Australian Federal and State Budgets - An Overview
According to s 4(1) of the Fiscal Responsibility Act 2005 (NSW), the term net operating result means the excess of total revenue over total expenses as described for GFS. It is noted that net operating result excludes expenditure on the acquisition of capital assets, but includes the consumption of capital (depreciation).
Public debt: Public debt, according to a recent definition by Marc Robinson, measures “the excess of [government] assets over [government] liabilities in respect to bonds and holdings of money.”7 Some years before Robinson’s paper, the H.V. Evatt Foundation, in a report entitled The Capital Funding of Public Enterprise in Australia, wrote that “Public debt is the sum of borrowings by government either from domestic or international capital markets.” 8
General Government Sector: The general government sector, as described in the NSW Budget 2005-06, includes:
all. . .government agencies that receive parliamentary appropriations…Non- budget dependent general government sector agencies are generally self- financing through the imposition of regulatory and user charges. 9
General Government Sector Net Debt: This is defined by the NSW Auditor- General as follows:
General Government Sector net debt is the sum of all deposits held by, advances received by and borrowings made by the General Government Sector less the sum of cash and deposits held by, advances paid and investments, loans and placements made by the General Government Sector. It excludes financial assets that are allocated to fund other liabilities through legislation or contract. 10
This definition is the same as the definition of underlying general government net debt in s 4(1) of the Fiscal Responsibility Act 2005 (NSW). As the budget is a financial document focusing on the public sector, general government sector net debt is a significant indication of the position of a government’s budget.
Negative Net Debt: The term negative net debt indicates that a government has a surplus of assets over liabilities.
Net Financial Liabilities: Net debt plus unfunded liabilities (such as superannuation and long service leave). In s 4(1) of the Fiscal Responsibility Act
Marc Robinson, Accrual Financial Reporting in the Australian Public Sector: An Economic Perspective (School of Economics and Finance, Queensland University of Technology, 2000), p.11.
H.V. Evatt Foundation, The Capital Funding of Public Enterprise in Australia (H.V. Evatt Foundation, Sydney, 1988), p.99.
NSW Treasury, NSW Budget 2005-06 (NSW Treasury, Sydney, 2005), Budget Paper No.2, pp.1-2.
Auditor-General’s Report to Parliament 2009 Volume Four, p 37.