or error in the public sector, including local government, where
no other specific remedy exists
.. ensuring as far as possible that applications by the community for access
to information held by State and local government are decided correctly
according to law.
By providing for public scrutiny of the activities of executive government, this
output supports a strong corporate governance and accountability framework in
the Queensland public sector.
Capital funding of $0.12 million is provided in 2003-04 for the provision of
office and information technology tools to enable investigative staff to review
complaints and appeals about Government administration.
Office of the Ombudsman and Information Commissioner
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
Page 204
to
2003-04
2003-04
Project
Cost
30-6-03
$'000
$'000
$'000
$'000
OFFICE OF THE OMBUDSMAN AND INFORMATION COMMISSIONER
Property, Plant and Equipment
New personal computers and
05
188
100
Ongoing
software
Office equipment
05
20
20
Ongoing
Total Property, Plant and Equipment
120
Page 205
TOTAL OFFICE OF THE OMBUDSMAN AND INFORMATION
120
COMMISSIONER
OFFICE OF THE PUBLIC SERVICE COMMISSIONER
The Office of the Public Service Commissioner is committed to the development of
a strong and sustainable public service, which achieves the best results for
Queenslanders. The office has a mandate to deliver legislative and regulatory
functions as well as strategies that enable the Queensland Public Service to
deliver on the Government's priorities.
The office's capital expenditure in 2003-04 will be $0.07 million and focuses on
the replacement of computer and office equipment required to efficiently provide
the above service.
Office of the Public Service Commissioner
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
OFFICE OF THE PUBLIC SERVICE COMMISSIONER
Page 206
Property, plant and equipment
Plant and equipment
05
65
Ongoing
Total Property, Plant and Equipment
65
TOTAL OFFICE OF THE PUBLIC SERVICE COMMISSIONER
65
POLICE
The delivery of effective policing services to the community of Queensland
requires the establishment and maintenance of appropriate infrastructure. To
this end, the service has developed a number of infrastructure plans in respect
of capital works, information technology and other equipment needs. An
allocation of $99.4 million in 2003-04 will enable the service to progress key
projects identified in these plans.
Program Highlights
.. $32.2 million to construct new and replacement facilities and undertake
planning for future facilities under the Queensland Police Service's
Ten-Year Capital Investment Strategic Plan. Projects under construction and
due to be completed in 2003-04 include:
.. $1.2 million to complete Stage 2 of a redevelopment of Hervey Bay Police
Station;
.. $3.1 million to complete a replacement watchhouse complex in conjunction
with the construction of a new western district courthouse;
.. $2.1 million to complete a new police station at Loganholme;
.. $4.6 million to complete a replacement police station, district
headquarters and regional office at Mundingburra; and
.. $5.6 million to complete Stage 2 of a replacement police station and
district headquarters at Toowoomba.
.. Construction is expected to commence in 2003-04 on several new projects
including:
.. $0.5 million to a replacement police station and watchhouse at Gympie;
.. $0.35 million for a new police station at Hopevale;
.. $2.2 million for a new police station at Mackay North;
Page 207
.. $2.8 million for a new police station and watchhouse at Palm Island;
.. $0.43 million for a replacement police station at Sherwood; and
.. $1.1 million for a new watchhouse at Caloundra.
.. An allocation of $15 million for information management directed towards
projects identified as priorities in the service's Information Management
Strategic Plan 2001-10, including the commencement of the Incident
Recording and Management System.
.. $52.3 million to support the purchase of other plant and equipment
including motor vehicles, motor vessels and radio communications equipment.
Police
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF POLICE
Property, Plant and Equipment
Page 208
Building/General Works
Caloundra, New watchhouse
10
3,600
1,100
2,500
Coolum, Temporary police station
10
490
490
Gympie - Replacement police
15
9,000
492
500
8,008
station and watchhouse
Hervey Bay - Stage 2
15
1,600
400
1,200
Inala - Replacement watchhouse
05
3,500
412
3,088
Ingham - Replacement police
45
3,800
200
3,600
station and watchhouse
Page 209
Loganholme - New police station
05
2,500
393
2,107
Longreach - Replacement district
35
7,000
20
200
6,780
headquarters and watchhouse
Mackay North - New police station
40
2,200
30
2,170
Mundingburra - Replacement
45
7,150
2,522
4,628
station - District headquarters and regional office
Oxley - Dog Squad kennels
05
700
150
550
Palm Island - Replacement police
45
3,200
357
2,843
Page 210
station and watchhouse
Sherwood - Replacement station
05
450
20
430
Southport - Station refurbishment
10
2,000
25
100
1,875
Stafford - Replacement station
05
3,750
10
200
3,540
Toowoomba - Replacement station,
20
6,700
1,149
5,551
watchhouse, District headquarters
and regional office stage 2
Toowoomba - Replacement station,
20
3,000
60
100
2,840
watchhouse, District headquarters and regional
Page 211
office Stage 3
Academies Upgrade Program
05
500
Ongoing
Brisbane - Police headquarters
05
300
Ongoing
accommodation changes
Housing Program
Kowanyama - New twin dwelling
55
350
350
unit
Hopevale - New residences
50
600
100
500
Minor works
Various
1,347
Ongoing
Page 212
Other projects
Various
1,875
Ongoing
Small Stations Program
Childers - Replacement station
15
455
100
355
Halifax - Replacement station
45
375
200
175
Hopevale - New station
50
500
350
150
Pomona - Replacement station
10
390
135
255
Rainbow Beach - New Station
15
540
100
440
Station Security Program
Various
500
Ongoing
Watchhouse Upgrade Program
Various
500
Ongoing
Vessel replacement
Various
Page 213
1,778
Ongoing
Plant and equipment (includes motor
Various
65,505
Ongoing
vehicles)
Total Property, Plant and Equipment
99,447
TOTAL POLICE
99,447
PREMIER AND CABINET
Capital expenditure for Premier and Cabinet (including Crime and Misconduct
Commission, South Bank Corporation, Queensland Events Corporation and Commission
for Children and Young People) in 2003-04 is $10 million.
The Department of the Premier and Cabinet's primary responsibility is to support
and enhance Government decision making through the provision of timely
information and policy advice to the Premier, Executive Council, Cabinet and
other Government departments. The department's capital expenditure program for
2003-04 of $5.7 million focuses on:
.. managing the development of the whole-of-Government Integrated Justice
Information System (IJIS)
.. the enhancement and replacement of office and computer equipment as well as
information systems required to efficiently deliver the above outputs
.. miscellaneous capital grants to community groups throughout the State.
The capital works program for South Bank Corporation for 2003-04 is to be
directed at a range of parkland enhancements, which will complement the
completed masterplan works. Property, plant and equipment expenditure will be
allocated to the ongoing operational requirements of the parklands and the
Brisbane Convention and Exhibition Centre.
The 2003-04 capital expenditure program of the Commission for Children and Young
People is to include the replacement and upgrading of office equipment, and the
continued development of key databases to facilitate the commission's functions.
Page 214
The Crime and Misconduct Commission's 2003-04 plant and equipment program is to
maintain existing service levels. Other capital expenditure will maintain the
existing leasehold premises.
Capital expenditure for Queensland Events Corporation relates to scheduled asset
replacement. This is comprised of miscellaneous office and computer equipment.
Premier and Cabinet
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF THE PREMIER AND CABINET
Property, Plant and Equipment
Plant and equipment
05
Page 215
3,220
Ongoing
Total Property, Plant and Equipment
3,220
Capital Grants
Capital grants
Various
2,500
Ongoing
Total Capital Grants
2,500
TOTAL DEPARTMENT OF THE PREMIER AND CABINET
5,720
CRIME AND MISCONDUCT COMMISSION
Page 216
Property, Plant and Equipment
Plant and equipment
05
937
Ongoing
Total Property, Plant and Equipment
937
Other Capital Expenditure
Refit of Tericca Place
05
1,484
1,394
90
Total Other Capital Expenditure
90
TOTAL CRIME AND MISCONDUCT COMMISSION
1,027
Page 217
SOUTH BANK CORPORATION
Property, Plant and Equipment
South Bank Corporation minor works
05
1,205
Ongoing
Brisbane Convention and Exhibition
05
1,933
Ongoing
Centre minor works
Total Property, Plant and Equipment
3,138
TOTAL SOUTH BANK CORPORATION
3,138
Page 218
QUEENSLAND EVENTS CORPORATION
Property, Plant and Equipment
Plant and equipment
05
14
Ongoing
Total Property, Plant and Equipment
14
TOTAL QUEENSLAND EVENTS CORPORATION
14
COMMISSION FOR CHILDREN AND YOUNG PEOPLE
Page 219
Property, Plant and Equipment
Plant and equipment
05
60
Ongoing
Total Property, Plant and Equipment
60
TOTAL COMMISSION FOR CHILDREN AND YOUNG PEOPLE
60
TOTAL PREMIER AND CABINET
9,959
PRIMARY INDUSTRIES
Primary Industries' capital expenditure program for 2003-04 (including Forestry
Group and the Queensland Rural Adjustment Authority) is $33.6 million, and
focuses on property, plant and equipment associated with research facilities and
other plant and equipment.
A new facility at Redlands will be used to conduct research in the area of
amenity horticulture. This facility, together with a replacement research
vessel, will contribute to the Food and Fibre Science and Innovation output.
The redevelopment of the Abel Point Marine Base at Airlie Beach and the
construction of a new office and boat storage facility for the Queensland
Boating and Fisheries Patrol at Port Douglas will contribute to the Fisheries
output.
Page 220
The acquisition of diagnostic equipment and the development of information
systems will enhance laboratory disease diagnosis and testing capability for
preparedness and risk management against Foot and Mouth Disease. This
contributes to the market access and development output.
Property, plant and equipment expenditure will be allocated to the ongoing
operational requirements of the Food and Fibre Science and Innovation output
leading the way in research and development across a range of food and fibre
chains. The capital expenditure will also contribute to the Rural Community
Development output along with the ongoing minor works and Research Facilities
Development Programs.
Forestry
The capital expenditure budget for 2003-04 is $11.4 million. The Budget includes
$2.5 million for the purchase of freehold land for plantation establishment,
particularly in the hardwood plantation area, as well as an amount of $6.3
million for the replacement of heavy plant and vehicles. An amount of $1 million
is also included for the expansion of plant propagation facilities.
Queensland Rural Adjustment Authority
The authority's capital expenditure budget for 2003-04 is $0.4 million for
replacing or upgrading computer systems, office equipment and facilities, and
in-house developed computer software.
Primary Industries
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF PRIMARY INDUSTRIES
Page 221
Property, Plant and Equipment
Abel Point Marine Base, Airlie Beach
40
760
100
660
Foot and Mouth Disease enhanced
Various
1,200
350
850
preparedness
Centre for Amenity Horticulture,
05
2,000
80
1,720
200
Redlands
Port Douglas Queensland Boating
50
466
300
166
and Fisheries Patrol Office
Biodiversity Centre, Mareeba
Page 222
50
250
109
141
Vessels replacement
Various
1,180
Ongoing
Heavy plant and equipment
Various
1,500
Ongoing
Minor works
Various
1,500
Ongoing
Mechanical items
Various
500
Ongoing
Relocation and refurbishment
Various
427
Ongoing
Research facilities development
Various
1,500
Ongoing
Other property, plant and equipment
Various
10,635
Ongoing
Total Property, Plant and Equipment
20,779
Page 223
Other Capital Expenditure
Intangible Asset Projects
Pest and disease emergencies
05
250
250
Other projects
05
359
Ongoing
Other projects
05
450
Ongoing
Total Other Capital Expenditure
1,059
TOTAL DEPARTMENT OF PRIMARY INDUSTRIES
21,838
Page 224
FORESTRY
Property, Plant and Equipment
Plant and equipment
Various
7,819
Ongoing
Purchase of land
05/10
2,500
Ongoing
Road construction
Various
68
Ongoing
Buildings and improvements
Various
1,010
Ongoing
Total Property, Plant and Equipment
11,397
TOTAL FORESTRY
11,397
Page 225
QUEENSLAND RURAL ADJUSTMENT AUTHORITY
Property, Plant and Equipment
Upgrade/replace office equipment
05
180
180
Total Property, Plant and Equipment
180
Other Capital Expenditure
Intangible Asset Projects
Upgrade in-house computer software
05
1,100
Page 226
900
200
Total Other Capital Expenditure
200
TOTAL QUEENSLAND RURAL ADJUSTMENT AUTHORITY
380
TOTAL PRIMARY INDUSTRIES
33,615
PUBLIC WORKS
Capital expenditure for the Department of Public Works, including commercialised
business units (CBUs), in 2003-04 is $222.5 million. This year's Capital
Statement includes the capital spending of the department's CBUs which provide
services to departments (for example, QFleet).
QFleet will purchase motor vehicles totalling $152.7 million. The vehicles will
be leased to clients to facilitate the delivery of Government services across
Queensland. The vehicle purchases and their maintenance provide support for
local Queensland firms.
Estimated capital expenditure by the department, excluding CBUs, is $63.2
million. The major item of expenditure is $47.3 million for the new Government
office building presently under construction at 33 Charlotte Street, Brisbane.
The department has developed programs to address discrimination and workplace
health and safety issues, and capital expenditure of $0.9 million is provided to
meet these ongoing commitments. In addition, expenditure of $1.8 million is
allocated in 2003-04 to upgrade building fire systems in 111 George Street,
Brisbane.
Capital funds are also provided to acquire additional Government employee
housing, and to refurbish and upgrade existing office accommodation.
Additional works are scheduled for the Roma Street Parkland in 2003-04 to
further enhance the accessibility of the Parkland and the adjacent precinct, as
well as to provide additional amenities.
Feasibility and planning studies are currently being considered for a
Multi-purpose Centre on the bank of the Pioneer River in Mackay central business
district. It is anticipated that private sector proposals will be invited in
2003-04 for the
Page 227
development of the centre, subject to agreement being reached between Mackay
City Council and the State Government. An amount of $5 million is allocated in
2003-04 from a total budget of up to $38 million.
An amount of $0.75 million is provided for enhancements to the lighting system
in Mineral House, Brisbane through the Energy Efficient Lighting Project. This
is an integrated system designed to combine sophisticated lighting management
with maximum energy efficiency.
Public Works
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
DEPARTMENT OF PUBLIC WORKS
Property, Plant and Equipment
Office Accommodation
Page 228
Brisbane, 33 Charlotte St office
building
05
68,562
21,282
47,280
Cairns, New office building
50
17,605
17,100
505
Brisbane, Executive Building and
05
1,600
450
250
900
Executive Annexe, Upgrade
fire systems
Brisbane, 111 George St building
05
1,890
100
1,790
upgrade fire systems
Page 229
Brisbane, Mineral House,
05
750
750
Energy Efficient Lighting
Brisbane, Fortitude Valley
05
500
500
Transport House toilet
refurbishment
Warwick, Office building
20
250
250
refurbishment
Anti-Discrimination Program
Various
500
Ongoing
Carpet Replacement Program
Various
Page 230
1,000
Ongoing
Workplace health and safety
Various
400
Ongoing
Various minor works
Various
512
Ongoing
Government Employee Housing
Various
1,700
Ongoing
Major buildings and infrastructure
Brisbane, Roma Street Parkland
05
68,500
66,362
2,138
Mackay Multi-purpose Centre
40
38,000
250
5,000
32,750
Other plant and equipment
05
624
Ongoing
Total Property, Plant and Equipment
63,199
Page 231
TOTAL DEPARTMENT OF PUBLIC WORKS1
63,199
(excluding commercialised business units)
QBUILD
Property, Plant and Equipment
Plant and equipment
Various
1,528
Ongoing
Total Property, Plant and Equipment
1,528
Other Capital Expenditure
Page 232
Intangibles
05
500
Ongoing
Total Other Capital Expenditure
500
TOTAL QBUILD
2,028
QFLEET
Property, Plant and Equipment
Motor vehicles
Various
152,652
Ongoing
Total Property, Plant and Equipment
Page 233
152,652
Public Works
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-6-03
Page 234
$'000
$'000
$'000
$'000
Other Capital Expenditure
Information systems
05
1,678
Ongoing
Total Other Capital Expenditure
1,678
TOTAL QFLEET
154,330
PROJECT SERVICES
Property, Plant and Equipment
Plant and equipment
Various
Page 235
676
Ongoing
Total Property, Plant and Equipment
676
Other Capital Expenditure
Project management system upgrade
05
1,000
1,000
Other intangibles
05
412
Ongoing
Total Other Capital Expenditure
1,412
TOTAL PROJECT SERVICES
2,088
SALES AND DISTRIBUTION SERVICES
Page 236
Property, Plant and Equipment
Plant and equipment
05
235
Ongoing
Total Property, Plant and Equipment
235
Other Capital Expenditure
Internet development
05
952
400
370
182
Other Intangibles
05
245
Ongoing
Total Other Capital Expenditure
615
Page 237
TOTAL SALES AND DISTRIBUTION SERVICES
850
TOTAL PUBLIC WORKS
222,495
Note:
1. Total 2003-04 capital works expenditure for the Department of Public Works
does not include $4.2 million allocated for the continued refurbishment and
upgrading of Queensland House in London. This work is required to meet current
Health and Safety regulations, and to complement the existing streetscape. The
total project cost is $4.5 million.
QUEENSLAND AUDIT OFFICE
The capital expenditure of $0.15 million on minor works during 2003-04 is to
maintain systems that support the mandated audit program and the Queensland
Audit Office output of Independent Public Sector Auditing Services and Reporting
to Parliament. In particular the funds will be allocated to replace minor office
equipment and computer hardware and software which are due for replacement as
part of the ongoing program to maintain the asset standards.
Queensland Audit Office
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 238
$'000
$'000
$'000
$'000
QUEENSLAND AUDIT OFFICE
Property, Plant and Equipment
Minor works
05
150
Ongoing
Total Property, Plant and Equipment
150
TOTAL AUDIT OFFICE
150
STATE DEVELOPMENT
Estimated capital expenditure by the Department of State Development in 2003-04
is $283.3 million.
The key aims of the capital acquisition plan and asset management strategies are
to support the department in providing services related to the needs of
developing international markets, strengthening supply capacity, and supporting
business development, emerging industries and sustainable regional development.
Capital grants are targeted to enterprises that will make a major contribution
to the development of business and industries and thereby the creation of
sustainable employment.
Program Highlights
Page 239
.. $60.5 million out of a total project cost of $209.2 million towards the
Burnett Water Infrastructure Project.
.. $60.8 million for common-user infrastructure associated with the Comalco
Alumina Refinery, Common-User Infrastructure Project. Total project cost is
$150 million (net of interest costs).
.. $10.5 million to complete the Creative Industries Precinct.
.. $1 million to complete the Cairns CBD Revitalisation project.
The department also administers a number of significant projects on behalf of
the Government including the Gold Coast Convention and Exhibition Centre
(expenditure of $64.4 million in 2003-04 out of a total Government contribution
of $102.3 million).
The Property Services Group delivers the property services component of the
Industry Location Scheme. Key functions of the group include the acquisition,
planning and development of land for business and industry locating or expanding
to Queensland. The group's capital acquisition plan has a total budget of $81.6
million in 2003-04.
Property Services Group
Program Highlights
.. $10.3 million for further development of the Lytton Industrial Estate.
.. $4.2 million for the next stage of development of the Clinton Industrial
Estate.
.. $2.1 million for Stage 1 of the Woree Business and Industry Park.
.. $1.5 million for completion of the Murarrie Industrial Precinct.
.. $12 million for land acquisition at Wacol for future development.
.. $1 million for land acquisition at Yandina for future expansion of the
Yandina Industrial Estate.
.. $1.5 million for land acquisition at Charlton for future development.
State Development
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 240
$'000
$'000
$'000
$'000
DEPARTMENT OF STATE DEVELOPMENT
Property, Plant and Equipment
STATE DEVELOPMENT
Computer equipment
Various
892
Ongoing
Other plant and equipment
Various
338
Ongoing
Burnett Water Infrastructure
15
209,229
30,000
60,478
118,751
Development
Comalco Alumina Refinery,
30
Page 241
162,988
82,835
60,802
19,351
Common-User Infrastructure
Gold Coast Convention and
10
102,250
37,865
64,385
Exhibition Centre
Turtle Interpretive Centre
15
3,000
206
2,794
SUB-TOTAL STATE DEVELOPMENT
189,689
PROPERTY SERVICES GROUP
Targinie Valley - Residences
30
9,361
9,361
and improvements
Page 242
Plant and equipment
Various
150
Ongoing
SUB-TOTAL PROPERTY SERVICES GROUP
9,511
Total Property, Plant and Equipment
199,200
Other Capital Expenditure
PROPERTY SERVICES GROUP
Land Development
Aldoga Development Plan
30
12,000
990
11,010
Page 243
Lytton Industrial Estate
05
11,870
1,570
10,300
Clinton Industrial Estate - Red
30
4,200
50
4,150
Rover Road
Woree Business and Industry
50
4,342
442
2,100
1,800
Park
Murarrie Industrial Precinct
05
9,142
7,692
1,450
Synergy Industrial Park
05
16,933
16,353
580
Gladstone State Development
30
3,613
1,113
500
2,000
Infrastructure
Page 244
Coomera Marine Precinct
05
2,750
250
2,500
Arundel Industrial Park
10
6,647
17
200
6,430
Charlton Industrial Estate
20
2,200
200
2,000
Yandina Industrial Estate
10
4,200
200
4,000
Hamilton Industrial Estate
05
263
113
150
(Cullen and Curtin Streets)
Caloundra Regional Business
10
3,150
150
3,000
Park
Bribie Island Aquaculture Park
Page 245
05
2,000
70
100
1,830
Minor works
Various
500
Ongoing
Sub-total Land Development
31,840
State Development
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
$'000
Land Purchases
Aldoga Services Corridor
30
318
18
300
Targinie Valley
Page 246
30
22,899
14,899
8,000
Coomera Marine Precinct
05
2,636
2,336
300
Charlton
20
1,500
1,500
Murarrie
05
1,700
170
1,530
Townsville
45
4,500
3,070
1,030
400
Yandina
10
1,100
100
1,000
Wacol
05
12,000
12,000
Sub-total Land Purchases
32,559
Total Other Capital Expenditure
Page 247
64,399
Capital Grants
STATE DEVELOPMENT
Creative Industries Precinct
05
14,949
4,439
10,510
Cairns CBD Revitalisation
50
9,027
8,027
1,000
Queensland Manufacturing
05
500
Ongoing
Institute
Other capital grants
10
75
Ongoing
SUB-TOTAL STATE DEVELOPMENT
Page 248
12,085
Property Services Group
The Sustainable Minerals Institute1
05
7,500
6,155
1,345
Gladstone Infrastructure
30
1,500
1,500
SUB-TOTAL PROPERTY SERVICES GROUP
7,655
Total Capital Grants
19,740
TOTAL STATE DEVELOPMENT
283,339
Note:
1. The 2002-03 Capital Statement indicated that the Sustainable Minerals
Institute
Page 249
would cost $10 million. However $2.5 million of this will be spent as current
grants on the project and hence are not included in this Capital Statement.
TOURISM, RACING AND FAIR TRADING
The portfolio's capital program of approximately $8.9 million in 2003-04
principally relates to:
.. the acquisition of Cluden Park Racecourse, Townsville for transfer to
racing industry ownership
.. replacement of the financial management system and computer hardware
replacement for Tourism Queensland
.. the purchase of a replacement van for pre-race drug testing by the Racing
Science Centre
.. the purchase of an information management system for the Commercial and
Consumer Tribunal
.. the ongoing replacement of plant and equipment within the Department of
Tourism, Racing and Fair Trading and Tourism Queensland.
The transfer of Cluden Park Racecourse contributes to the operation of the
racing industry in a commercial manner. The pre-race van enables on-course drug
sampling and testing and contributes to maintaining the integrity of the racing
industry within Queensland. The information management system will enable
improved case management within the Commercial and Consumer Tribunal.
Improved information systems operating within the Department of Tourism, Racing
and Fair Trading and Tourism Queensland will provide more accessible and
reliable information to ensure an improved client service to the people of
Queensland.
Tourism, Racing and Fair Trading
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
$'000
$'000
$'000
Page 250
$'000
DEPARTMENT OF TOURISM, RACING AND FAIR TRADING
Property, Plant and Equipment
Motor vehicles
05
150
150
Plant and equipment
05
313
Ongoing
Racecourse transfers
45
6,547
6,547
Total Property, Plant and Equipment
7,010
Other Capital Expenditure
Computer software
05
230
230
Total Other Capital Expenditure
Page 251
230
TOTAL DEPARTMENT OF TOURISM, RACING AND FAIR TRADING
7,240
TOURISM QUEENSLAND
Property, Plant and Equipment
Computer equipment
Financial Management System
05
438
438
replacement
Page 252
Hardware replacements
05
707
707
Software
05
187
187
Other plant and equipment
05
300
300
fit-outs
Total Property, Plant and Equipment
1,632
TOTAL TOURISM QUEENSLAND
1,632
TOTAL TOURISM, RACING AND FAIR TRADING
8,872
Note:
1. The above figures exclude the value of fit-out ($0.32M) and hardware
replacement ($0.13M) purchases for interstate and international offices for
Tourism Queensland's operations.
Page 253
TRANSPORT
Total capital outlays for the Transport portfolio in 2003-04 are estimated to be
$972.9 million. The portfolio consists of Queensland Transport, Queensland Rail
and port authorities.
Queensland Transport
The Department's capital expenditure program for 2003-04 is $101.7 million and
predominately comprises investment in public transport infrastructure. Projects
and allocation in 2003-04 include $42 million for the Inner Northern Busway, $12
million for the Cultural Centre Busway Station upgrade, and $11.8 million for
the Integrated Ticketing System. The associated activity generated by the
investment program makes important contributions to the Government's priority
commitments of More Jobs for Queensland - Skills and Innovation - the Smart
State and Building Queensland's regions.
Queensland Rail
Queensland Rail forecast capital expenditure for 2003-04 is $614.8 million.
Track infrastructure works across the State account for $412.5 million of this
capital works program. These works include provision of new infrastructure and
maintenance works to existing infrastructure. A further $94 million is allocated
to Queensland Rail 's Coal and Freight Services and includes upgrading and
acquisition of rollingstock.
The passenger services businesses, Citytrain and Traveltrain, will allocate
$41.8 million to improving disabled access, upgrading the older Citytrain fleet,
improving safety and security, and minor expenditure associated with the
introduction of the new Cairns Tilt Train.
Port Authorities
The combined capital expenditure of Queensland's port authorities in 2003-04 is
$256.4 million.
Program Highlights
.. $146.9 million allocated by the Port of Brisbane Corporation for the
continuing development of the Port of Brisbane. This includes $58.2 million
for the expansion of Fisherman Islands and related infrastructure, $41.9
million for the relocation of Hamilton facilities, and $36.4 million for
business partnering.
.. $49 million allocated by the Cairns Port Authority to new and ongoing
airport and seaport development.
.. $37.8 million is allocated by the Gladstone Port Authority to the ongoing
expansion of the port.
Transport
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 254
$'000
$'000
$'000
$'000
QUEENSLAND TRANSPORT
Property, Plant and Equipment
Public Transport Infrastructure
Inner Northern Busway
05
135,000
93,000
42,000
Cultural Centre Busway Station
05
15,700
3,700
12,000
upgrade
Integrated Ticketing System
05
65,475
3,215
11,876
Page 255
50,384
Sub-total Public Transport Infrastructure
65,876
Maritime Infrastructure
Vessel Traffic System
05/10
1,500
700
800
Upgrade of Gladstone Shipping
30
300
25
275
Channel beacons
Modify five beacons and one
50
190
190
tower at Thursday Island
Upgrade for Maritime Safety
Various
123
Page 256
Ongoing
Queensland Vessels
Major upgrade of Boon Boon
15
100
10
90
lead lights
Deeral - upgrade of Jetty Boat Ramp
50
283
5
278
Minor works
Various
799
Ongoing
Sub-total Maritime Infrastructure
2,555
Other capital projects
Regional rail infrastructure
30
9,000
Page 257
6,000
3,000
Sub-total Other capital projects
6,000
Corporate Property - Buildings
Refurbishments
05
485
485
Refurbishment of Pinkenba
05
250
250
Marine Operations base
Customer service centre fit-outs
05
513
513
Minor works
Various
154
154
Sub-total Corporate Property - Buildings
1,402
Page 258
Corporate Information Services
Infrastructure replacement -
05
2,652
Ongoing
Upgrade
Sub-total Corporate Information Services
2,652
Regional Service Delivery
494
Ongoing
Plant and equipment
Page 259
Other Departmental Plant and Equipment
Other plant and equipment
05
743
Ongoing
Maritime Safety Queensland
Various
350
Ongoing
Sub-total Other Departmental Plant and Equipment
1,093
Total Property, Plant and Equipment
80,072
Other Capital Expenditure
Integrated Ticketing System
05
29,955
4,394
9,551
16,010
New Queensland Driver Licence
05
8,200
2,400
3,300
2,500
Total Other Capital Expenditure
Page 260
12,851
Capital Grants
Integrated Transport Planning
Rosehill Boat Ramp
50
100
100
Daintree Road Boat Ramp
50
50
50
Sub-total Integrated Transport Planning
150
Public Transport
Accessible buses
Various
3,000
Ongoing
Roadside infrastructure
Various
1,025
Page 261
Ongoing
Rural and remote airstrips
Various
1,250
250
1,000
School Bus Upgrade Scheme
Various
3,000
Ongoing
Sub-total Public Transport
8,025
Land Transport and Safety
Safe School Travel
Various
450
Ongoing
Safe Walking and Pedalling
Various
195
Ongoing
Sub-total Land Transport and Safety
645
Page 262
Total Capital Grants
8,820
TOTAL QUEENSLAND TRANSPORT
101,743
QUEENSLAND RAIL
Network Access
Regional
Coal Fleet upgrade
40
24,300
6,985
4,000
13,315
Infrastructure
Page 263
Rockhampton - Townsville -
Various
369,150
319,399
49,751
Cairns Track Upgrade
Statewide security fencing
Various
15,524
3,847
4,000
7,677
Rosewood - Helidon track relay
10
20,230
18,738
1,492
Re-rail Miles to Muckadilla
Various
25,445
15,111
10,000
334
Timber bridge replacement,
Various
38,270
9,627
9,550
19,093
regional
Level crossing protection
Various
16,969
1,501
2,700
12,768
Page 264
Townsville, New station
45
23,820
21,967
1,853
and track
Coal infrastructure projects
30
210,000
9,000
160,000
41,000
Hail Creek - Electrification
40
15,600
9,757
5,843
Hail Creek - Construction
40
72,000
840
71,000
160
Coppabella Mine Rail Deviation
40
20,470
876
19,594
Moorvale construction
40
12,000
900
11,100
Network Access / Regional -
Various
393,639
85,816
32,942
274,881
General
Page 265
Sub-total Network Access Regional
373,625
Page 266
Metropolitan
Caboolture - Landsborough
Various
11,795
5,918
1,000
4,877
upgrade
Noise Amelioration - Strategy
05
19,720
5,457
5,000
9,263
Turnout Replacement Strategy -
05
46,750
15,788
16,000
14,962
Stage 2
Timber bridge replacement
Various
15,400
3,069
6,000
6,331
Network Access / Metropolitan -
Various
124,034
31,766
10,828
Page 267
81,440
General
Sub-total Network Access Metropolitan
38,828
Total Network Access
412,453
Coal and Freight Services (CFS)
Stuart Stage 2
45
12,182
11,682
500
Coal Fleet upgrade - rollingstock
30
342,300
339,708
50
2,542
CFS Electric Loco fleet upgrade
Various
88,000
14,015
30,000
43,985
Page 268
Additional VSA coal wagons
05
77,526
76,926
600
Acquisition of 11 x 4000 Class
15
69,000
1,000
30,000
38,000
diesel electric locomotives
300 KOJX Cattle wagons
45
12,193
9,147
2,000
1,046
Coal and freight services - General
30
202,802
20,505
30,828
151,469
Total Coal and Freight Services
93,978
Passenger Services
Citytrain Electrical Multiple
05
30,100
29,100
1,000
Page 269
Units (EMU), Retrofit
30 x 3-Car Suburban Multiple
15
248,000
246,400
1,600
Units
Citytrain EMU Re-engineering
05
68,800
24,946
7,650
36,204
and overhaul
Citytrain Safe Stations
05
39,454
37,769
1,685
Cairns Tilt Train
05
13,800
13,400
240
160
Cairns Tilt Train
15
124,200
120,596
2,160
1,444
Vintage fleet upgrade
Various
13,500
Page 270
3,570
1,000
8,930
Interurban Multiple units (4 x 3 - car)
15
43,062
42,062
1,000
Citytrain disabled access
05
35,304
23,284
6,000
6,020
compliance
Citytrain disabled access
15
11,501
7,495
2,000
2,006
compliance
Traveltrain accessible stations
Various
10,100
2,312
2,888
4,900
Power car replacement
05
7,500
4,534
2,966
Passenger services - General
05
69,086
24,867
11,555
32,664
Total Passenger Services
Page 271
41,744
Infrastructure Services
Infrastructure services - General
05
34,335
14,110
6,917
13,308
Total Infrastructure Services
6,917
Workshops
Workshops - General
Various
8,891
3,988
1,499
3,404
Total Workshops
1,499
Page 272
Corporate Services
Motor vehicle acquisitions
05
296,157
176,157
30,000
90,000
Corporate services - General
05
59,878
10,611
11,061
38,206
Total Corporate Services
41,061
Technical Services
Technical services - General
Page 273
05
3,354
675
1,429
1,250
Total Technical Services
1,429
Strategy and Finance
Computer system
05
39,760
24,590
15,170
Strategy and finance
05
1,815
536
529
750
Total Strategy and Finance
15,699
TOTAL QUEENSLAND RAIL
614,780
Page 274
PORT AUTHORITIES
PORT OF BRISBANE CORPORATION
Property, Plant and Equipment
Car Precinct Flyover
05
5,600
4,000
1,600
Whimbrel St Car Terminals
05
4,500
4,500
Hamilton Site 1
05
15,650
200
1,000
14,450
Upgrade of major roads
05
2,500
Page 275
2,500
Colmslie and Hamilton Precincts 1
05
28,700
8,450
20,250
Wharf 9
05
32,100
5,000
22,100
5,000
Lessee terminals
05
16,700
1,513
10,387
4,800
Expansion - Reclamation
05
104,500
5,500
50,000
49,000
and Outer Bund Wall
Electrical Upgrades - P & O and
05
100
100
Patrick
Reclamation and earthworks
05
12,500
2,000
4,500
6,000
Surcharging
05
Page 276
6,000
1,500
1,000
3,500
Building and landscaping upgrades
05
650
250
100
300
Warehouses - Fisherman Island
05
40,000
20,000
5,000
15,000
Fisherman Island Wet Bulk
05
6,500
500
6,000
Whyte Island site preparation
05
15,500
1,000
4,500
10,000
Whyte Island road and services
05
6,500
5,000
1,500
network
Whyte Island property
05
35,500
9,800
5,000
20,700
development
Page 277
Eagle Farm Estate, Site preparation
05
13,000
2,000
6,000
5,000
and warehousing
Boat Harbour restoration works
05
8,700
2,530
6,170
Dredging equipment
05
2,954
1,200
1,754
Minor capital works
05
31,048
6,000
6,048
19,000
Total Property, Plant and Equipment
146,969
TOTAL PORT OF BRISBANE CORPORATION
146,969
Page 278
BUNDABERG PORT AUTHORITY
Property Plant and Equipment
Sea Scallop Project
15
350
350
Plant and equipment
15
404
404
Page 279
Total Property, Plant and Equipment
754
TOTAL BUNDABERG PORT AUTHORITY
754
CAIRNS PORT AUTHORITY
Property, Plant and Equipment
Cairns Airport
Terminal works
Bus bay covers, International
50
Page 280
205
205
terminal (ITB)
Bus facility, Bay 7 and 8 (ITB)
50
4,450
4,450
Checked bag screening,
50
2,240
90
2,150
Domestic terminal
Checked bag screening and
50
40,650
16,800
23,850
associated works 1 (ITB)
Bay 1 Concourse
50
5,430
1,090
4,340
Property Works
Commercial sites - Preparation
Page 281
50
1,650
470
1,180
and surcharging
Ad-hoc site filling
50
1,300
260
1,040
Hawker Pacific Development
50
5,739
595
5,144
Flood mitigation and drainage
Levee upgrade
50
1,318
20
1,298
Drainage upgrades
50
1,318
0
20
1,298
Apron works
Bay 7 and 8
50
7,175
3,075
4,100
Page 282
Future preparation and
50
2,115
1,167
948
surcharging
Major maintenance
Taxiway overlay (B3 to B2)
50
775
23
752
Taxiway overlay (B4 to B5)
50
737
25
712
Water Supply upgrade
50
970
30
940
Minor Airport Works
50
1,647
1,647
Sub-total Cairns Airport
37,548
Page 283
Cairns Seaport
Tingira Street land development
50
380
380
Coast Guard facilities
50
310
40
270
Dredge crane replacement
50
840
11
829
Workshop upgrade
50
150
150
Tug Fire fighting and berth
50
200
200
Security fencing
50
220
220
Security systems
50
324
324
Port Master planning
50
250
250
Page 284
Seaport, Navy Cadet facilities
50
80
43
37
Seaport, Smiths Creek
50
394
14
50
330
reconstruction
Seaport, Wharf 10 fire fighting
50
1,545
45
1,500
system
Minor Seaport works
50
200
200
Sub-total Cairns Seaport
4,410
Cairns corporate
Minor Works
50
1,252
1,252
Sub-total Cairns Corporate
Page 285
1,252
Total Property, Plant and Equipment
43,210
Other Capital Expenditure
Cairns Cityport Project
50
13,578
5,796
7,782
Total Other Capital Expenditure
5,796
TOTAL CAIRNS PORT AUTHORITY
49,006
Page 286
GLADSTONE PORT AUTHORITY
Property, Plant and Equipment
Reserve 274 subdivision
30
5,308
1,000
4,308
Auckland Point structural
30
626
336
190
100
works
RG Tanna Coal Terminal
shiploading modifications
30
1,198
379
690
129
structural works
Page 287
30
4,811
2,230
2,268
313
Barney Point structural works
30
881
337
544
Plant and equipment
30
11,538
3,970
6,363
1,205
Building modifications
30
3,145
720
1,940
485
Services
30
3,480
1,164
1,583
733
Land development
30
3,411
1,195
1,082
1,134
Reclamation/Earthworks
30
18,017
12,817
5,200
Provision for lease
30
10,080
4,915
4,810
355
Total Property, Plant and Equipment
25,670
Page 288
Other Capital Expenditure
Berth 3 development
30
80,000
76,310
3,690
Stockpile 16 development
30
10,500
2,000
8,500
Total Other Capital Expenditure
12,190
TOTAL GLADSTONE PORT AUTHORITY
37,860
MACKAY PORT AUTHORITY
Page 289
Property, Plant and Equipment
Mackay Airport
Runway approach lighting
40
100
100
Explosive Trace Detection Unit
40
100
100
Miscellaneous airport works
40
743
743
Plant and equipment
40
42
42
Sub-total Mackay Airport
985
Mackay Seaport
Page 290
Establish harbour security
40
400
400
perimeter
Quick Release Hook W Shore
40
100
100
Bollard Wharf 1
Create roadbase stock
40
250
250
Establish a commercial fishing
40
550
550
facility
Plant and equipment
40
399
399
Miscellaneous seaport works
40
1,150
Page 291
1,150
Sub-total Mackay Seaport
2,849
Total Property, Plant and Equipment
3,834
TOTAL MACKAY PORT AUTHORITY
3,834
PORTS CORPORATION OF QUEENSLAND
Property, Plant and Equipment
Abbot Point general works
Page 292
45
2,512
2,512
Head office plant and equipment
05
1,075
180
895
Weipa Minor projects
50
1,357
1,357
Weipa Dredging
50
4,000
2,000
2,000
Karumba minor projects
55
5
5
Lucinda minor projects
45
28
28
Mourilyan minor projects
50
97
97
Thursday Island minor projects
50
457
50
407
Thursday Island paving
50
600
50
550
Page 293
causeway
Thursday Island Cargo Wharf
50
550
200
350
fender upgrade
Thursday Island Main Wharf
50
3,000
200
2,800
upgrade
Cape Flattery plant and
50
3
3
equipment
Hay Point general works
40
2,018
2,018
Hay Point buffer land
40
10,000
1,129
Page 294
1,000
7,871
Total Property, Plant and Equipment
11,272
TOTAL PORTS CORPORATION OF QUEENSLAND
11,272
ROCKHAMPTON PORT AUTHORITY
Property, plant and equipment
30
117
117
Page 295
TOTAL ROCKHAMPTON PORT AUTHORITY
117
TOWNSVILLE PORT AUTHORITY
Property, Plant and Equipment
Building construction/Lease
45
3,000
3,000
to Australian Customs/
Australian Federal Police/
Australian Quarantine
Page 296
Inspection Service
Strategic acquisition various
45
1,000
1,000
properties
Construction service corridor
45
908
908
western side of port
Ross Creek reclamation
45
1,012
699
313
Minor works
45
483
483
Various plant and equipment
45
507
507
Page 297
Total Property, Plant and Equipment
6,597
TOTAL TOWNSVILLE PORT AUTHORITY
6,597
TOTAL PORT AUTHORITIES
256,409
TOTAL TRANSPORT PORTFOLIO
972,932
TREASURY
Treasury portfolio (incorporating the Department of Treasury, its statutory
authorities and the Government-owned corporation - Golden Casket Lottery
Corporation) has a combined capital works program of $34.9 million in 2003-04.
The Department of Treasury has a capital works program of $23.3 million in
2003-04.
Program Highlights
.. $8.5 million to implement and develop a new Information Technology
Strategic Plan (ITSP) within the Office of State Revenue. This system will
employ contemporary technology to provide revenue and information
management and e-business capability to better service the Government and
people of Queensland.
.. $2.5 million to undertake Treasury's Strategic Accommodation Plan. A key
priority
Page 298
of the accommodation plan is to consolidate a number of organisational
units into the new government building at 33 Charlotte Street, Brisbane to
streamline business processes.
.. $4.6 million to further improve client service and business related
initiatives within the Government Superannuation Office (GSO), such as:
.. $1.8 million towards leasehold improvements to cater for permanent
accommodation to meet the business requirements set out by the QSuper Board
of Trustees;
.. $1.2 million to develop a Workflow and Document Management System (WDMS) to
enhance business efficiencies; and
.. $0.63 million towards further stages of the continued development of a
Member Internet System (MIS) to enhance service to QSuper members.
.. $2 million to implement new infrastructure for the relocation of Treasury's
Network Servers to CITEC.
.. $0.92 million to redevelop the Corporate Office of Gaming System (COGS)
within the Office of Gaming Regulation which will assist in improving
information and communication systems and practices within the office.
.. $4 million towards the replacement of property, plant and equipment for the
ongoing operational requirement to support Treasury's key infrastructure of
intellectual capital and software solution needs.
Motor Accident Insurance Commission
Capital outlays for the Motor Accident Insurance Commission and the Nominal
Defendant of $0.42 million are allocated towards the continued development of a
viable and equitable personal injury compensation scheme in Queensland.
Golden Casket Lottery Corporation Limited
The Golden Casket Lottery Corporation has a capital works program of $11.2
million predominantly for improved lottery systems delivery and other
information technology related enhancements and replacements.
Treasury
Statistical
Total
Expenditure
Budget
Post
Division
Estimated
to
2003-04
2003-04
Project
Cost
30-06-03
Page 299
$'000
$'000
$'000
$'000
DEPARTMENT OF TREASURY
Property, Plant and Equipment
Asset replacement
05
3,956
Ongoing
Total Property, Plant and Equipment
3,956
Other Capital Expenditure
OSR ITSP
05
34,070
4,842
8,500
20,728
GSO Leasehold Improvement
05
1,800
1,800
Page 300
GSO WDMS
05
1,190
1,190
GSO MIS
05
633
633
33 Charlotte Street Leasehold
05
4,042
1,582
2,460
Improvement
Treasury Portfolio Metropolitan Network
05
2,000
2,000
COGS
05
915
915
Other Items
05
1,821
1,821
Total Other Capital Expenditure
19,319
TOTAL DEPARTMENT OF TREASURY
23,275
Page 301
MOTOR ACCIDENT INSURANCE ADMINISTRATION
Property, Plant and Equipment
Motor Accident Insurance Commission
05
6
Ongoing
Nominal Defendant
05
37
Ongoing
Total Property, Plant and Equipment
43
Other Capital Expenditure
Motor Accident Insurance Commission
05
250
Ongoing
Nominal Defendant
Page 302
05
122
Ongoing
Total Other Capital Expenditure
372
TOTAL MOTOR ACCIDENT INSURANCE ADMINISTRATION
415
Page 303
GOLDEN CASKET LOTTERY CORPORATION
Property, Plant and Equipment
Agents' Web
05
347
273
74
Electronic Data Management System
05
420
420
New business development
05
500
500
IS operations management
05
2,226
1,154
1,072
Retail network replacement
05
3,346
2,743
Page 304
603
Internet lottery sales and prize
05
3,447
3,447
payments
Other items
05
8,356
2,630
5,726
Total Property, Plant and Equipment
11,167
TOTAL GOLDEN CASKET LOTTERY CORPORATION
11,167
TOTAL TREASURY
34,857
15
Capital Statement 2003-04
Page 305
4. CAPITAL OUTLAYS BY REGION
STATISTICAL DIVISIONS
In the following tables, allocations of some minor works and other plant and
equipment funding to particular statistical divisions are indicative only at
this stage. This is because funds are allocated through the year to meet
emerging needs.
Similarly, for some ongoing capital programs, departmental planning processes
are such that allocations to particular statistical divisions will not be known
with certainty until later in the year. Indicative allocations have been used in
these cases based on population or previous years' expenditure patterns, as
appropriate.
SOUTH EAST
The Brisbane and Moreton regions are the most populous in Queensland. The
2003-04 capital outlays program provides $2.052 billion in the Brisbane region
and $672.9 million in the Moreton region, a total of $2.725 billion for these
regions. The Budget recognises the areas' emerging infrastructure needs,
particularly for health, transport, education, electricity generation and law
and order.
Brisbane
Brisbane is the most populous region and consequently requires a significant
contribution to infrastructure to meet service delivery needs. As mentioned, the
2003-04 capital program provides $2.052 billion for the Brisbane region.
Statistical Division 05 - Brisbane
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Aboriginal and Torres Strait Islander Policy
215
Arts
Gallery of Modern Art
87,140
21,488
Plaza Development, Common Infrastructure Works - South Bank
72,834
45,261
Millennium Library
55,326
17,854
Queensland Museum
16,000
8,998
Musgrave Park Cultural Centre
5,000
3,753
Library Board of Queensland
Page 306
13,067
Queensland Performing Arts Trust
2,250
Other
100
112,771
Corrective Services
Integrated Offender Management System
9,206
3,400
Other
3,334
6,734
Disability Services
Disability Information System
7,710
3,855
Brisbane West Area Office
500
100
Ipswich East Area Office
300
50
Community Renewal Project
315
145
Other
8,266
12,416
Education
School Facilities
126,776
63,241
Non-State Government grants
Page 307
19,662
Other
50,526
133,429
Electoral Commission
240
Emergency Services
Queensland Ambulance Service
Ambulance stations
7,320
6,567
Vehicle purchases
4,488
Other Queensland Ambulance Service
2,787
Queensland Fire and Rescue Authority
Vehicle purchases
8,088
Roma Street Fire Station refurbishment
2,050
850
Wynnum Fire Station replacement
1,400
1,200
Other fire stations
2,550
300
Other Queensland Fire and Rescue Authority
6,234
Squirrel Helicopter - Replacement
8,000
5,600
Other
3,446
39,560
Employment and Training
Page 308
New campus - Inala
4,200
3,257
New Western Campus - Browns Plains
4,070
2,553
Campus consolidation - Mount Gravatt
10,890
1,122
Public Private Partnership redevelopment - South Brisbane
9,224
2,345
Co-location - Caboolture
4,000
500
Campus redevelopment - Brisbane
2,950
300
Institute Student and Administration System
21,400
6,970
Information and communication technology
7,079
Skill Centre Program
2,186
Other
8,478
34,790
Environmental Protection Agency
5,414
Families
4,306
Health
Princess Alexandra Hospital redevelopment
Page 309
353,433
11,329
Herston Hospitals, Education Centre and demolitions
15,000
12,000
Other hospitals
33,644
Aged Care Facilities Program
Redcliffe
8,415
7,471
Redlands
18,945
3,393
Sandgate
11,026
3,617
Logan Central Community Health Centre
7,500
4,010
North West Brisbane Community Health Centre
4,690
3,490
Other Community Health Centres
7,965
1,700
Mental Health Services
1,727
Queensland Institute of Medical Research
1,724
Information and communication technology
31,806
Other
23,018
138,929
Housing
Public Housing
Detached houses
4,501
Medium density
14,860
Seniors' units
9,938
Capital works on existing dwellings
Page 310
57,370
Other
9,274
Aboriginal and Torres Strait Islander housing
3,019
Community housing
14,179
Community Renewal
3,400
Private housing
21,940
Other
1,961
140,442
Industrial Relations
421
Innovation and Information Economy, Sport and Recreation
Redevelopment of Suncorp Stadium
279,700
41,790
Sport and recreation development
11,675
Electronic Service Delivery Strategy
13,372
1,135
Access Queensland
11,081
303
Queensland Government Electronic Marketplace
2,580
1,438
Australian Computational Earth Systems Simulator
1,500
1,500
Other
17,061
ENERGEX Limited
214,554
Powerlink Queensland
50,998
CS Energy Limited
Page 311
25,038
Stanwell Corporation Limited
16,278
Tarong Energy Corporation Limited
4,795
Queensland Power Trading Corporation (Enertrade)
373
386,938
Justice and Attorney-General
New magistrates courthouse - Brisbane
135,500
90,402
New courthouse - Richlands
4,500
3,793
State Penalties Enforcement Registry Project
10,680
1,381
Integrated Justice Information Strategy
3,291
3,291
Legal Aid Queensland
2,314
2,314
Public Trust Office
1,563
Other
4,964
107,708
Legislative Assembly of Queensland
Parliament House stonework restoration
12,384
100
Other
Page 312
2,150
2,250
Local Government and Planning
Roads
8,968
Water
175
Sewerage
2,427
Other
3,174
14,744
Main Roads
Granard Road - Riverview, Planning, Widen 4 to 6 lanes - Stage 1
66,000
10,000
Dohles Rocks Road to Boundary Road, Widen to 6 lanes
40,000
30,000
Middle - Green Road/Fedrick Street, Duplicate 2 to 4 lanes
43,741
13,000
Caboolture Northern Bypass, Construct 2 lane Bypass
33,250
3,250
Gateway Motorway - Mount Cotton Road, At-grade Intersection Works
8,400
7,550
Windemere Road - Vienna Road, Duplicate 2 to 4 lanes
4,665
1,419
Samford Sub-Arterial, Arbor Street - Ferny Way, Duplicate 2 to 4 lanes
4,175
3,300
Other State-controlled roads
113,483
Other National Highways
13,250
Queensland Motorways Limited
5,000
Transport Infrastructure Development Scheme
Page 313
10,478
Federal Black Spot
1,998
Other
11,869
224,597
Natural Resources and Mines
Coordinated Land Asset Management System
3,050
1,050
Landcentre Office Fit-outs
4,570
1,187
Sunwater
6,573
Other
15,416
24,226
Office of the Governor
42
Office of the Public Service Commissioner
65
Offices of the Ombudsman and the Information Commissioner
120
Police
Replacement police station - Stafford
3,750
200
New watchhouse (joint Department of Justice project) - Inala
3,500
Page 314
3,088
New police station - Loganholme
2,500
2,107
Dog Squad Kennels - Oxley
700
550
Replacement police station - Sherwood
450
430
Plant and equipment (includes motor vehicles)
43,302
Other
2,477
52,154
Premier and Cabinet
South Bank Corporation
3,138
Crime and Misconduct Commission
1,027
Commission for Children and Young People
60
Queensland Events Corporation
14
Other
4,359
8,598
Primary Industries
Centre for Amenity Horticulture - Redlands
2,000
1,720
Forestry
2,838
Other
9,682
14,240
Page 315
Public Works
33 Charlotte St Office Building
68,562
47,280
Roma Street Parkland
68,500
2,138
QFleet
73,178
QBuild
1,765
Project Services
1,888
Sales and Distribution Services
850
Other
5,856
132,955
Audit Office
150
State Development
Synergy Industrial Park
16,933
580
Creative Industries Precinct
14,949
10,510
Land purchases - Wacol
12,000
12,000
Lytton Industrial Estate
11,870
10,300
Murarrie Industrial Precinct
9,142
1,450
Land puchases - Murrarie
1,700
1,530
The Sustainable Minerals Institute
7,500
6,155
Coomera Marine Precinct
5,386
Page 316
550
Bribie Island Aquaculture Park
2,000
100
Other
2,014
45,189
Tourism, Racing and Fair Trading
2,325
Transport
Inner Northern Busway
135,000
42,000
Integrated Ticketing System
95,430
21,427
Cultural Centre Busway Station upgrade
15,700
12,000
Other public transport
1,631
New Queensland driver licence
8,200
3,300
Port authorities
390,277
147,864
Queensland Rail
1,083,491
137,279
Other
5,482
370,983
Treasury
Golden Casket Lottery Corporation Limited
18,642
11,167
Motor Accident Insurance Commission
Page 317
415
Other
23,275
34,857
TOTAL BRISBANE
2,051,808
Moreton
The Moreton region covers the Gold Coast and Sunshine Coast. The 2003-04 capital
program provides $672.9 million for the emerging infrastructure needs of the
region.
Statistical Division 10 - Moreton
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Arts
2,982
Corrective Services
Woodford Correctional Centre expansion
68,800
125
Other
916
1,041
Disability Services
3,546
Education
School facilities
Page 318
61,339
41,163
Non-State Government grants
15,135
Other
35,759
92,057
Emergency Services
Queensland Ambulance Service
4,203
Queensland Fire and Rescue Authority
5,734
Other
817
10,754
Employment and Training
Redevelopment Stage 2 - Mooloolaba
13,860
197
Arts and environmental studies - Tewantin
6,000
5,500
Other
1,622
7,319
Environmental Protection Agency
Great Walks of Queensland
936
Other
1,386
2,322
Page 319
Families
1,905
Health
Nambour Hospital redevelopment
25,850
1,000
Nambour Hospital Breastscreen
1,900
500
Gold Coast Hospital Mental Health Service
1,456
1,256
Other
30,892
33,648
Housing
Public Housing
Detached houses
2,337
Medium density
1,577
Seniors' units
6,929
Capital works on existing dwellings
11,324
Other
Page 320
3,617
Aboriginal and Torres Strait Islander housing
272
Community housing
9,784
Other
1,089
36,929
Industrial Relations
42
Innovation and Information Economy, Sport and Recreation
Redevelopment of Tallebudgera Recreation Centre
18,000
7,000
ENERGEX Limited
100,778
Powerlink Queensland
19,095
Tarong Energy Corporation Limited
5,758
Other
5,789
138,420
Justice and Attorney-General
Land purchase and new courthouse - Caloundra
7,040
2,400
Other
825
3,225
Local Government and Planning
Page 321
Roads
5,711
Water
5,328
Sewerage
4,675
Other
5,024
20,738
Main Roads
Pacific Motorway, Tugun - Tweed Heads, Construct 4 lane bypass
240,000
25,000
Yandina to Cooroy, Duplication 2 to 4 lanes
110,000
9,000
Gatton Bypass, Duplication, 2 to 4 lanes
46,000
13,738
Kawana Arterial, Nicklin Way - Sunshine Motorway Link
22,500
14,500
Caboolture - Kilcoy, Scrubby and Sandy Creeks
5,400
2,500
Other State-Controlled roads
125,422
Other National Highways
14,361
Federal Black Spot
3,115
Transport Infrastructure Development Scheme
2,003
Other
4,203
213,842
Natural Resources and Mines
4,831
Page 322
Police
New watchhouse - Caloundra
3,600
1,100
Police station refurbishment - Southport
2,000
100
Temporary police station - Coolum
490
490
Other
7,049
8,739
Premier and Cabinet
504
Primary Industries
5,126
Public Works
10,649
State Development
Gold Coast Convention and Exhibition Centre
102,250
64,385
Arundel Industrial Park
6,647
200
Yandina Industrial Estate
4,200
200
Caloundra Regional Business Park
3,150
Page 323
150
Other
1,134
66,069
Transport
Public transport
1,875
Queensland Rail
46,749
5,190
Other
1,142
8,207
TOTAL MORETON
672,895
WIDE BAY-BURNETT
The 2003-04 capital program for Wide Bay-Burnett provides funding of $365.2
million to address infrastructure needs, particularly energy and transport.
Statistical Division 15 - Wide Bay-Burnett
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Arts
1,328
Corrective Services
Page 324
Maryborough Correctional Centre
97,000
8,200
Other
620
8,820
Disability Services
1,138
Education
School facilities
1,821
1,742
Non-State Government grants
524
Other
2,105
4,371
Emergency Services
Queensland Ambulance Service
3,155
Queensland Fire and Rescue Service
2,253
Other
327
5,735
Employment and Training
Wide Bay Institute of TAFE - Maryborough
5,934
4,307
Other
815
Page 325
5,122
Environmental Protection Agency
Great Walks of Queensland
419
Other
1,974
2,393
Families
611
Health
Staff accommodation
2,900
1,782
Gympie Hospital redevelopment
5,500
3,500
Aged Care Facilities Program
Maryborough
14,249
5,661
Wondai
6,777
180
Other
12,643
23,766
Housing
Public housing
4,408
Community housing
2,567
Aboriginal and Torres Strait Islander housing
926
Page 326
Other
349
8,250
Industrial Relations
23
Innovation and Information Economy, Sport and Recreation
ENERGEX Limited
4,249
618
Ergon Energy Corporation Limited
52,294
Tarong Energy Corporation Limited
50,399
Other
1,857
105,168
Justice and Attorney-General
918
Local Government and Planning
Roads
2,265
Water
1,784
Sewerage
3,173
Other
1,392
8,614
Main Roads
Page 327
Gin Gin - Benaraby, Fairbairn Flats - Bariveloe Road, Re-align 2 lanes
8,700
7,000
Maryborough turn-off, Realign 2 lanes
10,000
8,674
Maryborough - Hervey Bay Road, Construct overtaking lanes
2,516
2,408
Other State-controlled roads
16,549
Other National Highways
2,185
Transport Infrastructure Development Scheme
2,434
Other
1,798
41,048
Natural Resources and Mines
Barlil Weir
3,857
2,185
Jones Weir
7,348
3,766
Other
1,807
7,758
Police
Replacement police station and watchhouse - Gympie
9,000
500
Stage 2 - Hervey Bay
1,600
1,200
Replacement police station - Childers
455
355
New police station - Rainbow Beach
540
100
Other
Page 328
2,339
4,494
Premier and Cabinet
162
Primary Industries
5,903
Public Works
11,790
State Development
Burnett Water Infrastructure Development
209,229
60,478
Turtle Interpretive Centre
3,000
2,794
Other
89
63,361
Transport
Bundaberg Port Authority
754
Queensland Rail
534,704
52,432
Other
1,216
54,402
TOTAL WIDE BAY-BURNETT
365,175
DARLING DOWNS AND SOUTH WEST
Page 329
In 2003-04, $272.9 million is provided for capital outlays to meet the social
and development needs of these regions.
Darling Downs
The Darling Downs region covers Toowoomba, Goondiwindi and Taroom. The 2003-04
capital program provides $222.9 million for the emerging infrastructure needs of
the region, especially roads.
Statistical Division 20 - Darling Downs
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Arts
924
Corrective Services
64
Disability Services
1,360
Education
School facilities
1,863
1,863
Non-State Government grants
586
Other
3499
5,948
Emergency Services
Queensland Ambulance Service
1,193
Queensland Fire and Rescue Service
Page 330
1,603
Other
291
3,087
Employment and Training
Southern Queensland Institute of TAFE - Toowoomba
17,820
2,930
Other
1,546
4,476
Environmental Protection Agency
328
Families
543
Health
Toowoomba Hospital
3,500
2,099
Aged Care Facilities Program
18,738
719
Multi-purpose health services
770
Other
6,734
10,322
Housing
Public housing
Page 331
10,180
Other
2,271
12,451
Industrial Relations
53
Innovation and Information Economy, Sport and Recreation
Centre of Excellence in Engineered Fibre Composites
2,500
2,500
Ergon Energy Corporation Limited
81,309
Powerlink Queensland
13,014
Tarong Energy Corporation Limited
6,639
Other
1,649
105,111
Justice and Attorney-General
248
Local Government and Planning
Roads
2,664
Water
3,265
Other
2,746
8,675
Main Roads
Page 332
Leichhardt Highway, Miles - Goondiwindi, 54.5 - 57.8 km, Widen and seal
1,950
1,170
Millmerran - Inglewood Road, Clontarf Deviation, 13.38 - 15.54 km
1,900
570
New England Highway, Mt Kynock - Highfield, 107.1 - 109.4 km
1,015
930
Warwick - Killarney Road, 34.5 - 37.13 km, Widen and overlay
2,563
717
Other State-Controlled roads
18,175
Toowoomba Bypass, planning and land acquisition
26,250
4,720
Other National Highways
1,468
Transport Infrastructure Development Scheme
1,747
Other
1,655
31,152
Natural Resources and Mines
4,908
Police
Replacement police station, watchhouse, DHQ and regional office - Toowoomba
Stage 2
6,700
5,551
Stage 3
3,000
100
Other
2,911
8,562
Premier and Cabinet
144
Page 333
Primary Industries
2,002
Public Works
12,423
State Development
1,728
Transport
Queensland Rail
24,437
7,396
Other
1,034
8,430
TOTAL DARLING DOWNS
222,939
South West
The South West region covers the remainder of southern Queensland to the South
Australian border. The 2003-04 capital program provides $50 million for the
region.
Statistical Division 25 - South West
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Arts
42
Corrective Services
Page 334
79
Disability Services
128
Education
688
Emergency Services
632
Employment and Training
529
Environmental Protection Agency
771
Families
69
Health
1,104
Housing
Public housing
1,371
Other
684
2,055
Industrial Relations
Page 335
7
Innovation and Information Economy, Sport and Recreation
Ergon Energy Corporation Limited
7,354
Other
210
7,564
Justice and Attorney-General
29
Local Government and Planning
Roads
2,322
Water
2,289
Sewerage
228
Other
709
5,548
Main Roads
Carnarvon Highway, Roma - Injune, 63.66 - 71.2 km, Seal shoulders
2,530
2,478
Other State-controlled roads
11,932
Other
2,428
16,838
Page 336
Natural Resources and Mines
1,277
Police
2,231
Premier and Cabinet
18
Primary Industries
132
Public Works
2,203
Transport
Queensland Rail
24,974
7,627
Other
404
8,031
TOTAL SOUTH WEST
49,975
FITZROY AND CENTRAL WEST
A total of $836.6 million is allocated for capital outlays in these regions for
2003-04. Significantly, $314.3 million is provided for transport and main roads
related infrastructure and $312 million is provided for natural resources and
mining, and Government-Owned Electricity Corporation infrastructure. This
expenditure is in recognition of the importance of such infrastructure to these
areas.
Fitzroy
The Fitzroy region covers Rockhampton and Gladstone on the coast and reaches
west as far as Alpha. The 2003-04 capital program provides $807.6 million for
the region.
Statistical Division 30 - Fitzroy
Project
Page 337
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Aboriginal and Torres Strait Islander Policy
40
Arts
1,494
Corrective Services
Capricornia Correctional Centre
89,500
4,400
Other
512
4,912
Disability Services
970
Education
General works
11,003
Non-State Government grants
2,305
Other
3,037
16,345
Emergency Services
Page 338
Queensland Ambulance Service
1,889
Queensland Fire and Rescue Service
2,332
Other
250
4,471
Employment and Training
1,522
Environmental Protection Agency
1,122
Families
469
Health
Springsure Multi-purpose Health Service redevelopment
5,345
3,500
Emerald Community Health Centre and staff accommodation
1,000
700
Other
9,790
13,990
Housing
Public housing
13,978
Community housing
Page 339
3,714
Aboriginal and Torres Strait Islander housing
2,531
Other
404
20,627
Industrial Relations
23
Innovation and Information Economy, Sport and Recreation
CS Energy Limited
31,018
Ergon Energy Corporation Limited
63,613
Powerlink Queensland
46,062
Stanwell Corporation Limited
124,158
Other
1,422
266,273
Justice and Attorney-General
371
Local Government and Planning
Roads
1,867
Water
4,324
Sewerage
2,161
Other
Page 340
2,319
10,671
Main Roads
Gladstone Port Access Road, Construct to new sealed 2 lane standard
15,000
9,900
Capricorn Highway, Taraborah - Gemfields Turnoff, Widen and overlay
4,069
2,500
Dawson Highway
Monto turnoff - Scrubby Creek, Rehabilitate pavement
4,992
2,033
Staircase - Rodda's Lookout, Widen shoulders and sealing
3,893
1,585
Gregory Highway, Gordonstone Creek South, Widen and overlay
4,561
4,137
Other State-controlled roads
12,340
Other National Highways
1,146
Transport Infrastructure Development Scheme
1,780
Other
1,665
37,086
Natural Resources and Mines
Gladstone Area Water Board
Mt Miller Pipeline
17,200
16,463
Aldoga Pipeline and Reservoir
5,000
1,000
Other
9,282
6,014
Sunwater
Page 341
Callide extension
17,593
16,901
Other
1,262
Other
1,070
42,710
Police
1,763
Premier and Cabinet
124
Primary Industries
1,255
Public Works
12,898
State Development
Comalco Alumina Refinery, Common-user infrastructure
162,988
60,802
Aldoga Development Plan
12,000
11,010
Land Purchases - Targinie Valley
22,899
14,899
Residences and Improvements - Targinie Valley
9,361
9,361
Clinton Industrial Estate - Red Rover Road
4,200
4,150
Other
2,466
Page 342
102,688
Transport
Gladstone Port Authority
Berth 3 development
80,000
3,690
Stockpile 16 development
10,500
8,500
Reclamation and earthworks
18,017
5,200
RG Tanna Coal Terminal
6,009
2,958
Other
38,469
17,512
Queensland Rail
Coal and freight services
545,102
30,878
Network Access
522,344
188,552
Other
1,648
Other
6,882
265,820
TOTAL FITZROY
807,644
Central West
The Central West region covers the remainder of Central Queensland to the
Northern Territory border. The 2003-04 capital program provides $28.9 million
for the region.
Statistical Division 35 - Central West
Project
Total
Budget
Estimated
2003-04
Page 343
Cost
$'000
$'000
Arts
60
Corrective Services
17
Disability Services
59
Education
565
Emergency Services
172
Employment and Training
242
Environmental Protection Agency
366
Families
31
Health
853
Housing
403
Page 344
Innovation and Information Economy, Sport and Recreation
Ergon Energy Corporation Limited
2,997
Other
97
3,094
Justice and Attorney-General
14
Local Government and Planning
Roads
2,010
Water
4,979
Sewerage
169
Other
777
7,935
Main Roads
Diamantina Developmental Road, Bedourie - Crownwheel Creek, Pave and seal
1,800
1,800
Isisford - Blackall Road, 49.7 - 60.7 km, Pave and seal
1,800
723
Other State-controlled roads
7,244
Transport Infrastructure Development Scheme
809
Other
535
Page 345
11,111
Natural Resources and Mines
1,405
Police
Replacement district headquarters and watchhouse - Longreach
7,000
200
Other
1,380
1,580
Premier and Cabinet
8
Primary Industries
61
Public Works
693
Transport
238
TOTAL CENTRAL WEST
28,907
MACKAY AND NORTHERN
Page 346
The Mackay and Northern regions are the focus of Queensland's coal mining and
sugar industries.
The 2003-04 capital program provides a total of $692 million in these regions.
In particular, $245.9 million is provided for transport and main roads related
infrastructure.
Mackay
The Mackay region covers Mackay and the Whitsunday Islands. The 2003-04 capital
program provides $338.4 million for the region.
Statistical Division 40 - Mackay
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Arts
1,107
Corrective Services
17
Disability Services
663
Education
General works
4,874
Non-State Government grants
1,047
Other
1,431
7,352
Emergency Services
Queensland Ambulance Service
Page 347
1,784
Queensland Fire and Rescue Service
1,300
Mackay North Joint Emergency Services Complex
2,000
1,850
Other
191
5,125
Employment and Training
163
Environmental Protection Agency
Great Walks of Queensland
1,250
Other
800
2,050
Families
555
Health
Mackay Hospital, Specialist Outpatients upgrade
1,800
1,476
Staff Accommodation Program initiative
Bowen
800
300
Mackay
1,500
500
Other
6,210
Page 348
8,486
Housing
Public housing
6,627
Aboriginal and Torres Strait Islander housing
1,035
Community housing
1,793
Other
203
9,658
Industrial Relations
8
Innovation and Information Economy, Sport and Recreation
Ergon Energy Corporation Limited
31,341
Powerlink Queensland
4,613
Queensland Power Trading Corporation (Enertrade)
100,456
72,639
Stanwell Corporation Limited
1,843
Other
1,081
111,517
Justice and Attorney-General
Page 349
Extend courthouse - Mackay
11,400
8,418
Other
183
8,601
Local Government and Planning
Roads
3,859
Water
4,353
Sewerage
3,852
Other
1,156
13,220
Main Roads
Wallmans and Eimeo Roads, At-grade intersection improvement
6,400
3,694
Nebo - Mackay, Stockyard Creek - Spring Creek, Widen existing pavement
3,500
1,941
Other State-controlled roads
17,536
Transport Infrastructure Development Scheme
945
Other
2,283
26,399
Natural Resources and Mines
1,373
Page 350
Police
New police station - Mackay North
2,200
2,170
Other
1,585
3,755
Premier and Cabinet
94
Primary Industries
1,350
Public Works
Mackay Multi-purpose Centre
38,000
5,000
Other
5,033
10,033
State Development
27
Transport
Hay Point
12,018
3,018
Mackay Port Authority
Seaport
2,849
2,849
Airport
985
985
Queensland Rail
Page 351
Rockhampton - Townsville - Cairns Track upgrade
127,743
13,000
Construction and Electrification - Hail Creek
87,600
76,843
Coal Fleet Upgrade - Infrastructure
24,300
4,000
Coppabella Mine Rail Deviation
20,470
19,594
Timber bridge replacement
12,835
2,696
Other
23,190
3,411
Other
495
126,891
TOTAL MACKAY
338,444
Northern
The Northern region covers Townsville and the Bowen Basin coal fields. The
2003-04 capital program provides $353.5 million for the region.
Statistical Division 45 - Northern
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Aboriginal and Torres Strait Islander Policy
427
Arts
1,854
Corrective Services
570
Page 352
Disability Services
920
Education
School facilities
1,865
1,735
General works
5,123
Non-State Government grants
1,511
Other
2,564
10,933
Emergency Services
Queensland Ambulance Service
1,059
Queensland Fire and Rescue Service
1,760
Other
266
3,085
Employment and Training
1,235
Environmental Protection Agency
448
Families
Cleveland Youth Detention Centre
Page 353
4,120
3,900
Other
1,294
5,194
Health
Ayr Hospital redevelopment
11,300
9,920
Aged Care Facilities Program - Townsville
13,182
7,622
Townsville Community Health Centre consolidation
8,700
2,603
Other
8,625
28,770
Housing
Page 354
Public Housing
Medium density
5,124
Seniors' units
1,190
Capital works on existing dwellings
11,375
Other
1,087
Aboriginal and Torres Strait Islander housing
3,015
Capital grants to Aboriginal and Torres Strait Islander Councils
4,227
Community Renewal
2,990
Community housing
2,742
Other
283
32,033
Industrial Relations
50
Innovation and Information Economy, Sport and Recreation
Townsville Sports House
2,000
1,950
Ergon Energy Corporation Limited
74,397
Powerlink Queensland
17,970
Queensland Power Trading Corporation (Enertrade)
32,372
Other
1,501
Page 355
128,190
Justice and Attorney-General
417
Local Government and Planning
Roads
6,795
Water
1,078
Other
2,833
10,706
Main Roads
Douglas Arterial, University Road - Upper Ross River Road, Construct to new
sealed 2 lane standard
53,295
26,880
Hervey's Range Developmental Road
Townsville - Battery, Devils Marbles
10,200
6,848
Townsville - Battery, Ella Creek - Gregory Developmental Road
9,600
2,984
Other State-controlled roads
9,806
Other National Highways
1,719
Transport Infrastructure Development Scheme
2,186
Townsville District Office refurbishment
1,400
1,200
Other
1,440
53,063
Page 356
Natural Resources and Mines
Sunwater
Burdekin Hydro Project
21,159
500
Burdekin Scheme
1,955
Other
407
Other
2,515
5,377
Police
Replacement police station, DHQ and regional office - Mundingburra
7,150
4,628
Replacement police station and watchhouse - Ingham
3,800
200
Replacement police station and watchhouse - Palm Island
3,200
2,843
Other
2,796
10,467
Premier and Cabinet
131
Primary Industries
1,949
Public Works
10,445
Page 357
State Development
1,110
Tourism, Racing and Fair Trading
6,547
Transport
General Works - Abbot Point
2,512
2,512
Townsville Port Authority
6,910
6,597
Queensland Rail
Rockhampton - Townsville - Cairns Track upgrade
106,546
6,000
Coal and freight services
83,375
18,000
Townsville Station
23,820
1,853
Other
52,097
4,023
Other
604
39,589
TOTAL NORTHERN
353,510
FAR NORTH AND NORTH WEST
The 2003-04 capital program provides a total of $581.6 million for economic and
social infrastructure in these regions.
Far North
The Far North region covers Cairns, Cape York Peninsula and the Torres Strait
Islands. The 2003-04 capital program provides $453.7 million for the region.
Statistical Division 50 - Far North
Project
Total
Budget
Page 358
Estimated
2003-04
Cost
$'000
$'000
Aboriginal and Torres Strait Islander Policy
Torres Strait Major Infrastructure Program
13,020
6,510
Wujal Wujal Sewerage System
2,911
2,900
Hope Vale water and sewerage supply upgrade
5,224
1,350
Northern Peninsula Area water supply upgrade
2,545
1,210
Aboriginal Council Chambers
Lockhart River
1,575
71
Mapoon
1,400
274
New Mapoon
1,000
187
Other
1,829
14,331
Arts
1,856
Corrective Services
789
Disability Services
1,080
Page 359
Education
School facilities
8,649
7,982
General works
8,108
Non-State Government grants
3,314
Other
3,759
23,163
Emergency Services
Queensland Ambulance Service
2,036
Queensland Fire and Rescue Service
1,961
Other
311
4,308
Employment and Training
2,450
Environmental Protection Agency
4,776
Families
1,079
Page 360
Health
Torres Strait Primary Health Care
6,457
5,689
Innisfail Hospital redevelopment
16,000
2,714
Atherton Hospital refurbishment
1,024
793
Cardwell Community Health Centre
750
436
Other
10,783
20,415
Housing
Public housing
8,641
Aboriginal and Torres Strait Islander housing
7,182
Capital grants to Aboriginal and Torres Strait Islander Councils
40,223
Community housing
4,712
Community Renewal
932
Other
331
62,021
Industrial Relations
52
Innovation and Information Economy, Sport and Recreation
Ergon Energy Corporation Limited
Page 361
51,594
Powerlink Queensland
7,509
Stanwell Corporation Limited
16,893
Australian Tropical Forrest Institute
2,605
2,605
Other
2,517
81,118
Justice and Attorney-General
Courthouse upgrade - Cooktown
1,055
855
New Courthouse - Thursday Island
2,400
600
Other
289
1,744
Local Government and Planning
Roads
9,549
Water
3,545
Sewerage
26,989
Other
2,244
42,327
Main Roads
Cooktown Developmental Road, West Normanby River - Boggy Creek
Page 362
7529
5,956
Currajah - Pin Gin Hill Road
9,658
3,940
Innisfail - Japoon Road, South Johnstone Bridge - near Mill
10,000
9,012
Peninsula Developmental Road, Mt Molloy - Laura, Coalseam - Laura River
6,999
2,739
Other State-controlled roads
41,206
Other National Highways
3,116
Transport Infrastructure Development Scheme
9,756
Other
2,239
77,964
Natural Resources and Mines
Sunwater
Tinaroo Hydro Project
3,808
2,920
Mareeba Scheme
2,632
Other
2,209
7,761
Police
3,451
Premier and Cabinet
153
Page 363
Primary Industries
1,428
Public Works
New office building - Cairns
17,605
505
Other
13,939
14,444
State Development
Woree Business and Industry Park
4,342
2,100
Cairns CBD Revitalisation
9,027
1,000
Other
57
3,157
Transport
Cairns Port Authority
Cityport Project
13,578
5,796
Airport
77,719
37,548
Seaport
4,893
4,410
Other
1,252
1,252
Ports Corporation of Queensland
Weipa
Page 364
5,357
3,357
Thursday Island
4,607
1,357
Other
100
100
Queensland Rail
Rockhampton - Townsville - Cairns Track upgrade
57,711
26,751
Other
7,969
1,540
Other
1,731
83,842
TOTAL FAR NORTH
453,709
North West
The North West region covers Mt Isa and the communities of the Gulf of
Carpentaria. The 2003-04 capital program provides $127.9 million for the region.
Statistical Division 55 - North West
Project
Total
Budget
Estimated
2003-04
Cost
$'000
$'000
Aboriginal and Torres Strait Islander Policy
Aboriginal Council Chambers - Doomadgee
1,400
1,274
Sewerage upgrade - Doomadgee
1,150
1,150
Other
74
2,498
Page 365
Arts
270
Corrective Services
289
Disability Services
161
Education
Spinifex College - Mount Isa
1,452
1,224
Mount Isa Central
360
360
General works
2,258
Non-State Government grants
806
Other
947
5,595
Emergency Services
Queensland Ambulance Service
493
Queensland Fire and Rescue Service
257
Other
46
796
Employment and Training
Page 366
528
Environmental Protection Agency
71
Families
88
Health
2,485
Housing
Public housing
3,592
Aboriginal and Torres Strait Islander housing
1,260
Capital grants to Aboriginal and Torres Strait Islander councils
3,226
Other
818
8,896
Industrial Relations
8
Innovation and Information Economy, Sport and Recreation
CS Energy Limited
14,249
Ergon Energy Corporation Limited
Page 367
7,642
Other
263
22,154
Justice and Attorney-General
59
Local Government and Planning
Roads
9,540
Water
3,887
Sewerage
542
Other
1,454
15,423
Main Roads
Barkly Highway, Mount Isa - Camooweal, Bridges and approaches
55,350
20,000
Flinders Highway, Richmond - Julia Creek, Chatfield Creek approaches
3,250
1,880
Flinders Highway, Richmond - Julia Creek, Widen shoulder(s) and sealing
6,400
2,797
Kennedy Developmental Road, Widen shoulder(s) and sealing
5,300
1,971
Other State-controlled roads
10,715
Other National Highways
4,870
Transport Infrastructure Development Scheme
2,076
Other
Page 368
395
44,704
Natural Resources and Mines
Mount Isa Water Board
19,960
10,000
Other
980
10,980
Police
2,251
Premier and Cabinet
23
Primary Industries
169
Public Works
3,962
State Development
10
Transport
Upgrade of rural and remote airstrips
500
500
Queensland Rail
14,246
5,944
Other
Page 369
55
6,499
TOTAL NORTH WEST
127,919
APPENDIX A
Entities included in Capital Outlays - 2003-04 Budget
Department of Aboriginal and Torres Strait Islander Policy
Arts Queensland
Queensland Art Gallery
Queensland Museum
Queensland Performing Arts Trust
Library Board of Queensland
Department of Corrective Services
Disability Services Queensland
Department of Education
Queensland Studies Authority
Electoral Commission of Queensland
Department of Emergency Services
Department of Employment and Training
Environmental Protection Agency
Department of Families
Queensland Health
Queensland Institute of Medical Research Trust
Department of Housing
Queensland Building Services Authority
Residential Tenancy Authority
Department of Industrial Relations
Department of Innovation and Information Economy, Sport and Recreation
Queensland
CITEC
Stadium Redevelopment Authority
Major Sports Facility Authority
Government Owned Electricity Corporations
Department of Justice and Attorney-General
Legal Aid Queensland
Public Trust Office
Legislative Assembly
Department of Local Government and Planning
Department of Main Roads
Main Roads - Commercial Operations (RoadTek)
Queensland Motorways Limited
Department of Natural Resources and Mines
Gladstone Area Water Board
Mount Isa Water Board
Pioneer Valley Water Board
Sunwater
Office of the Governor
Offices of the Parliamentary Commissioner for Administrative Investigations and
the Information
Commissioner
Entities included in Capital Outlays - 2003-04 Budget, continued
Office of the Public Service Commissioner
Department of Police
Department of Premier and Cabinet
Crime and Misconduct Commission
South Bank Corporation
Page 370
Queensland Events Corporation
Commission for Children and Young People
Department of Primary Industries
Forestry
Bureau of Sugar Experiment Stations
Queensland Rural Adjustment Authority
Department of Public Works
QBuild
QFleet
Project Services
GOPRINT
Sales and Distribution Services
Queensland Audit Office
Department of State Development
Property Services Group
Department of Tourism, Racing and Fair Trading
Tourism Queensland
Department of Transport
Queensland Rail
Port Authorities
Department of Treasury
Motor Accident Insurance Commission
Nominal Defendant
Golden Casket Lottery Corporation
99
Capital Statement 2003-04
Page 371