Department of Infrastructure, Regional Development and Cities
Administered Budget Variances Commentary

Budget Variances Commentary

Administered Schedule of Comprehensive Income

Expenses

Employee expenses are under budget by $3.0 million mainly due to the increased use of contractors and Service Delivery Agreements to deliver services in the Indian Ocean Territories. 

Supplier expenses are over budget by $22.4 million mainly due to additional site management costs for the Western Sydney Airport reflected in the 2017–18 Portfolio Additional Estimates Statements (PAES), increased demand for services in the Indian Ocean Territories and Norfolk Island and further implementation of reforms on Norfolk Island.

Subsidy expenses are under budget by $26.4 million due to a slower than anticipated uptake of the expansion of the Tasmanian Freight Equalisation Scheme.

Grant expenses are over budget by $830 million mainly due to a Determination by the Treasurer to bring forward Financial Assistance Grant payments from 2018–19.

Write-down and impairment expenses were not budgeted and mainly reflect the write-down of land at Badgerys Creek as a result of entering into an airport lease with WSA Co Limited for no consideration. 

Concessional loan expenses are under budget by $111.2 million due to a change in accounting policy for the recognition of a provision for commitments to provide a loan at a below market interest rate (refer disclosures in the Overview Section).

Income

Other taxes are over budget by $4.4 million mainly due to a stamp duty equivalent payment due from WSA Co Limited.

Sale of goods and services revenue is over budget by $3.0 million due to additional revenue from the sale of sand at Jandakot Airport (WA) and provision of services in the Indian Ocean Territories.

Other contributions were not budgeted and reflect recovery of preparatory costs at the Western Sydney Airport site from WSA Co Limited. 

Other gains are over budget by $6.9 million due to the recognition of the fair value of land acquired for no consideration at Melbourne Airport.

Administered Schedule of Assets and Liabilities

Cash and cash equivalents are over budget by $16.6 million due to the drawdown of funds to meet payments in early July 2018.

Administered investments are under budget by $202 million mainly due to the recognition of provisions by WSA Co Limited and the Moorebank Intermodal Company Limited for remediation of land, partially offset by an adjustment to the investment in WSA Co Limited for the fair value of the airport  lease (refer Note 4.1D).

Non-financial assets are under budget by $180 million mainly due to differences between the actual and budgeted opening balances and the write-down of land at Badgerys Creek resulting from the airport lease with WSA Co Limited.

Payables are over budget by $16.6 million due to a difference between the estimated and actual timing of payments at 30 June 2018.

Provisions are over budget by $102 million due to the change in accounting policy to recognise a provision for commitments to provide a loan at a below market interest rate (refer Overview Section). 

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