annual report 1999-00 · 2019-08-14 · or omission from, the accounts and records of treasury for...

ANNUAL REPORT1999-00

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TABLE OF CONTENTS

LETTER OF REPRESENTATION .......................................................................................... 3

UNDER TREASURER�S REVIEW ......................................................................................... 5

TREASURY ROLE AND PERFORMANCE .............................................................................. 9

Northern Territory Treasury............................................................................... 11

Northern Territory Treasury Corporation ............................................................ 48

APPENDICES:

A: Legislation Administered.......................................................................... 57

B: Legislative Changes in 1999-00 ............................................................... 61

C: Treasury People....................................................................................... 64

D: Treasury Organisation ............................................................................. 66

E: Senior Executives .................................................................................... 67

F: Staffing ................................................................................................... 70

G: Management Controls.............................................................................. 73

H: Boards, Committees and Publications ...................................................... 76

FINANCIAL STATEMENTS ................................................................................................ 81

Northern Territory Treasury............................................................................... 85

Northern Territory Treasury Corporation ............................................................ 91

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LETTER OF REPRESENTATION

The Honourable M A Reed MLATreasurerGPO Box 3146DARWIN NT 0801

Dear Treasurer

In accordance with the provisions of section 28 of the Public Sector Employment and Management Act, I ampleased to provide to you the Annual Report of Northern Territory Treasury for 1999-00 and to confirm that, interms of that Act, all Employment Instructions have been satisfied.

This report describes developments and operational outcomes during the year in a form intended to be informativeto a wide range of readers including Parliamentarians, other Government agencies, the public and Treasuryemployees.

Pursuant to the Financial Management Act, I advise that to the best of my knowledge and belief:

(a) proper records of all transactions affecting Treasury are kept and that employees under my controlobserve the provisions of that Act, the Financial Management Regulations and the Treasurer�s Directions;and

(b) procedures within Treasury afford proper internal control, and that these procedures are recorded in theAccounting and Property Manual, which has been prepared in accordance with the requirements of theFinancial Management Act.

I am not aware of any indication of fraud, malpractice, major breach of legislation or delegation, major error in,or omission from, the accounts and records of Treasury for 1999-00. The Director Strategic and Audit Servicesin the Department of the Chief Minister reports to me upon matters internally audited in Treasury.

In my opinion the financial statements included in this Report have been prepared from proper accounts andrecords and are in accordance with the relevant sections of the Treasurer�s Directions.

Yours sincerely

K B ClarkeUnder Treasurer29 September 2000

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UNDER TREASURER�S REVIEW

The 1999-00 year saw significant projects come to fruition, affecting bothTreasury and Territory Government operations more widely. Along withadditional major tasks arising during the year, these had a direct impact on thepriorities within Treasury and therefore upon the way resources were allocated.However, Treasury�s core tasks were completed on time, to a high standard.Various improvements to Treasury processes also assisted in completing tasksand enhancing the working environment for staff.

Treasury�s activities, including provision of advice to Government on a widerange of issues, provide an underlying basis for progressing individualFoundations for Our Future initiatives across agencies.

Following the successful passage of Goods and Services Tax (GST) andassociated legislat ion in June 1999, and the formal isation of newCommonwealth-State financial arrangements in the IntergovernmentalAgreement at the same time, the focus on tax reform during 1999-00 movedtowards managing implementation and preparedness for the commencementof the GST on 1 July 2000.

A GST Implementation Project team was established in Treasury with the soleresponsibility of coordinating the Territory Government�s preparedness for thecommencement of the GST on 1 July 2000. This involved overall projectmanagement as well as development and communication of policy advice andimplementation requirements at a whole of government level. Treasury workedclosely with the Department of Corporate and Information Services and agenciesthroughout the year, with the result that the changeover to the new tax systemappears to have been made fairly smoothly, without major problems arising.

Legislative arrangements were made in the Legislative Assembly to meet theTerritory�s obligations agreed in the Intergovernmental Agreement, includingprovision for the First Home Owner Grant, entrenchment of the Agreement inTerritory legislation, and cessation of a number of Territory taxes.

Treasury will maintain an ongoing policy role in meeting the TerritoryGovernment�s obligations with respect to GST, Fringe Benefits Tax and Pay AsYou Go. Also, Treasury will monitor the receipt of GST revenues from theCommonwealth under the new financial arrangements.

The 2000-01 Budget was introduced in May and passed in June. The BudgetPapers again detailed information on outlays and revenues as well as furtherpapers on important issues in public finance, including a discussion of thechanges for the Territory Government flowing from national tax reform andgovernment business reform.

As Under Treasurer, I have joint overall responsibility for the implementation ofinitiatives articulated in Foundations for Our Future � Diversify the EconomyThrough Service Industry Growth (Foundation Five). As part of this, I amChair of the Information Technology and Communications Subcommittee whichmanages, coordinates, and progresses the Territory Government�s informationtechnology and communications capability, as well as that of the Territory�sbusiness sector and the community generally. The Subcommittee has overseensubstantial progress throughout the year in Foundation Five initiatives andbroader information technology and communications projects which will affectall areas of the Territory.

A new banking contract was executed on 31 December 1999, forming the basisfor the Territory�s banking arrangements from 1 January 2000 to the end of2002. This agreement enhances the range and level of existing services to theTerritory Government, including the introduction of local payments processing.

GST and theNew Tax System

2000-01 Budget

IT&CSubcommittee

Banking Services Contract

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Another significant achievement in 1999-00 was the finalisation andimplementation of reforms to the Territory�s electricity supply industry. Thenew framework is aimed at reducing the cost of electricity while, at the sametime, taking into account the Territory�s unique physical and social circumstances.This included a Territory-based third party access regime for electricity networks,the establishment of the Utilities Commission and the transfer of regulatoryfunctions from the Power and Water Authority.

Choice of supplier for large volume customers commenced on 1 April 2000,with contestability extending to other commercial customers over the next twoyears. By April 2002, around 45 per cent of the market will be open tocompetition.

Following the recommendations of the Select Committee on Food Prices,Treasury established a quarterly survey to monitor grocery prices across theTerritory, including comparative data from Cairns and Mount Isa. Two quarterlysurveys were conducted and results published in 1999-00. A detailed technicalpaper on the conduct of the survey was also published in 2000-01 BudgetPaper No. 3.

New superannuation arrangements for new employees commenced on10 August 1999, with the Australian Government Employees SuperannuationTrust (AGEST) appointed to provide default services for employees who do notnominate a fund. At the same time, the Northern Territory Government andPublic Authorities Superannuation Scheme (NTGPASS) and the Northern TerritorySupplementary Superannuation Scheme (NTSSS) were closed to new members.

Intensive effort was involved in the successful sale of the NT TAB to TABQueensland which was completed in June 2000, with effect from 1 July 2000.The sale included issuing an exclusive fifteen year totalisator licence to TABQueensland and a non-exclusive fifteen year sports totalisator licence. TABQueensland is also entitled to a sports bookmakers licence form 1 January 2001which will expire on 30 June 2005.

The sale process involved receiving expressions of interest, shortlisting andthen receiving binding offers. Three pieces of legislation were prepared andpassed into law to enable the sale process to proceed to completion. The salewas structured to provide an income stream for the Territory in the form ofwagering tax over the life of the totalisator licences, in addition to an up-frontlump sum payment.

A Conveyance by Return software package, piloted during the year, allowedapproved conveyancers and solicitors to self-assess routine conveyances ofproperty and leases and to pay the stamp duty by monthly return. The pilothas resulted in a 15 per cent reduction in the number of instruments lodgedover the counter for assessment, reducing compliance costs for revenue payersand collectors. The package will be rolled out further during the coming year,and development work is underway to enable electronic returns for other taxtypes in the future.

Following reforms to the pay-roll tax regime last year, the pay-roll tax rate wasfurther reduced to 6.6 per cent in the 2000-01 Budget. Other significant taxreform measures were announced as part of the Budget, including adjustmentsto the Territory�s tax mix to ensure it more equitably spreads the tax loadacross the Territory�s taxes.

Strategies and programs with the �Do the Job Better and Get a Life� themewere further implemented during 1999-00 to strengthen Treasury�s futurecapabilities as a central agency. These included major emphases on recruitmentapproaches and effort, improved physical working environment, restructuringof the Corporate Support Unit to better service the agency, and establishmentof an Information Management Committee to consider best use of appropriatetechnology to support Treasury�s business activities.

Electricity Reform

Grocery Price Survey

New SuperannuationScheme

TAB Sale

Conveyance by Return

Territory Tax Reform

Organisational Support

Under Treasurer�s Review

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Performance in all areas in Treasury, in achieving such significant outcomesthroughout 1999-00, has been facilitated by maintaining a professional groupwith the requisite knowledge and skills, both by training our existing staff andrecruiting new staff as necessary.

Finally, it is important to note that throughout the year, Treasury staff havecontinued to demonstrate their enthusiasm and commitment in meeting thechallenges we have faced. The challenges were wide ranging and theirresolution will have a material impact on the Territory�s future development.Once again, it was one of the busiest years Treasury has ever experienced. Iwould like to personally thank staff for being prepared to go the extra distanceto maintain the high standard of performance achieved over the years.

K B Clarke29 September 2000

Under Treasurer�s Review

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TREASURY ROLE AND

PERFORMANCE

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NORTHERN TERRITORY TREASURY

WHY WE ARE HERE

To assist the Government in securing the long term viability of the Territory.

WHERE WE FOCUS

Providing efficient and effective acquisition and management of public sector resources through sound advice, financial management,control, reporting and accountability.

WHAT WE DO

(1) Provide policy advice and analysis to Government.(2) Provide specialist financial services and policy advice to the public sector.(3) Secure appropriate financial resources for the Territory.(4) Manage Treasury as an agency.

HOW WE ARE ORGANISED

Northern Territory Treasury Northern Territory Treasury Corporation

Corporate Management Administration

Budgets, Finance and Economic Services External Debt Management

Territory Revenue Management Internal Funds Management

Community Service Obligations

Utilities Commission

Why We Are Here

Originally, the historical role of a Treasury has been the �keeper of the purse�. Whilst that remains anappropriate starting point, the modern role is somewhat broader: to assist the Government in securing thelong term financial and economic viability of the Territory. In recognising that sound administrative practicesand financial and economic policy underpin a strong Territory fiscus and economy, Treasury is placed as thekey central agency for advising Government on these matters. While short term concerns must obviously beproperly addressed, the main focus is to ensure the sustainability of the Territory in the long term.

In this way, Treasury provides an underpinning contribution to Foundations for Our Future.

Where We Focus

Treasury�s primary focus is on the efficient and effective acquisition and management of public sectorresources in order to maximise Government�s financial capability in delivering the requisite goods and servicesto encourage and support a growing Territory.

The important corollary to this is Treasury�s strategic economic advisory role which assists Government tomaximise the Territory�s growth.

What Are Our Obligations?

Treasury is obliged to:

� provide advice - mainly in the fiscal and economic areas but in other areas as well;

� provide services - such as budget management, statistical interpretation, fiscal reporting and financialmanagement;

� set frameworks - such as the Financial Management Act, Treasurer�s Directions and the Budget processfor Government agencies, the Territory revenue regime, and access regimes for essential servicesparticularly electricity;

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� represent the Territory in national forums, such as to the Commonwealth Grants Commission, at Headsof Treasuries and on taxation reform;

� secure and maintain sources of funds for the Territory - by virtue of own-source revenue collections,distribution of GST Revenue Grants and other revenues from the Commonwealth, undertaking borrowings,and sound, low risk investment of cash balances; and

� our staff - to provide leadership and to optimise our intellectual capability through best practice recruitment,and professional and personal development of our people.

Who We Are Obligated To

As a key central Territory Government agency, Treasury serves:

� the Treasurer and Cabinet - by providing advice and implementing Government policy;

� other Territory Government agencies - by providing sensible frameworks and advice, particularly inbudgeting, accounting and economic matters, and specialist financial services such as banking servicesand as the Government�s corporate tax adviser;

� the wider community - by providing an efficient and effective framework for collecting Territory taxes, byproviding meaningful and useful statistical and other publications, and by working with the NorthernTerritory University on academic issues related particularly to public sector economics and financialmanagement;

� the Territory in meeting our national obligations - by providing data to the Australian Bureau of Statisticsfor its public sector finance series, working with other jurisdictions, including the Commonwealth, toresolve issues of mutual concern and benefit, and dealing with national regulatory authorities (eg. theAustralian Competition and Consumer Commission and the Australian Taxation Office); and

� Treasury itself - as an organisation as well as its individual staff. Treasury has clear obligations to itsstaff, to their intellectual development and their general well-being and satisfaction with their work inTreasury.

What We Do

As shown in the Corporate Box, Treasury�s activities can be summarised as:

� providing policy advice and analysis to Government;

� providing specialist financial services and policy advice to the public sector;

� securing appropriate financial resources for the Territory; and

� managing Treasury as an agency.

Treasury�s current functional responsibilities are stipulated in the Administrative Arrangements Order of1 August 2000 and they are:

� Financial Administration

� Budgeting and Financial Policy

� Economic Policy and Assessment

� Government Revenue

� Mining Royalties

� Financial Asset and Liability Management

� Financial Agreements

� Coordination of Statistical Matters

� Territory Borrowings

� Liquor and Licensing (Licence Fee Investigations only)

� Public Sector Superannuation Policy

� Public Finance Policy

� Taxation

� Banking Services

� Fringe Benefits Tax Policy

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� GST Policy

� Economic Regulation

How We Are Organised

Northern Territory Treasury is a single organisation for personnel matters but is organised into two entitiesfor financial management purposes:

� Northern Territory Treasury; and

� Northern Territory Treasury Corporation.

Due to its small size, the Utilities Commission is also reported as an Activity within Treasury�s Budget.However, the Utilities Commission is legislatively separate and substantively operates as an independentorganisation, with Treasury�s involvement limited to administrative issues and the provision of corporatesupport functions.

The Northern Territory Treasury Corporation and the Utilities Commission each publish Annual Reports intheir own right.

This Report

This Report follows Treasury�s budget structure, outlined in the Corporate Box, to facilitate the ready alignmentof the resources applied with the performance of our agency in 1999-00.

It is worth noting that, whilst this is a report on Treasury�s activities as an agency throughout the year, it alsoincludes performance information relating to broader, whole of government policy objectives and activities.Examples of these include:

� the Commonwealth Grants Commission�s assessment of the Territory�s relativity � therefore the level ofuntied Commonwealth funding flowing to the Territory Budget;

� the Fiscal Strategy � Government�s framework for developing the Budget and monitoring progress duringthe year;

� preparation and presentation of the annual Budget Papers on behalf of the Government � includingdiscussion of issues in Budget Paper No. 3 on general aspects of public finance affecting Government asa whole, and detailed presentation and analysis of statistical information on the state of the Territoryeconomy; and

� the Territory�s participation with the national tax reform agenda � including the implementation issuesfor the Territory Government.

It is fair to say then that this report necessarily has a focus beyond the organisation itself. In a similarmanner, Treasury produces the Budget Papers and Treasurer�s Annual Financial Reports on behalf of theGovernment.

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ACTIVITY: CORPORATE MANAGEMENT

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO





Executive (1, 2, 3, 4) External Debt Management

Corporate Support (4) Internal Funds Management

Budgets, Finance and Economic Services

Territory Revenue Management



Functions

The Corporate Management Activity provides leadership, strategic direction,coordination and monitoring of Treasury�s activities, as well as advice on financialand economic matters generally to the Treasurer and Cabinet.

Services are provided to the Treasurer and his Office by this Activity. It is alsoresponsible for coordination and the quality of responses to all Ministerialsinvolving Treasury and the Treasury comment on all Cabinet Submissions.

Treasury�s contribution to the Government�s Foundations for Our Futurecommitments are also managed by the Activity.

The Activity provides frameworks for the management of corporate resourceswithin Treasury.

Strategies

A central strategy of this Activity is involvement in complex issues with materialfinancial and economic implications for Government and which have implicationsfor the long term viability of the Territory. In so doing, the Activity strives toprovide sound leadership to the Treasury as a whole and to the public sector ingeneral, and to set high standards for the quality of analysis and advice providedto Government.

Organisational support services (including information technology services) areprovided through this Activity, to facilitate the maximum benefit for Treasuryand its staff from available technology and optimise productivity from Treasurystaff.

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The Executive program aims to provide high quality advice to Governmenton a range of financial and economic issues, to assist and support theGovernment in securing the Territory�s long term financial and economic viability.

The program is responsible for the leadership and strategic direction of Treasury�sactivities, Ministerial liaison and the provision of sound, high quality comment,principally directed at financial and economic considerations, on all CabinetSubmissions. The program is also responsible for Treasury�s involvement in theAdelaide to Darwin railway and other major infrastructure projects.

The Executive program oversights all major policy issues for Northern TerritoryTreasury and is involved in a wide range of strategic issues which have financialor economic implications for the Territory. The program is required to representthe Territory on national committees and participate on working parties involvingother Territory agencies.

The program provides timely and accurate processing of all Treasury Ministerialsand comments on Cabinet Submissions. Due to the nature of Treasury�s role,these cover a comprehensive and complex spectrum of Government issues.

Overall responsibility for the pursuit of objectives outlined in Foundations forOur Future - Diversify the Economy Through Service Industry Growth(Foundation Five) also rests with the program.

Performance Indicators

� Quality and timeliness of advice to the Treasurer, the Government andagencies on financial, economic and related policy issues

Performance in 1999-00

Whilst individual Treasury divisions have had main carriage of major tasksthroughout the year, the Executive program has provided the leadership andstrategic focus necessary to ensure the successful completion of these tasks.

The program continued to service Government with policy advice andsubmissions on numerous issues during the year across the spectrum ofeconomic and financial affairs. Other major achievements of Treasury divisions,involving a significant contribution from the Executive program, included:

� management of major intergovernmental issues, in particular the imminenteffect of the Goods and Services Tax (GST) on fiscal transfers from theCommonwealth;

� management of the Territory Government�s response, in close conjunctionwith Department of Corporate and Information Services and agencies, tothe impending implementation of the GST on 1 July 2000;

� pursuant to Foundation Five, leadership of the Government�s InformationTechnology and Communications Sub Committee, formed to manage,coordinate and progress the Territory Government�s information technologyand communications capability, as well as that of the Territory�s businesssector and the community generally. The Under Treasurer has specificresponsibilities for management of the �Living On Line� objectives inFoundation Five as well as overall joint responsibility for Foundation Five;

� management and coordination of the Territory�s submission to theCommonwealth Grants Commission�s inquiry into Indigenous FundingArrangements in Australia;

� management of the sale of the NT TAB, including securing an up-front lumpsum payment plus a long term revenue stream for the Territory in the formof a wagering tax;

� provided specialist assistance in the preparation of submissions to theAustralian Competition and Consumer Commission (ACCC) and the NationalCompetition Council on gas access arrangements; and

Leadership and StrategicDirection

Advice to Government

Foundation Five

Leadership andStrategic Focus

Policy Advice andExecutive Management

Corporate Management

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� management of Treasury�s involvement in the consideration of proposalsfor convention centres in Alice Springs and Darwin.

A greater focus of effort in improving high level support to the Treasurer, theUnder Treasurer and Treasury as a whole has been successfully achieved throughthe role of Director Executive Support and Coordination, along with revisedstructure and business practices in the Executive Support Unit. The Unitmanages the processes for dealing with Cabinet Submissions received forcomment, Ministerials and all other forms of correspondence requiring action.Each member of the team has developed broad skills to improve the flexibilityand efficiency of work flows in the Unit which has increased the effectivenessof its support for Treasury�s senior executives. There has also been an enhancedmanagement reporting service provided by the Unit.

Throughout 1999-00, the Executive program formulated advice to Governmentand provided formal comment on 365 Cabinet Submissions and responded to404 requests to address Ministerial correspondence. Some 687 UnderTreasurer�s Minutes were sent to the Treasurer and other Ministers, and almost2 000 other pieces of correspondence were processed.

The program represents the Government�s shareholder interests in the activitiesof the Power and Water Authority�s (PAWA) wholly owned subsidiary companies(Gasgo and Darnor). Gasgo buys the natural gas on behalf of PAWA whichcomprises PAWA�s main fuel for electricity generation.

Senior executives were involved in the Government�s consideration ofdevelopment of the Timor Sea gas and oil fields, and in meetings and preliminarydiscussions with the companies regarding the purchase of offshore gas as afuel for PAWA�s power stations.

The program was closely involved in negotiations between Gasgo and theMeerenie producers for additional top-up gas for the next few years.

During 1999-00, senior executives represented the Territory�s public interest inlitigation involving the Power Facilities Group and the ACCC:

Case 1 � The Power Facilities Group sought a court declaration that the Territory�sguarantee of the $52 million financing of the Darwin to Katherine powertransmission line should continue beyond the initial 10 year financing periodwhich ended in September 1998;

Case 2 � The Power Facilities Group sought to stop Gasgo from exercising itspre-emptive right to Meerenie gas under a 1985 gas contract, and to gainaccess to PAWA�s wires (ahead of access becoming available to all contenders).The Group also sought damages related to these claims; and

Case 3 � The ACCC also sought to stop Gasgo from exercising its pre-emptiveright to Meerenie gas under the 1985 gas contract. Gasgo gave an undertakingnot to use these pre-emptive rights to prevent new electricity providers supplyingthe Territory public from buying gas.

Following the 1999 Treasury Executive Conference, the theme of which was�Do the Job Better and Get a Life�, useful and achievable strategies were furtherdeveloped and implemented through the year with the aim of improving thegeneral well-being and productivity of staff. Further detail is presented underthe Corporate Support program.

Initiatives in 2000-01 include:

� further development of policy issues in budgetary, accounting, taxation,financial relations and economics functions;

� high level management of a major long term program of public sectorfinancial reforms; and

Executive Support

Program PerformanceStatistics

PAWA Companies

Timor Sea Gas

Power Litigation

OrganisationalDevelopment

Northern Territory Treasury

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� continued provision of high level strategic support and leadership to agenciesand Treasury staff on major projects.

(Executive: 8999 6033

The Corporate Support program aims to support Treasury managers in theiremployee development and financial management responsibilities, informationrequirements and with other corporate resources.

The Corporate Support program provides policy and advisory services, andoperational support, tailored to the work areas of Treasury on employee, financialand information management and office services.

The program is also responsible for the management of the whole of governmentFinance Officer in Training Scheme.


� Timeliness, accuracy and quality of advice and assistance provided


The Finance Officer in Training Scheme (FOITS) entered its third year ofoperation. Under the guidance of the FOITS Committee within Treasury, theadvertising and selection strategy, the placement and rotation of graduateswithin Treasury, and the cadetship program for undergraduates, wereimplemented. Full details of the scheme are presented in Appendix C.

The Unit was restructured to better suit the organisational requirements ofTreasury�s management and staff, following the transfer of the majority of thefinance and employee relations functions to Department of Corporate andInformation Services (DCIS). The focus has shifted to providing high qualitystrategic and policy advice to management and improving Treasury processesand procedures to best facilitate business requirements. The program alsomanages the provision of those services undertaken by DCIS on behalf ofTreasury.

The restructured unit has enhanced the internal budgeting and financialmanagement processes and information for the organisation as a whole, andfor individual managers. It has also streamlined the organisation�s finance andpersonnel processes to manage the new DCIS/Treasury interfaces moreproductively and effectively.

The program was responsible for preparing Treasury, as an agency, for theGST. As part of the project, Treasury�s procurement practices and systemswere reviewed and revised to ensure GST readiness and to improve work flowsand business practices generally. The chart of accounts was reviewed andnew ledger codes, along with GST codes, have been posted in a central file foreasy access by all staff.

Staff training was undertaken, for Corporate Support staff as well as with otherrelevant staff in Treasury, on the requirements of procurement processing from1 July 2000. The changes have been effective as no problems have beenencountered with the move to the New Tax System to date.

Also, as part of the preparation for the GST, a central contracts database forthe agency was established. This enabled ready assessment of Treasury�scontractual commitments and review of transitional arrangements that wererequired. The database is managed by the Corporate Support staff, which hasallowed consistency to be maintained in Treasury�s approach to the engagementof consultants and other contractors, and ensures GST-related provisions areappropriately addressed in Treasury�s contracts.

FOITS

Improved OrganisationalSupport

Contracts Database

GST Preparations


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The program is responsible for providing strategic advice on developing andimplementing the �Do the Job Better and Get a Life� strategies.

Achievements and activities include in 1999-00:

� undertaking regular recruitment campaigns, both locally and interstate, usingdifferent advertising approaches to the traditional;

� provision of improved conference, training and meeting facilities in all workareas;

� establishment of the Information Management Committee with the charterof making the best use of appropriate technology to support Treasury�sbusiness activities;

� regular strategic planning sessions with divisions to set future directions;

� restructuring of the Organisational Support Unit to provide higher level andimproved quality of support to management and staff;

� specially focused professional development activities;

� greater emphasis on Treasury�s communication practices for both internaland external purposes through presentations and seminars with Cabinet,Coordination Committee, agencies and internally, as well as dedicatedresources and training for printing and publication activities; and

� engagement of the Employee Assistance Service to conduct regular employeeopinion surveys and exit interviews for Treasury with the aim of improvingfeedback channels from staff to management.

Secretariat services are provided for Treasury�s Information ManagementCommittee, established to enable a whole of Treasury approach to informationmanagement and communications matters and to advise management on thoseissues affecting Treasury as an agency.

The Committee has met several times and has a role in:

� providing a strategic focus for Treasury on information technology andcommunications issues and policy development;

� higher level technology planning for Treasury;

� keeping abreast of new and enhanced technology;

� promoting technology awareness across the organisation;

� sharing information about in-house technology development; and

� development of Internet and Intranet opportunities and use for Treasury.

Two of Treasury�s file servers required replacement in the past year, in order toensure that the necessary standard and quality of service could be maintained.The network operating system on both file servers was also upgraded to enhancethe ability to manage the network more efficiently. The LAN�s bandwidth hasbeen upgraded with 100mbit switches to improve the performance of the systembetween workstations on desktops and the servers.

There were no Year 2000 problems encountered on 1 January, and none inrespect of the leap year on 29 February, proving Treasury�s readiness for thesecritical events.

In line with Government policy, Treasury successfully completed the transitionfrom ccMail and Lotus Organiser to Lotus Notes 5 in January 2000. This involvedsome retraining for staff in the use of the new system.

As part of the outsourcing of on-site support to DCIS, staff now report problemsdirectly to the DCIS Helpdesk for first line resolution and for referral to the on-site IT/LAN personnel if further action is required.

Organisational Development

Information ManagementCommittee

Improved LAN Performance

Lotus Notes


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� further improvements to procurement procedures and processes in theorganisation;

� implement a document tracking and workflow system for the organisationas a whole, with capability for localised development at the divisional levelto suit particular needs of individual work areas;

� implement a thin client dial up system through the Octa4/Optus gateway toimprove Treasury�s remote access capability;

� improve the use of web technology for internal and external communications;

� prepare for the outsourcing of desktop services;

� continuation of the Finance Officer in Training Scheme; and

� further implementation of strategies and programs to strengthen Treasury�sfuture capabilities as a key central agency.

(Corporate Support: 8999 6691


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ACTIVITY: BUDGETS, FINANCE AND ECONOMIC SERVICES

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO






Budget Management (1, 2, 3) Internal Funds Management

Public Finance (1, 2, 3)

Economic Services (1, 2, 3)

Financial Management (1, 2, 3)

Capital Financing (1, 2, 3)




Functions

The key function of the Budgets, Finance and Economic Services Activity is toprovide quality and timely advice to the Treasurer and Government on resourceallocation, and financial and economic management issues.

Strategies

Strategies have been developed to encourage effective financial, budgetaryand economic advice, management and reporting to improve public sectorfinancial management, control and accountability, to maximise the net inflowof financial resources into the Territory from the Commonwealth and to promotethe Territory�s long term economic viability. This is achieved by:

� developing appropriate financial and economic regulatory and legislativeframeworks appropriate to the needs of the Territory;

� providing analysis and advice on policy, performance and management issuesrelating to the Territory Budget, and on resource allocation issues for theGovernment;

� meeting public financial accountability reporting requirements;

� maximising the net inflow of financial resources from the Commonwealth;

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� providing comprehensive analysis and advice on economic, superannuation,taxation and financial policy issues, including major commercial matters inwhich the Government has an interest;

� administering national and Territory legislation and agreements pertainingto the sound financial management of the Territory, and providing advice;and

� presenting quantitative analysis of the Territory economy as a basis forpolicy development by Government.

The Budget Management program aims to develop the Territory Budget,forward estimates and works programs to meet the Government�s fiscalobjectives together with public financial accountability requirements for budgetoutcomes reporting.

The program:

� coordinates, analyses and evaluates agency information necessary todevelop, manage and monitor the annual Budget, forward estimates andworks programs, and advises Cabinet on the Budget implications of newinitiatives proposed by agencies;

� provides quality, timely and accurate public sector financial reporting tomeet Government�s internal requirements and its public financialaccountability obligations;

� provides budget and financial accounting related advice and assistance toagencies, including relevant training; and

� the program also has a major role in preparation of various Treasurypublications on behalf of Government, specifically the Budget Papers andthe Treasurer�s Annual Financial Report.


� Quality and timeliness of Northern Territory Budget and forward estimatesinformation and documentation

� Quality and timeliness of analysis of proposed initiatives with budgetaryimplications

� Quality and timeliness of advice and information provided to agencies onBudget procedures, processes and guidelines

� Timeliness, accuracy and comprehensiveness of compilation of whole ofGovernment budget and outcome financial reports according to the Territory�sown statutory obligations and the Uniform Presentation Framework (UPF)


The 2000-01 Budget legislation, developed throughout 1999-00 in line withthe Government�s fiscal objectives, specific directives and objectives articulatedin Foundations for Our Future, was introduced into the Legislative Assembly inMay 2000 and passed in June 2000.

Enhancements were made to the Budget Cabinet �Umbrella Cabinet Submission�process, first introduced in 1998-99 to improve the quality of informationprovided to Cabinet to assist in its decision making on the Budget. Tocomplement this process, the timetable for submission of Budget informationby agencies was revised in order to assist agencies in better managing theirbudgets and workloads. Workshops were held to assist agencies to presenttheir business cases for proposed initiatives more effectively to Cabinet.

Documentation for Budget Cabinet was presented in a clearer and more conciseformat with the aid of an internal database, which also served to reduce theworkload for staff.

2000-01 Budget

Enhanced BudgetCabinet Advice


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Treasury both chairs and provides the secretariat function for the Government�sCapital Works Review Sub-Committee. This committee considers all worksprogram proposals with a focus on strategic budget management andconsistency with whole of government objectives. The review process wasenhanced for the 2000-01 Budget with agencies invited to provide presentationsto the committee on key proposals.

The processes relating to the Minor New Works (MNW) program were furtherreviewed and revised for the 2000-01 Budget, following changes made for the1999-00 Budget. These include the requirement for agencies to provide aquarterly schedule of planned projects with explanations for any variations andspecifying expected committal dates. This will improve the quality of informationavailable to Cabinet for future consideration of MNW program levels and increaseagencies� accountability for MNW programming generally.

The project to replace the existing cash based system progressed during1999-00. However, the move to an accrual based reporting framework by theAustralian Bureau of Statistics (ABS), and foreshadowed in the UPF, required asubstantial change in project scope resulting in implementation not proceedingas planned. Alternative system solutions to support whole of government accrualreporting required as part of the Territory�s national reporting obligations andGovernment Business Division (GBD) accrual budgeting and reporting are underconsideration. The new system, when identified, will progress with a view toimplementation in 2001.

The 2000-01 Budget presented the second year of accrual budgeting for GBDs,building on foundations laid the previous year and reflecting an improvementin the quality and understanding of the information presented. Furtherdevelopment and use of accrual budget information for decision making andanalysis will continue in the coming year.

Considerable effort has been applied to improving the underlying quality ofGovernment balance sheet information. Enhancements in the use of corporatesystem facilities, implemented late in the financial year, including greater useof fixed assets, accounts payable and accounts receivable subsidiary systemsin the Government Accounting System (GAS), should provide better and moretimely data in the future.

The UPF, which ensures that Commonwealth, State and Territory governmentsprovide a common set of financial information in their budget papers, has alsobeen revised to reflect the progressive development of accrual budgeting andreporting in many jurisdictions. The new accrual UPF is to be adopted by alljurisdictions by the 2002-03 budget year. The Territory�s 2000-01 Budget Paperscontained accrual UPF reports for the 1998-99 financial year for informationpurposes.

Accrual information was also provided to the ABS for the 1998-99 and 1999-00financial years for the release in April 2000 of its Government Financial Estimatespublication, the first to be presented on an accrual basis.

A personal development planning system was implemented for the programcentred on structured discussions twice a year between team leaders andindividual staff members. In addition, information on training needs from thediscussions is used to devise and implement training and development programsfor staff.

212 individual policy proposals were analysed and presented to Cabinet aspart of the Umbrella Cabinet Submission process for the 2000-01 Budget.

160 proposals were considered by the Capital Works Review Sub-Committeefor the 2000-01 Capital Works Program and 245 proposals were assessed forconsideration for the 2000-01 Design List.

Improved Capital WorksProcedures

New Budget System

Accrual FinancialInformation

Staff Training andDevelopment


GBD Accrual BudgetFramework


23

Outside the Budget process, the program also provided advice and analysis on92 Cabinet Submissions, 105 pieces of Ministerial correspondence andformulated 243 pieces of Under Treasurer�s correspondence. It generated anadditional 32 pieces of advice to the Treasurer.

The 1998-99 Treasurer�s Annual Financial Report was prepared on behalf ofGovernment and audited by 30 September 1999, for tabling in October, wellwithin legislative requirements. Four sets of Quarterly Treasurer�s FinancialReports were prepared and published with analysis provided to the Treasurer.Quarterly data was provided to the ABS in addition to Accrual GovernmentFinancial Estimates and Statistics. Uniform presentation reporting requirementswere achieved in the Budget Papers, the Treasurer�s Annual Financial Reportand the Mid-Year Report.

The quality of Budget Management outputs is gauged through ongoing informalfeedback from Government. All deadlines relating to the Budget and publicreporting obligations were met.

Provisional results for 1999-00 in relation to the five elements of the NorthernTerritory Government�s Fiscal Strategy were included in 2000-01 BudgetPaper No. 3.


� implementation of an improved management information system to supportdevelopment and monitoring of the Territory Budget;

� development of agency level accrual budget and financial reportinginformation to meet Government accrual management and reportingrequirements;

� continued enhancement of the GBD accrual budget framework to fullyintegrate accrual budget data in decision making;

� review of current procedures for program delivery for capital works andrepairs and maintenance; and

� streamlined and improved processes for collection of data from agenciesfor whole of government financial reporting purposes.

(Budget Management: 8999 7467

The Public Finance program aims to maximise the net inflow of financialresources into the Northern Territory from the Commonwealth while ensuringthat the Territory retains adequate discretion in the use of these resources.

The effective management of major intergovernmental matters, including thepreparation and coordination of submissions and returns to the CommonwealthGrants Commission, is undertaken by this program.

The program monitors and reviews all major intergovernmental financialarrangements affecting the Territory, and provides strategic advice toGovernment to ensure that the flow of funds to the Territory is optimised. Thelevels of all payments from the Commonwealth are monitored and opportunitiesto increase financial flows are maximised.


� Quality and timeliness of analysis and advice provided

� Appropriateness and timeliness of submissions to the Commonwealth GrantsCommission to maximise the Territory�s per capita relativity

IntergovernmentalArrangements


24


Submissions were provided to the Commonwealth Grants Commission on behalfof the Territory in relation to their General Revenue Grant Relativities2000 Update. This process resulted in an improved relativity for the Territoryand a consequent increase in funding from the Commonwealth.

The Northern Territory Government Submission to the 2004 Review: ProposedWork Program (February 2000) provided the Commission with feedback on thescope, nature and timing of various components of the 2004 Review ofRelativities.

The Northern Territory Government Submission to the Indigenous FundingInquiry (June 2000) provided Territory Government input into the Commission�sInquiry which seeks to determine the actual levels of service experienced andrequired by Indigenous people in different regions of Australia.

The program was active in the implementation of the IntergovernmentalAgreement on the Reform of Commonwealth-State Relations and arrangementsrelated to national tax reform, including the introduction of the Goods andServices Tax (GST). This included briefings for the Treasurer and senior Treasuryexecutives attending the inaugural Ministerial Council which dealt with the newregime of distributing GST Revenue Grants and Guarantee Payments from theCommonwealth to the States and Territories, replacing the former system ofFinancial Assistance Grants. The program has an ongoing role in monitoringthe flow of funds under the Agreement and associated issues, including providingsupport for the Territory�s representation on the GST AdministrationSubcommittee.

The program�s Government Finance Statistics time series database was furtherdeveloped which enabled improved analysis of the Territory�s fiscal performancecompared with the States.

Further work was completed on understanding tied budget arrangements.

In 1999-00, the program provided advice and analysis on 48 CabinetSubmissions, and responded to 10 requests to address Ministerialcorrespondence. Nine Under Treasurer�s Minutes were drafted and 183 otherpieces of correspondence were prepared.


� participation in the Commonwealth Grants Commission�s 2004 Review ofRelativities;

� monitoring the receipt of GST revenues from the Commonwealth andanalysing the impact on the Territory of the implementation of theIntergovernmental Agreement on the Reform of Commonwealth-StateRelations;

� further development of the program�s Government Finance Statistics timeseries database to incorporate changes in the Australian Bureau of Statistics�presentation of financial data, particularly accrual information; and

� analysis of the Fiscal Strategy in light of changes to the Australian Bureauof Statistics� presentation of financial data.

(Public Finance: 8999 6447

Commonwealth GrantsCommission Submissions

IntergovernmentalAgreement

GFS Database



25

The Economic Services program aims to ensure a sound economic frameworkis in place to facilitate the Territory�s economic development and long termviability.

The program provides advice and analysis on economic issues affecting theTerritory and manages the Territory�s involvement in national economic policyinitiatives, such as National Competition Policy (NCP). Management of a rangeof microeconomic reforms at the Territory level is undertaken, including thereform of GBDs.

In addition, the program coordinates the Territory Government�s statistical needsand priorities, and presents a quantitative view of the Territory economy as abasis for policy development by the Government. Comprehensive annual andmonthly reviews of the Territory economy are published to a standard suitablefor presenting the Territory to local, national and international audiences. Theprogram also liaises with the ABS, chairs and provides secretariat support tothe Northern Territory Statistical Liaison Committee and represents the Territoryon the Australian Statistical Advisory Committee.

Treasury�s direct responsibility for two initiatives from Foundations for Our Future� Preserve and Build on the Lifestyle of All Territorians (Foundation One) lieswith this program. These relate to progressively introducing competition inthe electricity market leading to long term reductions in power costs, andachieving greater community understanding of cost of living issues.

The program also provides policy advice to the Government on the varioussuperannuation schemes and arrangements established for Territory Governmentemployees.




During 1999-00, the program prepared analysis, advice and briefings on awide range of economic issues, Cabinet Submissions and development proposals.The program also provided advice on the New Tax System package, includingchanges to gambling taxation, and the Review of Business Taxation.

A significant outcome for the program during the year was the finalisation andimplementation of reforms to the Territory�s electricity supply industry. Thisincluded a Territory-based third party access regime for electricity networks,the establishment of the Utilities Commission and the transfer of regulatoryfunctions from the Power and Water Authority.

Choice of supplier commenced for large volume electricity customers on1 April 2000, with contestability progressively extending to other customersover the next two years. By April 2002, around 45 per cent of the market willbe open to competition. At this stage it does not appear feasible to extendchoice of supplier to residential or small business customers.

This outcome for the program serves to implement the Foundation One initiativeto progressively introduce competition in the electricity market, leading to longterm reductions in power costs.

Development of economic regulatory arrangements for the Territory�s waterand sewerage industries was well advanced, with legislation expected to beintroduced in the October 2000 Parliamentary sittings.

In relation to GBDs, new arrangements for Community Service Obligations(CSOs), dividends and performance monitoring were implemented. The firstannual GBD performance report was finalised and considered by Government.

Statistics

Foundations for Our Future

Superannuation

Utility Reforms

GBD PerformanceReporting

Economic Advice andAnalysis


26

In addition, a review was undertaken of GBD capital structures, with changesto debt levels being progressively implemented.

The program has continued its involvement in the implementation of theTerritory�s NCP commitments. This included participation on the Territory�s NCPSteering Committee and the handling of competitive neutrality complaints. TheTerritory received its full share of competition payments in 1999-00.

The program continued to report quarterly to Government on TIO�s compliancewith the prudential supervision regulations under the Territory Insurance OfficeAct. It also monitored and reported on TIO�s performance from an ownershipperspective.

During 1999-00, the program continued to produce Economic Briefs, primarilybased on ABS publications, and to prepare and distribute the Monthly EconomicReview. The Review provides a concise and timely roundup of the key economicand demographic indicators affecting the Territory. The program also producedthe Northern Territory Economy, an annual review and outlook report on theTerritory economy. The report was widely distributed within the Territory,nationally and internationally and was also published as Budget Paper No. 5.Both the Monthly Economic Review and the Northern Territory Economy areavailable on the Internet and on the Territory Government Intranet.

Following the recommendations of the Select Committee on Food Prices, theprogram established and reported on a quarterly survey to monitor groceryprices across the Territory, including comparative data from Cairns and MountIsa. The survey forms the basis for implementing the Foundation One initiativeto achieve greater community understanding of cost of living issues.

A major update of the economic model of the Territory economy used by variousGovernment agencies was conducted and enhancements implemented during1999-00.

New superannuation arrangements for new employees commenced on10 August 1999, with Australian Government Employees Superannuation Trust(AGEST) appointed to provide default services for employees who do notnominate a fund. At the same time, Northern Territory Government and PublicAuthorities Superannuation Scheme (NTGPASS) and Northern TerritorySupplementary Superannuation Scheme (NTSSS) were closed to new members.

Amendments were made to the Legislative Assembly Members� SuperannuationAct, the Supreme Court (Judges Pensions) Act, the Administrators PensionsAct and the Police Supplementary Benefit Trust Deed to allow additionalcommutation of benefits to enable former members to pay surcharge debts.Additional amendments were made to the Administrators Pensions Act to removea number of anomalies and to provide for an appropriate retirement benefit forretiring Administrators.

In 1999-00, the program provided advice and analysis on 143 CabinetSubmissions, prepared 9 Cabinet Submissions, and analysed and preparedresponses to the Commonwealth for the Treasurer on 9 Foreign InvestmentReview Board proposals. The program also responded to 60 requests to addressMinisterial correspondence, some 26 Under Treasurer�s Minutes were drafted,and 183 economic briefs and 104 other pieces of correspondence were prepared.

A review of the Economic Services program commenced in late 1999-00.


� key involvement in progressing implementation of the Territory�s NCPcommitments;

National Competition Policy

Publications

Grocery Price Survey

Superannuation



27

� further refinement of the new arrangements for CSOs and performancemonitoring, and implementation of the outcome of the review of GBD capitalstructures;

� extension of contestability in the electricity supply industry;

� extension of economic regulation to the Territory�s water supply andsewerage industries;

� trial of a new service from the ABS to deliver the full range of standardpublications and statistics to every desktop computer operating within theTerritory Government;

� revision of the format of regular economic briefs to incorporate five-yeargraphs and trend data where appropriate and of the Monthly EconomicReview to deliver a themed publication with improved presentation;

� preparation of a new set of small area population projections for the Territory,for publication by the ABS, for use across Government; and

� completion of the review of the Economic Services program.

(Economic Services: 8999 6700

The Financial Management program aims to provide a sound financialframework for public administration.

The program develops and maintains meaningful and useful financial legislation;provides professional advice to Government and policy development on publicsector accounting concepts; and analyses submissions to the Treasurer undercertain sections of the Financial Management Act.

The program compiles a range of central financial information registers onbehalf of the Government and is responsible for managing the Government�sprivate sector loans portfolio and certain aspects of unclaimed monies.

It also coordinates and monitors Government�s banking arrangements andprovides policy advice and management of the Government�s corporate taxpayerobligations relating to GST, Fringe Benefits Tax (FBT) and Pay As You Go (PAYG).



� Accuracy and timeliness of FBT returns and loans records

� Clarity and appropriateness of the financial legislative framework and itspolicy and legal parameters


A new banking contract was executed on 31 December 1999, forming the basisfor the Territory�s banking arrangements from 1 January 2000 to the end of2002. This agreement enhances the range and level of existing services to theTerritory Government, including the introduction of local payments processing.

Following rationalisation of Territory Government bank accounts, 47 bankaccounts were closed and replaced with 11 new accounts opened in the year.33 merchant facilities were upgraded across the Territory. 10 new ones wereintroduced and 10 existing facilities were cancelled.

The program was responsible for the coordination of the Territory Government�spreparedness for the implementation of the GST on 1 July 2000, involving overallproject management as well as development and communication of policy adviceand implementation requirements at a whole of government level. Elementsof the project included:

Financial Management

Banking and CorporateTaxpayer

Banking Services Contract

GST ImplementationProject


28

� regular Project Managers� forums and seminars;

� development of an intranet site;

� the engagement of a single law firm for GST advice and a panel of consultantsto provide accounting advice;

� development of a supplier strategy to guide the Territory Government�sdealings with its suppliers; and

� a contracts database to assist agencies to analyse the GST effect on contractsspanning the transitional period.

The program also formulated the financial management, accounting and policyframework for meeting the Territory Government�s GST, FBT and PAYGobligations. This was promulgated to agencies through a Treasury Circularseries, the Project Managers� forums and the Intranet, and it remains an ongoingpolicy responsibility for the program.

58 seminars, presentations and GST Project Managers Forums were conductedby the program throughout the year to communicate the Territory Government�spolicies and frameworks in relation to the Commonwealth�s tax reform legislation.

As a result of changes to Commonwealth taxation legislation, the TerritoryGovernment was required for the first time to provide details of certain fringebenefits tax amounts on employees� group certificates in 1999-00. Followingextensive liaison with DCIS, larger agencies and the Australian Taxation Office,a range of financial and systems procedures were developed to facilitateinformation gathering and analysis to fulfil these requirements. The appropriateinformation was provided on 1999-00 group certificates.

As part of the Commonwealth�s tax reform initiatives, the concessional treatmentof fringe benefits paid to employees of public hospitals and public benevolentinstitutions was reduced. From 1 April 2000, the grossed up taxable value offringe benefits exempt from FBT was capped at $17 000 for employees ofpublic hospitals and at $30 000 for public benevolent institution employees.Due to the nature of salary packaging within the Territory Government, theimpact of this will be restricted to certain Royal Darwin Hospital medical staff.

Other FBT initiatives included the exemption of remote area housing from FBTfor all employees from 1 April 2000. The definition of remote housing wasextended to public hospitals, public benevolent institutions and police servicesto include all of the Northern Territory for these organisations.

In conjunction with the Office of the Commissioner for Public Employment andthe Department of Corporate and Information Services, a review of TerritoryGovernment employment benefits was conducted to maximise efficiencies whichcould be derived from the Commonwealth Government�s taxation reforms. Thetypes of benefits examined in the review included housing, freight, fares,travelling and other allowances. Initiatives flowing from the review, whilst notreducing the value of benefits received by employees, are expected to result inefficiencies for Government, particularly in the areas of travel allowance andremote area housing.

Amendments to the Financial Management Act were made during 1998-99 inconsultation with relevant parties including the Auditor-General and affectedagencies. These changes were aimed at improving administrative efficiency infinancial management practices and clarifying certain aspects of the legislation.The amendments came into effect on 23 December 1999.

Following amendments to the Financial Management Act, the reportingrequirements for the Territory�s contingent liabilities were reviewed. The formalaccountability chain for reporting was revised and a risk assessment methodologywas developed and implemented with the Treasurer�s endorsement.

Fringe Benefits Tax

Review of EmploymentBenefits

Financial Management ActAmendments

Contingent Liabilities


29

In 1999-00, the program provided advice and analysis on 10 CabinetSubmissions, and responded to 105 requests to address Ministerialcorrespondence. Some 55 Under Treasurer�s Minutes were drafted and 235other pieces of correspondence were prepared.

Section 34 of the Financial Management Act requires that the Treasurer approveany arrangements that the Territory may enter into which involve a guaranteeor an indemnity. The program is active in promulgating awareness in agenciesof this requirement and the procedures for obtaining the Treasurer�s approval.In 1999-00, 91 requests under section 34 were analysed by the program andsubmitted to the Treasurer for approval. Of these, 84 were executed andrepresent records included in the Register of Contingent Liabilities at30 June 2000 (the Register is maintained on behalf of the Government).Contingent liabilities exceeding the materiality threshold of $5 million arereported in Schedule 5.1 of the Treasurer�s Annual Financial Report.

Section 35 of the Financial Management Act provides for write offs, waiversand postponements and section 37 provides for ex gratia payments by theTreasurer. As for section 34, the program actively promotes awareness of therequirement for the Treasurer�s approval under these sections of the Act.Information relating to sections 35 and 37 is collected and maintained on awhole of government basis, which enables reporting in the Treasurer�s AnnualFinancial Report as required.

80 requests under section 35 were investigated, analysed and submitted forthe Treasurer�s approval by the program during 1999-00. Eight requests forex gratia payments were made and approved by the Treasurer.

A high level review of the program was undertaken, the primary result of whichwas a revised program structure to better reflect program activities. The reviewwas timely due to the imminent winding down of the GST ImplementationProject and the commencement of the Government�s new responsibilities as acorporate taxpaying entity. The revised structure comprising sub-programs forFinancial Management Policy, Financial Management Operations and a CorporateTax Unit commenced in July 2000.


� coordination of the whole of government GST Post Implementation Review;

� establishment of a Corporate Taxpayer Unit responsible for policy andcommunication issues relating to GST, FBT and PAYG;

� participation in the e-Government Project and related subsidiary projects;and

� establishment of a Financial Management intranet site to service client agencyneeds more efficiently and effectively.

(Financial Management: 8999 5475

The Capital Financing program aims to optimise the Government�s positionin major commercial matters in which the Territory Government has an interestby providing timely and comprehensive advice and analysis.

The program provides advice and options to Government on the financing andimplementation of specific projects and on the acquisition of major or strategicgoods or services including gas.

The program provides professional assistance in respect of the possible sale,outsourcing or privatisation of Territory assets. The program prepares majorTerritory assets for sale, outsourcing or privatisation.

Program Evaluationand Review

Advice and Analysis



30

The program also provides advice on the involvement of the private sector inGovernment functions and on other projects involving Territory agencies, asappropriate.




The program managed and finalised the sale of the business of the NT TABduring 1999-00. This process was the main focus of the program during theyear. The sale process also involved representatives from the Attorney-General�sDepartment, the Department of Industries and Business and the NT TAB.

A trade sale process commenced in 1999 and culminated in the sale of thebusiness of the NT TAB to TAB Queensland with effect from 1 July 2000. Thisincluded the issue of an exclusive fifteen year totalisator licence and a non-exclusive fifteen year sports totalisator licence to TAB Queensland. TABQueensland is also entitled to a sports bookmaker�s licence from 1 January 2001which will expire on 30 June 2005.

International All Sports, a Northern Territory listed company, is to be issued anon-exclusive fifteen year sports totalisator licence in 2000 which will completethe sale process.

The process required intensive effort and the highlights are summarised:

� thirteen expressions of interest were received for the purchase of the NTTAB and five parties were shortlisted and undertook purchaser due diligence.Seven binding offers from four parties were then received in 2000;

� three pieces of legislation were introduced and passed to enable the saleprocess: Sale of the NT TAB Act 2000, Racing and Betting Amendment Act2000 and the Totalisator Licensing and Regulation Act 2000; and

� the way in which the sale was structured provides an income stream for theTerritory in the form of wagering tax over the life of the totalisator licences,in addition to the up-front amount received.

The program was responsible in 2000, in conjunction with the Executive program,for Treasury�s involvement in the purchase of gas for electricity generation inthe Territory. This includes the current arrangements administered by DarnorPty Ltd and Gasgo Pty Ltd as well as the future opportunities for the Territorythrough the delivering of gas on-shore to the Territory from the Timor Sea.

The program is also responsible, in conjunction with the Executive program,for Treasury�s involvement in the consideration of proposals for conventioncentres in Alice Springs and Darwin. Advice and financial analysis has beenprovided to Government on convention centre proposals during the year.

The program continued to assist agencies with financing and outsourcingproposals during the year by providing advice and financial analysis.

In 1999-00, the program provided advice and analysis on 27 CabinetSubmissions, prepared 11 Cabinet Submissions, mainly relating to the TABsale, and responded to 11 requests to address Ministerial correspondence.Some 32 Under Treasurer�s Minutes were drafted and 48 other pieces ofcorrespondence were prepared.

Sale of the NT TAB

Gas Contracts

Convention Centres



31


� assisting agencies in the development of financing proposals;

� managing Treasury�s involvement with the convention centre proposals;

� further development of policy advice on financing options;

� further involvement in the financial aspects of the purchase of gas forelectricity generation in the Territory.

(Capital Financing: 8999 7971


32


ACTIVITY: TERRITORY REVENUE MANAGEMENT

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO







Revenue Collection (3)

Revenue Development (1, 2, 3)

Revenue Administration (3, 4)



Functions

The Territory Revenue Management Activity comprises revenue developmentfunctions and the Office of the Commissioner of Taxes. It provides theadministrative machinery for the collection of revenue, from Territory taxesand mining royalties, and the payment of various subsidies and grants.

The Activity aims to provide a contemporary revenue regime which is responsiveto the needs of Government, maximising own-source revenue, whilst minimisinguncertainty and compliance costs for revenue payers. The Activity includesresponsibility for the review and amendment of revenue legislation.

The Activity monitors the implications of change in the community and ensuresthe viability and future relevance of the revenue regime. It includes monitoringperformance to ensure the timely payments of amounts due. The functionsinclude research into revenue potential and the review of current revenueperformance.

Strategies

Strategies are developed to provide Government with the revenue from Territorysources in the most efficient manner. Efficiency requires that the cost ofcollection is optimised both for the Government and the taxpayer.

Commissioner of Taxes

Revenue Regime

33

Strategies include:

� ensuring the viability of the revenue regime and its capacity to meet currentand future demands of Government;

� reviewing legislation and improving its relevance to changing marketcircumstances;

� increasing staff and taxpayer awareness and understanding of the revenuelegislation;

� improving administrative procedures and eliminating unnecessary practicesso as to reduce compliance costs; and

� monitoring program performance on a regular basis.

The Revenue Collection program aims to ensure effective collection ofrevenue in accordance with relevant tax and royalty legislation and to developcommunity understanding of revenue obligations.

The program advises on, and administers, relevant legislation, including theidentification of tax and royalty payers; and the minimisation of losses to revenuefrom avoidance practices. It also administers a number of subsidy schemesand grants including the First Home Owner Grant. The program also assists inimproving community understanding through the development of rulings andguidelines.


� Various measures demonstrating efficiency and effectiveness of operationsover time (see Table 1)


Revenue collected during the year totalled $246.8 million.

An expanded compliance program resulted in a significant increase in the numberof investigations completed during the year (449 cases, up from 235 the yearbefore) and revenue assessments, yielding $4.4 million. The enhancedperformance was gained from process review, refocused objectives andimproved targeting techniques.

Almost 93 per cent of pay-roll tax and 95 per cent of revenue from other returns-based taxes was collected within accepted tolerance periods.

Tables 1 and 2 (at the end of this section) provide further detail on key dataand performance indicators for the Activity.

A Conveyance By Return software package was piloted during the year. Thepackage allows approved conveyancers and solicitors to self-assess routineconveyances of property and leases and to pay the stamp duty by monthlyreturn. The scheme is being rolled out to other conveyancers and solicitorswith 10 now participating, resulting in a reduction in the number of instrumentslodged over the counter for assessment. This has reduced compliance costsfor participants, and for the Revenue Collection program.

A significantly enhanced pay-roll tax return package was developed during theyear including an electronic version. The personalised package is user friendlyand provides additional information to assist taxpayers in meeting theirobligations. More than 15 per cent of pay-roll tax taxpayers are using theelectronic version reflecting the simplicity of its functionality. The rate of uptakeis growing, with minimal promotional activity. The electronic return packagehas been provided to all taxpayers for the 2000-01 year.

Revenue CollectionPractices

Electronic Developments


34

Administrative andPerformance Measures

First Home Owners GrantScheme

Reform Measures

Electronic payment options were enhanced with 34.8 per cent of revenue(received from 14.5 per cent of all registered taxpayers) now being paidelectronically. Significant benefits accrue for taxpayers and the program throughthis payment mechanism. The development of a direct interface will furtherenhance the process in the future.

Tax registration forms and procedures were enhanced during the year, leadingto an improvement in the timing of collections and the detection of other taxliabilities.

Pay-roll tax return packages have been further enhanced to provide moreinformation to taxpayers and facilitate streamlined processing.

Key Performance Indicators (KPIs) and targets were reviewed and enhancedfor key functions including recovery of outstanding taxes, returns managementand stamp duty assessments.

Procedures for issuing Eligible Exploration Certificates (EECs) under the MineralRoyalty Act were reviewed and enhanced. Turnaround times for the issue ofEECs have reduced substantially, leading to efficiencies for the Office andindustry.

As part of the national tax reform arrangements, States and Territories wererequired to introduce and administer a first home owners grant scheme tooffset the impact of the Goods and Services Tax (GST). Under the scheme,eligible first home buyers are entitled to claim a lump sum payment of $7 000from 1 July 2000. Considerable effort was involved in implementing the scheme.This included the establishment of a national database and executing agreementswith in excess of 50 financial institutions for processing applications. Communityand staff awareness programs and appropriate forms and procedures werealso developed.

Significant revenue reform measures announced in the 1999-00 and 2000-01Budgets were implemented with minimal disruption to taxpayers.


� issue of guidelines to industry detailing standard information required toenable assessment of stamp duty on various types of documents, in orderto improve the timing of collections;

� implementation of appropriate systems and strategies for the administrationof new wagering tax (under the Totalisator Licensing and Regulation Act)and subsidy arrangements (for the First Home Owner Grant and revisedfuel and liquor subsidies);

� continued refinement and promotion of electronic payment options and theextension of electronic return packages to other revenue types;

� continued role in enhancing public awareness of revenue obligations,including appropriate forms and information brochures both in printed andelectronic format; and

� improved compliance coverage and targeting through risk analysis strategies,data matching and streamlining internal procedures.

(Revenue Collection: 8999 6326


35


� Efficiency of tax and royalty legislation

� Timeliness and accuracy of revenue forecasting and performancemanagement

� Turnaround time on the processing of administrative decisions

� Adequacy of Territory Revenue Management�s information systems


A significant program of legislative reform continued as part of the ongoingreview of the efficacy of the Territory�s taxation and royalty legislation. As aresult, during the year the Legislative Assembly passed amendments to thePay-roll Tax Act, Taxation (Administration) Act, Stamp Duty Act, FinancialInstitutions Duty Act, Debits Tax Act, various mineral and petroleum royaltylegislation, gambling tax legislation and the Fuel Subsidies Act. The LegislativeAssembly also enacted the First Home Owner Grant Act, Financial Relations(Consequential Provisions) Act and the Revenue Units Act. Detail on theselegislative changes is presented in Appendix B.

Significant Territory tax reform measures were included as part of the 2000-01Budget. The amendments include adjustments to the Territory�s tax mix toensure it is in line with similar taxes raised in other jurisdictions and to distributethe tax load more equitably across the Territory�s taxes. This includes rate andbase adjustments to pay-roll tax and certain stamp duties. Measures werealso taken to bolster the integrity of the Territory�s stamp duty regime andcounter a range of avoidance schemes. In addition, the amendments includeda number of equity and efficiency measures that will reduce compliance andadministration costs for taxpayers and the Revenue Collection program.

Legislation was passed by the Legislative Assembly, putting in place thenecessary legislative arrangements to meet the Territory�s obligations agreedin the Intergovernmental Agreement on the Reform of Commonwealth-StateFinancial Relations. The Financial Relations (Consequential Provisions) Actand the First Home Owner Grant Act provide for:

� the introduction of the First Home Owner Grant scheme;

� the cessation of tourism marketing duty and the payment of off-road fuelsubsidies from 1 July 2000 and financial institutions duty and stamp dutyon quoted marketable securities from 1 July 2001;

� the entrenchment of the Intergovernmental Agreement in the Territorylegislation;

� the clarification of the interaction of the Territory taxes, fees, charges androyalties with the GST; and

� adjustments to the Territory�s gambling tax rates to offset the impact of theGST.

The program also represented the Territory in several ongoing interjurisdictionalworking groups concerning taxation and royalty matters.

The Revenue Development program aims to ensure the continuing relevanceand efficacy of the Territory revenue regime in meeting the needs of the Territory.

The program provides advice to Government on revenue policy and budgetaryissues, and enhances public awareness of the Territory revenue regime. Theprogram also reviews decisions made under tax and royalty legislation, monitorsrevenue performance, and manages the revenue information systems.

Legislative Reform

Territory Tax Reform

National Tax Reform


36

The continued development of the process for handling objections and appealsprovided a significant increase in the number of objections cases completedduring the year and a significant reduction in the time taken for matters to beresolved.

Development of the Conveyance by Return system was finalised and distributedto conveyancing agents and solicitors during the course of the year. Furtherinformation on its implementation and impact is detailed under the RevenueCollection program.

The TAXAD system was also programmed to facilitate the direct uptake ofdetails received through the Conveyance by Return system and additionalbackend enhancements were developed to enable automatic matching withland titles data. Further programming changes were also made to improve thepay-roll tax annual reconciliation and compliance assessment processes.

The pay-roll tax electronic returns package was further enhanced to improveits operation and functionality. In addition, electronic returns packages werecreated for the calculation of hiring arrangements and general insurance stampduties.


� further review and improvement of Territory taxing legislation, and wherepossible, the further alignment of the administrative arrangements in eachof the Territory taxing Acts;

� further enhancement of the Conveyance by Return system for stamp dutyon conveyances;

� continued development and enhancement of revenue management systemsand related information technology;

� development of improved revenue forecasting, assessment and performancemeasurement reporting;

� continued role in enhancing public awareness of revenue legislation andassociated changes; and

� continued participation in interjurisdictional taxation reviews.

(Revenue Development: 8999 7935

The Revenue Administration program aims to provide strategic advice andsupport in the administration of the legislation, and to enhance communityand staff understanding, of the Territory revenue regime.

The program is responsible for the efficient management of the Revenueprograms; effective internal audit and control systems including riskmanagement; the coordination of reporting to Government; and the publicationand dissemination of information material. It is also responsible for recordsmanagement for Treasury with the aim of improving efficiencies and practicesthrough centralised management.


� Improved revenue management practices and outcomes

� Satisfactory compliance report from the Auditor-General on the Activity�sinternal audit and control systems

� Quality and timeliness of advice to Government on revenue-related issues

� Enhanced community and staff understanding of the Territory revenue regimeand coordinated staff development programs

� Effective records management practices

Enhanced Decision ReviewProcess

Systems Developments


37


Performance reporting was enhanced during the year to allow for the moreaccurate implementation of measures to protect the Territory�s own source taxrevenue and provide a better basis for evaluating revenue collection performanceand the development of revenue options.

The interjurisdictional performance benchmarking program was further enhancedin conjunction with the revenue authorities of the other States and the ACT.This has provided useful insights for improving performance comparisonsbetween the States and Territories.

Once again, the Activity received a satisfactory audit report on its internalcontrols from the Northern Territory Auditor-General�s Office. The Auditor-General also noted that consideration should be given to introducing anelectronic interface between TAXAD and the Government Accounting System.This will be explored further in 2000-01. The Activity also received a satisfactoryreport from the Auditor-General in relation to its performance managementsystems.

In 1999-00, the Territory Revenue Management Activity provided advice andanalysis on 7 Cabinet Submissions and responded to 50 requests to addressMinisterial correspondence. 101 additional pieces of advice were prepared forthe Minister�s Office. The Activity prepared 11 submissions to Cabinet andExecutive Council during the year, and provided a substantial paper for inclusionin Treasury�s Budget Cabinet submission. 29 Revenue Circulars and 38 270assessments were issued, and 79 objections were determined by theCommissioner.

The program coordinates advice to Government on revenue-related matterson behalf of the Activity. As such, the above performance statistics generallyreflect substantial contributions by the Revenue Collection and RevenueDevelopment programs.

A number of new revenue circulars were issued during the year to enhancepublic awareness of revenue legislation. Also, a significant overhaul of theOffice�s forms was conducted to enhance their effectiveness and useability.

To promote public awareness of Territory revenue laws, a number of publicseminars were made to the business community in Darwin and major regionalcentres.

A major awareness program was carried out in relation to stamp duty on motorvehicle certificates of registration. Relevant forms were revised and newinformation brochures issued. Newspaper advertisements were publishedperiodically to increase public awareness.

The Office has further refined the structure and operation of its web site toenhance user friendliness and access to information.

Commitment to staff development continued through the regular internal trainingsessions and specialist external courses. Self development was also promotedwith external study assistance provided to a number of staff. There has beenfurther refinement of the Performance Development Plan, which also facilitatesstaff development.

The program assumed responsibility for amalgamating the (previously separate)revenue and corporate registries. The Records Management Unit was formedfor this purpose. An appropriate organisational structure was developed andsteps were taken to settle the structure.

Performance Benchmarking

Audit Reports

Activity PerformanceStatistics

Enhanced CommunityAwareness of the RevenueRegime

Staff Training andDevelopment

Integrated Agency-wideRecords Management Unit


38

The Records Management Unit aims to improve efficiencies and practices throughcentralised management of Treasury�s records. Appropriate procedures are inplace to separate taxpayer records from the agency�s general records.

The new Records Management Unit is responsible for implementing the wholeof government records management initiatives associated with the RecordsConnect project. In particular, this has involved implementing the TRIM (TowerRecords Information Management) System in Treasury. This has includedmaintenance of an agency functional thesaurus and the provision of appropriatetraining and support on an ongoing basis to all Treasury staff.


� finalisation of a revenue policy and procedures manual for Territory RevenueManagement;

� comprehensive review of the Revenue Administration program (excludingthe Records Management Unit); and

� further implementation of initiatives associated with the Records Connectproject, including the development and implementation of recordsmanagement policies, procedures and guidelines for Treasury.

(Revenue Administration: 8999 7918

Implementation of theRecords Connect Project


39

Notes to Table 1 follow Table 2

1997-98 1998-99 1999-00

Key Data

Population '000 (a) 188.3 191.4 194.3

Average Number of Staff Employed (b) 40.2 41.2 50.5

Operational Costs ($M) 2.56 2.75 3.54

Total Revenue Collected ($M) (c) 249.3 247.0 246.8

Fuel and Liquor Subsidies Paid ($M) 11.0 13.4 12.6

Number of Assessments (d) 41 199 40 835 38 270

Number of Tax Investigations (e) 137 235 449

Value of Tax Investigations ($M) (e) 2.3 5.5 4.4

Outstanding Recoverable Debts ($M) 4.7 5.5 5.0

Debt Written Off ($M) 0.52 0.01 0.24

Performance Indicators - Economy and Efficiency

Operations Costs / Staff Member ($) 63 682 66 748 70 099

Operations Costs / Assessment ($) 62 67 93

Operational Costs / $000 of Revenue ($) 10.27 11.13 14.34

Operational Costs / Revenue Collected (%) 1.0% 1.1% 1.4%

Revenue / Operational Cost ($) 97 90 70

Revenue per capita ($) 1 324 1 291 1 270

Revenue / Assessment ($) 6 051 6 050 6 449

Assessments / Staff Member 1 025 991 758

Value of Tax Investigations / Tax Investigation ($) 16 788 23 404 9 800

Revenue collection - stamp duty assessing

- document turnaround (proportion assessed within 24 hrs) 82.4% 86.4% 86.4%

Revenue collection - stamp duty returns

- proportion of returns received by 28th of each month 88.2% 90.4% 88.4%

- proportion of total $ receipted by 28th of each month 92.8% 95.6% 94.9%

Revenue collection - pay-roll tax returns

- proportion of returns received by 14th of each month 90.5% 90.9% 88.3%

- proportion of revenue receipted by 14th of each month 91.4% 92.6% 91.2%

- proportion of revenue receipted by electronic means 10.7% 17.6% 34.8%

Debt profile

- recoverable debt as a proportion of revenue collected (f) 1.9% 2.2% 2.0%

- proportion of recoverable debt outstanding > 90 days 86.0% 91.7% 88.8%

Public seminars/awareness

- attendees' rating of satisfactory or better n/a 99.0% 98.5%

- attendees' rating of web site as informative/user-friendly n/a n/a 72.0%

Table 1TERRITORY REVENUE MANAGEMENT

KEY DATA AND PERFORMANCE INDICATORS


40

Table 2TERRITORY REVENUE MANAGEMENT

COLLECTIONS BY REVENUE TYPE

1997-98 change 1998-99 change 1999-00

$000 % $000 % $000

Pay-roll Tax 119 082 5.0 125 073 3.7 129 702

Private sector 79 769 84 523 88 483

Public sector (general government) 39 313 40 550 41 219

Stamp Duty 66 856 -3.7 64 372 -4.2 61 639

Conveyances 42 240 38 671 34 499

Motor vehicle registration/transfers 12 830 12 607 12 891

Insurance 6 789 7 743 8 680

Other 4 997 5 351 5 569

Tourism Marketing Duty 6 535 7.0 6 993 10.0 7 689

Business Franchise Fees 6 206 -100.0 0 0 0

Energy Resource Consumption Levy 555 -78.2 121 -70.2 36

Financial Transaction Taxes 18 430 8.4 19 970 -2.6 19 445

Financial Institutions Duty 11 297 12 822 12 532

Debits Tax 7 133 7 148 6 913

Mineral and Petroleum Royalties 25 654 -1.9 25 155 -0.8 24 948

Tax Equivalents 5 990 -10.5 5 361 -38.6 3 294

(income tax and sales tax equivalents)

TOTAL(a) 249 308 -0.9 247 045 -0.1 246 753

Note:

(a) Total revenue collected in 1999-00 can be reconciled to the collections of �Taxes, Fees and Fines� shown in the Financial Statements (atthe end of this Report) by deducting receipts from Pay-roll Tax � Public Sector, Tourism Marketing Duty, and Mineral and PetroleumRoyalties.

Totals may not add due to rounding.

Notes to Table 1:

(a) Population data as estimated in ABS Cat. No. 3101.0 December Quarter 1999 issue.

(b) Staffing numbers increased in 1999-00 because from July 1999 the Activity assumed responsibility for the amalgamated RecordsManagement Unit. Registry staff were transferred from Corporate Support (seven positions) and amalgamated with Revenue�s existingregistry staff.

(c) In 1997-98, Total Revenue Collected includes $6.2M as residual collections up to 5 August 1997 from business franchise fees (BFFs) ontobacco and petroleum (net of off-road diesel rebates). BFF collections ceased from that date.

(d) Assessment figures include the issue of tax and royalty assessments and the processing of subsidy claims. The decrease in the numberof assessments in 1999-00 is primarily due to the introduction of the Conveyance by Return scheme during the year.

(e) The increased number of investigations and value from investigation activities in 1998-99 and 1999-00 arose primarily from increasingand refocusing compliance resources.

(f) Recoverable debt does not include Bad/Doubtful Debts.

Totals may not add due to rounding.


41

EXPLANATION OF KEY INFORMATION IN TABLES 1 AND 2

Table 1 sets out a number of performance indicators for the Activity. On theirface, some performance measures appear to have deteriorated during 1999-00.However, this is explained by three key factors.

Firstly, the loss of business franchise fees in August 1997 means revenuecollections in 1997-98 are higher than later years, and thus needs to beconsidered in making comparisons based on revenue. Secondly, from July 1999the Activity assumed responsibility for managing an amalgamated RecordsManagement Unit on behalf of the agency. This increased the staffing levelsand operational costs but does not contribute to the revenue collected. Thirdly,the progressive introduction of the Conveyance by Return scheme has resultedin fewer assessments being issued, and thus impacts on measures based onthe Number of Assessments. The Conveyance by Return scheme allowsapproved conveyancers and solicitors to self-assess routine conveyances ofproperty and leases and to pay the stamp duty by monthly return. Consequently,there has been a reduction in the number of instruments lodged over thecounter for assessment.

The combined effect of these three factors explains the apparent deteriorationin such performance measures as:

� Operations Costs / Staff Member;

� Operations Costs / Assessment;

� Operational Costs / $000 of Revenue;

� Revenue / Operational Costs

� Assessments / Staff Member.

Although responsibility for collecting business franchise fees has ceased, theActivity has assumed responsibility for administering the payment of fuel andliquor subsidies as required by the safety net arrangements. A similar level ofresources has been required to administer these subsidies which means therehave not been material resource savings associated with the loss of businessfranchise fees administration.

Similarly, it is also worth noting that in future years it will become increasinglydifficult to make meaningful comparisons with the above performance measuresas certain revenue categories are abolished and the focus of the Activity hasbroadened to include administration of grant and subsidy payments.

There was a substantial increase in the number of tax investigations (by91 per cent) in 1999-00 due primarily to refocusing compliance resources toenable coverage of the tax base to be broadened. There is a comparativedecline in investigation revenue for 1999-00. This is explained by the fact thatthe value of tax investigations for 1998-99 was abnormally high as it was inflatedby significant audit settlements covering a number of years. The value of taxinvestigations in 1999-00 is significantly higher than periods prior to 1998-99.

Table 2 shows that total revenue collected by the Activity has declined slightlyin recent financial years (by 0.9 per cent and 0.1 per cent in 1998-99 and1999-00 respectively).

This is primarily due to the decline in conveyance duty receipts from 1997-98and the loss of business franchise fees as a revenue source from 5 August 1997.

Conveyance duty represents the primary source of stamp duty revenue for theTerritory. The 1997-98 and 1998-99 conveyance duty receipts were abnormallyhigh due to large one-off transactions in each year (associated with governmentasset sales at both the Commonwealth and Territory Government levels). There


42

were no such significant receipts in 1999-00. If those transactions arediscounted then the average annual growth in conveyance receipts between1997-98 and 1999-00 is approximately 6.3 per cent.

Collection of business franchise fees ceased in August 1997. A residual amount($6.2M) was collected in 1997-98, whilst none was collected in 1998-99 or1999-00.

Other points of interest to note from Table 2 include:

� pay-roll tax is the largest source of tax revenue collected, accounting for52.6 per cent of the Activity�s revenue collected in 1999-00;

� a slight decline in collections of financial institutions duty is due to 1998-99collections being inflated from compliance activity which led to auditsettlements covering a number of years. This also accounts for the declinein investigation revenue in Table 1;

� higher collections of tourism marketing duty in 1999-00, due in part toincreased accommodation activity associated with the United Nation�s EastTimor efforts being based in Darwin;

� lower collections of tax equivalents in 1999-00; and

� a decline in royalty revenues (primarily as a result of falls in commodityvalues, particularly spot gold prices).


43


ACTIVITY: COMMUNITY SERVICE OBLIGATIONS

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO








GBD Community Service Obligations (2)


Functions

The Community Service Obligations Activity provides a mechanism to transferConsolidated Revenue Account funds to Government Business Divisions (GBDs)to cater for those Community Service Obligations (CSOs) that have implicationsacross Government and which are not administered by a host agency.

The funds pay for those activities conducted by GBDs, at the direction ofGovernment, that have an identifiable community or social benefit and thatwould not be undertaken if only commercial considerations applied.

Strategies

The main strategy of the Activity is to negotiate funding and service levels ina purchaser-provider framework to ensure that the CSOs are delivered efficientlyand represent value for money.

The GBD Community Service Obligations program aims to ensure theleast cost delivery of those CSOs provided by specified GBDs.

Funding is provided only in relation to certain CSOs provided by the Powerand Water Authority (PAWA).


• Contribution to ensuring the least cost provision of relevant CSOs

Funds Benefiting theCommunity

PAWA CSOs

44


During the year, a level of payment was negotiated with PAWA to ensure themaintenance of uniform tariffs for electricity, water and sewerage services acrossthe Territory. This amounted to approximately $21.8 million. This was the firstyear of full Budget funding of the uniform tariff CSO, in line with the new CSOStatement of Policy and using a new methodology for estimating the appropriatefunding level. Previously this CSO was partly funded from the Budget andpartly by cross subsidies among PAWA�s electricity, water and seweragecustomers.

In addition, funding of around $34.8 million was provided for the delivery ofelectricity, water and sewerage services to rural and remote Aboriginalcommunities.


� review of the quantum of, and methodology for determining, PAWA�s CSOs,in conjunction with the Utilities Commission.

(GBD Community Service Obligations: 8999 6700

PAWA Payment Negotiated


45


ACTIVITY: UTILITIES COMMISSION

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO









Utilities Commission (1, 2)

Functions

The Utilities Commission came into existence on 21 March 2000, on assent ofthe Utilities Commission Act 2000.

The Commission�s primary function relates to the economic regulation ofmonopoly services in the Territory, where this is required by a relevant industryregulation Act.

The Commission is a separate administrative unit established within Treasuryand has specific statutory powers, undertaking its considerations independentlyfrom Treasury and reporting directly to the Regulatory Minister.

Strategies

Strategies are in place to ensure effective regulation of monopoly electricityservices, and to promote improved price and service quality outcomes. Thesestrategies include:

� issuing licences and monitoring compliance with licence conditions;

� regulating prices charged for monopoly services;

� conciliating any disputes over access to infrastructure;

� investigating customer and competitor complaints;

� monitoring and reporting on future supply capacity relative to future demand;and

� establishing and monitoring of standards of service.

46

The Utilities Commission program�s objective is to facilitate improved priceand service quality for consumers through regulation of certain monopolyservices provided by the Territory Government and other businesses in regulatedindustries, and to ensure that competition develops where possible in upstreamand downstream markets.


� Compliance with specific legislative obligations placed upon the UtilitiesCommission, both directly and as a result of the Commission�s role as industryregulator under relevant industry regulation Acts

� Contribution to the achievement of the objects of the regime as set out inthe relevant legislation


As a necessary precondition to the development of a contestable electricitygeneration and retail market in the Territory, on 1 April 2000 the Commissionissued licenses to conduct operations in the electricity industry to the Powerand Water Authority (PAWA) and the NT Power Group.

This licensing process was supported by a comprehensive licensing manualprepared by the Commission for the information of parties interested inparticipating in the Territory�s electricity market.

Third-party access to PAWA�s networks commenced in April 2000 when the NTPower Group physically began supplying about 20 per cent of the contestablemarket in Darwin and Katherine.

The Government has decided to progressively open the retail electricity marketover a period and, by April 2002, it is estimated that over 40 per cent ofelectricity consumed in the Territory by the largest customers will potentiallybe subject to direct competitive market pressure.

The Commission has put in place procedures in support of smooth operation ofthe contestable retail electricity market, and disseminated relevant informationto concerned parties.

On 1 April 2000, the Commission issued PAWA with licences covering activitieswhich remain monopoly functions.

Network operations will remain a monopoly business, so a regime to allowappropriately priced access to PAWA�s electricity networks (poles and wires)was introduced via a formal Access Code.

On the same date, the Regulatory Minister (the Treasurer) granted exemptionsfrom the need to hold a licence in relation to the privately owned Darwin-Katherine transmission line. The transmission line is not yet subject to thesame regulatory regime as PAWA�s distribution networks.

With regard to PAWA�s distribution networks, the Commission made a numberof pricing determinations and approvals which had effect between 1 April and30 June 2000, in accordance with the Network Access Code implemented bythe Electricity Networks (Third Party Access) Act 2000, as well as a number ofdeterminations and approvals relating to the prices to be charged by PAWA fornetwork access services from 1 July 2000 and other PAWA monopoly services.

PAWA�s retains its role as the monopoly retail provider of electricity to non-contestable customers. The Commission participated in the drafting andpromulgation of the first Electricity Pricing Order, giving effect to a Governmentdecision providing for reductions in the price of electricity to certain commercialcustomers and allowing PAWA to adjust its tariffs to take account of theintroduction of the Goods and Services Tax.

Increased Competition inthe Territory�s ElectricityMarket

Appropriate Regulation ofMonopoly ElectricityServices


47


� provide advice to the Treasurer regarding the development of a more formalframework for regulating the electricity prices paid by non-contestablecustomers, and the price paid by taxpayers for Community Service Obligationsundertaken by PAWA;

� consider, and seek amendments necessary in order to approve, a powersystem control code submitted by PAWA setting out the operating protocols,arrangements for system security and dispatch and arrangements fordisconnection;

� examine the standard terms and conditions governing the sale of electricity(including the service of making connections to the electricity network) byPAWA to non-contestable customers;

� commence a public consultation process aimed at setting minimum standardsof service and safety for non-contestable customers, taking into accountrelevant national benchmarks;

� develop forecasts of overall electricity load and generating capacity inconsultation with participants in the electricity supply industry and reportthe forecasts to the Minister and electricity entities;

� regularly update (and extend) information available to industry participantson the contestable electricity market in the Northern Territory; and

� develop an extended ring-fencing code through a public consultation process- a draft replacement code has already been issued for public comment.

(Utilities Commission: 8999 5480


48

NORTHERN TERRITORY TREASURY CORPORATION

ACTIVITY: ADMINISTRATION

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO





Budgets, Finance and Economic Services Administration (1, 2, 3)

Territory Revenue Management External Debt Management

Community Service Obligations Internal Funds Management


Functions

The Northern Territory Treasury Corporation is the central borrowing authorityfor the Northern Territory Government and is responsible for the borrowing,lending and investment functions. The funds raised are used to finance theTerritory�s infrastructure, including roads, ports, water, health and educationfacilities. Funds are also lent to Government Business Divisions and localauthorities.

The Administration Activity provides advice to Government and managementand support services to the Corporation.

Strategies

The Corporation�s strategies have been developed with the aim of ensuring theefficient and cost effective administration of the Government�s borrowing andfinancial asset management programs. These include:

� minimising the cost of borrowing;

� maintaining a strong demand for the Territory�s Government guaranteedsecurities;

� managing the duration and level of the Territory�s maturing debt; and

� maximising the return on the Territory�s cash balances.

49

The Administration program aims to ensure that effective managementand administration services are provided to the Northern Territory TreasuryCorporation.

The program produces regular financial statements on a commercial basis;provides services to the Corporation�s Advisory Board; maintains theCorporation�s stock register, debt profile, and loan repayment schedules forlendings; prepares and distributes Territory Bonds material; provides financialadvice to Government; and provides a service to bondholders through theFREECALL �1800� telephone number.


� Quality and timeliness of advice and analysis provided


For the second consecutive year the program achieved a record level of58 per cent of maturing Territory Bonds reinvested in new series in 1999-2000,compared to 54 per cent in 1998-99.

Based on the requests of Territory Bonds investors, two new terms of 1 and 3years were added to the choice of terms offered.

The Corporation was represented at the Australian Stock Exchange Share Daysin Sydney, Melbourne, Brisbane and Adelaide. Territory Bonds was alsorepresented at NT Expo.

The Treasury Corporation retained its Aa2 rating from Moodys Investor Service,two levels from the highest achievable rating and 18 levels above the lowest.

Risk management policies and statements were defined and are currently beingfinalised into a policy manual.

Assistance was given to Darwin Port Corporation and NT Housing to restructuretheir debt.

In 1999-00, the program responded to 13 requests to address Ministerialcorrespondence, drafted 16 Under Treasurer�s Minutes and prepared 11 otherpieces of correspondence for the Under Treasurer.


� introduction of new quarterly and annual interest payment terms on TerritoryBonds;

� introduction of the Corporation�s policy manual; and

� more extensive use of radio promotion to increase Territorians� awarenessof Territory Bonds, commencing in the Darwin region on 4 September onMIX FM.

(Administration: 8999 6318

Management Services

Territory Bonds

Moodys Rating


Administration

50


ACTIVITY: EXTERNAL DEBT MANAGEMENT

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO






Territory Revenue Management Interest on Commonwealth Advances (2, 3)

Community Service Obligations Interest on Territory Borrowings (2, 3)

Utilities Commission Repayment of Commonwealth Advances (2, 3)

Internal Funds Management

Functions

The External Debt Management Activity manages the Territory�s external debtto minimise the cost of funding for Territory taxpayers; borrows funds at thelowest possible margin compared to a benchmark to reduce interest payments;ensures cashflow is available to repay maturing debt; and makes timely paymentof interest.

Strategies

The Activity pursues a strategy to increase the investor base internationallyand domestically by visiting international and domestic financial institutions topromote the Territory. This helps maintain a diverse investor base to ensure achoice of funding sources and, therefore, cost effective borrowing for theTerritory.

The Interest on Commonwealth Advances program aims to ensure thatinterest payments to the Commonwealth are accurate and timely.

The program covers the Territory�s interest payments for debt servicingrequirements to the Commonwealth, which comprises assets transferred tothe Territory at Self-Government, advances provided under the Northern TerritoryHousing Advances Act and the State (Works and Housing) Act, and loans receivedthrough the General Purpose Capital program.


� Timeliness and accuracy of interest payments

51


Interest payments were made in accordance with repayment schedules agreedwith the Commonwealth.

(External Debt Management: 8999 5599

The Interest on Territory Borrowings program aims to ensure that interestpayments to Territory investors are accurate and timely, and to incur the lowestpracticable level of interest for the Territory.

The program covers the interest payments for the Northern Territory Governmentborrowing program, including both public and private investors. Financialderivative products are also used to ensure that the Territory�s borrowing criteriaare achieved.


� Timeliness and accuracy of interest payments to Territory investors

� Weighted average cost of funds

� Issuing margin to benchmark

� Interest rate exposure


The weighted average of the total cost of funds as at 30 June 2000 was8.85 per cent compared to 9.08 per cent in June 1999.

Interest rate exposure was managed to reduce exposure to maturing debt withthe intention of creating a relatively constant annual level of interest rateexposure over the next few years.

Initiatives in 2000-01 include: in 2000-01 include:

� management of the Territory�s interest rate risk.

( Interest on Territory Borrowings: 8999 6318

The Repayment of Commonwealth Advances program aims to ensurethat advances are repaid to the Commonwealth in a timely and accurate manner.

The program covers the Territory�s principal repayments for debt servicingrequirements to the Commonwealth Government, which comprises assetstransferred to the Territory at Self-Government, advances provided under theNorthern Territory Housing Advances Act and the State (Works and Housing)Act, and loans received through the General Purpose Capital program.


� Timeliness and accuracy of repayments


Repayments were made in accordance with repayment schedules agreed withthe Commonwealth.

(Repayment of Commonwealth Advances: 8999 5599

External Debt Management

52


ACTIVITY: INTERNAL FUNDS MANAGEMENT

WHY WE ARE HERE


WHERE WE FOCUS


WHAT WE DO







Community Service Obligations Dividends to Territory Government (2, 3)

Utilities Commission Interest and Advances to Territory Agencies (2, 3)

Functions

The Internal Funds Management Activity lends funds and provides financialadvice to Territory Government Business Divisions (GBDs) and local authorities,and reviews lending schedules in consultation with those GBDs and localauthorities. The Activity is also responsible for making the dividend paymentto Government, and covering certain debt management costs.

Strategies

The Activity provides an efficient and attractive lending facility to GBDs andlocal authorities by utilising current commercial practices whilst ensuring thatterms and conditions suit both the lender and borrower.

It also provides financial advice to the Northern Territory Government, GBDsand local authorities by keeping up to date with Government legislation, currentcommercial practices and understanding the requirements of clients. Thedividend to Government is paid by this Activity, as well as certain debtmanagement costs.

The Dividends to Territory Government program aims to ensure that theCorporation�s dividend, which is paid to the Northern Territory Government, isequal to its profit, after consideration of future risk factors.

The annual dividend is paid in the following year, once the audited financialstatements are available.

53


� Timeliness and accuracy of dividend payment


The 1998-99 dividend to the Territory Government was paid in June 2000.The 1999-00 dividend payment will be made in 2000-01 following the completionof the Corporation�s audit.

( Internal Funds Management: 8999 5599

The Interest and Advances to Territory Agencies program aims to lendfunds, make interest payments on cash balance accounts, and provide financialadvice to Government agencies and local authorities.

The program provides advances to Government agencies and local authorities,and pays interest on cash balances on terms and conditions approved by theTreasurer.


� Timeliness and accuracy of payment of advances and interest

� Appropriateness of advice to agencies and authorities


Funds totalling $5 million were advanced.

Advice was provided to local government bodies and to Government BusinessDivisions.

( Interest and Advances to Territory Agencies: 8999 6318

Internal Funds Management

55

A P P E N D I C E S

A: Legislation Administered

B: Legislative Changes in 1999-00

C: Treasury People

D: Treasury Organisation

E: Senior Executives

F: Staffing

G: Management Controls

H: Boards, Committees and Publications

57

APPENDIX A: LEGISLATION ADMINISTERED

Treasury has responsibility for the following statutes and legal arrangements.

Advance Bank Integration Act

Provides for the merger of the Advance Bank Australia Limited with St George Bank Limited and for relatedpurposes.

Appropriation Act 1999-00

Authorises the issuing of the money of the Territory in respect of the year ending 30 June 2000 in the formof Allocations to Activities.

Appropriation (Flood Relief) Act 1998

Authorises the issue and expenditure of public moneys of the Territory to provide relief to and reconstructthe Katherine and Douglas Daly regions affected by flooding.

Ayers Rock Resort Corporation ActAyers Rock Resort (Sale) ActYulara Tourist Village Management Act

The Ayers Rock Resort Corporation Act establishes the Ayers Rock Resort Corporation, the main purpose ofwhich from June 1992 to December 1997 was to hold, for the Territory, the Territory�s interest in the AyersRock Resort and associated interests. The Act was extensively amended and in part repealed by the AyersRock Resort (Sale) Act in late 1997 when the Ayers Rock and Alice Springs Resorts were sold. Since then,the Corporation has held responsibility for administering the funds of the former Yulara Town Council, andfor post sale matters relating to the resorts. All three Acts may be repealed in the near future when theremaining purpose of the Ayers Rock Resort Corporation has been fulfilled.

Bank of South Australia (Merger with Advance Bank) Act

Applies a South Australian Act dealing with the merger of the Bank of South Australia Limited and AdvanceBank Australia Limited as a law of the Territory and for related purposes.

Business Franchise Act and RegulationsBusiness Franchise Act (Suspension of Operation) Act

The Business Franchise Act requires persons selling tobacco or petroleum products in the Territory to belicensed. As a consequence of a High Court decision of 5 August 1997, the Business Franchise Act (Suspensionof Operation) Act was enacted, with effect from 1 February 1999, to suspend the operation of the businessfranchise legislation as part of the Commonwealth�s safety net arrangements.

Competition Policy Reform (Northern Territory) Act

Applies the Competition Code (essentially the Trade Practices Act) to all persons within the Northern Territory,as required by the Conduct Code Agreement under National Competition Policy.

Debits Tax Act and Regulations

Imposes tax at stepped rates on debits to specified accounts maintained by financial institutions.

Electricity Networks (Third Party Access) Act 2000

Establishes a code to regulate third party access to electricity networks in the Territory.

58

Electricity Reform Act 2000

Replaces the previous Electricity Act and provides the basis for regulation of the electricity supply industry inthe Territory. The Act removes the Power and Water Authority�s previous monopoly in the industry bylicensing suppliers and permitting certain customers to choose their supplier. The Act assigns responsibilityfor monitoring and enforcing compliance with the licensing regime to the Utilities Commission.

Energy Resource Consumption Levy ActEnergy Resource Consumption Levy (Waiver of Levy) Act

The Energy Resource Consumption Levy Act provides for a levy on the consumption above a specifiedannual quantity of specified fuel and oil. The Energy Resource Consumption Levy (Waiver of Levy) Actreduces the oil levy rate to zero with effect from 1 July 1998.

Financial Agreement Between the Commonwealth, States and Territories (Approval) Act

Approves an agreement between the Commonwealth, the States, the Territory and the Australian CapitalTerritory with respect to public debts.

Financial Institutions Duty Act and Regulations

Imposes duty at a specified rate on dutiable receipts of registered financial institutions.

Financial Management Act and RegulationsTreasurer�s Directions

Provides governing principles for the financial management of the Territory and the identification and operationof certain Government business activities. The Regulations supplement the Act, expanding upon mattersincluding requirements relating to losses, overpayments, rights of recovery and limits for transfers ofAllocations. Treasurer�s Directions specify the practices and procedures to be observed by AccountableOfficers in the financial management of their agencies.

Financial Management (Consequential Amendments) Act

Provides amendments to Northern Territory legislation, as a result of the replacement of the FinancialAdministration and Audit Act with the Financial Management Act, effective from 1 April 1995.

Financial Relations Agreement (Consequential Provisions) Act

Provides amendments to various Northern Territory legislation to meet the Territory�s legislative obligationsas agreed under the Intergovernmental Agreement on the Reform of Commonwealth-State Financial Relations.It includes the abolition of certain Territory taxes, reduction in gambling taxes (to offset the impact of theGoods and Services Tax (GST)) and also deals with the interaction of remaining Territory taxes with the GST.

First Home Owner Grant Act and Regulations

Provides for a $7 000 grant payable in respect of contracts made on or after 1 July 2000 for the purchase orbuilding of a person�s first home. The grant is payable to offset the impact of the introduction of the GST onthe price of a home for first homebuyers. The payment and administration of the grant satisfies one of theTerritory�s obligations under the Intergovernmental Agreement on the Reform of Commonwealth-State FinancialRelations.

Fuel Subsidies Act and Regulations

Provides for the payment of subsidies to licensed fuel suppliers, users of diesel for off-road purposes andcertain prescribed persons. The legislation forms part of the Commonwealth safety net arrangementsintroduced after business franchise fees ceased to be collected.

Appendix A

59

Mineral Royalty Act

Provides for the assessment and collection of mineral royalties. Operates in conjunction with Part 3 Division5 of the Petroleum Act which provides for the imposition of royalty payments.

New Tax System Price Exploitation Code (Northern Territory) Act

Enabling legislation that extends the Australian Competition and Consumer Commission�s price monitoringand prosecution powers to Northern Territory Government agencies.

Northern Territory Treasury Corporation ActTreasury (Northern Territory Stock) Regulations

Provides regulations and financial controls that address: the issuance, management and inscription of debton behalf of the Northern Territory Government; the payment of interest and principal; and the investmentof surplus cash balances.

Pay-Roll Tax Act and Regulations

Requires employers whose pay-rolls exceed a specified threshold to pay tax at a rate of 6.6 per cent of theirgross pay-rolls. Certain exemptions and concessional arrangements are available to specified employers.

Petroleum Act (Royalty Provisions)

Imposes royalty at a specified rate on the gross well head value of crude oil, casing head petroleum spiritand natural gas produced. Replaced the Petroleum (Prospecting and Mining) Act in 1984. No royalty payershave been granted tenements under the new Act. However, tenements issued under the repealed Act arepreserved under that Act.

Revenue Units Act

Introduces a scheme to represent, where appropriate, Territory fees and charges as a revenue unit in placeof dollar amounts. This scheme significantly simplifies the process for maintaining the currency of Territoryfees and charges and provides a more efficient process for altering Territory fees and charges.

Stamp Duty ActStamp Duty (Exemption) Regulations

Imposes duty at a number of different rates on a range of legal instruments and certain transactions. Themost significant items are conveyance duty, motor vehicle certificate of registration duty, and insuranceduty.

State Bank of South Australia (Transfer of Undertaking) Act

Provides for the transfer of part of the undertaking of the State Bank of South Australia to a companyformed to carry on the business of banking under the law of the Commonwealth, and for other purposes.

Superannuation Act and Regulations

Provides superannuation benefits to permanent and certain fixed term employees of the Territory publicsector.

Superannuation Guarantee (Safety Net) ActAdministrative Instructions

Enabling legislation that extends the Northern Territory Supplementary Superannuation Scheme to providetop-up superannuation benefits to enable the Government to meet its obligations under the Commonwealth�sminimum superannuation benefit requirements. The Instructions set out details of benefits payable underthe Act.

Legislation Administered

60

Taxation (Administration) Act and Regulations

Provides the administrative framework for the collection of duty and tax where the relevant taxing Act hasno such provisions, and provides for the imposition of penalties for late payment, avoidance, or evasion andthe exchange of information between jurisdictions.

Tax Equivalent Regime Manual

Introduced under the Treasurer�s Directions, the manual contains the basis for administering the NorthernTerritory Tax Equivalent Regime.

Utilities Commission Act 2000

Establishes the Utilities Commission to undertake economic regulation for certain monopoly services providedby the Territory Government and other businesses in the Territory. The electricity supply industry is initiallythe only industry declared to be subject to regulation by the Utilities Commission.

Appendix A

61

APPENDIX B: LEGISLATIVE CHANGES IN 1999-00

Competition Policy Reform (Northern Territory) Amendment Act

Provides a consequential amendment to the Competition Policy Reform (Northern Territory) Act to ensurethe New Tax System Price Exploitation Code (Northern Territory) Act deals exclusively with price monitoringand the Competition Policy Reform (Northern Territory) Act deals with other competition policy issues.

Debits Tax Regulations

Exempting approved trust accounts established and maintained for the collection and payment of stampduty under the Conveyance by Return scheme from duty.

Electricity Networks (Third Party Access) Act 2000

Establishes a code to regulate third party access to electricity networks in the Territory.

Electricity Reform Act 2000

Replaces the previous Electricity Act and provides the basis for regulation of the electricity supply industry inthe Territory. The Act removes the Power and Water Authority�s previous monopoly in the industry bylicensing suppliers and permitting certain customers to choose their supplier. The Act assigns responsibilityfor monitoring and enforcing compliance with the licensing regime to the Utilities Commission.

Financial Institutions Duty Act and Regulations

Amendments in 1999-00 included:

� exempting the payment of a First Home Owner Grant from duty;

� preserving the exemption for certain family assistance payments following changes to those paymentsand providing an exemption for payment of the Bonus for Older Australians; and

� exempting approved trust accounts established and maintained for the collection and payment of stampduty under the Conveyance by Return scheme from duty.

Financial Management Act and RegulationsTreasurer�s Directions


� clarifying the legislative intent and introducing several additional contemporary financial managementconcepts and practices;

� accommodating Northern Territory public sector administrative changes by minor amendments under theDeterminations to the Act; and

� updating the Treasurer�s Directions in relation to Delegations, Physical Assets and Standard Classificationsof Receipts and Expenditure.

Financial Relations Agreement (Consequential Provisions) Act

Provides amendments to various Northern Territory legislation to ensure compliance with the IntergovernmentalAgreement on the Reform of Commonwealth-State Financial Relations. The Act:

� provides for the inclusion of the Intergovernmental Agreement on the Reform of Commonwealth�StateFinancial Relations in Schedule 1 to the Act;

� provides for the cessation of tourism marketing duty, financial institutions duty, stamp duty on quotedmarketable securities and fuel subsidies;

� clarifies the interaction of the Territory taxes, fees, charges and royalties with the Goods and ServicesTax (GST); and

� includes amendments to ensure that Territory gambling tax rates are reduced to offset the impact of theGST.

62

First Home Owner Grant Act and Regulations

Provides for a $7 000 grant payable in respect of contracts made on or after 1 July 2000 for the purchase orbuilding of a person�s first home. The grant is payable to offset the impact of the introduction of the GST onthe price of a home for first homebuyers. The payment and administration of the grant satisfies one of theTerritory�s obligations under the Intergovernmental Agreement on the Reform of Commonwealth-State FinancialRelations.

Fuel Subsidies Act and Regulations

Amendments in 1999-00 ensured the special fuel subsidy is not payable to motherships where a fullCommonwealth excise rebate is payable on the supply of fuel.

New Tax System Price Exploitation Code (Northern Territory) Act

Enabling legislation that extends the Australian Competition and Consumer Commission�s price monitoringand prosecution powers to Northern Territory Government agencies.

Pay-roll Tax Act and Regulations


� reducing the pay-roll tax rate from 6.75 per cent to 6.6 per cent with effect from 1 July 2000;

� extending the lodgement and payment date from the 7th to the 21st of each month;

� providing an exemption for wages paid in relation to service performed in another country subject tocertain criteria;

� ensuring that payments to workers engaged by labour hire firms are liable for pay-roll tax; and

� allowing the Commissioner to extend the time limit for lodging an objection.

Revenue Units Act

Introduces a scheme to represent, where appropriate, Territory fees and charges as a revenue unit in placeof existing dollar amounts. This scheme significantly simplifies the process for maintaining the currency ofTerritory fees and charges and provides a more efficient process for altering Territory fees and charges.

Stamp Duty Act and Regulations

Amendments in 1999-00 include:

� increasing the stamp duty rate on policies of general insurance from 8 per cent to 10 per cent;

� increasing the stamp duty rate on policies of indemnity insurance from a flat rate of $5 per policy to10 per cent of premiums;

� restricting the stamp duty exemption for public benevolent institutions to dealings that have a directpurpose for which the organisation is established;

� exempting all residential leases from duty;

� increasing the stamp duty rate imposed on hiring arrangements from 1.5 per cent to 1.8 per cent;

� clarifying and extending various motor vehicle exemptions;

� removing nominal stamp duty from Mining Agreements, Powers or Letters of Attorney and Guaranteesand affixing a $20 nominal duty charge to most other nominal duty categories;

� providing concessional stamp duty treatment for property transferred in accordance with the ManagedInvestments Act 1998;

� providing a stamp duty exemption for the conveyance of property used for farming purposes to familymembers; and

� ensuring that a full first home owner stamp duty concession is available for recipients under the HomeStartor HomeShare equity housing assistance schemes.

Appendix B

63

Statute Law Revision Act

Amendments in 1999-00 included consequential and minor amendments to the Taxation (Administration)Act, the Financial Institutions Duty Act and the Pay-roll Tax Act.

Taxation (Administration) Act


� ensuring mining tenements and mining information relating to such tenements fall within the �land rich�provisions of the Act;

� anti-avoidance provisions to attend to certain stamp duty avoidance schemes;

� ensuring stamp duty on insurance policies is imposed on the basis of the location of the risk insured andallows for the apportionment of risks that extend outside of the Territory;

� ensuring that stamp duty imposed on hiring arrangements includes hire purchase agreements and excludesvideo cassette hire;

� rewriting the nexus arrangements that apply to stamp duty on hiring arrangements;

� allowing unascertainable rents to be assessed by way of an estimate at the commencement of a lease;

� ensuring that the sale and purchase of marketable securities effected by representatives of brokers inthe Territory are liable to stamp duty;

� enhancing the provisions that permit the self-assessment of stamp duty payable on conveyances of realproperty;

� permitting interest to be paid on refunds where an objection is allowed or an appeal upheld; and

� allowing the Commissioner to extend the time limit for lodging an objection.

Utilities Commission Act 2000

Establishes the Utilities Commission to undertake economic regulation for certain monopoly services providedby the Territory Government and other businesses in the Territory. The electricity supply industry is initiallythe only industry declared to be subject to regulation by the Utilities Commission.

Legislative Changes in 1999-00

64

APPENDIX C: TREASURY PEOPLE

Finance Officers in Training

The whole of Government Finance Officer in Training Scheme (FOITS) aims tostrengthen the Government�s business and finance capabilities.

Now in its third year, FOITS seeks to attract and develop staff with academicqualifications in accounting, finance, economics, business, public administrationand other related disciplines. There were over 100 applications in 2000 for theGraduate Development and Cadetship programs in the FOIT Scheme, withselection based on academic performance and a range of personal attributes.

Graduates, who have completed their degrees, are initially employed for twelvemonths, with an offer of permanent appointment at the end of that perioddependent upon satisfactory performance. Graduates have two placementswithin Treasury, and undertake an extensive formal training program of relatedseminars and workshops covering a wide range of finance and Governmentissues. In addition, several graduates employed in other Government agenciesparticipate in the FOITS workshops.

Eleven graduates commenced with Treasury in January 2000 and participatedin an extensive induction program (one has since transferred, one has resignedand one has been permanently placed). All of the 1999 FOITS were permanentlyplaced at the completion of their 12 month contract.

Cadetships are aimed at undergraduates who have completed at least oneyear of their degree at Northern Territory University. Cadets receive a stipendof $4 000 per annum, and are employed in Treasury for between five andtwelve weeks during the University holidays.

Five cadets were selected for 2000 and, subject to satisfactory progress, willremain in the program until they have completed their qualifications.

Developing Our People

Treasury continues to support students studying at Northern Territory Universityand Centralian College by donating three prizes for outstanding Bachelor ofBusiness students.

On average, 13 per cent of Treasury�s staff are undertaking external academicstudy, with courses ranging from Certificate to Bachelor Degree levels inBusiness, Economics, Law and Information Technology, and Honours inEconomics. Treasury also continues to encourage staff to participate inprofessional courses such as the Certified Practising Accountants program.

Support is provided through time for local attendance (approximately 292 daysin the past year) and reimbursement of fees (approximately $14 000) uponsuccessful completion of units.

One employee is participating in competency based assessment and training(CBAT) for base grade clerical staff whereby accelerated salary advancementcan be attained by achieving identified competencies.

Treasury has continued to support the Business Office Skills Traineeship with atrainee commencing early in 2000 on a twelve month placement. This involvesworkplace training and study at the University in business office skills.

Graduates

Cadetships

University Prizes

Further Study

CBAT

65

Treasury�s employee performance management program was furtherimplemented during the year. Under Treasury�s policy, each work area hasflexibility in developing a scheme suited to its own identified needs and gearedto its own timeframes. During the year, all work areas have been involved inthe development and implementation of programs.

Equal Opportunity Management

All Treasury employees, as part of the Induction Program, are required to attendan awareness session conducted by the Northern Territory Anti-DiscriminationCommission.

As at 30 June 2000, 55 per cent of Treasury staff were female, which is areduction of 3 per cent over the previous twelve months.

Equal opportunity statistics show that:

� 4 per cent of Treasury staff have identified as being of first generation non-English background, where the first language is not English and neitherparent�s first language is English;

� 1 per cent have identified as second generation non-English speaking, wherethe first language spoken is not English, but the person was born in Australiaor came to Australia before the age of five, or at least one parent�s firstlanguage is English; and

� 1 per cent identify as having a disability.

Occupational Health and Safety Program

Treasury continues to be proactive in providing professional ergonomicassessments and education for all staff. Mindful of the increasing usage ofpersonal computers, Treasury has a policy of providing large computer screensto all staff who use a personal computer for more than 20 per cent of the day.

Ergonomic assessments were carried out in various work areas. As a result,improved lighting levels have been implemented on all floors of the buildingoccupied by Treasury, and furniture is progressively being replaced with furnituremore appropriate to the contemporary working environment. Recent renovationsin all Treasury work areas have increased the natural light levels for all staff.

A number of staff have undertaken fire warden training to ensure that sufficientcapability is available on all floors in the event of an emergency. Several firedrills throughout the year have served to refine fire evacuation procedures andeducate staff. There has also been extensive testing and proving of the firealarm system in the building.

Anti-Discrimination

EEO

Ergonomic Assessments

Fire Evacuation Training

Employee PerformanceManagement

Treasury People

66

APPENDIX D: TREASURY ORGANISATION

U n d e r T re a sure r(K e n C la rke )

C o m m iss io n e rU tilitie s

(A la n T reg ilg a s)

U tilitie sC o m m iss io n

A /D ire c tor F ina n cia lM a n a g e m e n t

(K a th y C la yd e n )

G e n e ra l M a n a ge rN T T C o rp o ra tion(Jo h n M o n ta g ue )

D e p u ty U n d e rT re a sure r

(Je n n ife r P rin ce )

D ire c to r E xe cu tiveS u p p o rt a ndC o o rd in a tio n(C a th e rineW au cho p e )

D ire c to r B u d g e tD e ve lop m e n t

(Jo d ie K irkm a n )

D ire c to r B u d g e tM a n a g e m e n t

(C la re M ilik in s )

D ire c to r E co n o m icA n a lysis

(P e te r Jo ne s )

D ire c to r E co n o m icP o licy

(H a rry A rm y ta g e )

S e n io r D ire c to rE va lu a tio n

(P h il P o tte r to n )

S e n io r D ire c to rP u b lic F ina n ce(T o n y S tu bb in )

A ss is ta n t U nd e rT re a sure r

(P a u l E m e ry )

S e n io r D ire c to rC a p ita l

(L in d a M a cke n zie )F in a n cin g

P r in c ip a l A d vise r(P e te r C a ld w e ll)

R e d e ve lo p m e n t(L o rra in e H a rd y )

D ire c to r S ys te mR e d e ve lo p m e n t

A ss is ta n t U nd e rT re a sure r /

(A n d re w S m ith )

C o m m iss io n e r o fT a xe s

D ire c to r

(K a th le e n(R o b in so n )

F in a n cia l R e fo rm s

D ire c to r R e ven u eD e p u ty C o m m iss io n e r

C o lle c tio n

(M u rra y H a n co ck)

D ire c to r R e ven u e

T a xa tio n

A ss is ta n t

D ire c to r R e ven u eD e ve lop m e n t

(C ra ig V u km a n )C o m m iss io n e r T a xa tio n

C a p ita l F in a n cing

F in a n cia lM a n a g e m e n t

R e ve n u eC o lle c tio n

R e ve n u eD e ve lop m e n t

N T T rea su ryC o rp o ra tio n

C o rp o ra teS u p p o rt

E xe cu tiveS u p p o rt

B u d g e tM a n a g e m e n t

B u d g e tD e ve lop m e n t

E co n o m icA n a lysis

E co n o m ic P o licy

P u b lic F ina n ce

S ys te mR e d e ve lo p m e n t

F in a n cia lR e fo rm s

R e ve n u eA d m in is tra tio n

inc ludingR e co rd s

M a n a g e m e n t

E va lu a tio n

Organisation Chart as at 30 September 2000

67

APPENDIX E: SENIOR EXECUTIVES

Ken Clarke B Comm (Hons)Under Treasurer

Commenced career in Canberra with the Bureau of Agricultural Economics in 1969 and subsequently workedin London as an editor with a London business reference publishing group. Joined the Papua New GuineaDepartment of Finance Monetary Policy Unit in 1975 before moving to Northern Territory Treasury in 1978.Held senior positions in intergovernmental financial relations and budget management before being appointedDeputy Under Treasurer in 1987, and Under Treasurer in December 1996.

Jennifer Prince Dip RadDeputy Under Treasurer

Commenced career as a Senior Therapy Radiographer before moving to the Territory in 1979 when shejoined the Northern Territory Department of Health, with involvement in a range of intergovernmentalhealth policy issues and hospital management. Joined Treasury in 1985 with responsibility forintergovernmental and budget policy matters. After moving interstate in 1989, continued to work for theTreasury on a wide range of policy issues, particularly intergovernmental financial arrangements, publicfinance and budget issues. Returned to Northern Territory Treasury in April 1997 as Deputy Under Treasurer.

Harry Armytage B Ec (Hons)Director Economic Policy

Commenced career with the Association of Permanent Building Societies in 1974 and then worked as atransport economist with consultant Rendel and Partners. Joined Victoria�s Gas and Fuel Corporation in 1981as an economist. Moved to Myer in 1985 to work on economic and market research, and appointed ResearchManager Myer/Grace Bros in 1988. Became a freelance consultant in 1991. Came to the Territory in early1995 to work in the Land Development Division of the Department of Lands and Housing. Joined EconomicAnalysis Division of Northern Territory Treasury in 1998, and was appointed Director Economic Policy in2000.

Peter Caldwell B A (Hons Econ)Principal Adviser

After working at the University of Ghana in 1963, worked in Canberra in the Commonwealth GovernmentDepartments of Trade, Territories and Treasury. Joined the Department of the Northern Territory, Darwin in1973. Worked in the Asian Development Bank, Philippines as an economist from 1974 to 1980. Joined theDepartment of Mines and Energy, Darwin in 1980; moved to Northern Territory Treasury in 1981 as DirectorEconomic Policy and later Director Capital Resources; and then to the Department of Industries andDevelopment in 1988 as Assistant Secretary. Returned to Northern Territory Treasury in 1992 as SeniorDirector Economic Services. Appointed Principal Adviser in 1994.

Kathleen Clayden B Bus (Accy) CSMActing Director Financial Management

Commenced employment in the Territory public sector in 1978, holding various positions including AccountingPolicy Analyst and Business Analyst for Northern Territory Treasury, Commercial Accountant for the ConservationCommission of the Northern Territory and Finance and Investment Manager for the Northern TerritorySuperannuation Office. Returned to Northern Territory Treasury in February 1999 as Assistant DirectorFinancial Management to work on the GST Implementation Project. Acting Director Financial Managementsince July 2000.

Paul Emery B EcAssistant Under Treasurer

Commenced employment with the Hunter District Water Board in Newcastle in 1978, working mainly in thefinance area. Joined the Industries Assistance Commission in Canberra in 1985. Following periods in policycoordination and research, was promoted to Director Assistance Evaluation Branch in 1989. Appointed asEconomic and Strategic Planning Adviser at Hunter Water Corporation in 1992. Returned to the IndustryCommission in 1994. Joined the Northern Territory Treasury as Director Economic Policy in 1998, appointedSenior Director Economic Services in 1999, and Assistant Under Treasurer in August 2000.

68

Murray HancockDirector Revenue CollectionDeputy Commissioner of Taxes

Commenced career in the Western Australian State Revenue Department, gaining extensive experience inthe administration of stamp duty laws and the development of policy and legislation for all state taxes.Joined Northern Territory Treasury as Director Revenue Collection and Deputy Commissioner of Taxes in1997.

Lorraine Hardy B Bus (Accy) CPADirector System Redevelopment

Commenced a career with Ernst & Young in Perth. Joined the Northern Territory Treasury as a graduate in1990 in the Financial Services Division. After two years, transferred to the Internal Audit Bureau in theDepartment of the Chief Minister as a senior internal auditor. In 1994, became a consultant with Ernst &Young in Darwin before returning to Treasury in 1996 as Assistant Director Financial Management (Policy).Transferred to the Budgets Division in 1998. Promoted to Director Budget Management in June 1999 andDirector System Redevelopment in March 2000.

Jodie Kirkman B Bus (Accy) CPADirector Budget Development

Commenced career as a Northern Territory University graduate attached to Treasury in 1992. In 1997,worked as Finance Manager in the Department of Asian Relations and Trade. Returned to Treasury in 1998as Assistant Director Budget Development and promoted to Director Budget Development in June 1999.

Linda Mackenzie B Com (Hons) CASenior Director Capital Financing

Commenced career with Coopers and Lybrand in Brisbane. After completing the chartered accountingProfessional Year, moved to the Corporate Financing and Leasing Division of Macquarie Bank Limited inSydney which involved working on structured finance transactions. Joined Ernst & Young in Darwin in 1996and was promoted to Senior Manager in 1997. Joined Treasury in 1998 as Director Capital Financing andpromoted to Senior Director Capital Financing in 1999.

Clare Milikins B Com CPA, Grad Dip MgmtDirector Budget Management

Commenced career as an auditor with Ernst & Young in Perth. Returned to the Territory in 1990 commencingwith Treasury as a graduate for a short period before transferring to the Darwin Port Authority as theaccountant. In late 1991, moved to the Internal Audit Bureau as an Audit Manager, before rejoining Treasuryin 1994, primarily working on the new financial management legislation. In 1996, moved to Transport andWorks as Director Commercial Services focusing on Government Business Division reform. Returned toTreasury in 1998 and appointed Director Budget Management in March 2000.

John Montague B A (Hons Econ) ASIA GAICDGeneral Manager Northern Territory Treasury Corporation

Commenced with Westpac Banking Corporation in 1986 holding various trading and management positionsin Sydney and Melbourne within the bank�s Treasury Fixed Interest department. Seconded to NorthernTerritory Treasury Corporation as Manager Financial Assets and Liabilities in 1994. Appointed General Managerof the Corporation in 1996.

Philip Potterton B A (Hons) MA Int Relns M Pub PolSenior Director Evaluation

Joined Commonwealth Department of Transport in 1979 with involvement in road transport and aviationpolicy development. Postgraduate study in public policy at the Kennedy School of Government, Harvardfrom 1983 to 1985. Subsequent experience in cost-benefit appraisal of overseas aid projects with theAustralian Agency for International Development, and policy analysis and evaluation with the Department ofFinance. Joined the Department of Employment, Education and Training as program evaluation manager in1993 and from 1998 managed implementation of the New Apprenticeships Scheme. Joined Northern TerritoryTreasury in February 2000.

Appendix E

69

Kathleen Robinson B Bus (Accy) CPADirector Financial Reforms

Commenced employment with Northern Territory Treasury in 1978 as a Finance Officer in Training, thenworked in a number of other Northern Territory Government agencies, primarily in the internal audit field.Returned to Northern Territory Treasury in 1987 and managed the Accounting Policy and Debt Managementunits for three years, followed by various policy and operational positions in the Department of the ChiefMinister. Returned to the Northern Territory Treasury in 1993 to resume work in financial management andaccounting policy areas. Appointed Director Financial Management in 1994. In 1999 assumed the projectmanager role for the Northern Territory Government�s GST Implementation Project and, following itscompletion, moved to the new role of Director Financial Reforms.

Andrew Smith B Bus (Accy) LLBAssistant Under TreasurerCommissioner of Taxes

Commenced career in Brisbane in the taxation consulting division of Ernst & Young. Primarily involved inproviding taxation services to government agencies (including the Northern Territory and QueenslandTreasuries) and corporate clients. Promoted to Manager in 1995. Joined Northern Territory Treasury asDirector Revenue Development and Assistant Commissioner of Taxes in 1996. Appointed Senior DirectorRevenue and Commissioner of Taxes in May 1999 after acting in those positions since July 1998, and promotedto Assistant Under Treasurer in August 2000.

Tony Stubbin B A (Econ)Senior Director Public Finance

Commenced with the Commonwealth Government in 1983 and worked with the Australian Capital TerritoryTreasury in the Economic Policy Section. Spent two years with the Department of Employment, Educationand Training as Assistant Director Labour Market Analysis. Joined Northern Territory Treasury in 1992 withthe Economic Policy and Assessment Division and appointed Director Economic Analysis in January 1996.Appointed Senior Director Public Finance in July 2000.

Alan Tregilgas M EcUtilities Commissioner

After three years as an economics lecturer, worked for ten years with the Commonwealth Treasury in Canberra,including a two year secondment to the International Monetary Fund in Washington DC. After spending1989-90 with the Northern Territory Treasury as Senior Director Programs and Resources, spent four yearswith the Standard & Poor�s Ratings Group in Australia and South-East Asia, based in Melbourne. After a twoyear period as Deputy Under Treasurer in the South Australian Treasury, worked as an economic consultant(privately and with Access Economics). Appointed Utilities Commissioner on 1 April 2000, following sixmonths as Interim Utilities Commissioner.

Craig Vukman B Bus (Accy) CPADirector Revenue DevelopmentAsssistant Commissioner of Taxes

Commenced career in 1985 with the Western Australian Treasury Department as a prudential standardauditor of non bank financial institutions. In 1991, joined the Western Australian State Revenue Departmentand held the positions of investigations officer, senior investigations officer and finally senior policy officer.Joined Northern Territory Treasury in July 1998 as Director Revenue Development and Assistant Commissionerof Taxes.

Catherine Wauchope B Ec M Pub PolDirector Executive Support and Coordination

Commenced employment in the Territory public sector in 1980, working mainly in regional areas of theDepartment of Education and the Conservation Commission of the Northern Territory. After two and a halfyears as a researcher on the Chief Minister�s staff, travelled and worked overseas before completing aneconomics and politics degree. Joined Northern Territory Treasury in 1993 as an economics graduate andmoved directly into Budget Policy. Promoted to Director Budget Management in 1996 and transferred toDirector Public Finance in August 1997. Appointed Director Executive Support and Coordination inJune 1999.

Senior Executives

70

APPENDIX F: STAFFING

STAFF

Average Actual

Paid Staff Staff

1999-00 30 June 2000

Northern Terr i tory Treasury 144.5 144.5

Northern Terr i tory Treasury Corporat ion 12 10

TOTAL 156.5 154.5

STAFF MOVEMENTS

1998-99 1999-00

Staff Employed as at 1 July 211 151.5

less Resignat ions 26 26

Ret irements 1 -

Transfers/promot ions to other agencies 81 35

Leave without pay (over 12 weeks) 9 8

Redundancy 2 1

-119 -70

plus Appointments/engagements 30 50

Transfers/promotions from other agencies 25.5 20

Return from leave without pay (over 12 weeks) 4 3

59.5 73

STAFF EMPLOYED AS AT 30 JUNE 151.5 154.5

Notes:

Includes Northern Territory Treasury and Northern Territory Treasury Corporation.

Includes staff who transferred to the Department of Corporate and Information Services on 1 January 1999 including the SuperannuationOffice.

71

STAFF BY DESIGNATION

Designation Actual Staff Actual Staff

30 June 1999 30 June 2000

Execut ive Contract Off icer 6 1 1


Execut ive Contract Off icer 4 1 -




Execut ive Off icer 1 2.5 4

Administrat ive Off icer 8 10 11





Administrat ive Off icer 3 25 25.5



TOTAL 151.5 154.5

Notes:


Figures show the number of employees paid at these levels on these dates.

STAFF BY LEVEL AND GENDER

Level Male Female Total

EO1 and above 11 9 20

AO7 to AO8 15 9 24

Up to AO6 43 67.5 110.5

TOTAL AS AT 30 JUNE 2000 69 85.5 154.5

Notes:


Figures show the number of employees paid at these levels on 30 June 2000.

Staffing

72

STAFF BY ACTIVITY / PROGRAM


Average Actual Staff

Paid Staff 30 June 2000

1999-00

Activity/Program

Corporate Management 27 26

Execut ive 10 9

Corporate Support 17 17

Budgets, Finance and Economic Services 64.5 63.5

Budget Management 29 29.5

Publ ic F inance 4 2

Economic Services 12.5 11

Financia l Management 15 16

Capital Financing 4 5

Territory Revenue Management 50 51.5

Revenue Collection 29 29

Revenue Development 9 10

Revenue Administration 12 12.5

Utilities Commission 3 3.5

Utilities Commission 3 3.5

TOTAL 144.5 144.5

Note: There are no staff in the Community Service Obligations Activity.

Northern Territory Treasury Corporation

Average Paid Actual Staff

Staff 30 June 2000

1999-00

Activity/Program

Administration

Administrat ion 12 10

TOTAL 12 10

Note: All staff are attached to the Administration Activity.

Appendix F

73

APPENDIX G: MANAGEMENT CONTROLS

Internal Review Processes

The Treasury management control strategy involves:

� formal and informal monitoring of all Treasury programs to include, but notbe confined to:

u Directors� reports on work in progress covering general and specificissues, reviewed by Executive Management and with peer interaction ofall Treasury Directors at monthly Directors� meetings;

u scheduled staff meetings in operational areas to communicate andmonitor specific elements;

u regular progress reports covering key operational functions;

u weekly Treasury Management Group meetings to review current issuesand set immediate task directions;

u regular liaison meetings with external parties covering key areas ofinterest, including other agencies, other jurisdictions, the Auditor-Generaland consultants; and

u participation in various inter- and intra-governmental committeesconcerned with areas relevant to Treasury responsibilities.

� regular monitoring and adjustment where appropriate in the light of emergingneeds of:

u activity and program structures;

u organisational structures and staff profiles;

u internal and external communications processes; and

u internal and external management reporting.

� progressive monitoring of key control elements in areas of:

u financial management;

u risk management;

u asset management;

u strategic planning and program maintenance;

u fraud prevention and protection;

u functional allocation;

u change implementation;

u project management;

u staff delegation;

u work flow organisation;

u purchasing; and

u records management and security.

� review of strategic planning, operational and developmental issues duringthe Treasury Conference, supported by regular reviews to monitor progressand to address emerging issues and, as necessary, to reset major prioritiesand resource allocations;

� progressive analysis of Treasury programs to ensure appropriateness andto implement, where necessary, adjustments which will improve theirrelevance, effectiveness and efficiency;

� the Treasury Management Group serving as the Treasury Audit Committee;and

� the Deputy Under Treasurer designated as the coordinator for all internalaudit matters.

74

Program Evaluation and Review

Public Finance Government Finance Statistics Review

The Public Finance program uses Government Finance Statistics (GFS)extensively in its work, particularly in publication of interjurisdictionalcomparisons in Budget Paper No. 3, the Treasurer�s Annual Financial Report,Commonwealth Grants Commission submissions, and presentations to MoodysInvestor Service. Over the past 10 years, comparing the data betweenjurisdictions has become increasingly difficult, mainly due to several breaks inthe Australian Bureau of Statistics (ABS) series over that time. For examplethe ABS moved the universities to the multijurisdictional sector several yearsago with only limited backcasting of the data. This made it extremely difficultto extend backcasting of that data to obtain robust time series of any greatlength. A review of the Public Finance internal data set was therefore necessary.

The primary objectives of the review were:

� to understand the GFS data sets produced by the Australian Bureau ofStatistics (ABS); and

� to propose a program to consolidate the existing Public Finance Division(PFD) data collections and to improve the efficiency with which they areused.

The review was completed internally. There were three broad parts to thereview. It was necessary to:

� understand differences in data sets for preparation and completion ofbriefings and Budget Papers;

� review the means of making meaningful and legitimate interstate financialcomparisons; and

� investigate the refining of existing data systems to enable rapid, robustresponses to data request needs.

It was found that further consideration should be given to the storing of alldata series in a single database rather than as a set of linked spreadsheets.This would improve the integrity and the usability of the data. It wasrecommended that an external resource set up this single database.

It was acknowledged that further work will need to be undertaken toaccommodate the emerging use of accruals standards in other jurisdictionsand the adoption of these standards by the ABS and the Australian Loan Council.

A consolidated Northern Territory GFS time series of data was completed in aset of linked spreadsheets. Consideration is being given to development ofthe database as recommended in the review.

Understanding and using the accrual data being published by States andTerritories and the ABS, currently and in the future, will be a major focus forthe program in the coming year.

Financial Management Review

To ensure that the Financial Management program is best placed to meet currentand anticipated future operational needs, in accordance with program objectives.

Due to significant changes in the program since the last review, along withanticipated future changes in the program�s tasks and role, a complete reviewof the program was undertaken in mid 1999-00. In particular, the review wasconsidered timely due to the imminent winding down of the GST ImplementationProject.

Objectives

Methodology

Review Findings

Outcomes

Objective

Methodology

Appendix G

75

The review was undertaken by obtaining a thorough understanding of theprogram�s objectives, tasks and role. This process involved analysis of theprogram�s key inputs and outputs, and incorporated consultation with all programstaff and key stakeholders.

Once a thorough understanding of the program was achieved, an assessmentof the program�s efficiency, effectiveness and appropriateness was undertaken.This resulted in a number of recommended program changes.

Overall the program was found to be operating well, with a significant day today operational workload. Among other things, staff shortages had limited theprogram�s ability to completely fulfil its role in relation to financial managementpolicy matters. The creation of a specific financial management policy sub-program, proactive action on staffing and a greater awareness of the extent ofthis policy role by senior management was noted to be of assistance in resolvingthis issue.

With the GST Implementation Project nearing completion, the review provideda timely means of assessing future Territory Government corporate taxpayerobligations and resulting workload issues. Creation of a Corporate Tax Unithas enabled the program to more effectively and efficiently complete thesetasks. In addition the Fringe Benefits Tax responsibilities of Treasury andDepartment of Corporate and Information Services continue to be assessedpost review.

The program is also responsible for a number of key financial managementprojects that were identified as requiring action in the coming year. Althoughongoing workflow issues may make completion of these tasks difficult, it isimportant that additional emphasis be given to these tasks in a reasonabletimeframe.

The review indicated that additional emphasis needed to be placed on theprogram�s financial management policy role. A separate sub-program, FinancialManagement Policy, was created that includes responsibility for accountingpolicy. Financial Management Policy also has a key role to play in theimplementation of any form of accrual reporting or accounting undertaken bythe Territory Government. A Corporate Tax Unit was established to managethe Territory�s corporate taxpayer obligations, while the review confirmed theongoing requirement for the Financial Management Operations sub-program�srole and tasks to continue as previously defined.

Staffing levels will be developed in the program to meet the requirements ofthe restructure, and staff are encouraged to continue to develop skills outsidetheir immediate work areas. Program management and staff were alsoencouraged to take a proactive role in the completion of identified key projects.The development of realistic project timeframes and key milestones will assistin this regard.

Progress is well underway on the action items noted in the review.

Review Findings

Outcomes

Management Controls

76

APPENDIX H: BOARDS, COMMITTEES AND PUBLICATIONS

Boards and Committees

Agents Licensing Fidelity Guarantee Fund

Alice Springs Resort Company Pty Ltd (in Members� Voluntary Liquidation)

Australian Statistics Advisory Council

Ayers Rock Resort Company Ltd (in Members� Voluntary Liquidation)

Banking Contract Project Team (Chair)

Banking Contract Steering Committee (Chair)

Barramundi Fishery Licence Buy Back Expert Working Group

Committee on Regulatory Reform

Committee on Territory Regulatory Regime for Electricity, Water and Sewerage Services

Commonwealth-State National Tax Reform Working Group

Conditions of Service Trust

Co-ordination Committee

Co-ordination Committee Capital Works Review Sub-Committee (Chair)

Co-ordination Committee Executive

Co-ordination Committee Information Technology and Communications Sub-Committee (Chair)

Co-ordination Committee Infrastructure Development Sub-Committee

Corporate Systems Management Committee

Darnor Pty Ltd

Deputy Secretaries Information Management Group

Department of Finance Payroll Stakeholders Management Committee

Djukbinj National Park Board

Executive Remuneration Panel

Finance Managers Forum

Fringe Benefits Tax - ATO and State Governments Liaison Group

Fringe Benefits Tax - Jurisdictional Liaison Committee

GAS (Government Accounting System) Client Group

Gasgo Pty Ltd

Government Business Divisions Steering Committee (Chair)

Government Business Division Reference Group

Government Energy Management Program Steering Committee

GST Administration Sub-Committee

GST Corporate Issues Group (Chair)

GST Executive Review Group

GST Interstate Working Group

GST Project Managers Forum (Chair)

GST Small Agencies Group (Chair)

Heads of Treasuries

Heads of Treasuries Accounting and Reporting Advisory Committee

Heads of Treasuries Fiscal Reporting Committee

Heads of Treasuries Interjurisdictional Pay-roll Tax Contractors Working Party

Heads of Treasuries Reciprocal Taxation Review Working Group

Heads of Treasuries Revenue Officers Working Group

Heads of Treasuries State Taxes Working Group

Hidden Valley Promotions Pty Ltd

77

Impact of Tax Reform on Employment Conditions Working Party

Information Management Reference Group

Legislative Assembly Members� Superannuation Trust

Menzies School of Health Research Finance Committee

Menzies School of Health Research Audit Committee

Northern Territory Conditions of Service Trust

Northern Territory Education and Training Authority Planning and Resource Advisory Council

Northern Territory Government and Public Authorities Superannuation Scheme Investment Board

Northern Territory Government and Public Authorities Superannuation Scheme Review Board

Northern Territory Legal Aid Commission

Northern Territory Major Events Company

Northern Territory Ord River Working Group

Northern Territory Police Legacy Board

Northern Territory Police Supplementary Benefit Trust

Northern Territory Public Sector Career Development Reference Group

Northern Territory Statistical Liaison Committee (Chair)

Northern Territory Steering Committee on National Competition Policy

Northern Territory Treasury Corporation Advisory Board

Northern Territory University Council

Northern Territory University Finance Committee

NT Gas Distribution Pty Ltd

NT Gas Pty Ltd

PIPS (Personnel Information and Payroll System) Client Group

Population Intelligence Working Group

Procurement Review Board

Public Sector Consultative Council

Public Trustee Investment Board

Railway Executive Group

Reportable Fringe Benefits Amount Working Group

Revenue Officers Tax Reform Issues Group

SA/NT Government Officials Railway Taskforce

State Tax Commissioners Group

State Tax Commissioners Tax Law Committee Subgroup

State Tax Commissioners Electronic Service Delivery Subgroup

State Tax Commissioners Compliance Subgroup

State Tax Commissioners New Management Practices Subgroup

State Tax Commissioners Business Processes Subgroup

Territory Loans Management Advisory Committee (Chair)

Timor Sea Gas Developments Executive Group

Yulara Corporation Pty Ltd

Publications

Treasury publications which are available on the Internet can be found at http://www.nt.gov.au/ntt/.

2000-01 Budget

The 2000-01 Budget was brought down on 16 May 2000 and was accompanied by the following BudgetPapers.

Boards, Committees and Publications

78

Budget Speech - Budget Paper No 1

The Treasurer�s speech to the Legislative Assembly describes the Government�s Budget strategy and keyfeatures of the 2000 Budget, together with the Bill presented to Parliament seeking Allocations to Activitiesfor 2000-01.

The Budget - Budget Paper No 2

Detailed dissection and description of the Budget by Ministerial portfolio and programs. Detailed estimatesof receipts and expenditure by category of cost and source of funds, together with outlays, revenue andfinancing transactions for all agencies within the Northern Territory budget sector, presented according tothe Economic Transactions Framework. Additional financial statements are provided for Government BusinessDivisions. A comprehensive summary of revenue information is also provided.

Issues in Public Finance - Budget Paper No 3

A Northern Territory Treasury perspective on current issues in public finance which have an impact onNorthern Territory financial management, operational management and reporting. Discussions on the financialimplications of the Commonwealth Government�s New Tax System and preparations for the implementationof the GST on 1 July 2000, together with the Territory�s fiscal strategy are also provided.

Capital Works Program - Budget Paper No 4

Detailed description of the 2000-01 Capital Works Program by agency and project, including information onprojects over $1M, and detailed estimates of expenditure in 1999-00 and 2000-01 by construction agenciesare presented.

Northern Territory Economy - Budget Paper No 5

An overview of the Northern Territory economy, including reviews of the performance and outlook for majorindustry sectors. The performance of the Territory in both an Australian and a Regional context is compared.

Related Papers

Budget Overview

Presents key aspects of the 2000-01 Budget.

Regional Highlights

The effect of the 2000-01 Northern Territory Budget on the major regions of the Territory. Agency budgetsare dissected by region and 2000-01 initiatives and significant priorities of agencies are outlined.

Women in the Budget

An overview of Budget expenditures and Government initiatives targeted at women and girls.

Treasurer�s Financial Statements

Treasurer�s Quarterly Financial Report 1999-00

These statements summarise the quarterly and year to date financial transactions for the Public Account andAccountable Officers� Trust Accounts and provide a summary of the overall Account balances.

Treasurer�s Annual Financial Report 1999-00

This report comprises of the Treasurer�s Annual Financial Statement prepared in accordance with Section 9of the Financial Management Act and other unaudited financial information.

Appendix H

79

Information on the gross and net outlays and receipts data for the Northern Territory budget sector, netoutlays and receipts compiled according to the Uniform Presentation Framework and stock of public assetsand liabilities, including debt, are included in the Treasurer�s Report.

Web Sites

� Treasury

� Commissioner of Taxes

� GST NT

� Territory Bonds

� Utilities Commission

Annual Reports

Separate Annual Reports are produced for:

� Northern Territory Treasury;

� Northern Territory Treasury Corporation;

� Utilities Commission;

� Northern Territory Government Conditions of Service Trust; and

� Ayers Rock Resort Corporation.

Other Publications

Submissions to the Commonwealth Grants Commission

The Northern Territory Government Submission to the 2004 Review: Proposed Work Program (February2000) provided the Commission with feedback on the scope, nature and timing of various components ofthe 2004 Review of Relativities.

The Northern Territory Government Submission to the Indigenous Funding Inquiry (June 2000) provided theCommission with Territory Government input into the Commission�s Inquiry which seeks to determine theactual levels of service experienced and required by Indigenous people in different regions of Australia.

Territory Talking

A publication aimed specifically at holders, and prospective holders, of Territory Bonds. Articles are preparedboth in-house and by interested external parties, such as the Registry Managers.

Monthly Economic Review

Published soon after the end of each month, providing an economic overview for the previous month as wellas a variety of comparative statistical tables. It is distributed within the Northern Territory Government andis available to other individuals and organisations upon request.

An Employer�s Guide to Pay-roll Tax in the Northern Territory

An aid to employers who may have a liability for pay-roll tax. It comprehensively explains the basic provisionsof the Pay-roll Tax Act and gives examples of how to calculate payroll tax. The Guide replaces the formerPay-roll Tax Booklet.

Stamp Duty Booklet

Information for taxpayers on certain duties imposed under the Stamp Duty Act with a brief explanation ofthe administrative requirements for those duties. The booklet is updated as necessary and is available onrequest.

Boards, Committees and Publications

80

Superannuation Arrangements For Employees Who Commence from 10 August 1999

Information brochure provided to all new employees and includes details of their superannuation entitlementsand options. It provides advice on how to select a complying funding and the role of the default fund.

GST Guides:

An Overview of GSTImplementing GSTGST and ContractsGST Impact Statement GuideSystems Compliance Checklist

Detailed information and advice on the Commonwealth�s GST legislative requirements to assist agencieswith the implementation of the GST in the Northern Territory Government.

Appendix H

81

FINANCIAL

STATEMENTS

83

FINANCIAL STATEMENTS

The financial statements are separated into two financial agencies:

� Northern Territory Treasury; and

� Northern Territory Treasury Corporation.

It should be noted that, although a legislatively separate entity, the UtilitiesCommission is included as an Activity in Northern Territory Treasury�s budgetand therefore in these financial statements.

The 1999-00 financial statements and accounts included in this section havebeen prepared in accordance with Part 2 Section 5 of the Treasurer�s Directions.Where there has been no activity in relation to any of the reporting elementsprescribed, schedules have not been included. Within each schedule, onlyitems with activity during the year have been shown. Unless otherwise indicated,all amounts in the financial statements have been rounded off to the nearestone thousand dollars. To assist the reader, explanatory notes have been includedwith each schedule as necessary.

The format of these financial statements reflects the Activity and Programstructure of the two entities as at 30 June 2000.

Details of investments held in corporations, trusts, joint ventures or similarentities, together with contingent liabilities, have been provided in accordancewith Treasurer�s Directions for consideration in global reporting in the Treasurer�sAnnual Financial Report.

Treasury�s internal financial management is undertaken within a policy frameworkwhich includes:

� maintenance and presentation of financial information in a manner whichenables timely monitoring and effective control of Treasury�s financialactivities;

� use of cash accounting principles, with supplementary accrual informationmaintained for key liabilities and assets for Northern Territory Treasury;

� adherence to statutory requirements and policies as set out in the FinancialManagement Act and Regulations, Treasurer �s Directions, and theProcurement Act and related Circulars;

� management of Treasury assets in accordance with Accounting and PropertyManual guidelines;

� internal control monitoring procedures; and

� annual planning processes to ensure resource allocation and priorities areconsistent with Government requirements.

The following information is provided to assist in understanding the 1999-00financial statements.


� The Budgets and Finance Activity and the Economic Services Activity werecombined to better reflect the core responsibilities of Treasury and the wayin which the organisation operates.

� The Taxation Policy program was merged with the Economic Servicesprogram. Responsibility for operational issues regarding taxation wastransferred to the Revenue Development program.

� In 1999-00, the Utilities Commission was established and included as anActivity in Treasury�s Budget.

84

� Additional Allocation of $10 million in the Corporate Management Activity in1999-00 relates to legal expenses for the NT Power litigation.

� The Community Service Obligations Activity accounted for 59 per cent ofexpenditure for Northern Territory Treasury.


� 98 per cent of expenditure is non-discretionary, relating to scheduledborrowing and lending programs.

� Further interest rate risk management was undertaken during the year toeven out the Territory�s exposure in future years to interest rate movementsfrom year to year.

85


EXPENDITURE BY ACTIVITYFOR YEAR ENDED 30 JUNE 2000

Activity/Program Final Allocation Actual Expenditure

$000 $000

Corporate Management 15 876 15 876

Executive 13 018 12 921 Corporate Support 2 858 2 955

Budgets, Finance and Economic Services 7 195 7 186

Budget Management 2 345 2 641 Public Finance 433 316 Economic Services 1 359 1 218 Financial Management 2 765 2 666 Capital Financing 293 345

Territory Revenue Management 16 176 16 166

Revenue Collection 14 548 14 457 Revenue Development 854 931 Revenue Administration 774 778

Community Service Obligations 56 655 56 655

GBD Community Service Obligations 56 655 56 655

Utilities Commission 500 448

Utilities Commission 500 448

TOTAL EXPENDITURE 96 402 96 331

86

EXPENDITURE BY STANDARD CLASSIFICATIONFOR YEAR ENDED 30 JUNE 2000

$000

Personnel Expenditure 9 486

Fringe Benefits Tax 94 Higher Duties Allowance 156 Leave Loading 64 Northern Territory Allowance 29 Other Allowances 55 Other Benefits Paid by Employer 274 Overtime 55 Pay-roll Tax 628 Recreation Leave Fares 29 Salaries 7 307 Salary Advances 16 Superannuation 385 Termination Payments 315 Workers Compensation 79

Operational Expenditure 17 499

Advertising 10 Bank Charges 1 319 Communications 212 Consultants Fees 1 390 Consumables/General Expenses 130 Document Production 235 Entertainment/Hospitality 16 Freight 6 Furniture and Fittings 250 General Property Management 10 Information Technology Services 2 078 Legal Expenses 10 426 Library Services 79 Membership and Subscriptions 7 Motor Vehicle Expenses 172 Office Requisitions and Stationery 92 Official Duty Fares 257 Other Plant and Equipment 67 Power 111 Property Maintenance 32 Recruitment Expenses 278 Relocation Expenses 27 Training and Study Expenses 168 Travelling Allowance 127

Capital Expenditure 65

Purchase of Capital Assets 65

Grants 69 281

Community/Government Service Obligations 56 655 Current Grants 12 626

TOTAL EXPENDITURE 96 331


87

RECEIPTS BY ACCOUNTFOR YEAR ENDED 30 JUNE 2000

Financial Statements

Estimated Receipts Actual Receipts

$000 $000 CONSOLIDATED REVENUE ACCOUNT

Taxes 182 191 168 738

Fees and Charges 132 45

Miscellaneous Receipts 6 075 12 209

Sale of Other Assets 0 7 675

Equity 70 000 60 000

Property Income 24 500 24 948

Territory Borrowings 0 100 000

Intrasector Receipts 126 324 123 493

Commonwealth Grants 1 227 146 1 210 419

Financial Assistance Grants 1 078 400 1 073 755 Revenue Replacement Payments 129 836 124 789 Other Commonwealth Grants 18 910 11 875

TOTAL CONSOLIDATED REVENUE ACCOUNT 1 636 368 1 707 527

OPERATING ACCOUNT

Charges for Goods and Services 465 1 051 Miscellaneous Revenue 623 867 Sale of Assets 5 0

TOTAL OPERATING ACCOUNT 1 093 1 918

Transfer from Consolidated Revenue Account 95 194 96 176

TOTAL RECEIPTS TO AGENCY OPERATING ACCOUNT 96 287 98 094

Note:

The $100 million in advances received was additional borrowings received into the Consolidated Revenue Account, asannounced by the Treasurer in the Budget Speech in May 2000 to meet additional capital expenditure requirements. AtBudget time, it was recorded against Northern Territory Treasury Corporation but was actually received directly into theConsolidated Revenue Account.

88

ACCOUNTABLE OFFICER�S TRUST ACCOUNTFOR YEAR ENDED 30 JUNE 2000

Nature of Trust Money Opening Balance Receipts Payments Closing Balance

1 July 1999 30 June 2000

$000 $000 $000 $000

Miscellaneous 43 0 0 43 Unclaimed Money 175 104 33 246

TOTAL 218 104 33 289

WRITE OFFS, POSTPONEMENTS, WAIVERS ANDEX-GRATIA PAYMENTS

FOR YEAR ENDED 30 JUNE 2000

DEBTORS AS AT 30 JUNE 2000

External Intrasector Total

Other Other

$000 $000 $000

Activity

Corporate Management 8 8

Budgets, Finance and Economic ServicesTerritory Revenue Management 1 220 1 220

Community Service ObligationsUtilities Commission

TOTAL 1 220 8 1 228

less Provision for Doubtful Debts 382 382

NET DEBTORS 838 8 846

Classified As:Current 838 8 846

Non Current

NET DEBTORS 838 8 846

$000 Amounts written off or waived by Delegated Officers

Irrecoverable money written off 8 Waiver of right to receive or recover money 55

Amounts written off, postponed or waived by the Treasurer

Irrecoverable money written off 237 Waiver of right to receive or recover money 167

Ex-Gratia Payments under the Act

Ex-gratia payments approved by Delegated Officers 3 Ex-gratia payments approved by the Treasurer 11

TOTAL 481


89

CREDITORS AND ACCRUALS AS AT 30 JUNE 2000

Note: All amounts are classified as current.


Activity/Program Creditors Accruals Total Creditors Accruals Total Total

$000 $000 $000 $000 $000 $000 $000

Corporate Management 921 77 998 - 3 3 1 001

Executive 908 23 931 - 3 3 934

Corporate Support 13 54 67 - - - 67

Budgets, Finance and Economic

Services 30 104 134 2 15 17 151

Budget Management 7 47 54 - 8 8 62

Public Finance 2 3 5 - 2 2 7

Economic Services 9 21 30 - - - 30

Financial Management 7 24 31 2 4 6 37

Capital Financing 5 9 14 - 1 1 15

Territory Revenue Management 113 667 780 5 9 14 794

Revenue Collection 106 635 741 - 6 6 747

Revenue Development 2 16 18 - 1 1 19

Revenue Administration 5 16 21 5 2 7 28

Community Service Obligations - - - - - - - GBD Community Service Obligations - - - - - -

Utilities Commission - 6 6 - - - 6

Utilities Commission - 6 6 - - - 6

TOTAL 1 064 854 1 918 7 27 34 1 952

External Intrasector

90

EMPLOYEE ENTITLEMENTS OUTSTANDINGAS AT 30 JUNE 2000

Methodology:

The value of recreation leave entitlements is calculated by PIPS based on employees� actual salaries and entitlements at30 June 2000.

The value of leave loading entitlements is calculated by PIPS based on employees� actual salaries and entitlements at30 June 2000.

Long service leave entitlement is calculated in accordance with Australian Accounting Standard AAS 30. The calculationtakes into account the probability of employees reaching ten years of service, the future increases in salary costs anddiscount rates to achieve the net present value of the future liability.

LEASE LIABILITIES FOR YEAR ENDED 30 JUNE 2000

Information Technology

Hardware

Lease Commitments / Liability $000

Not later than one year 4Later than one year but not later than two years 4Later than two years but not later than five years -Later than five years -

TOTAL 8

Classified as:

Current 4Non Current 4

TOTAL 8


Amount

Outstanding

$000Current

Recreation Leave 1 075 Leave Loading 98 Long Service Leave 993

Non Current

Long Service Leave 289

TOTAL 2 455

91


EXPENDITURE BY ACTIVITYFOR YEAR ENDED 30 JUNE 2000

Final Allocation Actual Expenditure

Activity / Program $000 $000

Administration 5 471 5 624

Administration 5 471 5 624

External Debt Management 223 207 221 960

Interest on Commonwealth Advances 26 834 26 834 Interest on Territory Borrowings 140 194 138 974 Repayment of Commonwealth Advances 56 179 56 152

Internal Funds Management 24 862 24 862

Dividends to Territory Government 20 602 20 602 Interest and Advances to Territory Agencies 4 260 4 260

TOTAL EXPENDITURE 253 540 252 446

$000 Personnel Expenditure 737

Fringe Benefits Tax 7 Higher Duties Allowance 6 Leave Loading 7 Northern Territory Allowance 3 Other Benefits Paid by Employer 12 Overtime 2 Pay-roll Tax 47 Recreation Leave Fares 6 Salaries 622 Termination Payments 25

Operational Expenditure 4 882

Agent Service Arrangements 465 Audit Fees 104 Borrowing Costs 1 421 Communications 130 Consultants Fees 9 Consumables/General Expenses 5 Document Production 59 Entertainment/Hospitality 4 Freight 1 Furniture and Fittings 9

EXPENDITURE BY STANDARD CLASSIFICATIONFOR YEAR ENDED 30 JUNE 2000

(continued)

92

Information Technology Services 212 Insurance Premiums 2 334 Marketing and Promotion 33 Membership and Subscriptions 16 Motor Vehicle Expenses 10 Office Requisitions and Stationery 4 Official Duty Fares 12 Regulatory and Advisory Boards and Committees 37 Training and Study Expenses 8 Travelling Allowance 9

Capital Expenditure 5

Capital Items 5

Interest Expense 165 808

To Commonwealth 26 834 To Private Sector 138 974

Advances 4 260

To Government Business Divisions 4 260

Borrowings 56 152

From Commonwealth - Loans Repaid 56 152

Profit Distribution (Dividends) 20 602

To Northern Territory Treasury 20 602

TOTAL EXPENDITURE 252 446

EXPENDITURE BY STANDARD CLASSIFICATIONFOR YEAR ENDED 30 JUNE 2000 (continued)


93

DEBTORS AS AT 30 JUNE 2000

Estimated Receipts Actual Receipts

$000 $000 CONSOLIDATED REVENUE ACCOUNT

Interest Received from Private Sector 13 875 7 236

TOTAL CONSOLIDATED REVENUE ACCOUNT 13 875 7 236

OPERATING ACCOUNT

Charges for Goods and Services 262 262 Interest Receivable from Local Government 1 521 1 522 Advances to Local Government - Repaid 3 578 3 576 Commonwealth Grants 5 100 5 096 Borrowings 46 811 40 583 Other Intrasector Receipts 78 916 78 740

TOTAL OPERATING ACCOUNT 136 188 129 779

Transfer from Consolidated Revenue Account 140 684 129 917

TOTAL RECEIPTS TO AGENCY OPERATING ACCOUNT

276 872 259 696

Total

Charges Other Total Other Total

Activity $000 $000 $000 $000 $000 $000

Administration

Debtors 50 50 834 834 884


Interest on Loans 6 327 6 327 3 309 3 309 9 636 Derivative Financial Instruments

Domestic and InternationalInterest Rate Swaps 2 901 2 901 2 901

Cross Currency Swaps 53 243 53 243 53 243

TOTAL 50 62 471 62 521 4 143 4 143 66 664

less Provision for Doubtful Debts

NET DEBTORS 50 62 471 62 521 4 143 4 143 66 664

Note: All debtors are classified as current.

External Internal

RECEIPTS BY ACCOUNTFOR YEAR ENDED 30 JUNE 2000


94

CREDITORS AND ACCRUALS AS AT 30 JUNE 2000

EMPLOYEE ENTITLEMENTS OUTSTANDINGAS AT 30 JUNE 2000

External Intrasector Total

Activity $000 $000 $000

Administration

Creditors and Accruals 114 114


Interest 37 212 37 212

Derivative Financial InstrumentsDomestic and International

Interest Rate Swaps 6 935 6 935

Cross Currency Swaps 6 954 6 954

TOTAL 51 215 51 215

Note:

Figures have not been disaggregated to program level as amounts are not material. All amounts are classified as current.

Amount Outstanding

$000 Current

Recreation Leave 94 Leave Loading 9 Long Service Leave 46

Non Current

Long Service Leave 18

TOTAL 167

Methodology:

The value of recreation leave entitlements is calculated by PIPS based on employees� actual salaries and entitlements at30 June 2000.

The value of leave loading entitlements is calculated by PIPS based on employees� actual salaries and entitlements at 30June 2000.

Long service leave entitlement is calculated in accordance with Australian Accounting Standard AAS 30. The calculationtakes into account the probability of employees reaching ten years of service, the future increases in salary costs anddiscount rates to achieve the net present value of the future liability.


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