PORTFOLIO ADDITIONAL ESTIMATES STATEMENTS 2012 ......Defence Portfolio Additional Estimates Statements 2012-13 vi Abbreviations and Conventions The following notations may be used:

i

PORTFOLIO ADDITIONAL

ESTIMATES STATEMENTS 2012-13

DEFENCE PORTFOLIO

EXPLANATIONS OF ADDITIONAL ESTIMATES 2012-13

Defence Portfolio Additional Estimates Statements 2012-13

ii

© Commonwealth of Australia 2012

ISBN 978-0-642-29773-0

This publication is available for your use under a Creative Commons BY Attribution 3.0 Australia licence, with the exception of the Commonwealth Coat of Arms, the Department of Defence and Defence Housing Australia logo, photographs, images, signatures and where otherwise stated. The full licence terms are available from http://creativecommons.org/licenses/by/3.0/au/legalcode.

Use of the Department of Defence’s material under a Creative Commons BY Attribution 3.0 Australia licence requires you to attribute the work (but not in any way that suggests that the Department of Defence endorses you or your use of the work).

Department of Defence material used 'as supplied'

Provided you have not modified or transformed the Department of Defence material in any way including, for example, by changing the text; calculating percentage changes; graphing or charting data; or deriving new statistics from published Department of Defence statistics – then the Department of Defence prefers the following attribution:

Source: The Australian Government Department of Defence

Derivative material

If you have modified or transformed the Department of Defence ‘s material, or derived new material from those of the Department of Defence in any way, then the Department of Defence prefers the following attribution:

Based on The Australian Government Department of Defence’s data.

Defence Housing Australia material used 'as supplied'

Provided you have not modified or transformed the Defence Housing Australia material in any way including, for example, by changing the text; calculating percentage changes; graphing or charting data; or deriving new statistics from published Defence Housing Australia statistics – then the Defence Housing Australia prefers the following attribution:

Source: The Australian Government Defence Housing Australia

Derivative material

If you have modified or transformed the Defence Housing Australia‘s material, or derived new material from those of the Defence Housing Australia in any way, then the Defence Housing Australia prefers the following attribution:

Based on The Australian Government Defence Housing Australia’s data.

iii

Use of the Coat of Arms

The terms under which the Coat of Arms can be used are set out on the It’s an Honour website (see www.itsanhonour.gov.au)

Other Uses

Inquiries regarding this licence and any other use of this document are welcome at:

Director Chief Finance Officer Coordination R1-2-C003 Department of Defence PO Box 7900 Canberra BC ACT 2610 Telephone: (02) 6265 5341 Email: [email protected]


iv


vi

Abbreviations and Conventions

The following notations may be used:

NEC/nec not elsewhere classified

- nil

.. not zero, but rounded to zero

na not applicable (unless otherwise specified)

nfp not for publication

$m $ million

$b $ billion

Figures in tables and in the text may be rounded. Figures in text are generally rounded to one decimal place, whereas figures in tables are generally rounded to the nearest thousand. Discrepancies in tables between totals and sums of components are due to rounding.

Enquiries

Should you have any enquiries regarding this publication please contact:

Chief Finance Officer R1-2-C001 Department of Defence PO Box 7900 Canberra BC ACT 2610 Telephone: (02) 6265 5341 Email: [email protected]

A copy of this document can be located on the Australian Government Budget website at:

<http://www.budget.gov.au>.

References

Previous years’ Defence Portfolio Budget Statements, Portfolio Additional Estimates Statements and Annual Reports can be found at <www.defence.gov.au/budget/>.

vii

User Guide to the

Portfolio Additional Estimates

Statements


viii

User Guide The purpose of the Portfolio Additional Estimates Statements (PAES), like that of the Portfolio Budget Statements (PB Statements), is to inform Senators and Members of Parliament of the proposed allocation of resources to Government outcomes by agencies within the portfolio. The focus of the PAES differs from the PB Statements in one important aspect. While the PAES include an Agency Resource Statement to inform Parliament of the Revised Estimate of the total resources available to an agency, the focus of the PAES is on explaining the changes in resourcing by outcome(s) since the Budget. As such, the PAES provides information on new measures and their impact on the financial and/or non-financial planned performance of programs supporting those outcomes.

The PAES facilitate understanding of the proposed appropriations in Appropriation Bills (No. 3 and No. 4) 2012-13. In this sense the PAES is declared by the Additional Estimates Appropriation Bills to be a 'relevant document' to the interpretation of the Bills according to section 15AB of the Acts Interpretation Act 1901.

Whereas the Mid Year Economic and Fiscal Outlook 2012-13 is a mid-year budget report which provides updated information to allow the assessment of the Government's fiscal performance against its fiscal strategy, the PAES update the most recent budget appropriations for agencies within the portfolio.


x

Table of Contents

11

Table of Contents User Guide.......................................................................................................................................................... viii

Structure of the Portfolio Additional Estimates Statements........................................................................ ix

Table of Contents .................................................................................................................................................11

PORTFOLIO OVERVIEW..................................................................................................................................14

Ministers and their Portfolio Responsibilities ...............................................................................................15

Portfolio Structure and Outcomes ......................................................................................................................16

Portfolio Resource Statement...............................................................................................................................17

Portfolio Workforce...............................................................................................................................................20

DEPARTMENT OF DEFENCE..........................................................................................................................24

Section 1: Defence Overview and Resources ..................................................................................................24

1.1 Strategic Direction Statement ........................................................................................................................24

1.2 Defence Resourcing.........................................................................................................................................28

1.3 Funding from Government............................................................................................................................36

1.4 Capital Investment Program..........................................................................................................................41

1.5 People................................................................................................................................................................43

Section 2: Outcomes and Planned Performance .............................................................................................48

2.1 Outcomes and Performance Information.....................................................................................................48

Section 3: Explanatory Tables and Budgeted Financial Statements ...........................................................78

3.1 Explanatory Tables..........................................................................................................................................78

3.2 Budgeted Financial Statements .....................................................................................................................82

3.3 Consolidated Budgeted Financial Statements for the Department of Defence (including DMO) .......97

Appendices..........................................................................................................................................................102

Appendix A..........................................................................................................................................................103

Appendix B ..........................................................................................................................................................104

Appendix C..........................................................................................................................................................105

Appendix D..........................................................................................................................................................114

Appendix E ..........................................................................................................................................................118

Appendix F...........................................................................................................................................................125


12

DEFENCE MATERIEL ORGANISATION ...................................................................................................128

Section 1: Agency Overview and Resources .................................................................................................128

1.1 Strategic Direction Statement ......................................................................................................................128

1.2 DMO Resource Statement ............................................................................................................................131

1.3 Agency Measures Table................................................................................................................................132

1.4 Additional Estimates and Variations..........................................................................................................132

1.5 Breakdown of Additional Estimates by Appropriation Bill ....................................................................132

1.6 People..............................................................................................................................................................133

Section 2: Outcomes and Planned Performance ...........................................................................................134

2.1 DMO Outcomes and Performance Information........................................................................................135

Section 3: Explanatory Tables and Budgeted Financial Statements .........................................................165

3.1 Explanatory Tables........................................................................................................................................165

3.2 DMO Budgeted Financial Statements ........................................................................................................168

DEFENCE HOUSING AUSTRALIA ..............................................................................................................176

Section 1: DHA Overview and Resources .....................................................................................................176

Section 2: Outcomes and Planned Performance ...........................................................................................176

Section 3: Explanatory Tables and Budgeted Financial Statements .........................................................176

APPENDICES .....................................................................................................................................................177

Glossary ...............................................................................................................................................................178

Acronyms and Abbreviations ..........................................................................................................................184

13

Portfolio Overview


14

Portfolio Overview The Defence portfolio consists of a number of component organisations that together are responsible for supporting the defence of Australia and its national interests. The three most significant bodies are:

the Department of Defence—a department of state, headed by the Secretary of the Department of Defence

the Australian Defence Force (ADF)—which consists of the three Services, Navy, Army and the Air Force (including Reserves) commanded by the Chief of the Defence Force (CDF). Each Service Chief also administers their respective Cadet service, although the Cadet service is not a component of the parent Service

the Defence Materiel Organisation (DMO)—a prescribed agency within the Department of Defence, headed by its Chief Executive Officer (CEO) DMO.

In practice, these bodies have to work together closely and are broadly regarded as one organisation known simply as Defence (or the Australian Defence Organisation).

The portfolio also contains some smaller entities, including a number of statutory offices created by the Defence Force Discipline Act, 1982 which are independent but reside administratively within Defence and various trusts and companies such as Defence Housing Australia (DHA) and the Australian Strategic Policy Institute.

DHA's main function is to provide adequate and suitable housing for members of the ADF. DHA is an enterprise within the Defence portfolio and has two shareholder Ministers: the Minister for Defence, the Hon Stephen Smith MP; and the Minister for Finance and Deregulation, Senator the Hon Penny Wong.

DHA is required by legislation to perform its functions in accordance with the policies of the Australian Government and in accordance with sound commercial practice. This means that DHA has a targeted rate of return and a requirement to make annual dividends and income tax payments.

The Minister for Defence's portfolio also contains the Department of Veterans' Affairs and associated bodies, as it is designated as part of the Defence portfolio in the Administrative Arrangements Order. The Department of Veterans' Affairs is administered separately to Defence.

Portfolio Overview

15

Ministers and their Portfolio Responsibilities

No changes have been made to Ministers and their Portfolio Responsibilities since the Portfolio Budget Statements 2012-13.

Portfolio Overview

17

Portfolio Resource Statement

Table 1: Portfolio Resources[1]

DepartmentalBill No. 3

$m

AppropriationBill No. 4

$m

Section 10Appropriation

Act (No.1)

2012-13[3]

$m

Return to the OPA

$m

Special Appropriation

$m

Total Appropriation

$m

Non-Appropriation

Receipts

$m

Other Non-Appropriated

Items[2]

$m

TotalResources

Available

$m

Department of Defence

Administered appropriations - - - - - - - - -

Departmental appropriations - 468.8 -366.5 76.2 - 178.5 -60.7 - 117.8

Total Department of Defence - 468.8 -366.5 76.2 - 178.5 -60.7 - 117.8


$m


$m


Act (No.1)2012-13

$m

Return to the OPA

$m


$m

Total Appropriation

$m

Non-Appropriation

Receipts

$m


Items

$m

TotalResources

Available

$m

Defence Materiel Organisation

Administered appropriations[4]- - - - - - - - -

Departmental appropriations - - -17.4 - - -17.4 110.6 - 93.2

Total Defence Materiel Organisation - - -17.4 - - -17.4 110.6 - 93.2


$m


$m


Act (No.1)2012-13

$m

Return to the OPA

$m


$m

Total Appropriation

$m

Non-Appropriation

Receipts

$m


Items

$m

TotalResources

Available

$m

Defence Housing Australia

Administered appropriations - - - - - - - - -

Departmental appropriations - - - - - - - - -

Total Defence Housing Australia - - - - - - - - -

Total Portfolio - 468.8 -383.9 76.2 - 161.1 49.9 - 211.0

Notes 1. Figures shown include inter-agency transactions. 2. Represents interest on DHA loans taken out prior to 30 June 2008 reported against non-appropriation receipts. 3. Defence will seek a determination by the Minister for Finance and Deregulation, under Section 10 of the Appropriation Act (No. 1) 2012-13, to decrease the Departmental outcome appropriation. 4. DMO receives interest receipts from overseas bank accounts which are returned to the OPA and do not form part of DMO's resources. The revised estimate for 2012-13 is $4.3m.


18

Table 2: Total Departmental and Administered Consolidated Cash Budget for the Department of Defence (including DMO)[1]

2012-13RevisedBudget

$m

APPROPRIATIONS AND CAPITAL

Appropriation (Bill 1)[2]23,846.4

Appropriation - Contributed Equity (Bill 2) -

Appropriation (Bill 3) -

Appropriation (Bill 4) 468.8

Appropriations for military superannuation[3]2,019.9

less Returns to the OPA -1,363.0

Total cash available 24,972.0

OPERATING ACTIVITIES

Cash received

Goods and services 475.8

Net GST received 1,186.5

Interest 32.0

Other cash 206.2

Fees 10.0

Total cash received 1,910.4

Cash used

Employees 9,237.9

Suppliers 8,824.6

Net GST paid 1,186.5

Grants 71.7

Other cash 195.4

Subsidies paid 109.2

Military benefits 1,910.6

Total cash used 21,535.9

Net cash from or (used by) operating activities -19,625.5

INVESTING ACTIVITIES

Cash received

Proceeds from sales of land and buildings 44.5

Proceeds from sales of infrastructure, plant and equipment 28.7

Dividends 48.6

Other -

Total cash received 121.9

Cash used

Purchase of land and buildings 859.0

Purchase of infrastructure, plant and equipment 246.2

Purchase of specialist military equipment 3,261.6

Purchase of intangibles 13.8

Purchase of inventory 897.1

Selling costs on sale of assets 8.4

Finance costs 77.5

Total cash used 5,363.5

Net cash from or (used by) investing activities -5,241.7

Portfolio Overview

19

Table 2 (cont’d): Total Departmental and Administered Consolidated Cash Budget for the Department of Defence (including DMO)[1]


$m

FINANCING ACTIVITIES

Cash used

Repayment of debt 79.6

Total cash used 79.6

Net cash from or (used by) financing activities -79.6

Net increase or (decrease) in cash and cash equivalents held 25.3

Cash and cash equivalents at beginning of the reporting period 42.8

Effect of exchange rate movements on cash and cash equivalents -

Cash and cash equivalents at end of the reporting period 68.1

Notes 1. Figures shown eliminate interagency transactions and transactions flowing between Departmental and Administered funding. 2. Includes $943.0m of appropriation planned to be drawn down by DMO. 3. Cross reference with Table 65 Consolidated Budgeted Administered Statement of Cash Flows for the Department of Defence

(including DMO) for the period ended 30 June.


20

Portfolio Workforce

The Portfolio Budget Statements 2012-13 noted that following a period of historically low separation rates which led the Australian Defence Force (ADF) to exceed its budgeted workforce strength, the measures implemented to correct the overachievement had succeeded and the ADF workforce had returned to its budgeted strength.

Since then, changes in labour market conditions have led to increased separations as civilian employment opportunities for ADF personnel continue to grow. Recruiting, while relatively strong, is insufficient to compensate for the increased separations.

Consequently the military workforce has declined, and the Revised Estimate for 2012-13 is some 1,345 lower than the Budget Estimate.

In response, Defence has implemented the Defence Employment Offer project, aiming to provide a mechanism for identifying those elements of their employment that are important to ADF personnel, and facilitating the use of targeted retention initiatives.

The program of reductions to Defence’s Australian Public Service workforce outlined in the Portfolio Budget Statements 2012-13 is on track. From July 2012 to January 2013, Defence’s actual APS workforce has reduced from 22,159 to 21,147 (a reduction of 1,012 staff). During 2012-13, the separation rate for APS staff has been lower than originally anticipated as fewer APS left the department in the first half of the financial year than forecast. Under the DMO’s combined workforce management model, DMO can utilise funding from ADF positions that cannot be filled and this has the effect of increasing Defence’s APS workforce beyond its budgeted strength by an average of 384, even though its total workforce (civilian and military) is within the parameters.

Table 3: Defence and DMO Consolidated Workforce (Average)

2012-13Budget

Estimate

2012-13Revised

Estimate Variation

2013-14ForwardEstimate



ADF

ADF Permanent Force[1]58,636 56,751 -1,885 58,235 58,518 58,664

Reserves[2]21,650 22,190 540 22,645 22,895 23,095

1 Total ADF Workforce 80,286 78,941 -1,345 80,880 81,413 81,759

APS

Defence APS 15,651 15,731 80 15,476 15,115 14,934

DMO APS 5,544 5,406 -138 5,368 5,590 5,608

DMO APS Backfill - 384 384 - - -

2 Total APS 21,195 21,521 326 20,844 20,705 20,542

Contractor[3]

Defence Contractor 488 385 -103 448 445 447

DMO Contractor 48 48 - 48 48 46

3 Total Contractor 536 433 -103 496 493 493

Total Workforce (1+2+3) 102,017 100,895 -1,122 102,220 102,611 102,794

Notes 1. Numbers for ADF Permanent Force include ADF members in the DMO and Reservists on full-time service. 2. Numbers for Reserves include Active and High Readiness Reserve members and are actual reservists rendering service not

averages. 3. Contractors are individuals under contract performing agency roles. Contractors are not APS Employees.

21

Agency Resources and

Planned Performance





22


23


Agency Resources and Planned Performance

Section 1: Defence Overview and Resources

1.1 Strategic Direction Statement

1.2 Defence Resourcing

1.3 Funding from Government

1.4 Capital Investment Program

1.5 People

Section 2: Outcomes and Planned Performance

2.1 Outcomes and Performance Information

Section 3: Explanatory Tables and Budgeted Financial Statements

3.1 Explanatory Tables

3.2 Budgeted Financial Statements

3.3 Consolidated Budgeted Financial Statements for the Department of Defence (including DMO)


24


Section 1: Defence Overview and Resources

1.1 Strategic Direction Statement A full outline of the Department of Defence’s (Defence) Strategic Direction can be found in the Portfolio Budget Statements 2012-13.

Revised Policy Framework

No changes have been made to Revised Policy Framework since the Portfolio Budget Statements 2012-13.

Contribution to the Fiscal Strategy

No changes have been made to Contribution to the Fiscal Strategy since the Portfolio Budget Statements 2012-13.

Defence Reform

No changes have been made to Defence Reform since the Portfolio Budget Statements 2012-13.

Submarine Program Management

No changes have been made to Submarine Program Management since the Portfolio Budget Statements 2012-13.

Force Posture Review

No changes have been made to Force Posture Review since the Portfolio Budget Statements 2012-13.


25

Cultural Reviews – Pathway to Change

Defence is continuing to implement its five-year cultural change program to deliver our cultural intent that we are “trusted to defend, proven to deliver, respectful always”. High priority has been given to Pathway to Change: Evolving Defence Culture, which will deliver a workplace culture that promotes diversity and the highest standards of behaviour to assure our people, the community and Government that Defence is fully inclusive, collaborative and professional in all respects. The culture change program now incorporates the 21 recommendations made in the Review into the Treatment of Women in the Australian Defence Force Phase 2 Report 2012, which was tabled in Parliament on 22 August 2012. In total, the program incorporates 175 key actions and culture review recommendations. To date, Defence has completed or implemented 44 of these and good progress is being made to implement the remainder in accordance with the Pathway to Change: Evolving Defence Culture Implementation Strategy.

On 26 November 2012, the Minister for Defence announced the Government's response to the Report of the DLA Piper Review into allegations of sexual or other forms of abuse in Defence. Defence's interaction with the Defence Abuse Response Taskforce will be facilitated by the Organisational Response Unit in the Cultural Reviews Response Branch of the Defence People Group. The Cultural Reviews Response Branch also includes the Organisational Development Unit, responsible for the coordination and facilitation of Pathway to Change: Evolving Defence Culture. Systematic issues highlighted by the response to the Defence Abuse Response Taskforce will be integrated into the Pathway to Change: Evolving Defence Culture strategy.

Relocation of Defence Units from Moorebank to Holsworthy

Defence is implementing a project to relocate units at Moorebank to support the Government's Moorebank Intermodal Freight Terminal (MIMT) project, which will be developed on Commonwealth owned, Defence occupied, land at Moorebank, NSW. The land currently houses thirteen Defence units, the largest of which is the Army's School of Military Engineering. The project is relocating these Defence units from Moorebank to the nearby Holsworthy Barracks by developing new purpose built facilities and enhancing existing barracks infrastructure. This project is being funded from the Government's MIMT initiative and the Defence Portfolio. Construction of the project works commenced in October 2012. The works will allow the relocation of Defence assets from Moorebank to Holsworthy by mid 2015, in accordance with MIMT program requirements. Some additional works not critical to the relocation will be completed by the end of 2015.


26

Senior Executive changes

Changes below reflect senior level movements that have occurred since the publication of the Portfolio Budget Statements 2012-13:

With effect 11 October 2012, Mr Duncan Lewis ceased as the Secretary of the Department of Defence.

With effect 18 October 2012, Mr Dennis Richardson commenced as the Secretary of the Department of Defence.

With effect 23 July 2012, Mr David Gould, commenced as General Manager Submarines within the Defence Materiel Organisation.

With effect 29 January 2013, Mr Steven Grzeskowiak commenced as the Deputy Secretary Defence Support and Reform, Department of Defence.

With effect 16 November 2012, Mr Greg Farr ceased as the Chief Information Officer, Department of Defence.

With effect 26 November 2012, Dr Peter Lawrence commenced as the Chief Information Officer, Department of Defence.

With effect 12 July 2012, Ms Jane Wolfe ceased with the Department of Defence.

Organisational Structure

The following changes have taken place since the Portfolio Budget Statements 2012-13.

On Monday, 22 October 2012 the Defence Support Group was re-named to the Defence Support and Reform Group. The change of the name reflects structural changes in the Chief Operating Officer Organisation, with the Ministerial and Executive Coordination and Communication (MECC) Division and the Strategic Reform and Management Office (SRMO) joining the Defence Support and Reform Group.


27

Figure 2: Defence Organisational Chart

Notes:

(1) Section 9(3) of the Defence Act 1903 requires the Service Chiefs to advise the Minister on matters relating to their command.(2) Under the agreed business model for DMO as a prescribed agency, the CEO DMO Ministerial Directive identi�es that the CEO DMO is directly accountable to the Minister for DMO’s performance but remains accountable to the Secretary and CDF.

Stars (*) refer to ADF Star rank or SES Band levels

Deputy SecretaryStrategy

Mr Brendan Sargeant***

Deputy SecretaryDefence People

Ms Carmel McGregor***

Deputy SecretaryIntelligence and Security

Mr Stephen Meekin***

Deputy SecretaryDefence Support and Reform

Mr Steve Grzeskowiak***

Chief Capability DevelopmentVADM Peter Jones

***

Chief Information OfficerDr Peter Lawrence

***

Chief Finance OfficerMr Phillip Prior

***

Chief Defence ScientistDr Alex Zelinsky

***

Chief Executive OfficerDefence Materiel Organisation

Mr Warren King***

(2)

Chief of Air ForceAIRMSHL Geoff Brown

***(1)

Chief of ArmyLTGEN David Morrison

***(1)

Chief of NavyVADM Ray Griggs

***(1)

Chief of Joint OperationsLTGEN Ash Power

***

Vice Chief of the Defence ForceAIRMSHL Mark Binskin

***(1)

Chief Operating OfficerMr Simon Lewis

***

Chief of the Defence ForceGEN David Hurley

****

SecretaryMr Dennis Richardson

****

Parliamentary Secretaryfor Defence

The Hon Dr Mike Kelly MP

Parliamentary Secretaryfor Defence

Senator the Hon David Feeney

Minister for Veterans’ Affairs andDefence Science and PersonnelThe Hon Warren Snowdon MP

Minister forDefence Materiel

The Hon Jason Clare MP

Minister for DefenceThe Hon Stephen Smith MP

Defence Senior Management Chart


28

1.2 Defence Resourcing Departmental funding is presented in Serial 14 of Table 4. The total level of departmental funding in 2012-13 has increased by $117.8m to $24,335.2m compared with $24,217.4m in the 2012-13 Budget. Defence Funding is comprised of:

an appropriation for departmental outputs ($22,903.4m) (Table 4, Serial 1)

an equity injection ($468.8m) (Table 4, Serial 2)

return of equity to government (-$14.1m) (Table 4, Serial 7)

net capital receipts ($73.3m) (Table 4, Serial 10)

own source revenue ($903.9m) (Table 4, Serial 11).

There are several measures and adjustments that have affected Defence’s funding. These are:

an increase of $34.0m for Operations (Table 13)

an increase of $144.5m for other budget adjustments (Table 13)

a decrease in capital receipts of -$53.4m (Table 4, Serial 10)

a decrease in own source revenue of -$7.3m (Table 4, Serial 11).


29

Table 4: Total Defence Resourcing S

eria

l No

2011-12Actual$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%


$'000


$'000


$'000

Defence resourcing

1 22,434,418 Appropriation for departmental outcomes 23,269,856 22,903,354 -366,502 -1.6 23,222,935 24,350,270 26,349,946

2 2,773,786 Equity injection appropriation - 468,774 468,774 - 329,405 939,329 1,573,185

3 - Prior Year Appropriation - - - - - - -

4 25,208,204 Current year's appropriation (1+2+3) 23,269,856 23,372,128 102,272 0.4 23,552,340 25,289,599 27,923,131

5 50,122 Drawdown of appropriations carried forward - - - - - - -

6 - Other appropriation receivable movements - - - - - - -

7 -4,597 Return to OPA[1] -90,304 -14,077 76,227 -84.4 -48,821 -38,733 -46,042

8 45,525 Funding from/to the OPA (5+6+7) -90,304 -14,077 76,227 -84.4 -48,821 -38,733 -46,042

9 25,253,729 Funding from Government (4+8) 23,179,552 23,358,051 178,499 0.8 23,503,519 25,250,866 27,877,089

10 85,391 Capital receipts 126,683 73,284 -53,399 -42.2 101,666 98,046 173,962

11 921,479 Own source revenue (s31 receipts)[2] 911,206 903,893 -7,313 -0.8 876,827 909,546 945,066

12 83,484 Prior Year Receipts - - - - - - -

13 1,090,354 Funding from Other Sources (10+11+12) 1,037,889 977,177 -60,712 -5.8 978,493 1,007,592 1,119,028

14 26,344,083 Total Defence funding (9+13) 24,217,441 24,335,228 117,787 0.5 24,482,012 26,258,458 28,996,117

Administered

15 4,215,384 Administered special appropriations 4,227,427 4,227,427 - - 4,444,915 4,670,495 4,867,880

16 1,382,678 Own source revenue 1,344,595 1,344,595 - - 1,384,655 1,443,113 1,506,866

17 -1,382,678 Returns to the OPA -1,344,595 -1,344,595 - - -1,384,655 -1,443,113 -1,506,866

18 4,215,384 Total Administered Funding (15+16+17) 4,227,427 4,227,427 - - 4,444,915 4,670,495 4,867,880

19 30,559,467 Total Defence Resourcing (14+18) 28,444,868 28,562,655 117,787 0.4 28,926,927 30,928,953 33,863,997

Appropriation carried forward

20 50,122 Appropriation Receivable including previous year's Outputs 121,517 76,857 -44,660 -36.8 76,857 76,857 76,857

21 64,871 Cash in bank 72,871 18,091 -54,780 -75.2 18,091 18,091 18,091

22 114,993 Total appropriations carried forward (20+21) 194,388 94,948 -99,440 -51.2 94,948 94,948 94,948

23 30,674,460 Total Defence Resourcing (19+22) 28,639,256 28,657,603 18,347 0.1 29,021,875 31,023,901 33,958,945

Notes 1. Represents net transfers to and from the OPA. 2. All figures are net of GST.


30

Table 5: Defence Resource Statement

Ser

ial

No

.

Estimateas at

Budget2012-13

$'000

+

Proposed Additional Estimates

2012-13$'000

=

Total Estimate at Additional

Estimates2012-13

$'000

Total Actual Available

Appropriation2011-12

$'000

ORDINARY ANNUAL SERVICES

Outcome 1 21,919,073 -419,765 21,499,308 21,122,108

Outcome 2 1,341,283 53,263 1,394,546 1,459,492

Outcome 3 9,500 - 9,500 9,829

1 Total Departmental outputs 23,269,856 -366,502 22,903,354 22,591,429

2 Total Ordinary Annual Services (1) 23,269,856 -366,502 22,903,354 22,591,429

OTHER SERVICES

Departmental non-operating

Equity injections - 468,774 468,774 2,773,786

3 Total Departmental non-operating - 468,774 468,774 2,773,786

4 Total Other Services (3) - 468,774 468,774 2,773,786

5 Total Available Annual Appropriation (2+4) 23,269,856 102,272 23,372,128 25,365,215

SPECIAL APPROPRIATIONS

Special appropriations limited by criteria/entitlement

Defence Forces Retirement Benefits Act, 1948 Part 1 s.15D and VIC , s.82ZJ 28,531 - 28,531 28,443

Defence Force Retirement and Death Benefits Act, 1973 Part XII, s.125 1,574,188 - 1,574,188 1,578,799

Military Superannuation and Benefits Act, 1991 Part V, s.17 2,515,472 - 2,515,472 2,473,953

Defence Force (Home Loan Assistance) Act, 1990 Part IV, s.38 2,883 - 2,883 3,547

Defence Home Ownership Assistance Scheme Act 2008 Part VI, s.84 106,353 - 106,353 94,335

6 Total Special Appropriations 4,227,427 - 4,227,427 4,179,077

7 Total Appropriations (5+6) 27,497,283 102,272 27,599,555 29,544,292

Funding from other sources 2,382,484 -60,712 2,321,772 2,415,044

Returns to the OPA (net) -1,434,899 76,227 -1,358,672 -1,460,463

Previous years' outputs (appropriation receivable) 121,517 -44,660 76,857 50,122

Cash Available 72,871 -54,780 18,091 64,871

8 Total Other Available Resources 1,141,973 -83,925 1,058,048 1,069,574

9 Total Resourcing (7+8) 28,639,256 18,347 28,657,603 30,613,866

Special Accounts

Opening Balance 93,567 18,884 112,451 116,531

Appropriation Receipts - - - -

Appropriation Receipts - other agencies - - - -

Non-Appropriation Receipts to Special Accounts 50,064 - 50,064 68,531

10 Total Special Accounts 143,631 18,884 162,515 185,062


31

Payments to Defence Housing Australia

No changes have been made to Payments to Defence Housing Australia since the Portfolio Budget Statements 2012-13.


32

Annual Appropriations

Defence’s annual appropriations will increase by a net $102.3m to $23,372.1m. This increase is related to a net reduction of $366.5m for Departmental outcomes and an increase of $468.8m in equity injection. The net reduction of $366.5m for Departmental outcomes is comprised of a reduction of $419.8m in Outcome 1 offset by an increase of $53.3m in Outcome 2. Defence will seek a determination by the Minister for Finance and Deregulation, under section 10 of the Appropriation Act (No 1) 2012-13, to decrease its Departmental appropriation by a net $366.5m.

Table 6: Appropriation Bill (No 3) 2012-13[1]

2011-12 Available

$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Increase inEstimates

$'000

Decrease inEstimates

$'000

Departmental Outputs

Outcome 1

Australia's national interests are protected and advanced through the provision of military capabilities and the promotion of security and stability 21,122,108 21,919,073 21,499,308 - 419,765

Outcome 2

Military operations and other tasks directed by the Government to achieve the desired results 1,459,492 1,341,283 1,394,546 53,263 -

Outcome 3

Defence's support to the Australian community and civilian authorities to achieve the desired results 9,829 9,500 9,500 - -

Total 22,591,429 23,269,856 22,903,354 53,263 419,765

Note Appropriation Bill (No 3) as the net funding change is negative. $366.5m will be

extinguished against Appropriation Bill (No 1).

Table 7: Appropriation Bill (No 4) 2012-13

2011-12 Available

$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Increase inEstimates

$'000

Decrease inEstimates

$'000

Non-operating

Equity injections 2,773,786 - 468,774 468,774 -

Total non-operating 2,773,786 - 468,774 468,774 -

Drawdown of Appropriations Carried Forward

Table 8: Revised Appropriation Receivable

2012-13Revised

Estimate$'000

2013-14Forward Estimate

$'000


$'000


$'000

Previous Estimate[1]121,517 121,517 121,517 121,517

Net drawdown -44,660 -44,660 -44,660 -44,660

Closing balance appropriation receivable 76,857 76,857 76,857 76,857

Note 1. As published in Table 10 of the Portfolio Budget Statements 2012-13.

1. No additional appropriation is provided in


33

Funding from Other Sources

Own Source Revenue

Table 9: Variation in Own Source Revenue

2012-13Revised

Estimate$'000


$'000


$'000


$'000

Previous Estimate[1]911,206 920,731 954,636 991,593

Variation in own source revenue -7,313 -43,904 -45,090 -46,527

Own source revenue revised estimates 903,893 876,827 909,546 945,066

Prior year receipts - - - -

Total 903,893 876,827 909,546 945,066


Table 10: Variation in Estimates of Net Capital Receipts

2012-13Revised

Estimate$m


$m


$m


$m

Portfolio Budget Statements 2012-13 Estimates[1]37.3 55.5 104.2 125.5

Movement in capital withdrawal associated with capital disposals program 76.2 19.6 -25.8 -32.4

Movement in proceeds from sales associated with the capital disposals program -53.4 -21.3 -18.3 35.6

Variation in net capital receipts 22.8 -1.7 -44.1 3.3

Total net capital receipts 60.1 53.8 60.1 128.8



34

Capital Investment Program

Approved Capability Investment Program

Table 11: Approved Capability Investment Program

Ser

ial

No

. 2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

DMO delivered

1 Major Capital Investment Program (AMCIP) 3,074.2 3,228.0 153.7

Minors program

Navy Minors Program 3.3 3.9 0.6

Army Minors Program 48.2 53.1 4.9

Air Force Minors Program 19.0 20.6 1.5

Joint Logistics Command Minors Program 0.8 2.2 1.4

Chief Information Officer Minors Program 0.5 0.5 -

Office of the Secretary and CDF Minors Program - - -

2 Total Minors program 71.9 80.3 8.4

Sustainment

Navy Sustainment 1,669.5 1,622.0 -47.5

Army Sustainment 1,249.9 1,249.7 -0.1

Air Force Sustainment 1,476.3 1,524.0 47.8

Chief Information Officer Sustainment 65.6 59.9 -5.7

Vice Chief of the Defence Force Sustainment 88.4 83.7 -4.7

Office of the Secretary and CDF Sustainment 18.0 17.3 -0.6

Joint Operations Command Sustainment 6.1 5.9 -0.2

Defence Support and Reform Group Sustainment 27.0 27.0 -

3 Total Sustainment 4,600.7 4,589.6 -11.0

4 Total DMO Delivered (1+2+3) 7,746.8 7,897.9 151.1

Defence Groups and Services delivered

5 Major Capital Investment Programs (AMCIP) 64.1 99.0 35.0

6 Minors program 24.1 12.9 -11.2

7 Total Defence Groups and Services delivered (5+6) 88.2 112.0 23.8

8Government Approved Defence Capability Plan (DCP) projects yet to be allocated to Groups, Services or the DMO 59.3 33.8 -25.5

9 Total approved programs (4+7+8) 7,894.3 8,043.7 149.5

10 Total AMCIP (1+5) 3,138.3 3,327.0 188.7

11 Total Minors (2+6) 96.0 93.3 -2.7

12 Total Sustainment (3) 4,600.7 4,589.6 -11.0

13Government Approved Defence Capability Plan (DCP) projects yet to be allocated to Groups, Services or the DMO (8) 59.3 33.8 -25.5

14 Total approved programs (10+11+12+13) 7,894.3 8,043.7 149.5


35

Table 12: Unapproved Capability Investment Program

Ser

ial

No

. 2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

1 DCP Planned Government Approvals in 2011-12 107.9 34.4 -73.5

2 DCP available from 1 July 2012 108.7 182.2 73.5

3 Subtotal Unapproved DCP 216.6 216.6 -

4 DCP Approvals since 1 July 2012 - 185.7 185.7

5 DCP Planned Government Approvals Remaining in 2012-13 - 11.1 11.1

6 Planned Total DCP Approvals in 2012-13 (4+5)[1]- 196.8 196.8

7 Minors 13.5 18.0 4.4

8 Future Sustainment costs associated with AMCIP 124.4 - -124.4

Note 1. Additional Funding for Planned Approvals in 2012-13 of $14.6m will be funded through reprioritisation and reallocation from the

broader Defence Budget.


36

1.3 Funding from Government

2012-13 Budget Measures and Other Budget Adjustments

Table 13: Variations to Defence Funding

Program2012-13

$m2013-14

$m2014-15

$m2015-16

$mTotal FE

$m2016-17

$m2017-18

$m2018-19

$m2019-20

$m2020-21

$m2021-22

$mTOTAL

$m

Budget Measures

Expenditure Measures

Timor-Leste - transition of Australia's security commitment and future Defence engagement

2.1 34.0 3.0 -0.4 - 36.6 - - - - - - 36.6

Australia's Contribution to the Sustainment of the Afghan National Security Forces from 2014-15

2.2 - - 76.8 77.5 154.3 77.5 - - - - - 231.8

Bushmaster vehicles - acquisition[1] 1.3 - - - - - - - - - - - -

Growler electronic warfare system - acquisition[1] 1.4 - - - - - - - - - - - -

Total Budget Measures 34.0 3.0 76.4 77.5 190.9 77.5 - - - - - 268.4

Other Budget Adjustments

DMO Direct Appropriation Adjustments Various 17.4 51.8 58.2 60.6 188.0 60.1 60.3 63.7 65.8 67.9 70.4 576.2Living Away From Home Allowance 1.12 4.3 13.7 19.1 19.1 56.3 19.1 - - - - - 75.4

Fire Services Levy 1.6 -18.8 -19.6 -20.5 -20.5 -79.5 -20.5 -20.5 -20.5 -20.5 -20.5 -20.5 -202.8DFAT Cleaning and Utility Charges 1.1 - 0.6 0.6 0.6 1.8 0.6 0.6 0.7 0.7 0.7 0.7 5.8Foreign Exchange Various 65.4 92.6 83.7 96.1 337.8 141.9 174.1 216.3 215.9 253.9 258.1 1,598.1Property Disposals 1.6 76.2 19.6 -25.8 -32.4 37.7 - - - - - - 37.7

Total Other Budget Adjustments 144.5 158.6 115.4 123.5 542.0 201.3 214.5 260.1 261.9 302.0 308.6 2,090.5

Variation to Defence Funding 178.5 161.6 191.8 201.0 732.9 278.8 214.5 260.1 261.9 302.0 308.6 2,358.9

Note 1. The cost of this measure will be met from within the existing resourcing of the Department of Defence.


37

2012-13 Budget Adjustments Expenditure Measures

Timor-Leste – transition of Australia’s security commitment and future Defence engagement

The Government provided $37.1m over three years for the net additional cost of the security transition of Operation Astute, Australia’s military contribution to maintaining stability in East Timor through the International Stabilisation Force (ISF).

The Government will support an ongoing Defence engagement with the Government of East Timor through the Defence Cooperation Program, including training and exercises.

The Government had previously approved funding for Operation Astute through to December 2012. On 22 November 2012, the Australian-led ISF ceased its security operations in East Timor and began a staged drawdown following the peaceful East Timorese Parliamentary elections in July 2012. ISF withdrawal was expected to be completed by April 2013.

The cost of this measure reduced by the recovery of $0.5m in 2012-13 from the New Zealand Defence Force for logistics support provided by the ADF, resulting in net funding of $36.6m.

This measure is also expected to lead to a reduction in revenue of $1.1m through to the completion of the withdrawal as ADF personnel are taxed concessionally on their base pay and allowances while on deployment.

Funding for this measure was included as a ‘decision taken but not yet announced’ in the Mid-Year Economic and Fiscal Outlook 2012-13.

Further information can be found in the joint press release of 21 November 2012 issued by the Minister for Defence and the Minister for Foreign Affairs.

Australia's Contribution to the Sustainment of the Afghan National Security Forces from 2014-15

The Government will provide US$100.0m per year from 2014-15 to 2016-17 as part of the international contribution to the sustainment of the Afghan National Security Forces (ANSF). This will be made up of US$80.0m per annum from the Department of Defence and US$20.0m per annum from the Australian Agency for International Development (AusAID).

Australia’s contribution is part of international efforts to help sustain and support the ANSF beyond the transition process.

Bushmaster vehicles – acquisition

The Government will provide $205.7m over five years for the acquisition of up to 214 additional Bushmaster Protected Mobility Vehicles to be built in Bendigo, Victoria.

Bushmaster vehicles provide mobility and protection for Australian forces deployed on overseas operations. The cost of this measure will be met from within existing resourcing of the Department of Defence.

Further information can be found in the joint press release of 2 July 2012 issued by the Minister for Defence and the Minister for Defence Materiel.

This measure was announced at the Mid-Year Economic and Fiscal Outlook 2012-13.


38

Growler electronic warfare system – acquisition

The Government has provided $1,458m for the conversion of twelve of Australia’s F/A-18F Super Hornet aircraft into Growler configuration and for associated equipment, training and spares.

The Growler aircraft will give the ADF the capacity to jam electronic systems and an enhanced capacity to undertake intelligence, surveillance and reconnaissance missions.

The cost of this measure will be met from within the existing resourcing of the Department of Defence.

Further information can be found in the joint press release of 23 August 2012 issued by the Minister for Defence and the Minister for Defence Materiel.

This measure was announced at the Mid-Year Economic and Fiscal Outlook 2012-13.

Other Budget Adjustments

DMO Direct Appropriation Adjustments

Due to functions and staff movements between Defence and DMO, DMO will return $17.4m in the budget year, with a net result of DMO transferring $188.0m to Defence across the Budget and Forward Estimates.

Living Away From Home Allowance

This adjustment supplements Defence for the additional Fringe Benefits Tax liability for overseas postings due to changes in the tax treatment of the Living Away From Home Allowance. This provides Defence with supplementation of $4.3m in 2012-13 and $56.3m across the Budget and Forward Estimates.

Fire Services Levy

A review of Commonwealth fire services arrangements with the states and territories will see Defence’s annual appropriation reduced by $18.8m in 2012-13 and $79.5m across the Budget and Forward Estimates with a commensurate reduction in Defence's annual insurance premium.

Department of Foreign Affairs and Trade (DFAT) Cleaning and Utility Charges

Revised Service Level Agreements for management services at DFAT managed posts has resulted in agencies now being responsible for cleaning and utility charges at post. DFAT is devolving funds to relevant agencies that will now be required to pay on a user pays basis. This arrangement takes effect from 2013-14 at a cost of $1.8m across the Budget and Forward Estimates.

Foreign Exchange

Under no win/no loss arrangements, Defence is required to return to the Government any surplus foreign exchange supplementation for an appreciation of the Australian dollar relative to the other currencies as part of the Budget process. Conversely where the Australian dollar depreciates relative to other currencies, the exchange rate set for Defence is supplemented under these arrangements. Defence will receive $65.4m in 2012-13 as a result of movements in exchange rates since the 2012-13 Budget. Over the Budget and Forward Estimates, a total of $337.8m will be received by Defence.

Property Disposals

Adjustments to the Property Disposals Program since the 2012-13 Budget have resulted in a reduced return to Government of $76.2m in 2012-13 and $37.7m across the Budget and Forward Estimates.


39

Operations Summary

Table 14: Net Additional Cost of Operations from 1999-00 to 2015-16

1999-00 to 2007-08

Actual Result

$m

2008-09 Actual Result

$m


$m


$m


$m

2012-13Revised

Estimate$m


$m


$m


$mTotal

$m

Operation Astute[1]3,611.1 164.7 144.9 155.7 141.7 121.6 3.8 0.2 - 4,343.7

Operation Bel Isi 47.7 - - - - - - - - 47.7

Operation Slipper[2]1,200.2 701.9 1,125.3 1,088.9 1,066.7 1,189.8 351.5 208.3 127.5 7,060.1

Operation Resolute[3][4]103.9 10.0 10.3 8.2 7.9 9.5 - - - 149.8

Operation Catalyst 2,062.2 290.9 11.4 - - - - - - 2,364.5

Operation Anode 171.9 25.1 27.9 35.7 38.5 42.9 1.6 1.1 - 344.6

Operation Sumatra Assist 44.5 - - - - - - - - 44.5

Operation Acolyte 10.5 - - - - - - - - 10.5

Operation Deluge 6.7 - - - - - - - - 6.7

Operation Pakistan Assist 9.8 - - - - - - - - 9.8

Operation Outreach 12.3 2.3 - - - - - - - 14.6

Operation Kruger[5]- - 29.8 13.8 1.8 1.9 - - - 47.2

Enhanced Force Protection in Afghanistan[6][7][8]- - 80.3 196.0 159.1 164.6 10.0 16.2 - 626.3

Total Net Additional Costs 7,280.9 1,194.9 1,429.8 1,498.2 1,415.8 1,530.3 366.9 225.8 127.5 15,069.9

Sources of Funding for Operations

Government Supplementation 7,249.5 112.5 1,386.7 1,320.1 1,246.9 1,354.3 356.9 209.6 127.5 13,364.0

Department of Foreign Affairs and Trade 9.1 - - - - - - - - 9.1

Department of Defence (Absorbed) 22.3 1,082.4 43.1 178.1 168.8 176.0 10.0 16.2 - 1,696.9

Total Cost 7,280.9 1,194.9 1,429.8 1,498.2 1,415.8 1,530.3 366.9 225.8 127.5 15,069.9

Notes 1. Government approved an increase of $34.0m in 2012-13, $3.0m in 2013-14 and a reduction of $0.4m in 2014-15 to extend Operation Astute to April 2013. 2. Government approved an increase of $76.8m in 2014-15, $77.5m in 2015-16 and $77.5m in 2016-17 (not shown in this table) for Australia's Contribution to the sustainment of the ANSF. 3. For 2012-13 Defence will absorb the cost of Operation Resolute. 4. The 2011-12 actual result of $13.5m for Operation Resolute has been reduced to reflect expenditure against Government agreed budget lines. An additional amount of $5.6m in support of

Operation Resolute, was also funded by Defence for the temporary re-opening of the bare base at Learmonth WA. 5. For 2012-13 Defence will absorb the cost of Operation Kruger, which includes costs associated with return of equipment to Australia and its remediation. 6. Government supplementation for Enhanced Force Protection in Afghanistan costs are captured against Operation Slipper. 7. An amount of $16.2m has been reprogrammed from 2012-13 to 2014-15 to align funding with revised acquisition schedules. 8. An additional amount of $30.7m is no longer required and has been returned to the Defence Capability Program (DCP).


40

Operations Summary

The ADF is involved in a number of deployments around the world, including United Nations peacekeeping and regional assistance missions, and border protection and domestic security operations.

Defence plans to spend $1,530.3m on the net additional costs of its operational deployments in 2012-13, or $13.0m less than the Budget Estimate. This is the result of a $34.0m increase to Operation Astute and a $46.9m decrease to Enhanced Force Protection in Afghanistan. The Revised Estimates for all operations are shown in Table 14.

Operation Budget Measures

Budget measures relating to Operations are detailed on Page 36 and are summarised in Table 13.


41

1.4 Capital Investment Program

Table 15: Total Capital Investment Program

Ser

ial

No

. 2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

Defence Capability Plan

1 DMO Delivered 248.2 27.3 -221.0

2 Group and Services delivered 27.6 3.0 -24.6

3 Total Defence Capability Plan (1+2) 275.8 30.3 -245.5

Approved Major Capital Investment Program[1]

4 DMO Delivered 3,074.2 3,228.0 153.8

5 Group and Services delivered 64.1 99.0 35.0

6 Total Approved Major Capital Investment Program (4+5) 3,138.3 3,327.0 188.7

Capital Facilities

7 Approved Capital Facilities Projects[2]837.4 953.9 116.5

8 Unapproved Capital Facilities Projects 181.5 65.0 -116.5

9 Total Capital Facilities Program (7+8) 1,018.9 1,018.9 -

10 Other Investment[3]171.9 275.8 103.9

11 Total Capital Investment Program (3+6+9+10)[4]4,604.9 4,651.9 47.1

Capital component 4,237.5 4,377.6 140.1

Operating component 367.4 274.3 -93.1

Notes 1. Includes projects delivered by the DMO and Defence Groups and Services. 2. Includes both Major and Minor Capital Facilities Program. 3. This includes plant and equipment, Minor Capital Investment projects, infrastructure costs, non-capital facilities building

projects, intangibles and purchase of repairable items. 4. The Capital Investment Program funding includes $37.3m (Budget Estimate) and $60.1m (Revised Estimate) in retained

capital receipts. Cross reference with Table 16, Retained Capital Receipts.

Major Capital Investment Program

The $56.8m decrease in the Major Capital Investment Program is comprised of a $245.5m decrease in the Defence Capability Plan (DCP) and a $188.7m increase in the Approved Major Capital Investment Program (AMCIP).

The $245.5m decrease in the DCP relates to transfers following project approvals: $208.2m to the AMCIP; $35.0m for projects delivered by other Groups and Services and; $2.5m to MCF and other minor movements totalling $0.2m.

The $188.7m increase in the AMCIP relates to a $208.2m increase due to transfers from the DCP, a $31.8m increase for foreign exchange, a $25.3m decrease for the 2011-12 payable to the DMO, a decrease of $60.0m due to AMCIP reprogramming, a $35.0m increase in projects delivered by other Groups and Services and other minor movements totalling $1.0m.

Capital Facilities Program

No changes have been made to Capital Facilities Program since the Portfolio Budget Statements 2012-13. Project approvals worth $116.5m have been approved since the Portfolio Budget Statements 2012-13.


42

Other Investment

The $103.9m increase in Other Investment is comprised of a $24.1m decrease for the purchase of Buildings, a $247.3m increase in Specialist Military Equipment (SME), a $119.0m decrease in Other Plant and Equipment, a $54.9m decrease in Infrastructure purchase, a $52.2m increase in purchases of Repairable Items and a number of other minor movements totalling $2.4m.

Retained Capital Receipts

The Retained Capital Receipts form part of the Total Capital Investment Program at Table 15: Total Capital Investment Program.

Retained Capital Receipts comprise the net proceeds from property sales which are returned to Government. It also includes proceeds from sale of specialist military equipment, commercial vehicles and other plant and equipment. Adjustments have been made to the property sales program since the 2012-13 Budget that have resulted in Defence’s return to Government reducing by $22.8m.

Table 16: Retained Capital Receipts

Ser

ial

No

. 2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

Property Sales

Proceeds from the sale of land and buildings 86.9 33.5 -53.4

Proceeds from the sale of housing 11.0 11.0 -

Less return to Government -89.4 -13.2 76.2

1 Proceeds retained by Defence 8.6 31.4 22.8

2Proceeds from sale of specialist military equipment - - -

3Proceeds from sale of infrastructure, plant and equipment 28.7 28.7 -

4 Retained Capital Receipts (1+2+3) 37.3 60.1 22.8


43

1.5 People

Workforce Overview

No changes have been made to Workforce Overview since the Portfolio Budget Statements 2012-13.

Workforce Summary

The revised strength of the total Defence workforce (including the DMO) is shown in Table 17. The revised strength of the total workforce in 2012-13 is forecast to be 1,119 less than the 2012-13 Budget Estimate of 102,017, including ADF permanent forces (-1,885), Reserve Forces (+540), APS staff (+326), and Contractors (-103).

The reduction in the estimate for permanent forces follows on from the success of measures introduced to return the ADF to its budgeted strength. Since then, changes in labour market conditions have led to increased separations as employment opportunities for ADF personnel, particularly those with professional and/or technical skills, continue to grow. Recruiting, while relatively strong, is insufficient to compensate for the increased separations.

In addition, the reduction in forecast strength is contributed to by the cancellation of the ADF Gap Year program as announced in the Portfolio Budget Statements 2012-13, leading to a reduction for the Navy of -90 from 2012-13 onwards, and for Army -177 AFS in 2012-13 and -264 thereafter. This reduces the gap between the permanent force ADF revised strength estimate and the Budget Estimate to 1,618. This figure also includes some workforce that is awaiting funding through the approval of projects as part of the Defence Capability Plan.

In response to the changes in labour market conditions, Defence has implemented the Defence Employment Offer project, aiming to provide a mechanism for identifying those elements of their employment that are important to ADF personnel, and facilitating the use of targeted retention initiatives.

In relation to its Australian Public Service workforce, Defence has put measures in place to meet the ongoing reductions of 666 Full Time Equivalents in 2012-13 and an additional 334 in 2013-14. These include natural attrition, tightening of recruitment practices and a program of targeted Voluntary Redundancies (VRs), with over 600 VRs being accepted in late 2012.

The program of reductions to Defence’s Australian Public Service workforce outlined in the 2012-13 Portfolio Budget Statement is on track. From July 2012 to January 2013, Defence’s actual APS workforce has reduced from 22,159 to 21,147 (a reduction of 1,012 staff). During 2012-13, the separation rate for APS staff has been lower than originally anticipated as fewer APS left the department in the first half of the financial year than forecast. Under the DMO’s combined workforce management model, DMO can utilise funding from ADF positions that cannot be filled and this has the effect of increasing Defence’s APS workforce beyond its budgeted strength by an average of 384, even though its total workforce (civilian and military) is within the parameters.

Over the Forward Estimates period, the total workforce is expected to grow by 1,899 from the revised estimate of 100,895 in 2012-13 to 102,794 in 2015-16. This consists of a decrease of -919 in the civilian workforce and an increase of +2,818 in the military workforce.


44

Defence People

In a significant step towards delivering people services through a shared services model, in October 2012 consolidation of the human resources (HR) domain saw the movement of a number of HR functions and staff from their previous functional areas across the Groups and Services into the Defence People Group. This change paves the way for future re-design and integration of functions into new service delivery models.

In response to the recommendations of Review into the Treatment of Women in the Australian Defence Force Phase 2 Report, the Sexual Misconduct Prevention and Response Office has been established to ensure members who report abuse are given appropriate support to assist with their immediate safety and well being, their care and recovery, and their return to their full work potential. Defence will also provide an option for ADF members to make restricted (confidential) reports of sexual misconduct through the SeMPRO, with some exceptions in line with Defence’s obligations under the Sex Discrimination Act and the Work Health and Safety Act. This Office will be fully operational from June 2013.


45

Table 17: Planned Workforce Allocation for the 2012-13 Budget and Forward Estimates (Average)

2012-13Budget

Estimate

2012-13Revised

Estimate Variation




ADF Permanent Force[1]

Navy 14,260 13,772 -488 14,224 14,249 14,270

Army 30,270 29,017 -1,253 29,847 30,143 30,278

Air Force 14,106 13,962 -144 14,164 14,126 14,116

1 Total Permanent Force 58,636 56,751 -1,885 58,235 58,518 58,664

Active Reserve Force

Navy 2,100 2,100 - 2,150 2,200 2,200

Army 16,000 16,350 350 16,200 16,400 16,600

Air Force 2,400 2,400 - 2,500 2,500 2,500

2 Sub-total Active Reserve Force 20,500 20,850 350 20,850 21,100 21,300

High Readiness Reserve

Navy - - - - - -

Army 550 740 190 1,195 1,195 1,195

Air Force 600 600 - 600 600 600

3 Sub-total High Readiness Reserve Force 1,150 1,340 190 1,795 1,795 1,795

4 Total Reserves (2 + 3) 21,650 22,190 540 22,645 22,895 23,095

5 Total ADF Employees (1 + 4) 80,286 78,941 -1,345 80,880 81,413 81,759

Civilian Employees

APS - Defence 15,651 15,731 80 15,476 15,115 14,934

APS - DMO 5,544 5,406 -138 5,368 5,590 5,608

APS - DMO - ADF backfill - 384 384 - - -

6 Total APS 21,195 21,521 326 20,844 20,705 20,542

Contractors - Defence 488 385 -103 448 445 447

Contractors - DMO 48 48 - 48 48 46

7 Total Contractors[2]536 433 -103 496 493 493

8 Total Civilian Employees (6 + 7) 21,731 21,954 223 21,340 21,198 21,035

Total Workforce Strength (5 + 8) 102,017 100,895 -1,122 102,220 102,611 102,794

Notes 1. Numbers for ADF Permanent Force include ADF members in the DMO and Reservists on full-time service. 2. Contractors are individuals under contract performing agency roles. Contractors are not APS employees.


46

Table 18: Breakdown of Personnel Numbers by Service and Rank

2012-13Budget

Estimate

2012-13Revised

Estimate

Navy[1]

One Star and above 57 57

Senior Officers[2]531 543

Officers 2,851 2,808

Other Ranks 10,731 10,364

Gap Year Participants[3]90 -

Sub-Total: Permanent Navy 14,260 13,772

Reserve Forces[4]2,100 2,100

Total Navy 16,360 15,872

Army[1]





Gap Year Participants[3]294 117

Sub-Total: Permanent Army 30,270 29,017


Total Army 46,820 46,107

Air Force[1]





Gap Year Participants[3]- -

Sub-Total: Permanent Air Force 14,106 13,962


Total Air Force 17,106 16,962

APS[1]

Senior Executives[5]169 168

Senior Officers[2]6,431 6,782

Other APS Staff 14,595 14,571

Total APS 21,195 21,521

Contractors[6]536 433

Total Workforce 102,017 100,895

Notes 1. All Budget and Revised Estimates are forecasts of the average strength for 2012-13, and include the DMO. 2. Senior Officers are of Colonel or Lieutenant Colonel rank equivalent and substantive APS Executive Level 1 and 2. 3. ADF Recruitment and Retention Initiative. 4. Reserve figures represent the actual numbers of Active and High Readiness Reservists who render service. Reservists on

full-time service are reported in the Permanent Force. 5. The figures for Senior Executive Service include the Secretary of the Department of Defence, 17 Chiefs of Division, and 2

Medical Officer Grade 6. 6. Contractors are individuals under contract performing agency roles. Contractors are not APS employees.


47

Workforce Expenses

Table 19: Workforce Expenses for the Department of Defence (including DMO)

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m


$m


$m


$m

Military employees

Salary, allowances, superannuation and leave[1]6,802.5 6,822.1 19.6 6,778.1 7,081.6 7,709.7

Housing 751.8 723.6 -28.2 839.6 867.3 921.7

Health services 351.2 307.2 -44.0 365.6 380.6 408.3

Fringe Benefits Tax 364.4 363.6 -0.8 405.7 451.1 453.9

Total military employee expense 8,269.9 8,216.5 -53.4 8,389.0 8,780.6 9,493.6

Civilian employees

Salary, allowances, superannuation and leave 2,133.1 2,225.4 92.3 2,220.0 2,361.0 2,563.2

Other expenses including Fringe Benefits Tax 14.2 12.1 -2.1 14.1 15.5 16.3

Total civilian employee expenses 2,147.3 2,237.6 90.3 2,234.0 2,376.4 2,579.4

Total employee expenses 10,417.2 10,454.1 36.9 10,623.0 11,157.0 12,073.2

Note 1. This includes estimates for Reservists.


48


2.1 Outcomes and Performance Information No changes have been made to Defence’s Outcomes and Performance Information since the Portfolio Budget Statements 2012-13.


50

Outcome 1 Resources

Table 20: Total Budgeted Resources Available for Outcome 1

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000


$'000


$'000


$'000

Program 1.1 Office of the Secretary and CDF

Revenues from other sources 1,389 542 -847 539 538 540

Departmental outputs 168,219 142,888 -25,331 154,959 155,999 188,908

Program 1.2 Navy Capabilities

Revenues from other sources 167,686 168,311 625 176,128 182,541 188,819

Departmental outputs 4,270,118 4,313,495 43,377 4,423,895 4,526,486 4,587,867

Program 1.3 Army Capabilities

Revenues from other sources 146,748 146,878 130 158,621 167,756 176,110


Program 1.4 Air Force Capabilities

Revenues from other sources 263,467 244,791 -18,676 280,798 293,143 303,238

Departmental outputs 4,217,797 4,185,485 -32,312 4,245,960 4,392,903 4,635,566

Program 1.5 Intelligence Capabilities

Revenues from other sources 12,813 12,492 -321 13,308 12,800 13,452

Departmental outputs 474,357 525,429 51,072 511,269 556,081 618,473

Chief Operating Officer

Revenues from other sources 303,300 304,328 1,028 333,321 357,056 437,449


Program 1.6 Chief Operating Officer - Defence Support and Reform



Program 1.8 Chief Operating Officer - Chief Information Officer


Departmental outputs 833,021 945,992 112,971 880,786 936,194 1,101,825

Program 1.13 Chief Operating Officer - Defence People

Revenues from other sources - - - - - -


Program 1.7 Defence Science and Technology



Program 1.9 Vice Chief of the Defence Force



Program 1.10 Joint Operations Command

Revenues from other sources 374 1,131 757 372 384 396


Program 1.11 Capability Development


Departmental outputs 987,597 240,157 -747,440 1,012,523 1,566,707 2,303,825

Program 1.12 Chief Finance Officer

Revenues from other sources 151,354 931,876 780,522 963,003 1,009,905 1,046,960

Departmental outputs 458,100 284,480 -173,620 363,352 414,111 420,042


51

Table 20 (Cont): Total Budgeted Resources Available for Outcome 1

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000


$'000


$'000


$'000

Defence Force Retirement Benefits Act, 1948 Part 1, s.15D and VIC, s.82ZJ (1) - - - - - -

Defence Force Retirements and Death Benefits Act, 1973 Part XII, s.125 (3) 92,344 92,344 - 81,122 71,342 62,592

Military Superannuation and Benefits Act, 1991 Part V, s.17 1,210,709 1,210,709 - 1,299,327 1,389,354 1,443,959

Total Administered expenses 1,303,053 1,303,053 - 1,380,449 1,460,696 1,506,551

Administered revenues from other sources 1,215,188 1,215,188 - 1,256,539 1,309,468 1,366,639

Total Program 1.14 87,865 87,865 - 123,910 151,228 139,912

Defence Force Retirement Benefits Act, 1948 Part 1, s.15D and VIC, s.82ZJ (1) 28,531 28,531 - 26,912 25,344 23,828

Defence Force Retirements and Death Benefits Act, 1973 Part XII, s.125 (3) 1,481,844 1,481,844 - 1,486,254 1,488,450 1,488,484Military Superannuation and Benefits Act, 1991 Part V, s.17 1,304,763 1,304,763 - 1,433,947 1,572,738 1,721,098

Total Administered expenses 2,815,138 2,815,138 - 2,947,113 3,086,532 3,233,410

Administered Revenues from other sources - - - - - -

Program 1.15 2,815,138 2,815,138 - 2,947,113 3,086,532 3,233,410

Program 1.16 Housing AssistanceDefence Force (Home Loan Assistance) Act , 1990 Part IV, s.38 2,883 2,883 - 2,306 1,845 1,476Defence Home Ownership Assistance Scheme Act 2008 Part VI, s.84 106,353 106,353 - 115,047 121,422 126,443

Total Administered expenses 109,236 109,236 - 117,353 123,267 127,919

Administered Revenues from other sources 9,963 9,963 - 10,228 10,502 10,695

Total Program 1.16 99,273 99,273 - 107,125 112,765 117,224

Program 1.17 Other Administered

Administered Revenues from other sources 116,719 116,719 - 121,848 125,788 136,011

Program 1.17 -116,719 -116,719 - -121,848 -125,788 -136,011

Total resourcing

Total Departmental outputs 21,943,465 21,499,308 -444,157 22,856,040 24,140,684 26,222,458

Total Administered 2,885,557 2,885,557 - 3,056,300 3,224,737 3,354,535

Total Departmental revenue from other sources 1,413,242 2,151,765 738,523 2,258,246 2,370,883 2,534,402

Total Administered revenue from other sources 1,341,870 1,341,870 - 1,388,615 1,445,758 1,513,345

Equity Injection - 468,774 468,774 329,405 939,329 1,573,185

Total resources for Outcome 1 27,584,134 28,347,274 763,140 29,888,606 32,121,391 35,197,925

Program 1.14 Defence Force Superannuation Benefits

Program 1.15 Defence Force Superannuation Nominal Interest


53

Program 1.1 Deliverables

The following changes have been made to Program 1.1 Deliverables since the Portfolio Budget Statements 2012-13:

ensure Group-specific reform and savings initiatives have been achieved

on behalf of the Secretary and CDF undertake independent audits of Defence activities, and coordinate Australian National Audit Office activity in Defence

on behalf of the Secretary and CDF, take a leading role in the prevention and detection of fraud, undertake fraud investigations, and produce the Defence Fraud Control Plan.

The following Deliverables transferred to the Chief Operating Officer Organisation since the Portfolio Budget Statements 2012-13:

oversee, integrate and coordinate reforms

ensure policy advice provided to the Government is accurate, timely and responsive, and offers practical and cost-effective approaches to fulfil the Government's defence responsibilities

continue implementation of the reforms to the Military Justice System

promote and protect Defence's reputation by increasing public awareness of Defence activities and achievements and strengthen Defence capabilities in media-related activities

provide overarching strategic guidance, policy and supporting plans to implement the recommendations of the reviews into the culture of the ADF and Defence. Not withstanding, the SEC and CDF retain personal accountability for Pathway to Change which is executed through the Culture Reform Steering Committee. Resourcing of individual initiatives in support of the Pathway to Change Strategy comes from the individual Groups and Services as appropriate.

Program 1.1 Key Performance Indicators

The following Key Performance Indicator transferred to the Chief Operating Officer Organisation since the Portfolio Budget Statements 2012-13:

the Ministers are satisfied with the timeliness and quality of advice, including Cabinet documentation, provided by the Department.


55

Table 23: Navy Deliverables (Unit Ready Days)[1]

Deliverables

2012-13

Budget

Estimate

2012-13

Revised

Estimate

18 Major Combatants 4,304 3,804[2]

22 Minor Combatants 5,323 5,188[3]

12 Amphibious and Afloat Support 2,417 1,817[4]

9 Hydrographic Force 2,967 2,563[5]

Notes 1. Unit Ready Days (URD) are the aggregate number of days that constituent force elements are available for tasking. 2. Major Combatants include the Adelaide class frigates, Anzac class frigates, and submarines. The decrease in the URD target

is due to significant schedule changes to major maintenance periods. 3. Minor Combatants include Armidale Class Patrol Boats (ACPB), coastal mine hunters and auxiliary minesweepers. ACPB

URD target adjusted downward to accommodate refinements to the ACPB maintenance remediation program. 4. Amphibious and Afloat Support comprises the oil tanker, replenishment ship, landing ship dock, heavy landing ship, and

heavy landing craft. The decrease in the URD target is due to significant schedule changes to major maintenance and repair periods for HMA Ships Success, Tobruk, Choules and heavy landing craft; and refinements to targets arising from promulgation of formal paying off dates for HMA Ships Balikpapan, Betano and Wewak.

5. Hydrographic Force comprises the hydrographic ships, survey motor launches, chart production office and meteorological and oceanographic centres. The decrease in the URD target is attributable to replacement of Variable Speed Drives in HMA Ships Melville and Leeuwin and major repairs to HMA Ships Mermaid and Paluma coincident with HMA Ships Benalla and Shepparton major maintenance periods.

Table 24: Navy Deliverables (Products)

Deliverables

2012-13

Budget

Estimate

2012-13

Revised

Estimate

Nautical Charting 156 93[1]

Note 1. Paper chart production target reduced to enable resource redistribution to emergent high priority Electronic Navigational

Chart remediation project.

Table 25: Navy Deliverables (Flying Hours)

Deliverables

2012-13

Budget

Estimate

2012-13

Revised

Estimate

13 Squirrels 4,000 3,600[1]

Note 1. Inability to sustain Squirrel serviceability at the level required to achieve flying hours allocation due to shortfalls in logistics

support and higher than expected rate of unscheduled maintenance.


No changes have been made to the Program 1.2 Key Performance Indicators since the Portfolio Budget Statements 2012-13.


58


The following changes have been made to Program 1.4 Key Performance Indicators since the Portfolio Budget Statements 2012-13:

provide accurate, timely and considered advice that meets CDF, Secretary and Government requirements.


61

Table 30: Cost Summary for Chief Operating Officer

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000


$'000


$'000


$'000

Expenses

Employees 1,315,568 1,284,797 -30,771 1,361,410 1,385,807 1,481,345

Suppliers 2,636,945 2,857,782 220,837 2,830,342 2,840,949 3,184,139

Grants 1,473 1,643 170 1,509 1,548 1,584

Depreciation and amortisation 1,021,350 1,007,941 -13,409 994,936 1,042,523 1,097,884

Finance Cost 67,100 67,592 492 96,878 107,467 103,806

Write-down of assets and impairment of assets 72,059 77,139 5,080 91,830 97,548 102,312

Net losses from sale of assets - 3,446 3,446 - - -

Other expenses 33,897 52,562 18,665 21,073 28,329 101,094

Total expenses 5,148,392 5,352,902 204,510 5,397,978 5,504,171 6,072,164

Income

Revenues

Goods and services 278,771 279,610 839 290,979 302,830 314,196

Other revenue 8,053 8,253 200 6,428 6,601 6,782

Total Revenue 286,824 287,863 1,039 297,407 309,431 320,978

Gains

Assets now recognised 12,076 16,465 4,389 23,914 25,625 26,471

Net gains from sale of assets 4,400 - -4,400 12,000 22,000 90,000

Other gains - - - - - -

Total gains 16,476 16,465 -11 35,914 47,625 116,471

Total income 303,300 304,328 1,028 333,321 357,056 437,449

Chief Operating Officer 4,845,092 5,048,574 203,482 5,064,657 5,147,115 5,634,715

Program Deliverables

The following Deliverables transferred from Program 1.1 Office of the Secretary and CDF to the Chief Operating Officer Organisation since the Portfolio Budget Statements 2012-13:

oversee, integrate and coordinate reforms

ensure policy advice provided to the Government is accurate, timely and responsive, and offers practical and cost-effective approaches to fulfil the Government's defence responsibilities

continue implementation of the reforms to the Military Justice System

promote and protect Defence's reputation by increasing public awareness of Defence activities and achievements and strengthen Defence capabilities in media-related activities

provide overarching strategic guidance, policy and supporting plans to implement the recommendations of the reviews into the culture of the ADF and Defence. Not withstanding, the SEC and CDF retain personal accountability for Pathway to Change which is executed through the Culture Reform Steering Committee. Resourcing of individual initiatives in support of the Pathway to Change Strategy comes from the individual Groups and Services as appropriate.

Program Key Performance Indicators

The following Key Performance Indicator transferred from Program 1.1 Office of the Secretary and CDF to the Chief Operating Officer Organisation since the Portfolio Budget Statements 2012-13:

the Ministers are satisfied with the timeliness and quality of advice, including Cabinet documentation, provided by the Department.


63


The following changes to DSRG's core responsibilities focus on day-to-day support to the ADF to enable Defence capability. Particular deliverables for 2012-13 and the Forward Estimate years include:

provision of timely, accurate and high quality advice on Defence Support and Reform matters to the CDF, the Secretary and the Government

ensure Defence input to Cabinet and the National Security Committee of Cabinet is timely, relevant and appropriately robust

ensure policy advice provided to the Government is accurate, timely and responsive, and offers practical and cost-effective approaches to fulfil the Government’s defence responsibilities

promote and protect Defence’s reputation by increasing public awareness of Defence activities and achievements and strengthen Defence capabilities in media-related activities

ensure that Defence complies fully with its obligations under the Archives and Freedom of Information Acts, including the pro-disclosure and accessibility requirements of the Information Publication scheme

continue to drive reform including in areas of the non-materiel procurement shared services and the Estate Shared Services reform

development and delivery of the 2012-13 Major Capital Facilities Program within scope and budget as outlined in Appendices C, D and E

provision of facilities, housing and other DSRG support services

Strategic Reform Management Office (SRMO) is responsible for the high-level integration, coordination and oversight of the Strategic Reform Program

development of environmental policies and strategies in accordance with Defence obligations towards the Environment and Biodiversity Conservation Act 1999 and other environmental policies as outlined in the Defence Environmental Strategic Plan 2010-2014

management of Defence's property leasing, acquisition and disposal programs

ongoing development of options for changes to the estate which inform and are informed by Force Structure Review 2013, the Australian Defence Force Posture Review, agreed US Global Force Posture Review initiatives, and Defence White Paper 2013 considerations

provision of, through the centre of expertise, non-materiel procurement and contracting advice and support, and continuation of the improvement of procurement practices across Defence

provision of garrison and other base support services to support Defence bases and establishments throughout Australia including the management of the Base Services Retender

provision of nationally delivered whole-of-Defence corporate services, including printing and publishing, and travel

administration of the Defence Home Ownership Assistance Scheme

continue implementation of the Base Accountabilities Model across all Defence bases to provide a clear separation of responsibility for base management and support services from responsibility for capability

implementation of DSRG elements of the base security improvement program.


64


The following changes to Program 1.6 Key Performance Indicators since the Portfolio Budget Statements 2012-13 are:

improve business outcomes as part of broader Defence reform, including ongoing implementation of the revised responsibilities and accountabilities for base support

the Ministers are satisfied with the timeliness and quality of advice, including Cabinet documentation, provided by the Department

deliver products and services on time and on budget to support the development and delivery of Defence capability

develop industry engagement and collaborative relationships to ensure the effective and efficient delivery of products and services

support ADF operational capability, including through the deployment of ADF lawyers to provide access to relevant and timely legal support

Provide ADF members with high quality service residences, relocation and travel services using cost-effective contract arrangements

manage, develop and sustain the Defence estate to meet Defence and Government requirements by developing and delivering major estate and environment programs on time, to budget and compliant with all appropriate regulatory requirements.


67


The following changes to Program 1.13 Deliverables since the Portfolio Budget Statements 2012-13 are:

establishment of an Organisational Response Unit within Defence People group to facilitate Defence's interaction with the Defence Abuse Response Taskforce established by Government in response to the Report of the DLA Piper Review into allegations of sexual or other forms of abuse in Defence

establishment of a Sexual Misconduct Prevention and Response Office to ensure members who report abuse are given appropriate support to assist with their immediate safety and well being, their care and recovery, and their return to their full work potential.


The following changes to Program 1.13 Key Performance Indicators since the Portfolio Budget Statements 2012-13 are:

provide professional support services to ADF members and families, including delivery of family support programs and bereavement support in the event of death and serious casualties

ensure timely recognition of ADF members and ex-serving members in accordance with the Australian and Imperial Honours and Awards systems and civilian long service recognition.


78



Table 42: Summary of Estimated Special Account Balances[1][2][3]

Outcome

Opening2012-132011-12

$'000

Receipts2012-132011-12

$'000

Payments2012-132011-12

$'000

Adjustments2012-132011-12

$'000

Closing Balance2012-132011-12

$'000

1 110,744 49,968 -49,873 -34,778 76,061

114,880 55,736 -59,872 - 110,744

1 328 28 -39 - 317

322 29 -23 - 328

1 162 8 -6 - 164

162 8 -8 - 162

1 1,217 60 - - 1,277

1,167 58 -8 - 1,217

Total Special Accounts 2012-13 112,451 50,064 -49,918 -34,778 77,819

2011-12 actual 116,531 55,831 -59,911 - 112,451

Services for Other Entities and Trust Moneys - Defence Special Account– Financial Management and Accountability Act 1997

Defence Endowments Special Account – Financial Management and Accountability Act 1997

Fedorczenko Legacy Special Account – Financial Management and Accountability Act 1997

Young Endeavour Youth Program Special Account – Financial Management and Accountability Act 1997

Notes 1. 2012-13 estimates in bold. 2. 2011-12 actuals in italics. 3. These are all Special Public Monies.


79

3.1.1 Australian Government Indigenous Expenditure

Table 43: Australian Government Indigenous Expenditure

ProgramBill No. 1

$'000

Outcome 1

Defence Indigenous Employment Strategy 1.13

Departmental 2012-13 Revised Estimate 2,783

Departmental 2012-13 Budget Estimate 2,783

Defence Indigenous Development Program 1.13



Army Aboriginal Community Assistance Program[1][2]1.3



Total 2012-13 Revised Estimate 15,484

Total 2012-13 Budget Estimate 16,757

Notes 1. All amounts are GST exclusive. 2. The majority of costs are subsequently recovered from Department of Families, Housing, Community Services and Indigenous

Affairs.

Defence Indigenous Employment Strategy

No changes have been made to Defence Indigenous Employment Strategy since the Portfolio Budget Statements 2012-13.

Defence Indigenous Development Program

No changes have been made to Defence Indigenous Development Program since the Portfolio Budget Statements 2012-13.

Army Aboriginal Community Assistance Program

No changes have been made to Army Aboriginal Community Assistance Program since the Portfolio Budget Statements 2012-13.


80

3.1.2 Grants

The following changes to the grants program since the Portfolio Budget Statements 2012-13 total $1,628.0m, with two new grant programs and four grants approved.

Table 44: Grants Approved Since the 2012-13 Budget

Total Approvals

$'000[1]

2012-13Revised

Estimate

$’000[1]

Defence Family Support Funding Program - approved in 2011-12[2]24 -

Defence Family Support Funding Program[3]1,272 1,430

Army Military History Research Grants Scheme 82 82

International Institute for Strategic Studies (IISS) – for 2013 Shangri-La Dialogue[4]85 84

Kokoda Foundation[5]115 115

The Sir Richard Williams Foundation 50 50

Total additional grants 1,628 1,761

Notes 1. Approvals and Revised Estimate are as at 31 December 2012 and exclude GST. 2. Approved 4 June 2012 and payment made in 2011-12. 3. Revised Estimate includes funds for Seeding Grants. 4. This grant was approved for US$80,875. 5. Payment of $115,000 was made. $15,000 reimbursement received for the cancellation of the November 2012 Young Strategic

Leaders Congress.

Defence Family Support Program

Since the publication of the Portfolio Budget Statements 2012-13, the Defence Family Support Funding Program has approved $24,000 in seeding grants at the end of 2011-12 and approved grants totalling $1,272,000 in 2012-13. The Program provides funds to support projects and services initiated by Defence families. It is also available to existing groups in the community composed of, or benefiting, Defence families.

Army Military History Research Grants Scheme

Grants totalling $82,000 were approved for the Army Military History Research Grants Scheme. The purpose of the scheme is to support and encourage research into the role and involvement of the Army in the development of the nation. The scheme has been in operation since 1992.

International Institute for Strategic Studies (IISS) - Shangri-La Dialogue

A grant of $85,000 (US$80,875) was awarded to the IISS for the 2013 Shangri-La Dialogue, which is a major annual Ministerial level meeting of defence and security officials from the Asia-Pacific and wider region. It provides an opportunity for regional states' defence establishments to exchange views on security in the region. IISS is a registered charity based in London and is a leading authority on political-military conflict and an independent source of objective information on international strategic issues.


81

Kokoda Foundation

A grant of $85,000 was awarded to the Kokoda Foundation to support the Australia-United States Trilogy Dialogue held on 14 to 17 November 2012. A further grant of $30,000 was also awarded for two weekend congresses of the Kokoda Foundation Young Strategic Leaders program (one of which was cancelled and funding reimbursed to Defence). The Kokoda Foundation is a not-for profit organisation that focuses on issues relating to national security and whole-of-nation responses to crises and threats, and fosters research and innovative thinking on Australia's future security challenges.

The Sir Richard Williams Foundation

A grant of $50,000 was provided to the Sir Richard Williams Foundation to undertake independent research and analysis of national security issues facing Australia in today's complex security environment. The outcome of this research will be a series of published reports and publications for public education and discussion.


82


3.2.1 Departmental and Administered Budgeted Financial Statements

Table 45: Variation in Budgeted Departmental Comprehensive Income Statement (showing net cost of services) for the period ended 30 June

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%

EXPENSES

Employee benefits 9,862,642 9,850,793 -11,849 -0.1

Supplier expenses 9,640,819 10,230,282 589,463 6.1

Grants 43,870 43,782 -88 -0.2

Depreciation and amortisation 3,883,375 3,677,486 -205,889 -5.3

Finance costs 92,591 99,244 6,653 7.2

Write-down of assets and impairment of assets 1,085,305 1,105,141 19,836 1.8

Losses from sale of assets - 7,565 7,565 -

Other 123,279 65,717 -57,562 -46.7

Total expenses 24,731,881 25,080,010 348,129 1.4

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sales of goods and rendering of services 840,972 798,644 -42,328 -5.0

Other revenue 70,234 851,480 781,246 1,112.3

Total own-source revenue 911,206 1,650,124 738,918 81.1

Gains

Reversals of previous asset write-downs 521,145 521,531 386 0.1

Sale of assets 281 - -281 -100.0

Other gains 5,001 5,001 - -

Total gains 526,427 526,532 105 -

Total own-source income 1,437,633 2,176,656 739,023 51.4

Net cost of (contribution by) services 23,294,248 22,903,354 -390,894 -1.7

Revenue from Government 23,269,856 22,903,354 -366,502 -1.6

Surplus (Deficit) attributable to the Australian Government -24,392 - 24,392 -100.0Total comprehensive income attributable to the Australian Government -24,392 - 24,392 -100.0


83

Table 46: Variation in Budgeted Departmental Balance Sheet (as at 30 June)

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%

ASSETS

Financial assets

Cash and cash equivalents 72,871 18,091 -54,780 -75.2

Trade and other receivables 90,967 132,631 41,664 45.8

Tax assets 112,449 84,060 -28,389 -25.2

Appropriation receivable 121,517 76,857 -44,660 -36.8

Other receivables 232,507 153,969 -78,538 -33.8

Total financial assets 630,311 465,608 -164,703 -26.1

Non-financial assets

Land and buildings 15,905,773 15,950,564 44,791 0.3

Infrastructure, plant and equipment 6,763,225 6,852,428 89,203 1.3

Specialist military equipment 39,847,374 40,738,740 891,366 2.2

Intangibles 438,992 511,014 72,022 16.4

Heritage and cultural 965,944 984,939 18,995 2.0

Inventories 5,388,990 5,576,003 187,013 3.5

Prepayments 154,833 154,166 -667 -0.4

Total non-financial assets 69,465,131 70,767,854 1,302,723 1.9

Assets held for sale 53,512 25,698 -27,814 -52.0

Total assets 70,148,954 71,259,160 1,110,206 1.6

LIABILITIES

Payables

Suppliers 872,433 912,961 40,528 4.6

Other 365,640 418,700 53,060 14.5

Total payables 1,238,073 1,331,661 93,588 7.6

Interest bearing liabilities

Leases 1,015,758 1,086,866 71,108 7.0

Total interest bearing liabilities 1,015,758 1,086,866 71,108 7.0

Provisions

Employee provisions 2,310,942 2,235,790 -75,152 -3.3

Restoration, decontamination and decommissioning 879,277 897,853 18,576 2.1

Other 6,358 3,822 -2,536 -39.9

Total provisions 3,196,577 3,137,465 -59,112 -1.8

Total liabilities 5,450,408 5,555,992 105,584 1.9

NET ASSETS 64,698,546 65,703,168 1,004,622 1.6

EQUITY

Contributed equity 16,521,019 17,713,203 1,192,184 7.2

Reserves 14,565,010 14,715,576 150,566 1.0

Retained surplus (accumulated deficit) 33,612,517 33,274,389 -338,128 -1.0

Total equity 64,698,546 65,703,168 1,004,622 1.6


84

Table 47: Variation in Budgeted Departmental Statement of Cash Flows (for the period ended 30 June)

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%


Cash received

Appropriations 23,269,856 22,903,354 -366,502 -1.6

Goods and services 840,972 798,675 -42,297 -5.0

Net GST received 637,848 627,693 -10,155 -1.6

Other cash received 70,234 105,218 34,984 49.8

Cash transfer from the Official Public Account (receivables) - - - -

Total cash received 24,818,910 24,434,940 -383,970 -1.5

Cash used

Employees 9,841,548 9,843,469 1,921 -

Suppliers 8,910,692 8,955,219 44,527 0.5

Net GST paid 637,848 627,693 -10,155 -1.6

Grants 43,870 43,782 -88 -0.2

Other cash used 33,897 52,568 18,671 55.1

Cash transfer to the Official Public Account (receivables) 90,304 14,077 -76,227 -84.4

Total cash used 19,558,159 19,536,808 -21,351 -0.1

Net cash from (used by) operating activities 5,260,751 4,898,132 -362,619 -6.9


Cash received

Proceeds from sales of land and buildings 97,936 44,537 -53,399 -54.5

Proceeds from sales of infrastructure, plant and equipment 28,747 28,716 -31 -0.1

Other cash received - 31 31 -

Total cash received 126,683 73,284 -53,399 -42.2

Cash used

Purchase of land and buildings 873,245 858,956 -14,289 -1.6

Purchase of infrastructure, plant and equipment 416,946 243,295 -173,651 -41.6

Purchase of specialist military equipment 2,936,004 3,261,572 325,568 11.1

Purchase of intangibles 11,306 13,754 2,448 21.7

Purchase of inventory 988,753 897,108 -91,645 -9.3

Selling costs on sale of assets 4,154 8,382 4,228 101.8

Finance costs 77,434 77,531 97 0.1

Total cash used 5,307,842 5,360,598 52,756 1.0

Net cash from (used by) investing activities -5,181,159 -5,287,314 -106,155 2.0


Cash received

Appropriations - contributed equity - 468,774 468,774 -

Total cash received - 468,774 468,774 -

Cash used

Repayment of debt 79,592 79,592 - -

Cash to the Official Public Account - - - -

Total cash used 79,592 79,592 - -

Net cash from (used by) financing activities -79,592 389,182 468,774 -589.0

Net increase (decrease) in cash and cash equivalents held - - - -

Cash and cash equivalents at the beginning of the reporting period 72,871 18,091 -54,780 -75.2

Effect of exchange rate movements on cash and cash equivalentsat the beginning of the reporting period - - - -

Cash and cash equivalents at the end of the reporting period 72,871 18,091 -54,780 -75.2


85

3.2.2 Departmental Budgeted Financial Statements

Table 48: Budgeted Departmental Comprehensive Income Statement (showing net cost of services) for the period ended 30 June

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

EXPENSES

Employee benefits 9,841,400 9,850,793 10,060,697 10,543,742 11,431,814

Supplier expenses 10,665,998 10,230,282 10,632,442 11,118,700 12,075,280

Grants 71,305 43,782 44,208 82,590 83,425

Depreciation and amortisation 3,630,984 3,677,486 3,411,495 3,590,476 3,771,849

Finance costs 100,547 99,244 126,209 141,101 145,739

Write-down of assets and impairment of assets 933,464 1,105,141 1,137,194 1,178,335 1,229,980

Losses from sale of assets 13,216 7,565 - - -

Other 97,415 65,717 68,936 66,209 146,261

Total expenses 25,354,329 25,080,010 25,481,181 26,721,153 28,884,348

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sales of goods and rendering of services 778,992 798,644 806,597 837,512 871,155

Other revenue 985,639 851,480 878,636 923,492 958,493

Total own-source revenue 1,764,631 1,650,124 1,685,233 1,761,004 1,829,648

Gains

Foreign exchange 368 - - - -

Reversals of previous asset write-downs 479,573 521,531 551,980 577,905 603,742

Sale of assets - - 15,907 26,720 95,626

Other gains 84,348 5,001 5,126 5,254 5,386

Total gains 564,289 526,532 573,013 609,879 704,754

Total own-source income 2,328,920 2,176,656 2,258,246 2,370,883 2,534,402

Net cost of (contribution by) services 23,025,409 22,903,354 23,222,935 24,350,270 26,349,946

Revenue from Government 22,466,427 22,903,354 23,222,935 24,350,270 26,349,946

Surplus (Deficit) attributable to the Australian Government -558,982 - - - -Total comprehensive income attributable to the Australian Government -558,982 - - - -


86

Table 49: Budgeted Departmental Balance Sheet (as at 30 June)

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

ASSETS

Financial assets

Cash and cash equivalents 18,091 18,091 18,091 18,091 18,091

Trade and other receivables 121,937 132,631 132,631 132,631 132,631

Tax assets 84,062 84,060 84,060 84,060 84,060

Appropriation receivable 76,857 76,857 76,857 76,857 76,857

Other receivables 193,533 153,969 153,790 153,232 152,294

Total financial assets 494,479 465,608 465,429 464,871 463,933


Land and buildings 15,695,215 15,950,564 16,154,168 16,454,927 16,845,783

Infrastructure, plant and equipment 6,730,403 6,852,428 7,212,724 7,018,486 6,693,348

Specialist military equipment 40,327,792 40,738,740 41,136,509 42,161,404 44,433,168

Intangibles 575,006 511,014 453,778 406,454 406,985

Heritage and cultural 984,939 984,939 984,939 984,939 984,939

Inventories 5,686,425 5,576,003 5,480,855 5,388,433 5,312,879

Prepayments 154,178 154,166 154,149 154,131 154,113

Total non-financial assets 70,153,958 70,767,854 71,577,122 72,568,774 74,831,215

Assets held for sale 25,698 25,698 25,698 25,698 25,698

Total assets 70,674,135 71,259,160 72,068,249 73,059,343 75,320,846

LIABILITIES

Payables

Suppliers 1,182,758 912,961 915,805 931,683 1,011,532

Other 434,503 418,700 426,910 437,883 440,650

Total payables 1,617,261 1,331,661 1,342,715 1,369,566 1,452,182


Leases 748,717 1,086,866 1,501,518 1,424,981 1,386,383

Total interest bearing liabilities 748,717 1,086,866 1,501,518 1,424,981 1,386,383

Provisions

Employee provisions 2,227,657 2,235,790 2,271,288 2,349,281 2,443,807

Restoration, decontamination and decommissioning 876,140 897,853 917,291 941,602 975,105

Other 3,822 3,822 3,822 3,822 3,822

Total provisions 3,107,619 3,137,465 3,192,401 3,294,705 3,422,734

Total liabilities 5,473,597 5,555,992 6,036,634 6,089,252 6,261,299

NET ASSETS 65,200,538 65,703,168 66,031,615 66,970,091 69,059,547

EQUITY

Contributed equity 17,245,351 17,713,203 18,041,650 18,980,126 20,552,436

Reserves 14,715,576 14,715,576 14,715,576 14,715,576 14,715,576

Retained surplus (accumulated deficit) 33,239,611 33,274,389 33,274,389 33,274,389 33,791,535

Total equity 65,200,538 65,703,168 66,031,615 66,970,091 69,059,547


87

Table 50: Budgeted Departmental Statement of Cash Flows (for the period ended 30 June)

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000


Cash received

Appropriations 22,484,540 22,903,354 23,222,935 24,350,270 26,349,946

Goods and services 751,279 798,675 806,597 837,512 871,155

Net GST received 540,888 627,693 625,414 651,005 701,055

Interest 4 - - - -

Other cash received 253,680 105,218 70,230 72,034 73,911

Cash transfer from the Official Public Account (receivables) 1,665,917 - - - -

Total cash received 25,696,308 24,434,940 24,725,176 25,910,821 27,996,067

Cash used

Employees 9,641,223 9,843,469 10,016,989 10,454,776 11,334,521

Suppliers 9,135,283 8,955,219 8,922,704 9,287,795 10,001,853

Net GST paid 626,715 627,693 625,414 651,005 701,055

Grants 70,569 43,782 44,208 82,590 83,425

Other cash used 69,879 52,568 21,073 28,329 101,094

Cash transfer to the Official Public Account (receivables) 1,670,514 14,077 48,821 38,733 46,042

Total cash used 21,214,183 19,536,808 19,679,209 20,543,228 22,267,990

Net cash from (used by) operating activities 4,482,125 4,898,132 5,045,967 5,367,593 5,728,077


Cash received

Proceeds from sales of land and buildings 51,165 44,537 65,506 61,675 136,685

Proceeds from sales of infrastructure, plant and equipment 25,698 28,716 36,160 36,371 37,277

Proceeds from sales of specialist military equipment 6,929 - - - -

Proceeds from sales of heritage and cultural assets 573 - - - -

Other cash received 1,026 31 - - -

Total cash received 85,391 73,284 101,666 98,046 173,962

Cash used

Purchase of land and buildings 675,386 858,956 882,824 1,010,239 653,026

Purchase of infrastructure, plant and equipment 424,253 243,295 394,657 322,816 197,900

Purchase of specialist military equipment 4,967,268 3,261,572 2,973,544 3,734,893 5,113,499

Purchase of intangibles 34,465 13,754 5,661 11,228 56,346

Purchase of inventory 1,153,994 897,108 1,054,038 1,130,670 1,302,101

Selling costs on sale of assets 13,443 8,382 5,643 1,795 1,518

Finance costs 52,766 77,531 106,771 116,790 112,236

Total cash used 7,321,575 5,360,598 5,423,138 6,328,431 7,436,626

Net cash from (used by) investing activities -7,236,184 -5,287,314 -5,321,472 -6,230,385 -7,262,664


Cash received

Appropriations - contributed equity 2,773,786 468,774 329,405 939,329 1,573,185

Total cash received 2,773,786 468,774 329,405 939,329 1,573,185

Cash used

Repayment of debt 66,982 79,592 53,900 76,537 38,598

Cash to the Official Public Account - - - - -

Total cash used 66,982 79,592 53,900 76,537 38,598

Net cash from (used by) financing activities 2,706,804 389,182 275,505 862,792 1,534,587

Net increase (decrease) in cash and cash equivalents held -47,255 - - - -

Cash and cash equivalents at the beginning of the reporting period 64,871 18,091 18,091 18,091 18,091

Effect of exchange rate movements on cash and cash equivalents at beginning of the reporting period 475 - - - -

Cash and cash equivalents at the end of the reporting period 18,091 18,091 18,091 18,091 18,091


88

Table 51: Departmental Statement of Changes in Equity — Summary of Movements (Budget year 2012-13)

Retained Earnings

$'000

Asset Revaluation

Reserve$'000

Contributed Equity/Capital

$'000

Total Equity

$'000

Opening balance as at 1 July 2012

Balance carried forward from previous period 33,239,611 14,715,576 17,245,351 65,200,538

Adjustment for changes in accounting policies - - - -

Adjusted opening balance 33,239,611 14,715,576 17,245,351 65,200,538

Comprehensive income

Comprehensive income recognised directly in equity:

Gain/loss on revaluation of property - - - -

Subtotal comprehensive income - - - -

Surplus (Deficit) for the period - - - -

Total comprehensive income recognised directly in equity - - - -

Transactions with owners

Distribution to owners

Returns on capital:

Restructuring - - - -

Other - - -922 -922

Contributions by owners

Appropriation (equity injection) - - 468,774 468,774

Other 34,778 - - 34,778

Sub-total transaction with owners 34,778 - 467,852 502,630

Transfers between equity components - - - -

Estimated closing balance as at 30 June 2013 33,274,389 14,715,576 17,713,203 65,703,168


89

Table 52: Departmental Capital Budget Statement

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

CAPITAL APPROPRIATIONS

Equity injection 2,773,786 468,774 329,405 939,329 1,573,185

Total capital appropriations 2,773,786 468,774 329,405 939,329 1,573,185

Represented by:

Purchase of non-financial assets 2,706,804 389,182 275,505 862,792 1,534,587

Annual finance lease costs 66,982 79,592 53,900 76,537 38,598

Other items - - - - -

Total Items 2,773,786 468,774 329,405 939,329 1,573,185

PURCHASE OF NON-FINANCIAL ASSETS

Funded by capital appropriations 2,773,786 468,774 329,405 939,329 1,573,185

Funded by finance lease costs - 404,287 468,552 - -

Funded internally from departmental resources[1]3,336,392 3,908,803 3,927,281 4,139,847 4,447,586

Total 6,110,178 4,781,864 4,725,238 5,079,176 6,020,771Reconciliation of cash used to acquire assets to asset movement table

Total purchases 6,110,178 4,781,864 4,725,238 5,079,176 6,020,771

less additions by finance lease 8,806 404,287 468,552 - -

less additions by creditors/borrowings - - - - -

plus borrowing/finance costs 52,766 77,531 106,771 116,790 112,236

plus Annual finance lease costs 66,982 79,592 53,900 76,537 38,598

less Gifted assets - - - - -

less s32/restructuring - - - - -

Total cash used to acquire assets 6,221,120 4,534,700 4,417,357 5,272,503 6,171,605

Note 1. Includes the following sources of funding:

- annual and prior year appropriations - donations and contributions - gifts - internally developed assets - s31 relevant agency receipts - proceeds from the sale of assets.


90

Table 53: Statement of Departmental Asset Movements (2012-13)

Land$'000

Buildings

$'000

Specialist Military

Equipment$'000

Infrastructure, Plant and

Equipment$'000

Intangibles$'000

Heritage and Cultural

Assets $'000

Assets Held for

Sale$'000

Total$'000

As at 1 July 2012

Gross book value 4,579,475 11,354,224 74,914,928 7,121,243 1,084,316 984,939 25,698 100,064,823

Accumulated depreciation/amortisation and impairment - 238,484 34,587,136 390,840 509,310 - - 35,725,770

Opening net book balance 4,579,475 11,115,740 40,327,792 6,730,403 575,006 984,939 25,698 64,339,053

CAPITAL ASSET ADDITIONS

Estimated expenditure on new or replacement assets

By purchase - appropriation equity - 858,956 3,261,572 243,295 13,754 - - 4,377,577

By purchase - donated funds - - - - - - - -

By finance lease - - - 404,287 - - - 404,287

Total Additions - 858,956 3,261,572 647,582 13,754 - - 4,781,864

Other Movements

Assets held for sale - - - - - - - -

Reclassifications[1]- - 392,553 23,039 - - - 415,592

Depreciation and amortisation - 542,500 2,579,209 478,031 77,746 - - 3,677,486

Disposal of entities or other operations (including restructuring) - 10,761 - 32,866 - - - 43,627

Other disposals[2]- 50,346 663,968 37,699 - - - 752,013

As at 30 June 2013

Gross book value 4,579,475 12,152,073 77,905,085 7,721,299 1,098,070 984,939 25,698 104,466,639

Accumulated depreciation/amortisation and impairment - 780,984 37,166,345 868,871 587,056 - - 39,403,256

Closing net book value 4,579,475 11,371,089 40,738,740 6,852,428 511,014 984,939 25,698 65,063,383

Notes 1. Reclassifications include asset first found. 2. Other disposals includes write-offs.


91

Table 54: Variation in Schedule of Budgeted Income and Expenses Administered on Behalf of Government (for the period ended 30 June)

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%

EXPENSES ADMINISTERED ON BEHALF OF GOVERNMENT

Subsidies 109,236 109,236 - -

Military retention benefits 64,223 64,223 - -

Military superannuation benefits 4,053,968 4,053,968 - -

Total expenses administered on behalf of Government 4,227,427 4,227,427 - -

INCOME ADMINISTERED ON BEHALF OF GOVERNMENT

Revenue

Non-taxation

Interest 31,849 31,849 - -

Dividends 45,813 45,813 - -

Military superannuation contributions 1,215,188 1,215,188 - -

Fees 9,963 9,963 - -

Other 39,057 39,057 - -

Total Non-taxation 1,341,870 1,341,870 - -

Total revenues administered on behalf of Government 1,341,870 1,341,870 - -


92

Table 55: Variation in Schedule of Budgeted Assets and Liabilities Administered on Behalf of Government (as at 30 June)

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%

ASSETS ADMINISTERED ON BEHALF OF GOVERNMENT

Financial assets

Cash and cash equivalents - - - -

Trade and other receivables 65,475 61,393 -4,082 -6.2

Investments accounted for using the equity method 2,311,926 2,277,654 -34,272 -1.5

Loans 509,580 509,580 - -

Total financial assets 2,886,981 2,848,627 -38,354 -1.3


Prepayments 165,226 164,772 -454 -0.3

Total Non-financial assets 165,226 164,772 -454 -0.3

Total assets administered on behalf of Government 3,052,207 3,013,399 -38,808 -1.3

LIABILITIES ADMINISTERED ON BEHALF OF GOVERNMENT

Payables

Other - 5,159 5,159 -

Total Payables - 5,159 5,159 -

Provisions

Superannuation - DFRB[1]475,271 471,514 -3,757 -0.8

Superannuation - DFRDB[2]25,475,645 25,344,837 -130,808 -0.5

Superannuation - MSBS[3]23,472,268 23,363,587 -108,681 -0.5

Total Provisions 49,423,184 49,179,938 -243,246 -0.5

Total Liabilities administered on behalf of Government 49,423,184 49,185,097 -238,087 -0.5

Notes 1. Defence Force Retirement Benefits. 2. Defence Force Retirement and Death Benefits. 3. Military Superannuation and Benefits Scheme.


93

Table 56: Variation in Schedule of Budgeted Administered Cash Flows (for the period ended 30 June)

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000

Variation%


Cash received

Interest 31,849 31,849 - -

Military superannuation contributions 1,215,132 1,215,132 - -

Fees 9,963 9,963 - -

Other 39,057 39,057 - -

Total cash received 1,296,001 1,296,001 - -

Cash used

Subsidies paid 109,236 109,236 - -

Military benefits 1,910,631 1,910,631 - -

Total cash used 2,019,867 2,019,867 - -

Net cash from or (used by) operating activities -723,866 -723,866 - -


Cash received

Dividends 48,594 48,594 - -

Total cash received 48,594 48,594 - -

Net cash from or (used by) investing activities 48,594 48,594 - -

Net increase (decrease) in cash held -675,272 -675,272 - -

Cash at the beginning of the reporting period - - - -

Cash from the Official Public Account for appropriations 2,019,867 2,019,867 - -

Cash to the Official Public Account -1,344,595 -1,344,595 - -

Effect of exchange rate movements on cash and cash equivalents - - - -

Cash and cash equivalents at end the of the reporting period - - - -


94

Table 57: Schedule of Budgeted Income and Expenses Administered on Behalf of Government (for the period ended 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Subsidies 96,585 109,236 117,353 123,267 127,919

Military retention benefits 56,525 64,223 77,103 95,883 77,940

Military superannuation benefits 4,062,274 4,053,968 4,250,459 4,451,345 4,662,021

Other 141 - - - -

Total Expenses administered on behalf of Government 4,215,525 4,227,427 4,444,915 4,670,495 4,867,880


Revenue

Non-taxation

Interest 35,517 31,849 31,849 31,849 31,849

Dividends 49,654 45,813 49,717 52,306 59,456

Military superannuation contributions 1,158,903 1,215,188 1,256,539 1,309,468 1,366,639

Fees 12,251 9,963 10,228 10,502 10,695

Other 59,751 39,057 40,282 41,633 44,706

Total Non-taxation 1,316,076 1,341,870 1,388,615 1,445,758 1,513,345

Total Revenues administered on behalf of Government 1,316,076 1,341,870 1,388,615 1,445,758 1,513,345


95

Table 58: Schedule of Budgeted Assets and Liabilities Administered on Behalf of Government (as at 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Financial assets

Cash and cash equivalents - - - - -


Investments accounted for using the equity method 2,275,236 2,277,654 2,279,257 2,280,457 2,283,126

Loans 509,580 509,580 509,580 509,580 509,580

Total Financial assets 2,848,934 2,848,627 2,854,190 2,858,035 2,867,183


Prepayments 170,095 164,772 152,069 150,086 178,546

Total Non-financial assets 170,095 164,772 152,069 150,086 178,546

Total Assets administered on behalf of Government 3,019,029 3,013,399 3,006,259 3,008,121 3,045,729

Payables

Other 5,159 5,159 5,159 5,159 5,159

Total Payables 5,159 5,159 5,159 5,159 5,159

Provisions

Superannuation - DFRB[1]634,100 471,514 444,171 417,713 392,162

Superannuation - DFRDB[2]38,677,000 25,344,837 25,400,766 25,419,660 25,401,389

Superannuation - MSBS[3]46,479,000 23,363,587 25,663,834 28,129,133 30,757,752

Total Provisions 85,790,100 49,179,938 51,508,771 53,966,506 56,551,303

Total Liabilities administered on behalf of Government 85,795,259 49,185,097 51,513,930 53,971,665 56,556,462




96

Table 59: Schedule of Budgeted Administered Cash Flows (for the period ended 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Cash received

Interest 32,173 31,849 31,849 31,849 31,849


Fees 11,216 9,963 10,228 10,502 10,695

Other 74,472 39,057 40,282 41,633 44,706

Total Cash received 1,330,299 1,296,001 1,338,842 1,393,396 1,454,560

Cash used

Subsidies paid 92,061 109,236 117,353 123,267 127,919

Military benefits 1,899,936 1,910,631 1,986,025 2,087,510 2,183,624

Total Cash used 1,991,997 2,019,867 2,103,378 2,210,777 2,311,543

Net cash from or (used by) operating activities -661,698 -723,866 -764,536 -817,381 -856,983


Cash received

Dividends 52,379 48,594 45,813 49,717 52,306

Total Cash received 52,379 48,594 45,813 49,717 52,306

Net cash from (used by) investing activities 52,379 48,594 45,813 49,717 52,306

Net increase (decrease) in cash held and cash equivalents held -609,319 -675,272 -718,723 -767,664 -804,677

Cash at the beginning of reporting period - - - - -

Cash from the Official Public Account for appropriations 1,991,997 2,019,867 2,103,378 2,210,777 2,311,543

Cash to the Official Public Account -1,382,678 -1,344,595 -1,384,655 -1,443,113 -1,506,866

Effect of exchange rate movements on cash and cash equivalents - - - - -

Cash and cash equivalents at end of reporting period - - - - -


97

3.3 Consolidated Budgeted Financial Statements for the Department of Defence (including DMO)

Table 60: Consolidated Comprehensive Departmental Income Statement (showing net cost of services) for the Department of Defence (including DMO) for the period ending 30 June

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

EXPENSES

Employee benefits 10,433,665 10,454,078 10,623,040 11,157,021 12,073,191


Grants 92,105 71,693 66,368 113,130 86,806

Depreciation and amortisation 3,632,664 3,680,013 3,414,085 3,593,130 3,774,570

Finance costs 100,547 99,244 126,209 141,101 145,739

Write-down of assets and impairment of assets 934,701 1,105,141 1,137,194 1,178,335 1,229,980

Losses from sale of assets 13,216 7,565 - - -

Other 97,768 65,717 68,936 66,209 146,261

Total expenses 25,113,951 24,889,621 25,208,846 26,432,178 28,582,584

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sales of goods and rendering of services 429,695 476,797 432,009 444,640 461,598

Rental Income 9,481 - - - -

Other revenue 197,500 70,434 70,230 72,034 73,911

Total own-source revenue 636,676 547,231 502,239 516,674 535,509

Gains

Foreign exchange 1,300 - - - -

Reversals of previous asset write-downs 479,632 521,531 551,980 577,905 603,742

Sale of assets - - 15,907 26,720 95,626

Other gains 85,748 6,401 6,526 6,654 6,786

Total gains 566,680 527,932 574,413 611,279 706,154


Net cost of (contribution by) services 23,910,595 23,814,458 24,132,194 25,304,225 27,340,921

Revenue from Government 23,397,697 23,814,458 24,132,194 25,304,225 27,340,921

Surplus (deficit) attributable to the Australian Government -512,898 - - - -Total comprehensive income (loss) attributable to the Australian Government -512,898 - - - -


98

Table 61: Consolidated Budgeted Departmental Balance Sheet for the Department of Defence (including DMO) as at 30 June

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

ASSETS

Financial assets



Tax assets 199,973 199,971 199,971 199,971 199,971

Appropriation receivable 378,781 346,857 349,924 353,579 340,444

Other receivables 181,813 140,601 140,422 139,864 138,926



Land and buildings 15,695,215 15,950,564 16,154,168 16,454,927 16,845,783

Infrastructure, plant and equipment 6,737,274 6,859,627 7,220,259 7,026,366 6,701,581

Specialist military equipment 40,327,792 40,738,740 41,136,509 42,161,404 44,433,168

Intangibles 575,062 511,153 454,002 406,766 407,387

Heritage and cultural 984,939 984,939 984,939 984,939 984,939

Inventories 5,686,425 5,576,003 5,480,855 5,388,433 5,312,879

Prepayments 1,520,202 1,520,190 1,520,173 1,520,155 1,520,137


Assets held for sale 25,698 25,698 25,698 25,698 25,698

Total assets 72,480,167 73,046,614 73,859,191 74,854,373 77,103,184

LIABILITIES

Payables

Suppliers 2,351,977 2,174,627 2,177,471 2,193,349 2,273,198

Other 502,498 381,495 392,149 405,590 389,349

Total payables 2,854,475 2,556,122 2,569,620 2,598,939 2,662,547


Leases 748,717 1,086,866 1,501,518 1,424,981 1,386,383

Total interest bearing liabilities 748,717 1,086,866 1,501,518 1,424,981 1,386,383

Provisions

Employee provisions 2,421,944 2,423,060 2,459,602 2,539,215 2,640,057

Restoration, decontamination and decommissioning 876,140 897,853 917,291 941,602 975,105

Other provisions 9,520 9,520 9,520 9,520 9,520



NET ASSETS 65,569,371 66,073,193 66,401,640 67,340,116 69,429,572

EQUITY

Contributed equity 17,400,719 17,868,571 18,197,018 19,135,494 20,707,804

Reserves 14,715,815 14,715,815 14,715,815 14,715,815 14,715,815

Retained surplus (accumulated deficits) 33,452,837 33,488,807 33,488,807 33,488,807 34,005,953

Total equity 65,569,371 66,073,193 66,401,640 67,340,116 69,429,572


99

Table 62: Consolidated Budgeted Departmental Statement of Cash Flows for the Department of Defence (including DMO) for the period ended 30 June

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000


Cash received

Appropriations 23,354,540 23,846,383 24,129,127 25,300,570 27,354,056

Goods and services 424,837 475,767 429,560 443,746 460,681

Net GST received 1,217,247 1,186,489 1,214,938 1,325,364 1,502,416

Other cash received 282,305 162,926 130,799 132,559 136,010

Cash transfer from the Official Public Account (receivables) - - - - -


Cash used

Employees 10,211,933 10,452,990 10,575,844 11,063,967 11,988,590

Suppliers 9,003,659 8,824,614 8,928,402 9,262,036 9,996,974

Net GST paid 1,318,611 1,186,489 1,214,938 1,325,364 1,502,416

Grants 91,017 71,693 66,368 113,130 86,806

Other cash used 69,883 195,354 21,073 28,329 101,094

Cash transfer to the Official Public Account (receivables) 4,597 14,077 48,821 38,733 46,042

Total cash used 20,699,700 20,745,217 20,855,446 21,831,559 23,721,922

Net cash from or (used by) operating activities 4,579,229 4,926,348 5,048,978 5,370,680 5,731,241


Cash received

Proceeds from sales of land and buildings 51,165 44,537 65,506 61,675 136,685

Proceeds from sales of infrastructure, plant and equipment 26,271 28,716 36,160 36,371 37,277

Proceeds from sales of specialist military equipment 6,929 - - - -

Other cash received 1,026 31 - - -


Cash used

Purchase of land and buildings 675,386 858,956 882,824 1,010,239 653,026

Purchase of infrastructure, plant and equipment 426,143 246,233 397,668 325,903 201,064

Purchase of specialist military equipment 4,967,268 3,261,572 2,973,544 3,734,893 5,113,499

Purchase of intangibles 34,465 13,754 5,661 11,228 56,346

Purchase of inventory 1,153,994 897,108 1,054,038 1,130,670 1,302,101

Purchase of heritage and cultural assets - - - - -

Selling costs on sale of assets 13,443 8,382 5,643 1,795 1,518

Finance costs 52,766 77,531 106,771 116,790 112,236

Total cash used 7,323,465 5,363,536 5,426,149 6,331,518 7,439,790

Net cash from or (used by) investing activities -7,238,074 -5,290,252 -5,324,483 -6,233,472 -7,265,828


Cash received

Appropriations - contributed equity 2,773,786 468,774 329,405 939,329 1,573,185

Total cash received 2,773,786 468,774 329,405 939,329 1,573,185

Cash used

Repayment of debt 66,982 79,592 53,900 76,537 38,598

Cash to the Official Public Account - - - - -

Total cash used 66,982 79,592 53,900 76,537 38,598

Net cash from or (used by) financing activities 2,706,804 389,182 275,505 862,792 1,534,587

Net increase or (decrease) in cash and cash equivalents held 47,959 25,278 - - -Cash and cash equivalents at the beginning of the reporting period -5,621 42,813 68,091 68,091 68,091Effect of exchange rate movements on cash and cash equivalents 475 - - - -



100

Table 63: Consolidated Budgeted Income and Expenses Administered on Behalf of Government for the Department of Defence (including DMO) for the period ended 30 June

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Revenue

Non-taxation

Interest 36,059 31,855 31,855 31,855 31,855

Dividends 49,654 45,813 49,717 52,306 59,456


Fees 12,251 9,963 10,228 10,502 10,695

Other 59,793 39,057 40,282 41,633 44,706

Total non-taxation 1,316,660 1,341,876 1,388,621 1,445,764 1,513,351

Total revenues administered on behalf of Government 1,316,660 1,341,876 1,388,621 1,445,764 1,513,351


Subsidies 96,585 109,236 117,353 123,267 127,919

Military retention benefits 56,525 64,223 77,103 95,883 77,940

Military superannuation benefits 4,062,274 4,053,968 4,250,459 4,451,345 4,662,021

Other 846 - - - -

Total expenses administered on behalf of Government 4,216,230 4,227,427 4,444,915 4,670,495 4,867,880

Table 64: Consolidated Budgeted Assets and Liabilities Administered on Behalf of Government for the Department of Defence (including DMO) as at 30 June

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Financial assets

Receivables 68,460 61,393 65,353 67,998 74,477

Investments accounted for using the equity method 2,275,236 2,277,654 2,279,257 2,280,457 2,283,126

Loans 509,580 509,580 509,580 509,580 509,580

Total financial assets 2,853,276 2,848,627 2,854,190 2,858,035 2,867,183


Prepayments 170,095 164,772 152,069 150,086 178,546

Total non-financial assets 170,095 164,772 152,069 150,086 178,546

Total assets administered on behalf of Government 3,023,371 3,013,399 3,006,259 3,008,121 3,045,729

Payables

Other 5,159 5,159 5,159 5,159 5,159

Total payables 5,159 5,159 5,159 5,159 5,159

Provisions

Superannuation - DFRB[1]634,100 471,514 444,171 417,713 392,162

Superannuation - DFRDB[2]38,677,000 25,344,837 25,400,766 25,419,660 25,401,389

Superannuation - MSBS[3]46,479,000 23,363,587 25,663,834 28,129,133 30,757,752


Total liabilities administered on behalf of Government 85,795,259 49,185,097 51,513,930 53,971,665 56,556,462




101

Table 65: Consolidated Budgeted Administered Statement of Cash Flows for the Department of Defence (including DMO) for the period ended 30 June

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Cash received

Interest 35,846 31,979 31,855 31,855 31,855


Fees 11,216 9,963 10,228 10,502 10,695

Other 74,472 43,275 40,282 41,633 44,706


Cash used

Subsidies paid 92,061 109,236 117,353 123,267 127,919

Military benefits 1,899,936 1,910,631 1,986,025 2,087,510 2,183,624

Total cash used 1,991,997 2,019,867 2,103,378 2,210,777 2,311,543

Net cash from or (used by) operating activities -658,025 -719,518 -764,530 -817,375 -856,977


Cash received

Dividends 52,379 48,594 45,813 49,717 52,306


Cash used

Loans - - - - -

Total cash used - - - - -

Net cash from (used by) investing activities 52,379 48,594 45,813 49,717 52,306

Net increase (decrease) in cash held -605,646 -670,924 -718,717 -767,658 -804,671

Cash at the beginning of the reporting period - - - - -

Cash from the Official Public Account for appropriations 1,991,997 2,019,867 2,103,378 2,210,777 2,311,543

Cash to the Official Public Account -1,386,351 -1,348,943 -1,384,661 -1,443,119 -1,506,872

Effect of exchange rate movements on cash and cash equivalents - - - - -

Cash and cash equivalents at the end of the reporting period - - - - -


102

Appendices

Appendix A Defence Portfolio Bodies

Appendix B Defence Cooperation Program

Appendix C Major Capital Facilities Program

Appendix D Status of Major Projects Foreshadowed For Government and Parliamentary Standing Committee on Public Works (PWC) Consideration in 2012-13

Appendix E Approved Projects Being Developed for Private Financing Arrangements

Appendix F The Unapproved Major Capital Investment Program (also known as the Defence Capability Plan)


103

Appendix A

Defence Portfolio Bodies

Royal Australian Navy Central Canteens Board

Chairman: Commodore Clinton Thomas AM CSC is now Rear Admiral Clinton Thomas AM CSC.


104

Appendix B

Defence Cooperation Program

No changes have been made to Defence Cooperation Program since the Portfolio Budget Statements 2012-13.


105

Appendix C

Major Capital Facilities Program

Information is as reported in the Portfolio Budget Statements 2012-13.

Approved Major Capital Facilities Projects

Table 66 and the following descriptions provide details on progress and expenditure during 2012-13 on major capital facilities projects.

Table 66: Approved Major Capital Facilities Projects by State and Federal Electorate

TotalEstimated

Expenditure$m

CumulativeExpenditure

to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m Project Performance Update and Explanation of Variation

NEW SOUTH WALES

Gilmore

HMAS Albatross

Redevelopment Stage 3 192.0 - 19.1 0.5 -18.6The financial variation is due to protracted negotiations in establishing the delivery phase contracts.

Hughes

Moorebank Units Relocation 352.9 - 64.8 49.6 -15.2The financial variation is due to estimated 2012-13 spend being refined through detailed design and contract award.

Defence Logistics

Transformation Project[1][11] - - - 45.9 45.9Project has been approved since the Portfolio Budget Statements 2012-13 .

Liverpool Military Area High Voltage Reticulation Systems

Upgrade [11]19.6 - - 8.0 8.0

Project has been approved since the Portfolio Budget Statements 2012-13 .

Facilities for Joint Counter Improvised Explosive Device

Capability[1][12] - - - 0.3 0.3



106

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


Hunter

SingletonEnhanced Land Force Stage

2 Works[1][3] - 97.6 24 21.2 -2.8The financial variation is as a result of extended procurement activities that have delayed the delivery of an element of work.


Capability[1][12] - - - 0.1 0.1

MacKellar

Pittwater AnnexeHMAS Penguin and Pittwater

Annexe Redevelopment[1][4] - 2.7 4.3 4.3 -

Riverina

KapookaEnhanced Land Force Stage

1 Works[1][2] - 102.1 1.2 2.0 0.8The financial variation is a result of achieving some accelerated works outcomes. The project is now in the Defects Liability Period.

Warringah

HMAS PenguinHMAS Penguin and Pittwater

Annexe Revelopment[1][4] - 20.0 20.5 28.0 7.5The financial variation is due to earlier then expected delivery of construction works being achieved on site.

Total New South Wales 564.5 222.4 133.9 159.9 26.0


107

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


VICTORIA

Gippsland

East SaleRAAF Base East Sale Redevelopment

185.6 - 25.0 25.0 -

Indi

Bandiana

Facilities for Replacement

Towed Artillery (Land 17)[1][5] - 0.1 2.8 0.9 -1.9The financial variation is due to a delay in finalising the delivery phase contracts. The expected completion date has slipped to financial year 2014-15.

Joint Logistics Unit Warehousing

36.4 32.2 - 2.2 2.2

Gaza Ridge Barracks

Facilities for Project

Overlander (LAND 121)[1][7] - 1.4 7.8 8.0 0.2The financial variation is attributable to contractor performance and unforeseen inground conditions.

Jagajaga

WatsoniaDefence Force School of Signals

101.3 90.9 2.4 3.0 0.6The financial variation is a result of the delay in the delivery of the final scope element, which is being reassessed.

McEwen

PuckapunyalEnhanced Land Force Stage

1 Works[1][2] - 43.9 32.5 20.2 -12.3 The financial variation is due to delivery schedule reprogramming.


Towed Artillery (Land 17)[1][5] - 0.1 2.5 1.2 -1.3The financial variation is due to a delay in finalising the delivery phase contracts. This has delayed the completion date to financial year 2014-15.

Total Victoria 323.3 168.6 73.0 60.5 -12.5


108

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


QUEENSLAND

Blair

AmberleyRAAF Base Amberley Redevelopment Stage 3

331.5 297.2 29.2 17.0 -12.2 The financial variation is due to delivery schedule reprogramming.

Australian Super Hornet

Facilities[8] 110.1 106.9 0.9 0.9 -

Heavy Airlift Capability

Permanent Facilities[1][9] - 148.8 5.2 4.1 -1.1The financial variation is a result of the payment profile for the Cargo Compartment Trainer differing from that assumed at the time of the publication of the Portfolio Budget Statements 2012-13 .


Overlander (Land 121)[1][7] - 7.9 3.9 3.2 -0.7Amberley works are now complete. The financial variation can be attributed to favourable tender outcomes.

Enhanced Land Force Stage

1 Works[1][2] - 98.4 3.1 4.2 1.1

The financial variation is a result of a delay in delivery of the Air Point of Disembarkation facilities. It was necessary to recontract for project manager services and this has impacted on the 2012-13 financial year spend.

Defence Logistics


Enoggera


2 Works[1][3] - 441.3 119.5 202.6 83.1The financial variation is attributed to beneficial programming of the delivery schedule, allowing works elements to be brought forward.


Towed Artillery (Land 17)[1][5] - 0.1 13 8.7 -4.3The financial variation is due to a delay in finalising the delivery phase contracts. This has delayed the completion date to financial year 2014-15.

Forde

Canungra


2 Works[1][3] - 16.8 28.3 24 -4.3The financial variation is attributed to reduced activity as a result of contractor insolvency. The contract has been retendered and works are anticipated to be delivered on schedule.


109

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


Herbert

TownsvilleEnhanced Land Force Stage

1 Works[1][2] - 168.4 8.8 13.1 4.3The financial variation is the result of costs associated with Information and Communications Technology (ICT) works.


2 Works[1][3] - 58.5 2.9 1.6 -1.3The financial variation is a result of savings realised in the delivery of some elements of these works.




Capability[1][12] - - - 0.2 0.2


Lilley

Damascus Barracks


Overlander (Land 121)[1][7] - 11.9 6.2 2.8 -3.4The financial variation is a result of delays to the program due to asbestos being found on site. These delays are not anticipated to impact the construction completion date.

Moncrief


Capability[1][12] - - - 0.1 0.1


Rankin

Greenbank Training AreaEnhanced Land Force Stage

2 Works[1][3] - 13.2 83.2 79.2 -4.0The financial variation is attributed to reduced activity on site related to a contractual dispute.

RyanFacilities for Joint Counter Improvised Explosive Device

Capability[1][12] - - - 0.1 0.1


Wide Bay

Wide Bay Training AreaEnhanced Land Force Stage

2 Works[1][3] - 44.6 38.7 14.2 -24.5The financial variation is due to delays in the agreement of the preferred site which has delayed works scheduled for 2012-13.

Total Queensland 441.6 1,414.1 346.9 383.0 36.1


110

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


SOUTH AUSTRALIA

Barker

Murray Bridge Training AreaHardened and Networked

Army Facilities[1][10] - 16.5 7.1 10.3 3.2The financial variation is a result of work to resolve environmental issues.

Wakefield

Edinburgh Defence PrecinctHardened and Networked

Army Facilites[1][10] - 544.1 3.8 0.7 -3.1 The financial variation is due to delivery schedule reprogramming.



RAAF Base Edinburgh

Redevelopment Stage 2 99.6 86.2 6.1 12.0 5.9The financial variation is due to the prompt resolution of design and licensing issues related to the construction of Ordnance Loading Aprons at RAAF Base Edinburgh .


1 Works[1][2] - 19.5 5.8 4.1 -1.7The financial variation is due to an extended design period for the remaining elements. Construction of these elements will continue into financial year 2013-14.


2 Works[1][3] - 14.1 19.9 21.2 1.3The financial variation is due to some decontamination works undertaken on site.

Total South Australia 99.6 680.5 45.9 49.4 3.5

WESTERN AUSTRALIA

Pearce

RAAF Base Pearce

Redevelopment Stage 1 142.2 130.8 7.6 3.5 -4.1The financial variation is a result of delays to the program caused by the design non compliance of one element of the project.

PearceFacilities for Joint Counter Improvised Explosive Device

Capability[1][12] - - - 0.1 0.1


Total Western Australia 142.2 130.8 7.6 3.5 -4.1


111

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


TASMANIA

BassScottsdale Specific Nutritional Capability

18.7 0.9 9.9 7.1 -2.8The financial variation is attributed to contingency being retired as risks are mitigated.

Total Tasmania 18.7 0.9 9.9 7.1 -2.8

NORTHERN TERRITORY

Solomon

Darwin

Robertson Barracks

Redevelopment 72.1 60.3 0.4 1.6 1.2The financial variation is as a result of additional compliance works required to address Work Health and Safety risk.

Robertson Barracks Electrical Reticulation System Upgrade

43.4 3.6 32.0 33.7 1.7The financial variation is due to an allowance calculated for advance payments on long lead time items.



Defence Logistics


RAAF Base Darwin

Redevelopment Stage 2 48.7 43.0 0.7 2.1 1.4The financial variation is due to some remediation works undertaken on site.


Permanent Facilities[1][9] - 40.8 1.7 1.7 -


Capability[1][12] - - - 0.1 0.1


Total Northern Territory 164.2 147.8 39.2 50.2 11.0


112

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m


AUSTRALIAN CAPITAL TERRITORY

CanberraDefence Facilities at HMAS Harman and Other

Locations[5] - 25.9 103.9 130.0 26.1

The financial variation reflects a more accurate spend spread based on the current delivery program.

Australian Defence Force Academy: Living-In Accommodation Refurbishment

34.7 21.7 9.5 9.3 -0.2The financial variation is due to savings realised in the delivery of the project.

Australian Defence Force Academy Redevelopment

98.5 4.8 41.6 40.0 -1.6The financial variation is result of delays in construction. Work is being accelerated and the original program will be met.

Fraser

HMAS Creswell

Redevelopment 83.6 82.5 0.1 0.7 0.6The financial variation is as a result of additional compliance works required to address Work Health and Safety risk.

Total Australian Capital Territory 216.8 134.9 155.1 180.0 24.9

VARIOUS LOCATIONS[1]


1 Works[1][2] 793.1 - - - -


2 Works[1][3] 1,457.8 - - - -

HMAS Penguin and Pittwater

Annexe Redevelopment[1][4] 63.3 - - - -


Towed Artillery (Land 17)[1][5] 46.5 - - - -

Defence Facilities at HMAS Harman and Other

Locations[6] 163.5 - - - -


113

TotalEstimated

Expenditure$m


to 30 June 2012

$m

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m



Overlander (Land 121)[1][7] 50.3 - - - -


Permanent Facilities[1][9] 268.2 - - - -

Hardened and Networked

Army Facilites[1][10] 597.4 - - - -


Capability[1][12]13.4 - - - -

Defence Logistics

Transformation Project[11] 752.7 - - - -

Projects in or about to enter Defects Liability Period

801.0 - 3.5 19.3 15.8

Total Various 5,007.2 - 3.5 19.3 15.8

TOTAL 6,978.1 2,900.0 815.0 912.9 97.9

Notes 1. These projects cross state and electoral boundaries. Expenditure estimates for 2012-13 are provided in the table per location. 2. Enhanced Land Force Stage 1 has an approved budget of $793.1m covering the following locations: RAAF Base Richmond (completed), Holsworthy, Singleton (completed), Kapooka,

Puckapunyal, RAAF Base Amberley, Lavarack Barracks, Townsville High Range Training Area (completed), RAAF Base Edinburgh and Campbell Barracks. 3. Enhanced Land Force Stage 2 Works has an approved budget of $1,457.8m covering the following locations: Singleton, Garden Island (completed), HMAS Penguin (completed), Watsonia

(completed), Puckapunyal (completed), RAAF Base Amberley (completed), Enoggera, Canungra, Lavarack Barracks, Townsville Field Training Area (completed), Greenbank Training Area, Wide Bay Training Area, Cultana Training Area, RAAF Base Edinburgh, Majura Field Training Area (completed) and Royal Military College Duntroon (completed).

4. HMAS Penguin and Pittwater Annexe Redevelopment has an approved budget of $63.3m covering two locations: HMAS Penguin and the Pittwater Annexe. 5. Facilities for Replacement Towed Artillery (LAND 17) has an approved budget of $46.5m. This project covers six sites: Enoggera, Puckapunyal, Townsville, Edinburgh, Darwin and Bandiana. 6. Defence Facilities at HMAS Harman and Other Locations project covers two locations: Army facilities in Victoria (completed) and Defence facilities at HMAS Harman, ACT. 7. Facilities for Project Overlander (LAND 121) has an approved budget of $50.3m. This project covers three locations: Gaza Ridge Barracks North Bandiana, Damascus Barracks Meeandah and

RAAF Base Amberley. 8. Australian Super Hornet Facilities has a budget of $117.1m that includes both the development and delivery phase budgets leaving a delivery budget of $110.1m . 9. Heavy Airlift Capability - Permanent Facilities has an approved budget of $268.2m covering five locations: RAAF Base Amberley, RAAF Base Edinburgh, RAAF Base Darwin, RAAF Base

Townsville and RAAF Base Pearce. Construction works at RAAF Bases Amberley, Townsville, Edinburgh and Darwin are complete. Outstanding Defects Liability works remain to be completed at RAAF Base Darwin. The Cargo Compartment Trainer is an approved additional scope item being delivered at RAAF Base Amberley.

10. Hardened and Networked Army Facilities has a budget of $623.7m, which includes the development and delivery phase budgets leaving a delivery phase budget of $597.4m. Hardened and Networked Army Facilities project covers two locations: Edinburgh Defence Precinct and Murray Bridge Training Area. The project does not include similarly named works at Robertson Barracks.

11. Project has been approved since publication of Portfolio Budget Statements 2012-13. 12. Facilities for Joint Counter Improvised Explosive Device Capability has an approved budget of $13.4m. The project covers seven locations across three States.


114

Appendix D

Status of Major Projects Foreshadowed For Government and Parliamentary Standing Committee on Public Works (PWC) Consideration in 2012-13

Table 67: Program of Major Works by State, Federal Electorate and Locality

Actual/IndicativeReferral Date

Actual/Indicative

Hearing Date[1] Current Status

NEW SOUTH WALES

Hughes

Liverpool Military Area High Voltage Upgrade Early 2012 08 August 2012 Approved

Moorebank - Units Relocation Early 2012 09 August 2012 Approved

Newcastle

RAAF Base Williamtown Redevelopment Stage 2 Late 2013 Early 2014 In development

QUEENSLAND

Blair

17 Construction Squadron Redevelopment/Relocation to Amberley Deferred

VICTORIA

Corio

Point Wilson Waterside Infrastructure Remediation Deferred

Melbourne Ports

Human Protection Performance Division Early 2013 Mid 2013 In development

VARIOUS LOCATIONS

Base Security Improvement Program Mid 2012 10 August 2012 Approved

Defence Logistics Transformation Program Mid 2012

26, 28 September and 04 October

2012 Approved

Aircraft Pavements and Airfield Lighting at RAAF Base Amberley, RAAF Base Williamtown, RAAF Base Darwin and RAAF Base

Townsville[2]Mid 2012 27-Sep-12 Approved

Aircraft Pavements and Airfield Lighting at RAAF Base Edinburgh,

RAAF Base Williams and Woomera[2]Late 2012 Mid 2013 In development

Facilities for Chinook Helicopter (AIR 9000 Phases 5B and 5C) Mid 2013 Deferred

Facilities for Force Protection Research and Training (JP154) Early 2013 Mid 2013 In development

Facilities for Air Warfare Destroyer (SEA 4000) Early 2013 Mid 2013 In development

Facilities for Amphibious Deployment and Sustainment (JP 2048) Early 2013 Mid 2013 In development

Facilities for Future Naval Aviation Combat System Support (AIR 9000 Phase 8) Early 2013 Mid 2013 In development

Notes 1. Hearing dates will be subject to the Committee's consideration and agreement. 2. Defence proposes to seek exemption from the Public Works Committee scrutiny of this project on the grounds that the work is

declared repetitive in accordance with Section 18(8A) of the Public Works Act 1969.


115

New South Wales

Liverpool Military Area High Voltage Upgrade

The Liverpool Military Area High Voltage Upgrade project received expediency on 17 September 2012. The project is providing improved energy supply and distribution to the Liverpool Military Area, primarily at Holsworthy Barracks. This project will provide a necessary increase in electrical supply to the Liverpool Military Area and improved electrical reticulation within Holsworthy Barracks. Construction is scheduled to commence in early 2013 and be completed in mid 2014.

Moorebank – Units Relocation

The Moorebank Units Relocation Project received expediency on 17 September 2012. The project is delivering new facilities at Holsworthy Barracks to relocate affected Defence units and facilities from the proposed Moorebank Inter-Modal Transport site, including the School of Military Engineering. Construction commenced in late 2012 and is programmed to be completed in late 2015.

RAAF Base Williamtown Redevelopment Stage 2

The project is supporting and improving the functionality and capability of the Base, while at the same time upgrading or replacing ageing infrastructure to meet future requirements. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in late 2014 and be completed in late 2017.

Queensland

17 Construction Squadron Redevelopment/Relocation to Amberley

The project is providing new facilities to accommodate 17 Construction Squadron at RAAF Base Amberley. The 17 Construction Squadron is currently located at Holsworthy Barracks in the precinct marked for the future base entry under the Moorebank Units Relocation project. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in late 2014 and be completed in mid 2017. This project has been deferred.

Victoria

Point Wilson Waterside Infrastructure Remediation

The project will construct upgraded Explosive Ordnance waterside infrastructure (new wharf, refurbished jetty, associated mooring and berthing infrastructure) at Point Wilson Explosive Area (PWEA), Victoria. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in late 2014 and be completed late 2017. This project has been deferred.

Human Protection Performance Division

This project aims to provide new and upgraded site security and to rectify identified accommodation shortfalls within on-site Human Protection Performance Division facilities located at the Defence Science and Technology Organisation site at Fishermans Bend in Melbourne. Subject to Government and Parliamentary clearance, construction is scheduled to commence in mid 2013 and be completed in late 2015.


116

Various Locations

Base Security Improvement Program

The Base Security Improvement Program received expediency on 17 September 2012. The project is providing infrastructure works at 16 high security risk bases in order to achieve an acceptable level of security. Construction is scheduled to commence in 2013 and be completed in 2014.

Defence Logistics Transformation Program

The Defence Logistics Transformation Program received expediency on 26 November 2012. The project is modernising and enhancing the wholesale storage, distribution and land materiel functions of Joint Logistic Command units nationally to provide optimum support to Defence operations. The project will provide enhanced logistics facilities at Moorebank New South Wales, Bandiana Victoria, Amberley and Townsville Queensland, Palmerston Northern Territory, Edinburgh South Australia and Guilford and Garden Island Western Australia. Construction is scheduled to commence in early 2013 and be completed in late 2015.

Aircraft Pavements and Aircraft Lighting at RAAF Base Amberley, RAAF Base Darwin, RAAF Williamtown and RAAF Base Townsville

The Aircraft Pavements and Aircraft Lighting at RAAF Base Amberley, RAAF Base Darwin, RAAF Williamtown and RAAF Base Townsville project received exemption and approval on 27 September 2012. The project is resurfacing asphalt pavements and replacing airfield lighting at RAAF Base Amberley, RAAF Base Darwin and RAAF Base Townsville. Construction is scheduled to commence in early 2013 and be completed in late 2013.

Aircraft Pavements and Aircraft Lighting at RAAF Base Edinburgh, RAAF Base Williams and Woomera

The project will resurface asphalt pavement and replace airfield lighting at RAAF Base Edinburgh, RAAF Base Williams, Point Cook and Woomera. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in late 2013, and be completed in mid 2014.

Facilities for Chinook Helicopter (AIR 9000 Phases 5B and 5C)

The project will provide new and upgraded facilities to support the introduction into service of the Chinook Helicopter. The works will be primarily at 5 Aviation Regiment at RAAF Base Townsville. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in early 2014 and be completed in late 2016. This project has been deferred.

Facilities for Force Protection Research and Training (JP 154)

This project will provide test and evaluation facilities at Nurrungar (Woomera, South Australia) and Edinburgh (Adelaide, South, Australia), plus storage and training facilities at 14 other sites across Australia. Subject to Government and Parliamentary approval, construction is scheduled to commence in late 2013 and be completed in late 2014.

Facilities for Air Warfare Destroyer (SEA 4000)

This project will provide new and upgraded wharf-side facilities to support berthing and sustainment at Garden Island, Sydney, for the new Hobart Class Air Warfare Destroyer. The works also include the provision of training facilities at HMAS Watson and Randwick Barracks. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in mid 2013 and be completed in mid 2015.


117

Facilities for Amphibious Deployment and Sustainment (JP 2048)

This project will provide new and upgraded wharf-side facilities to support berthing and sustainment at Garden Island, Sydney, for the new Canberra Class Landing Helicopter Dock Ship. The works also include the provision of training facilities at Randwick Barracks. Subject to Government approval and Parliamentary clearance, construction is scheduled to commence in mid 2013 and be completed in mid 2015.

Facilities for Future Naval Aviation Combat System Support (AIR 9000 Phase 8)

This project will provide new and upgraded facilities for operational maritime helicopter squadrons at HMAS Stirling and HMAS Albatross. The works include the provision of facilities for explosive ordnance storage, aircraft hangars, aircraft workshops, synthetic training, and working accommodation. Subject to Parliamentary clearance, construction is scheduled to commence in late 2013 and be completed in late 2016.


118

Appendix E

Approved Projects Being Developed for Private Financing Arrangements

Project Single Living Environment and Accommodation Precinct (Single LEAP Phase 2)

No changes have been made to Project Single Living Environment and Accommodation Precinct (Single LEAP Phase 2) since the Portfolio Budget Statements 2012-13.

Table 68: Single LEAP Phase 2[1] by State, Federal Electorate and Locality

State Electorate Locality

NEW SOUTH WALES Gilmore Nowra: HMAS Albatross

Riverina RAAF Base Wagga Kapooka: Blamey Barracks

VICTORIA Indie Albury/Wodonga:Bandiana

Jagajaga Watsonia: Simpson Barracks

McEwen Puckapunyal

QUEENSLAND Herbert Townsville: Lavarack Barracks

SOUTH AUSTRALIA Wakefield RAAF Base Edinburgh

WESTERN AUSTRALIA Brand Garden Island: HMAS Stirling

Curtin Swanbourne: Campbell Barracks

NORTHERN TERRITORY Solomon Darwin: Robertson Barracks

Darwin: HMAS Coonawarra (Larrakeyah Barracks)

AUSTRALIAN CAPITAL TERRITORY

Fraser Royal Military College Australian Defence Force Academy

Note 1. Work has commenced at all sites, with the last site due for completion by February 2014. Under the Public Private

Partnership arrangement, annual payments to the Strategic Partner will commence after Commercial Acceptance of each site.


119

Approved Medium Capital Facilities Projects

Table 69: Spending in 2012-13 for Medium Facilities Projects

TotalEstimated

Expenditure$'000


to 30 June 2012$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000

Variation$'000 Project Performance Update and Explanation of Variation

NEW SOUTH WALES

Hughes

Holsworthy - - - - -6th Aviation Regiment - Expanded 171 Aviation Squadron Facilities

11,684 235 9,396 8,846 -550The financial variation is due to a delay in finalising design. Construction has commenced and facilities are anticipated to be delivered on schedule.

Newcastle

RAAF WilliamtownCorrosion Control Facility and Spray Paint Booth Facilities Upgrade

6,280 - - 4,616 4,616Project approved in 2012 and commenced to meet anticipated handover from current tenant.

Total New South Wales 17,964 235 9,396 13,462 4,066

VICTORIA

Melbourne PortsThermal Test Facility - Fishermans Bend

6,600 - - 3,630 3,630This project was recently approved with a forecast expenditure in financial year 2012-13.

Lalor

RAAF Williams - - - - -Australian Operational Concept Contingency and

Stores[1][3]- 42 616 716 100

The financial variation is the result of a reconsidered delivery methodology for warehousing facilities.

Total Victoria 6,600 42 616 4,346 3,730


120

TotalEstimated

Expenditure$'000


to 30 June 2012$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000


QUEENSLAND

Capricornia

Shoalwater Bay Training AreaTriangular Island Facility Upgrade 2,150[4] 93 1,160 2,057 897

The financial variation and budget increase is a reflection of the higher than expected cost to deliver the facilities.

Herbert

Lavarack BarracksCountermine Capability

Facilities (LAND 144)[1][2] - 18 87 389 302The financial variation is the result of a reconsidered delivery methodology for warehousing facilities.

RAAF TownsvilleAustralian Operational Concept Contingency and

Stores[1][3]- 17 610 716 106


Rankin

Greenbank Training AreaCountermine Capability


Ryan

EnoggeraAustralian Operational Concept Contingency and

Stores[1][3]- 10 490 716 226


Total Queensland 2,150 139 2,467 4,182 1,715


121

TotalEstimated

Expenditure$'000


to 30 June 2012$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000


SOUTH AUSTRALIA

Wakefield

RAAF EdinburghAustralian Operational Concept Contingency and

Stores[1][3]- 19 605 716 111


P&EE Port Wakefield

Explosive Ordnance Storage 13,182 - - 1,700 1,700

Total South Australia 13,182 19 605 2,416 1,811

WESTERN AUSTRALIA

Pearce

RAAF Base PearcePotable Water Supply Upgrade

3,144 373 1,533 3,978 2,445The financial variation is due to tender prices being higher than pre tender estimates.

Total Western Australia 3,144 373 1,533 3,978 2,445

TASMANIA

Denison

Derwent BarrackAustralian Operational Concept Contingency and

Stores[1][3]- 18 695 716 21


Total Tasmania - 18 695 716 21


122

TotalEstimated

Expenditure$'000


to 30 June 2012$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000


NORTHERN TERRITORY

Lingiari

RAAF Base Tindal

Mount Bundey Training Area -Medical Facility

4,260 524 2,677 3,611 934The financial variation is a result of payment profile for delivery phase being different to that assumed at the time of the publication of the Portfolio Budget Statements 2012-13 .

Corrosion Control Facility 4,465[4] 3 2,675 1,964 -711The financial variation is due to preliminary design being added as a requirement in request for tender documents. This has resulted in an increased budget and financial year spend.

Solomon

DarwinAustralian Operational Concept Contingency and

Stores[1][3]- 18 1,377 716 -661


Naval Fuel Installation Rectification

10,690 7,418 10 1,027 1,017The financial variation is due to essential WHS and environmental works being prioritised for delivery in 2012-13.

Larrakeyah BarracksStormwater Infrastructure Works

2,463 1,354 - 900 900

Robertson BarracksCountermine Capability


1st Aviation Regiment Facilities Upgrade

2,250 1,026 95 - -95The variation is a reflection of savings achieved during delivery. The project is in Defects Liability Period and financial close is anticipated in the 2012-13 financial year.

Total Northern Territory 19,663 10,348 7,069 8,648 1,579


123

TotalEstimated

Expenditure$'000


to 30 June 2012$'000

2012-13Budget

Estimate$'000

2012-13Revised

Estimate$'000


VARIOUS LOCATIONS[1]

Countermine Capability

Facilities (LAND 144)[1][2] 1,420 - - - -

Australian Operational Concept Contingency and

Stores[1][3]7,900 - - - -

Projects in or about to enter Defects Liability Period

- - - 3,251 3,251

Total Various 9,320 - - 3,251 3,251

TOTAL 72,023 11,174 22,381 40,999 18,618

Notes 1. This project crosses state and electoral boundaries. 2. Countermine Capabilities Facilities (LAND 144) has a budget of $1.420m covering five locations: Holsworthy Barracks; Lavarack Barracks; Greenbank Training Area; Gallipoli Barracks,

Enoggera; and Robertson Barracks. Construction works at Holsworthy and Enoggera are complete. 3. Australian Operational Concept Special Operation Contingency Vehicles & Stores has a budget of $7.900m covering six locations; RAAF Bases Williams, Darwin, Townsville, Edinburgh, and

Gallipoli and Derwent Barracks. 4. This project received budget increase approval since the publication of the Portfolio Budget Statements 2012-13.


124

Proposed Medium Capital Projects for Consideration in 2012-13

Table 70 lists new medium capital facilities projects foreshadowed for consideration in 2012-13.

Table 70: Proposed Medium Capital Projects for Consideration in 2012-13

StateFederalElectorate Locality Status

New South Wales Calare Bathurst Regional Airport: Australian Air Force Cadets In developmentNewcastle RAAF Base Williamtown: Corrosion Control Facility Upgrade Approved

Warringah HMAS Penguin – ADF Centre for Mental Health Facility In development

South Australia Grey Woomera Prohibited Area: Disposal Explosive Ordnance Storage Facilities Withdrawn

Wakefield Port Wakefield: Vibration Test Facility In development

Northern Territory Solomon RAAF Base Darwin: Flood Mitigation Works In development

Various ASLAV Additional Facilities In development

JP 2048 Phase 3LHD Landing Craft Support Facilities In development


126


127



Section 1: Agency Overview and Resources

1.1 Strategic Direction Statement

1.2 DMO Resource Statement

1.3 Agency Measures Table

1.4 Additional Estimates and Variations

1.5 Breakdown of Additional Estimates by Appropriation Bill

1.6 People


2.1 DMO Outcomes and Performance Information



3.2 DMO Budgeted Financial Statements


128



1.1 Strategic Direction Statement In December 2012, the CEO DMO released details of a new strategic framework to enhance accountability, re-balance the structure and deliver further reform across the DMO.

The new strategic framework aims to enhance the DMO’s ability to deliver outcomes efficiently and effectively and includes key themes to shape and inform behavior. These include personal accountability, managed urgency, and for the DMO to be cost aware in every element of DMO business. The new strategic framework also supports the whole of Defence Pathway to Change initiative to ensure the DMO is fair, inclusive and respectful for all, and to all.

Organisational structure

One of the DMO’s key objectives is to re-balance the workload across the organisation and provide better support to the people which the DMO is accountable to. To achieve this, the CEO has re-balanced the workload across the General Managers.

Effective 1 February 2013, the major changes to the DMO structure are:

The role and responsibilities of the Deputy CEO (DCEO)/General Manager Commercial (GMCOM) will be expanded to manage reform, governance and the day to day operations of the organisation. The DCEO/GMCOM will be responsible for: Special Counsel Commercial and Industry Programs Commercial Enabling Services Business Operations Division DMO Reform (the re-titled Acquisition and Sustainment Reform Division)

General Manager Systems will be re-titled General Manager Joint, Systems and Air (GM JSA) and will be responsible for: Aerospace Systems Division (including Wedgetail program) Electronic Systems Division New Air Combat Capability Program Helicopter Systems Division Standardisation Office

General Manager Programs will be re-titled General Manager Land and Maritime (GM LM) and will be responsible for: Land Systems Division Maritime Systems Division (including the Amphibious Deployment and Sustainment Program) Air Warfare Destroyer Program Explosive Ordnance Division

Head Acquisition and Sustainment Reform has been re-named DMO Reform and will report to the DCEO.


129

Figure 3: The DMO Organisational Structure as at 15 January 2013


130

Senior Executive Changes

The following changes have occurred to the DMO senior leadership group since 1 July 2012:

With effect 23 July 2012, Mr David Gould commenced as General Manager Submarines.

On 28 September 2012, RADM Tony Dalton was appointed to the position of Head Helicopter Systems Division.

On 11 December 2012, RADM Mark Purcell was appointed to the position of Head Maritime Systems Division.


131

1.2 DMO Resource Statement The Resource Statement details the resourcing for the DMO at Additional Estimates. Table 74 outlines the total resourcing available from all sources for the 2012-13 Budget year.

Table 74: DMO Resource Statement for the 2012-13 Additional Estimates

Estimateas at

Budget2012-13

$'000

+

ProposedAdditionalEstimates

2012-13$'000

=

TotalEstimate atAdditionalEstimates

2012-13$'000

TotalAppropriation

Actual2011-12

$'000

ORDINARY ANNUAL SERVICES

Departmental appropriation

Prior year departmental appropriation[1]415,486 -88,839 326,647 436,932

Departmental appropriation[2]928,466 -17,362 911,104 931,270

Total Departmental appropriation 1,343,952 -106,201 1,237,751 1,368,202

Total Ordinary Annual Services A 1,343,952 -106,201 1,237,751 1,368,202

Total Available Annual Appropriations 1,343,952 -106,201 1,237,751 1,368,202

Special Accounts

Opening Balance[3]415,486 -88,839 326,647 436,932

Appropriation Receipts[4]928,466 -17,362 911,104 931,270

Appropriation Receipts - other agencies[5]8,132,945 110,518 8,243,463 10,221,149

Non-Appropriation Receipts to Special Accounts 57,668 40 57,708 114,716

Total Special Accounts B 9,534,565 4,357 9,538,922 11,704,067

Total Resourcing (A + B) 10,878,517 -101,844 10,776,673 13,072,269

Less appropriations drawn from annual appropriations above and credited to special accounts 1,343,952 -106,201 1,237,751 1,368,202

Total Net Resourcing for DMO 9,534,565 4,357 9,538,922 11,704,067

Notes 1. Estimated adjusted balance carried forward from previous year for annual appropriations. 2. Appropriation Bill (No. 1) 2012-13. 3. Estimated opening balance for special accounts (less Services for Other Entities and Trust Moneys Special accounts

(SOETM)). For further information on special accounts see Table 90. 4. Direct appropriation for Workforce and Operating Expenses. 5. Appropriation receipts from Defence credited to DMO's special accounts.

Reader Note: All figures are GST exclusive.


132

Table 75: Third Party Payments From and On Behalf of Other Agencies

Estimateas at

Budget2012-13

$'000

Estimate atAdditionalEstimates

2012-13$'000

Receipts received from the Department of Defence for the provision of goods and services 8,132,945 8,243,463

Payments made to the Department of Defence for the provision of

services[1]440,227 366,788

Note 1. Primarily relates to the payment of military staff posted to the DMO and services provided by the

Department of Defence to the DMO in accordance with the Defence Services Agreement.

1.3 Agency Measures Table There are no measures impacting the DMO during the 2012-13 Additional Estimates.

1.4 Additional Estimates and Variations

Table 76: Additional Estimates and Variations to Outcomes From Other Variations

Program Impacted

2012-13$'000

2013-14$'000

2014-15$'000

2015-16$'000

Outcome 1

Decrease in Estimates (Departmental) Adjustments to agreed level of activity All 17,362 51,731 58,213 60,569

Net impact on Estimates for Outcome 1 (Departmental) -17,362 -51,731 -58,213 -60,569

1.5 Breakdown of Additional Estimates by Appropriation Bill The following table details changes sought by DMO during the 2012-13 Additional Estimates. The DMO will seek a determination by the Minister of Finance and Deregulation, under Section 10 of the Appropriation Act (No.1) 2012-13, to decrease the Departmental appropriation by $17.362m.

Table 77: Appropriation Bill (No 3) 2012-13

2011-12 Actual$'000

2012-13 Budget

$'000

2012-13 Revised

$'000

AdditionalEstimates

$'000

ReducedEstimates

$'000

Departmental Programs

Outcome 1

Contributing to the preparedness of Australian Defence Organisation through acquisition and through-life support of military equipment and supplies 931,270 928,466 911,104 - 17,362

Total 931,270 928,466 911,104 - 17,362


133

1.6 People

Workforce Summary

The DMO combined APS, ADF and Contractor workforce forecast is 7,220. This is a decrease of 165 below the 2012-13 Budget Estimate of 7,385. The DMO manages its workforce under a combined ADF, APS and Contractor model. Through this arrangement, where the Services are unable to provide agreed military personnel to contribute to acquisition and sustainment activities, DMO can use funding from unfilled ADF positions (384) to fill and resource positions with APS staff. The decrease in the estimated APS workforce is generally due to voluntary redundancies and intergroup transfers under Shared Services programs. The forecast DMO workforce is shown in Table 78.

Table 78: DMO Consolidated Workforce Statement

2012-13Budget

Estimate

2012-13Revised

Estimate Variation




Navy 368 303 -65 356 360 366

Army 485 377 -108 478 488 493

Air Force 940 702 -238 919 932 942

Sub Total Permanent Force[1] A 1,793 1,382 -411 1,753 1,780 1,801

DMO - APS 5,544 5,406 -138 5,368 5,590 5,608

APS - ADF Backfill - 384 384 - - -

Total DMO APS B 5,544 5,790 246 5,368 5,590 5,608

DMO - Contractor[2] C 48 48 - 48 48 46

Total Workforce Strength (A+B+C) 7,385 7,220 -165 7,169 7,418 7,455

Notes 1. Numbers for ADF Permanent Force include the DMO ADF Permanent Force and Reservists on continuous full-time service. 2. Contractors (formerly known as Professional Service Providers) are individuals under contract performing agency roles.

Contractors are not APS Employees.


134


No changes have been made to DMO’s Outcomes and Planned Performance since the Portfolio Budget Statements 2012-13.

Figure 4: Contributions to Outcomes and Programs


Total Price of Programs: $8,895.950m

(PBS 2012-13: $9,100.652m)

Total Departmental Appropriation: $911.104m

(PBS 2012-13: $928.466m)

Administered Appropriation: Nil

Outcome 1

Contributing to the preparedness of Australian Defence Organisation through acquisition and

through-life support ofmilitary equipment and supplies

Total Price: $8,895.950m

(PBS 2012-13: $9,100.652m)

Total Departmental Outcome Appropriation: $911.104m

(PBS 2012-13: $928.466m)

Program 1.2

Management of Capability Sustainment


(PBS 2012-13: $5,295.299m)

Total Departmental Program Appropriation: $551.054m

(PBS 2012-13: $549.750m)

Program 1.1

Management of Capability Acquisition


(PBS 2012-13: $3,676.094m)


(PBS 2012-13: $259.374m)

Program 1.3

Provision of Policy Advice and Management Services

Total Price: $112.566m

(PBS 2012-13: $129.259m)


(PBS 2012-13: $119.342m)


136

Outcome Expenses and Resource Statement

Table 79: Budgeted Expenses and Resources for Outcome 1

Outcome 1: Contributing to the preparedness of Australian Defence Organistion through acquisition and through-life support of military equipment and supplies

2011-12Actual

Expenses

$'000

2012-13Revised

EstimatedExpenses

$'000

Program 1.1 Management of Capability Acquisition

Departmental expenses

Departmental appropriation[1]214,978 254,727

Special Accounts 4,359,127 3,353,530

Expenses not requiring appropriation in the Budget year[2]10,297 10,170

Total for Program 1.1 4,584,403 3,618,427

Program 1.2 Management of Capability Sustainment





Total for Program 1.2 5,389,415 5,164,957

Program 1.3 Provision of Policy Advice and Management Services



Special Accounts - 1,061


Total for Program 1.3 108,738 112,566

Outcome 1 Total by appropriation type





Total Expenses for Outcome 1 10,082,556 8,895,950

2011-12 2012-13

Average Staffing Level (number)[3]5,989 5,790

Notes 1. Departmental Appropriation combines "Ordinary annual services (Appropriation Bills No. 1)" and "Revenue from independent

sources (s31)". 2. Expenses not requiring appropriation in the Budget year is made up of resources received free of charge. 3. Average staffing levels do not include military staff posted to DMO, as military staff remain employees of the Department of

Defence and are included in its staffing.


138


Changes to the detailed descriptions of deliverables for the top 30 DMO projects is contained in Table 81 Top 30 Projects by 2012-13 Forecast Expenditure. A status update on other major projects included in the previous five years is provided at Table 83.

Information relating to the DMO's Program 1.1 Deliverables remains as reported in the Portfolio Budget Statements 2012-13, except for the following:

The DMO is currently managing 182 major capital acquisition projects. A major capital project is defined as a project with strategic importance and is funded through the Defence Capability Plan (DCP). Key deliverables are specified in a Joint Project Directive (JPD) issued by the Secretary and Chief of the Defence Force (for projects approved after March 2010). The DMO’s element of the major capital project is described in more detail in a Materiel Acquisition Agreement (MAA) between the DMO, the Capability Development Group and the relevant Capability Manager.


No changes have been made to Program 1.1 Key Performance Indicators since the Portfolio Budget Statements 2012-13.


139

Top 30 Projects by 2012-13 Forecast Expenditure

Table 81: Top 30 Projects by 2012-13 Forecast Expenditure

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m

BudgetEstimate2012-13

$m

RevisedEstimate2012-13

$mVariation

$m Project Performance Update and Explanation of Variation

Air to Air Refuelling Capability AIR 5402 1,802 1,466 174 119 -56

Testing of the military avionics modifications has been successfully completed. The variation is primarily due to delays to other program elements that are expected to extend completion of boom testing and re-delivery of the first (prototype) aircraft to later in 2013.

Additional C-17AGlobemaster III

AIR 8000 Phase 4

553 419 51 4 -48

Australia's sixth C-17A has been delivered and is now in ADF operational service. Installation of enhanced US-common electronic warfare self-protection systems for the fifth and sixth C-17A is on schedule to achieve Final Operational Capability by mid 2013. The variation is primarily due to a large Foreign Military Sales (FMS) case payment that was previously brought forward into 2011-12 and retirement of cost risk associated with the two acquisition FMS cases.

Bridging Air Combat CapabilityAIR 5349 Phase 1

3,281 2,697 49 29 -20

Final Operational Capability was achieved in December 2012. The variation is primarily due to cost reductions against the principal Foreign Military Sales case and delays in additional spares purchases.

C-17 Globemaster IIIAIR 8000 Phase 3

1,847 1,336 40 10 -31

All four C-17A aircraft acquired under Phase 3 are in operational service and all remaining capability elements are anticipated to be met. The variation is primarily due to retirement of cost risk associated with the primary Foreign Military Sales acquisition case, and reprogramming of spare engines and major support equipment procurements into later financial years.

Maritime Patrol and Response Aircraft System

AIR 7000 Phase 2

172 72 31 27 -4

A Project Arrangement was signed with the United States Navy in September 2012 to formalise Australia's participation in the development of the Increment 3 upgrade to the P-8A aircraft weapons and sensors. The variation is due to a lower than forecast contribution to the Increment 3 Project Arrangement and other minor budget variations.

General Manager Systems

Aerospace Systems


140

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m


$m


$mVariation


Airborne Surveillance for Land Operations

JP 129 Phase 2

93 47 27 17 -10

The initial delivery of additional equipment for the Australian configuration of the Shadow 200 System occurred in September 2012, with final deliveries scheduled for mid 2013. Forecast variation is associated with the delivery of the Attrition Air Vehicles being scheduled in 2013-14 rather than 2012-13 and savings against other budget elements.

Battlespace Communications Systems (LAND)

JP 2072 Phase 2A

442 59 156 101 -55

Harris Corporation has successfully delivered the first batches of radios and ancillaries. The Harris' Communications Logistic Centre formally opened in August 2012 to support the equipment. Introduction Into Service of this new capability into Army has commenced. The variation is a result of milestone schedule adjustments.

Next Generation Satellite Communications System

JP 2008 Phase 4

864 468 116 90 -26

Production and testing of the Wideband Global Satellite (WGS) 6 satellite has been completed and WGS 6 was delivered into storage in August 2012 and is now awaiting delivery to the launch site. The Remote Monitoring and Control system at HMAS Harman and Geraldton has been installed allowing access to the WGS constellation.

The variation relates to negotiated price reductions under the launch vehicle contract and savings achieved in the delivery of the WGS 6 satellite.

Joint Command Support Environment

JP 2030Phase 8

256 123 47 25 -22

The contract for the development of Evolution 2 of the system was signed in early 2012. Evolution 2 Release 1 was successfully delivered in November 2012.

The variation is due to an update to the expenditure plan based on the contracted payment schedule and removal of planned Evolution 3 capability development work following its removal from the Defence Capability Development Plan.

Ultra High Frequency Satellite Communications

JP 2008 Phase 5A

436 312 43 18 -25

The payload is fully operational and on station. The project entered into a contract with ViaSat in May 2012 to deliver the ground infrastructure to support payload operations (the Network Control System). The variation was primarily caused by the early acceptance of the Payload in 2011-12. Final acceptance was initially scheduled for 2012-13.

Electronic Systems


141

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m


$m


$mVariation


Battle Management SystemLAND 75 Phase 3.4

308 132 33 52 18

Following Operational Test and Evaluation, Initial Operational Capability was declared by the Chief of Army in April 2012. The variation is primarily due to action being taken to recover schedule changes to contractual and payment arrangements and the realisation of risks that have required mitigation.

Achievement of Final Operational Capability of two motorised infantry Battle Groups in 7 Brigade is planned for December 2013.

Bridging Air Combat CapabilityAIR 5349 Phase 2

275 123 54 14 -41

Final Materiel Release was achieved in August 2012 for AIM 9X, Advanced Medium Range Air-to-Air Missile and Joint Stand-off Weapon. The variation is primarily due to Advanced Medium Range Air-to-Air Missile and Joint Stand-off Weapon C1 missile production schedule delays.

Lightweight Torpedo Replacement

JP 2070 Phase 2

335 250 33 26 -7

The scheduled Operational Test and Evaluation was completed successfully and Initial Operational Capability was declared by Chief of Navy on 30 November 2012. Work continues to establish in-service support arrangements, with budget variance relating to completion of ship modifications and delivery of spares.

Mulwala Redevelopment Project

JP 2086Phase 1

370 314 28 17 -11The project was added as a Project of Concern in December 2012. Budget variance is primarily due to delays in Mulwala infrastructure works.

Multi Role HelicopterAIR 9000 Phase 2

3,635 2,048 260 156 -104

The eighteenth aircraft was accepted in December 2012. The variation results from reduced aircraft acceptances due to technical deficiencies and contractual non-compliances as well as delays in other areas of the project. Achievement of the Initial Operational Capability for Navy has also been affected but is still expected to be achieved within 2012-13.

Future Naval Aviation Combat System Helicopter

AIR 9000Phase 8

2,958 254 145 207 63The variation results from an acceleration to the aircraft delivery schedule which has brought forward payments for aircraft, spares, training devices and other support.

Armed Reconnaissance Helicopter

AIR 87 Phase 2

2,032 1,813 72 51 -21The final retrofit aircraft was accepted in December 2012. The variation primarily results from early closure of the Project Office and replanning of a number of planned procurements.

Explosive Ordnance

Helicopter Systems


142

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m


$m


$mVariation


Field Vehicles and Trailers – Overlander Program

LAND 121 Phase 3

987 233 132 152 20

Light/lightweight capability: As at 19 December 2012, 338 G-Wagons and 207 trailers have been delivered to ADF units. The variation in Approved Project Expenditure of $3,191m in the PBS to $987m in the PAES is due to the incorporation of an additional 959 Mercedes-Benz G-Wagons and 826 trailers approved by Government in August 2011 to meet the DCP LAND 121 Phase 5A requirement and the removal of the Medium Heavy Capability. The Medium Heavy capability will now be managed separately under LAND 121 Phase 3B, while the approved Light/lightweight capability will be managed under Phase 3A. The variation in 2012-13 expenditure reflects additional contract deliverables received in 2012-13.

Bushmaster Protected Mobility Vehicle

LAND 116 Phase 3

1,033 771 58 57 -1

Project Expenditure relates to provision for 737 PMV approved under Phase 3 and 70 PMV approved under Phase 3.1. A further but separate phase, LAND 116 Phase 3.2 to acquire up to 214 PMV was approved in mid 2012. Variation in planned expenditure is primarily due to accelerated vehicle and spare parts deliveries brought forward to 2011-12, offset by slippages of support equipment and increased estimate for price escalation.

Counter Rocket, Artillery and Mortar (C-RAM)

LAND 19 Phase 7A

254 147 55 30 -26

This rapidly delivered capability has been operating effectively in Afghanistan since December 2010. Final Operational Capability (FOC) in Afghanistan was achieved in September 2012 and FOC in Australia is scheduled from January 2013. The variation is primarily due to additional expected savings against the C-RAM Foreign Military Sales case.

Digital Terminal Control System

LAND 17Phase 1B

115 33 35 8 -27

This project will deliver 152 digital terminal control systems. A contract was signed in June 2012 for the delivery of 96 digital terminal control systems, comprising the residual requirement. The variation is primarily due to a revised payment schedule reflecting the finalisation of negotiations.

Artillery Replacement 155mm Howitzer

LAND 17 Phase 1A

324 122 29 15 -15

This project has delivered 35 M777A2 lightweight towed howitzers and a command and control battle management system and will complete these deliveries into Army units during 2012-13. The variation is primarily due to additional expected savings against the lightweight towed howitzer Foreign Military Sales case.

Land Systems


143

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m


$m


$mVariation


Australian Protected Route Clearance Capability

JP 154 Phase 3A

74 13 29 18 -11

All 12 Husky vehicles, all 8 High Mobility Engineer Excavators and all 11 Special Mobility Radar II mine rollers have been delivered. Initial Materiel Release was achieved in November 2012. The variation is primarily due to revised Foreign Military Sales payment schedule, including incorporation of anticipated savings.

Upgrade of M-113 Armoured Vehicles

LAND 106 885 768 26 23 -3

The final of 431 M113 AS4 vehicle was accepted in September 2012. All technical risks for the project have been retired. The project is finalising delivery of documentation and spare parts, moving towards closure by mid 2013. The variation is primarily due to accelerated delivery of vehicles and support system elements into 2011-12.

Anzac Ship Anti-Ship Missile Defence

SEA 1448 Phase 2B

676 340 52 67 15

Development of the Stage 2 Phased Array Radar software continues. HMAS Arunta has commenced system installation work. The variation is due to the rescheduling of prefabrication work from 2011-12 until 2012-13 following Government approval to proceed with the upgrade of all eight ships.

Air Warfare Destroyer BuildSEA 4000 Phase 3

7,868 3,840 622 621 -1

A re-baselining of the AWD schedule was announced in September 2012, with the three ships set to be delivered in March 2016, September 2017 and March 2019. Hull consolidation commenced for the first destroyer, Hobart, and will progress to completion by the end of 2013. Fit-out of Platform and Combat System elements in the hull continue with main machinery alignment expected to be completed in 2012-13. Brisbane block construction continues with the first blocks delivered from BAES; Sydney blocks continue production.

Air Warfare Destroyer

General Manager Programs

Maritime Systems


144

Projectnumber/phase

ApprovedProject

Expenditure


to 30 June 2012

$m


$m


$mVariation


Amphibious Deployment and Sustainment

JP 2048 Phase 4A/4B

3,073 2,185 158 210 53

The hull of the first arrived in Melbourne in October 2012. BAE Systems completed the lifting of the Superstructure blocks onto the hull in December 2012, with full consolidation to be complete by March 2013. Installation and integration of the communication and combat systems has now begun. The hull of the second ship was launched in Spain in July 2012. The revised estimate reflects current schedule and end of year milestone payments.

Amphibious Watercraft Replacement

JP 2048Phase 3

226 17 59 33 -26

Cutting of steel for the first Landing Craft occurred, on schedule, in October 2012 with both Detailed Design Review and System Subsystem Detail Design Review exiting in December 2012 on schedule. The revised estimate now reflects the actual contracted schedule.

Airborne Early Warning and Control Aircraft

AIR 5077 Phase 3

3,845 3,255 289 209 -80

The test and evaluation program was completed in May 2012. However, the technical documentation required to support design acceptance was only achieved in October 2012, together with agreement on a final commercial settlement, resulting in further slippage to project schedule of eight months against Budget Estimates. Final acceptance of the sixth aircraft was achieved in November 2012 and final acceptance of the associated ground support systems is planned for January 2013.

Joint Strike Fighter AircraftAIR 6000 Phase 2A/2B

2,590 130 103 111 8

Contracting and production of the first two aircraft and support is now well underway to enable a 2014 aircraft delivery and commencement of United States based pilot training in 2015. The variation reflects a project assessment of forecast expenditure requirements in order to maintain schedule to deliver Australia's first two F-35 aircraft in 2014.

41,611 23,785 3,007 2,515 -491Total -Top 30 Projects (Gross Plan)

Amphibious Deployment and Sustainment

Collins and Wedgetail

New Air Combat Capability


145

Table 82: Major Capital Investment Program by 2012-13 Forecast Expenditure

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

Top 30 Projects Gross Plans A 3,007 2,515 -491

Other Approved Project Gross Plans B 683 892 209

Total Gross Plan Project Estimates C = A + B 3,690 3,407 -283

Management Margin: Slippage[1]D -616 -179 436

Payments Required from Defence for Approved Programs E = C + D 3,074 3,228 154

Projects Planned for Government Consideration and Transfer to the DMO F 248 27 -221

Total Estimated Funds Available G = E + F 3,322 3,255 -67

Note 1. Management margin is an estimate of possible overall approved capital program expenditure slippage

that may accrue as the 2012-13 financial year progresses.


146

Acquisition Projects not included in the Top 30 Projects-Current Status

Table 83 provides an update on the status of major projects reported in previous financial years. These projects were not ranked in the top 30 projects by expenditure in 2012-13.

Table 83: Current Status of Previously Reported Top 30 Projects (Projects Reported in the Last Five Financial Years)

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

AP-3C Electronic Support Measure Upgrade

AIR 5276 Phase 8B

2009-10 130 79 13 14 1

The project is being managed as a Project of Concern. Rework and retesting of software deficiencies identified during laboratory testing in March 2012 is forecast for completion in early 2013. Delivery of the first upgraded aircraft is expected by late 2013 and supporting ground systems and simulators by mid 2014.

F/A-18 Hornet Upgrade

AIR 5376 Phase 2

2011-12 1,879 1,612 25 26 ..Final Materiel Release was achieved in September 2012. Updates to the flight simulator for F/A-18 aircrew training will be undertaken to better align the simulator with the upgraded aircraft capability.

AP-3C Capability Assurance Program

AIR 5276 CAP 1

2009-10 88 65 4 6 2Fleet installation has commenced and is expected to be complete by mid 2015. Modification of the supporting ground systems and simulators was completed in July 2012.


Aerospace Systems


147

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

Battlespace Communications Systems

JP 2072 Phase 1

2011-12 257 187 15 24 9All major equipment has been delivered. The final ancillary procurement, arising from final design, testing and feedback from initial deployment, is underway.

High Frequency Modernisation

JP 2043 Phase 3A

2010-11 580 438 11 4 -7

The Mobiles Platform scope was removed following the 2012-13 Budget. The focus is now on completing the direction finding and signal enhancement (null steering) capability to the Fixed Network, as well as completing the Information Technology and 10kW Transmitter Refresh works.

ADF Deployable Logistics Systems

JP 2077 Phase 2B.2

2011-12 49 21 .. .. .. The project was cancelled following the 2012-13 Budget.

Dismounted Battlegroup and Below Command, Control Communication System

LAND 125 Phase 3A

2011-12 106 55 6 27 21

Following Operational Test and Evaluation, an Initial Operational Capability was declared by the Chief of Army in April 2012. The variance is primarily through reprogramming largely as a result of slippage arising from contractor production difficulties which moved expenditure from 2011-12.

Tactical information Exchange Domain

JP 2089 Phase 2A

2010-11 103 60 6 8 2

HMAS Perth equipment installation was completed by December 2012. Tasking of combat mission system software is underway. The variation is due to additional work required for the implementation of Electronic Warfare Coordination Messaging.

Electronic Systems


148

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

New Air Defence Command and Control Systems for Control Units 2 & 3

AIR 5333 2011-12 274 246 2 .. -1

The project achieved Final Materiel Release in August 2012 and transitioned the capability to the in-service support organisation. Variation is due to the successful remediation of negating the need to purchase new equipment. Final Operational Capability was declared by the Chief of Air Force on 19 December 2012. Project Closure is expected to be achieved in December 2013.

MILSATCOM Terrestrial Infrastructure

JP 2008 Phase 3E

2007-08 208 207 .. .. ..

The Maritime Advanced Satellite Communications Terrestrial Infrastructure System interference remediation to manufacture and install Radio Frequency Barriers has been completed. Discussions are underway to finalise the financial arrangements for through-life support of the barriers.

Electronic Warfare Self Protection for Selected Aircraft

AIR 5416 Phase 2

2009-10 292 276 - - -All asset rollout action has been completed and Project closure is underway.

Improvements to the Logistics Information Systems

JP 2077 Phase 2B

2009-10 153 152 - - - Project is being closed.

Lightweight Torpedo Replacement

JP 2070 Phase 3

2011-12 300 258 16 13 -3The procurement of MU90 Torpedo war stock inventory continues and is due to be completed this financial year; however, the contractor has advised that delivery of some batches of weapons may be delayed.

Explosive Ordnance Reserve Stocks

JP 2085Phase 1B

2008-09 235 205 10 1 -9

The final delivery of Excalibur projectiles was received in October 2012. Preparation for confirmatory firing of Excalibur at Woomera range in March 2013 is progressing. Work on upgrading Advanced Field Artillery Tactical Data System (AFATDS) is complete, and AFATDS integration with the Bushmaster Protected Mobility Vehicle is progressing.

Explosive Ordnance


149

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

Follow-On Stand Off Weapon

AIR 5418 Phase 1

2011-12 317 277 4 7 3Fuze issues are delaying finalisation of production and delivery of the final quantity of weapons. Final Materiel Release is planned to occur in 2013.

Evolved Sea Sparrow Missiles

SEA 1428 Phase 4

2009-10 88 84 .. .. -All orders for Evolved Sea Sparrow Missiles and canisters for the Anzac/FFG frigates have been placed. Deliveries have commenced and the project is expected to close in 2016.

Australian Light Armoured Vehicle Additional

LAND 112 Phase 3

2007-08 651 608 21 22 1

The project has delivered: 144 new Australian Light Armoured Vehicle Phase 3 vehicles; 59 behind armour Commander's Weapon Stations; 9 crew procedural trainers; and has standardised the Phase 2 fleet to an approximate Phase 3 build standard. Delivery of 18 Multi Spectral Surveillance Suites has commenced and the project is progressing towards Initial Materiel Release of six surveillance variants.

Tank Replacement Project

LAND 907 Phase 1

2007-08 558 446 4 5 1

All key milestones have been achieved. Delivery of the two remaining elements of Tank Urban Survivability Kit - the Commander's Weapon Station and Remote Thermal Sight, together with Mine Ploughs and Deep Water Fording Kits, will occur between 2013 and 2014.

Direct Fire Support Weapons

LAND 40 Phase 2

2010-11 145 37 2 2 ..

The purchase of the M3 Carl Gustaf and its sight are complete and the system is being introduced into service. The project was added as a Project of Concern in December 2012 due to delays in the acquisition of the Automatic Grenade Launches component of the project.

Land Systems


150

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

Anzac Ship ProjectSEA 1348 Phase 2

2007-08 5,381 5,371 5 9 3Finalisation of the warranty and safety upgrade work is progressing, prior to Project Closure.

Armidale Class Patrol Boat

SEA 1444 Phase 1

2007-08 537 488 1 1 ..Final Operational Capability was declared by Chief of Navy inOctober 2012.

Guided Missile Frigate Upgrade Implementation

SEA 1390 Phase 2.1

2010-11 1,450 1,349 23 4 -19

The Adelaide class frigates have achieved Navy Operational Release except for the Underwater Warfare System component. A Navy-directed solution to satisfy this requirement is being progressed.

Standard Missile Replacement

SEA 1390 Phase 4B

2011-12 400 307 19 28 9Test and evaluation of the Mid Course Guidance System software was completed in December 2012. Installation in the Adelaide class frigates continues for the remainder of 2012-13, pending ship availability.

Ships Self Defence Capability

SEA 1779 Phase 1

2007-08 44 44 - - - This project closed in August 2012.

Maritime Systems


151

Projectnumber/phase

LastFinancial

YearReported in

Top 30

ApprovedProject

Expenditure$m


to 30 June 2012

$m


$m


$mVariation

$m Status Report

New Heavyweight Torpedo

SEA 1429 Phase 2

2009-10 425 293 13 7 -6

The project expects to reach Spiral 4 Operational Requirement (OR) in June 2013. Remaining project budget will be used for the final boat modifications, associated activities including test and evaluation, as well as project closure activities. Further software upgrades, post Spiral 4 OR will be paid through sustainment organisation. Replacement Heavyweight Torpedo System installations continue. However, as each installation is dependent on the Full Cycle Docking program, completion dates may vary according to changes in the submarine Integrated Master Schedule. The final installation will be in HMAS Collins during full cycle docking commencing in 2013. The project will be completed in 2016.

Collins Class Submarine Reliability and Sustainability

SEA 1439 Phase 3

2008-09 411 327 13 11 -2System modifications continue as scheduled in the Integrated Master Schedule. Development of the Hedemora diesel engine land based test facility is in progress.

Collins Replacement Combat System

SEA 1439 Phase 4A

2007-08 450 429 5 5 ..

Replacement Combat System installations continue. However, as each installation is dependent on the Full Cycle Docking program, completion dates may vary according to changes in the submarine Integrated Master Schedule. The final installation will be in HMAS Collins during her full cycle docking commencing in 2013. The project will be completed in 2016.

Detailed Analysis and Acquisition Planning

AIR 6000 Phase 1B

2009-10 103 98 - - - Project has been completed.

Collins and Wedgetail


New Air Combat Capability


152

Top 10 Minor Capital Investment Projects by 2012-13 Forecast Expenditure

Table 84 lists the top 10 approved Minor Capital Investment Projects by forecast expenditure for 2012-13.

Table 84: Top 10 Approved Minor Projects by 2012-13 Forecast Expenditure

Projectnumber/

phase

ApprovedProject

Expenditure$m


to 30 June 2012$m


$m


$mVariation

$m Product Performance Update and Explanation of Variation

Enhanced Static Line Parachute Capability

AMP058.08 28 .. 15 14 ..

The United States Government has completed the initial contract with Airborne Systems North America for delivery of the first tranche of 500 Static Line Parachute Systems. Contract signature for the remaining systems is anticipated in early 2013. All Dispatcher Parachutes have been delivered and Rigger training on both parachute systems has been completed. The variation is due to billing from United States being less than planned.

Australian Light Armoured Vehicle Crew Procedural Trainers

AMP002.12 44 11 14 15 1

The project remains within budget and on schedule to deliver all elements of the required capability in accordance with the approved contract and Materiel Acquisition Agreement. Testing of the first article of equipment has been successfully completed. The variation is primarily due to prime contract progressing ahead of schedule.

Army


153

Projectnumber/

phase

ApprovedProject

Expenditure$m


to 30 June 2012$m


$m


$mVariation


Enhanced Land Force (ELF) Weapons Training Simulator System (WTSS)

AMP029.44 34 1 9 12 3

The project remains within budget to deliver all elements of the required capability. Installation of the new facilities at Edinburgh, Townsville and Singleton is complete and the sites have been accepted. The variation is due to schedule acceleration to include installation at Kapooka in February 2013, previously scheduled in 2013-14.

Chinook Passenger and Crew Seating

AMP015.36 8 .. 4 2 -2Design Acceptance of the modification remains scheduled to complete in 2012-13 but only two aircraft will now be modified in 2012-13 with trial results used to determine future requirements.

Army Field Catering Equipment

AMP500.09 4 - 3 1 -2

Deliveries for the Barbeques and Roasters contract will occur as forecast in 2012-13. Further detailed planning and industry feedback has resulted in a delay in contracting other elements with signature now anticipated to occur in March 2013 and deliveries in 2013-14.

Kiowa Pilot Seating AMP015.58 7 1 2 1 -1Pilot seating modification design is planned for completion in 2012-13. The variation is due to improved expenditure estimates based on final contract payment milestones.


154

Projectnumber/

phase

ApprovedProject

Expenditure$m


to 30 June 2012$m


$m


$mVariation


Traffic Alert and Collision Avoidance System (TCAS)

AFM01001 25 16 3 4 ..

Modification of the first AP-3C aircraft was completed in June 2012. Installation of the capability onto the remaining AP-3C aircraft has commenced and is forecast for completion by mid 2015. Modification of the supporting ground simulator was completed in November 2012.

Broadband AFM01004 6 3 3 3 ..

Broadband modification to the first aircraft was successfully conducted. Functional Test, Performance and Handling Flights with broadband rodome were successfully conducted September 2012. Modifications have no effect on the performance and handling of the aircraft. Broadband capability testing confirmed the system is performing to specification. Second and final aircraft modifications to commenceMarch 2013.

462SQN Electronic Combat and Monitoring System

AFM00977 3 .. 2 .. -2 The project has now been cancelled.

RAAF Intelligence Deployable LAN (RIDL)

AFM01003 5 2 2 3 1

Initial Materiel Release was achieved in October 2012, which delivered 16 fixed desktops and 11 deployable Local Area Networks to Air Force Tactical Intelligence Flights. The variation is due to the project progressing slightly ahead of originally planned expenditure, which is expected to continue throughout the remainder of the year. There is a low risk relating to the delivery of Final Materiel Release by mid 2013.

164 34 58 55 -3

Air Force

Total - Top 10 Minor Projects


155

Table 85: Minor Capital Investment Program by 2012-13 Forecast Expenditure

2012-13Budget

Estimate$m

2012-13Revised

Estimate$m

Variation$m

Top 10 Projects Gross Plans 58 55 -3

Other Approved Project Gross Plans 26 29 3

Total Gross Plan Project Estimates 84 84 -

Management Margin: Slippage[1]-12 -4 8

Payments Required from Defence for Approved Programs 72 80 8

Projects Planned for Government Consideration and Transfer to the DMO 14 18 4

Total Estimated Funds Available 85 98 13

Note 1. Management margin is an estimate of possible overall approved capital program expenditure

slippage that may accrue as the 2012-13 financial year progresses.


157


Information relating to Program 1.2 Deliverables remains as reported in the Portfolio Budget Statements 2012-13, except for the following.

Key deliverables are specified under each Materiel Sustainment Agreement (MSA). There are now seven MSAs as one MSA has been transferred to Chief Information Officer Group (CIOG). These seven MSAs incorporate 118 product schedules.

Changes to the detailed descriptions of deliverables for the top 20 DMO Sustainment products are contained in Table 87.


No changes have been made to Program 1.2 Key Performance Indicators since the Portfolio Budget Statements 2012-13.


158

Top 20 Sustainment Products by 2012-13 Forecast Expenditure

Table 87: Top 20 Sustainment Products by 2012-13 Forecast Expenditure


$m


$mVariation



Aerospace Systems

Airborne Early Warning & Control 161 138 -23

The sustainment system for the E-7A Wedgetail fleet, associated simulators and software laboratories has sufficiently matured to support Initial Operational Capability. The variation is primarily due to successful warranty claims for the repair of two engines and a number of other repairable items.

F/A-18A Hornet Weapons System 153 148 -5

Recommendations from Phase 1 of the Classic Hornet Ageing Aircraft Systems Audit were delivered in mid 2012 and are being actioned. Phase 2 of the Audit, which is a targeted inspection of aircraft and components, commenced in September 2012. Classic Hornet Deeper Maintenance contract negotiations are complete. The variation is primarily due to the reimbursement of an over-achievement in 2011-12.

F/A-18F Block II Super Hornet Weapons System 111 103 -8

Sustainment systems continue to mature as further spares are delivered and management systems are established in support of declaration of Full Operational Capability in December 2012. Refinement of performance measurements on all Foreign Military Sales programs and commercial support contracts has furnished effective data, which has also assisted in the maturity of the support system. The variation is primarily due to the reimbursement of an over-achievement in 2011-12.


159


$m


$mVariation


P-3C/AP-3C Orion Weapons System 105 118 13

The aircraft 16,000 hour safety-by-inspection program continues with most of the fleet completed. Fatigue cracking detected in the aft fuselage of some aircraft will require some components to be replaced. The variation is primarily due increases in the cost of fatigue inspections and repairs, additional aircraft paintings being planned and increases in the cost of hydraulic and engine maintenance.

C-130J-30 Weapons System 81 81 -The planned servicing schedule review to optimise the maintenance required on the C-130J-30 is on schedule for implementation in 2013.

Lead-in Fighter Hawk 127 Weapons System 73 56 -17

A new total logistic support contract for the Lead-in Fighter capability will replace the current contract with BAE Systems Australia when it expires in June 2013. Activities for the remainder of 2012-13 will focus on implementation of the new contract. The variation is due to budget reductions as a result of shared efficiencies.

Electronic Systems

Wide Area Surveillance Capability 83 80 -3

Wide Area Surveillance continues to consistently achieve a high level of availability. Variance is due to reduction in planned activities in 2012-13 with no impact to capability and expenditure planned for 2012-13 was incurred earlier in 2011-12.


160


$m


$mVariation


Explosive Ordnance

Explosive Ordnance - Navy, Army, Air Force 323 296 -27

Explosive Ordnance Division continues to improve munitions inventory serviceability in support of ADF operations and training, including resolving issues with engineering capacity and certification. The focus remains on longer term procurement planning and more strategic contracting to build security and certainty into the munitions supply chain to achieve better value for money. The variation is primarily due to return of sustainment funding for reallocation by the Capability Managers to higher sustainment priorities and transfer of funds to Defence Support Group for Mulwala facilities remediation works.

Helicopter Systems

Armed Reconnaissance Helicopter Weapons System

96 86 -10

The Tiger capability is recovering well from a temporary suspension of flying operations in late 2011-12 that delayed the achievement of a deployable squadron resulting in the variation. This key capability milestone is now planned for achievement by the end 2012-13.

Multi Role Helicopter 93 88 -5

Sixteen MRH90 have been accepted; five are based in Townsville, four in Oakey, four in Nowra, and three are at Australian Aerospace’s Brisbane facility for retrofit. Rectification of the key technical deficiencies is progressing, although more slowly than anticipated which continues to delay delivery of the full aircraft capability. Variation is primarily due to these delays.

S70A-9 Black Hawk Weapons System 86 85 -1The Black Hawk continues to perform as expected across 2012-13. Variation is due to more efficient replenishment arrangements and reduced costs following withdrawal from East Timor.

S70B-2 Seahawk Weapons System 62 63 1The Seahawk continues to perform as expected across 2012-13. Variation is due to additional funding to cover for Seahawk capability assurance program.


161


$m


$mVariation


Land Systems

General Service B Vehicle Fleet 66 80 14

Priority is directed to operations and sustaining the fleet to meet ADF capability requirements. The variation is due to the Lead Capability Manager providing additional funding for the support of Enhanced Equipment Pools, procurement of Up Armoured Sports Utility Vehicles for the MEAO, and additional sustainment support for training exercises.

ADF Clothing 56 46 -10

Standing offers with Australian manufacturers have been established for:• Slouch hats• The new operational combat uniform printed in the Australian Multicam camouflage pattern.• The Standard Combat Uniform and Accessories.

Tender evaluation for combat and cold weather boots is ongoing, with signature scheduled for late 2013.

Expenditure against budget has reduce this financial year due to reductions in operational demand and the consumption of existing stock as part of ongoing inventory rationalisation.

Maritime Systems

Fuels and Lubricants - Navy, Army, Air Force 412 390 -22

Optimal holdings continue to be reviewed. The fuel card process has progressed incrementally towards the introduction of the new single fuel card and management system, and the inventory and financial accounting system in active trial. Implementation of procedures to align responsibilities under the Australian Standards and Work Health and Safety Act continues.The variation is due to a reduced requirement for Air Force and Navy fuels.

Anzac Class Frigate 206 215 9

Materiel maintenance of eight ships and inventory management reform are ongoing and aligned with operational requirements. The Group Maintenance Contract has been implemented. The variation is due to funding of the preparations for installation of Project SEA 1448 Phases 2A and 2B.


162


$m


$mVariation


Adelaide Class Frigate 139 125 -14

Materiel maintenance of four ships is ongoing and aligned with operational requirements. A Draft Request for Tender for the Group Maintenance Contract is with Industry for comment. The FFG System Program Office is the lead business unit for the rollout of the Rizzo Reform Lifecycle Reference Model. The variation is due to there now being a higher level of confidence in the work to be undertaken across the remainder of 2012-13, including work already under contract with industry.

Auxiliary Oiler Replenishment 91 73 -18

Ongoing materiel support continues with HMAS Success currently undertaking a major refit until May 2013. The variation is due to the rephasing of Maintenance Availabilities for HMAS Success through to planned withdrawal from service, and a corresponding rebalancing of the maintenance effort across 2012-13

Mine Hunter Coastal 61 60 -1Materiel maintenance of four ships is ongoing and concurrent with design development for installation of upgrades to ship firefighting and combat systems.


Collins Class Submarines 516 501 -15

Reform activities aimed at improving Collins Class availability and reliability are ongoing and will be adjusted to accommodate the recommendations of the Coles Phase 3 report. Variation is due to realignment of priorities across other Chief of Navy products and an injection of Net Personnel and Operating Costs related to SEA 1439 Phase 3 (Collins Class Submarine Reliability and Sustainability).

Total - Top 20 Products 2,974 2,832 -142

Other Approved Sustainment Product Estimates 1,268 1,367 99

Total Sustainment Product Funds Available 4,242 4,199 -43

Support to Operations 359 391 32

Total Sustainment and Operations Funding 4,601 4,590 -11


164

Information relating to the Program 1.3 Provision of Policy Advice and Management Services remains as reported in the Portfolio Budget Statements 2012-13, except for the following.

More broadly, the DMO will continue to pursue its wider industry development initiatives, including the establishment of an Australian Military Sales Office to provide a one stop shop for the facilitating export opportunities for Australian industry.


165



3.1.1 Special Accounts

Special accounts provide a means to set aside and record amounts used for specified purposes. Table 89 shows the expected additions (receipts) and reductions (payments) for each account used by the DMO. The corresponding table in the Portfolio Budget Statements 2012-13 is Table 101.

Table 89: Estimates of Special Account Flows and Balances

Outcome

Opening2012-132011-12

$'000

Receipts2012-132011-12

$'000

Payments2012-132011-12

$'000

Adjustments2012-132011-12

$'000

Closing Balance2012-132011-12

$'000

1 326,647 9,216,623 9,223,270 - 320,000

436,932 11,267,137 11,304,928 -72,494 326,647

1 - - - - -

- - - - -

Total Special Accounts 2012-13 326,647 9,216,623 9,223,270 - 320,000

2011-12 actual 436,932 11,267,137 11,304,928 -72,494 326,647

Defence Materiel Special Account (A & D)

Services for Other Entities and Trust Moneys - Defence Materiel Organisation (S)

Notes (A) = Administered (D) = Departmental (S) = Special Public Money


166

3.1.2 Australian Government Indigenous Expenditure

No changes have been made to this section since the Portfolio Budget Statements 2012-13, as the Australian Government Indigenous Expenditure Statement is not applicable to the DMO.


167

3.1.3 Grants

Table 90 shows Approved Grants for 2012-13. Detailed information on Grant programs and recipients provided by DMO can be found at:

<www.defence.gov.au/dmo/id/sadi/index.cfm>

<www.defence.gov.au/dmo/id/picip/>

<www.defence.gov.au/dmo/id/industry_skilling>

<www.defence.gov.au/dmo/jsf/NACC_ISP.cfm>

Table 90: Approved Grants for 2012-13

2011-12Actual

Expenses$’000

2012-13Revised

EstimatedExpenses

$’000

Skilling Australia’s Defence Industry (SADI) 8,879 12,090

Priority Industry Capability Innovation Program (PIC IP) 7,100 9,403

Industry Skilling Program Enhancement (ISPE) 2,916 3,186

New Air Combat Capability Industry Support Program (NACC ISP) 1,905 3,232

Total 20,800 27,911


168

3.2 DMO Budgeted Financial Statements

3.2.1 Budgeted Financial Statements Tables

Table 91: Comprehensive Income Statement (Showing Net Cost of Services) for the period ended 30 June

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

EXPENSES

Employee benefits 592,265 603,285 562,343 613,279 641,377


Grants 20,800 27,911 22,160 30,540 3,381

Depreciation and amortisation 1,680 2,527 2,590 2,654 2,721

Write-down of assets and impairment of assets 1,237 - - - -

Other 353 - - - -

Total expenses 10,082,556 8,895,950 9,476,217 10,811,644 12,762,835

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sales of goods and rendering of services 9,156,761 7,945,498 8,526,661 9,816,419 11,729,593

Interest 1,444 - - - -

Other revenue 37,966 37,948 38,897 39,870 40,867

Total own-source revenue 9,196,171 7,983,446 8,565,558 9,856,289 11,770,460

Gains

Foreign exchange 932 - - - -

Other gains 1,459 1,400 1,400 1,400 1,400

Total gains 2,391 1,400 1,400 1,400 1,400


Net cost of (contribution by) services 883,994 911,104 909,259 953,955 990,975

Revenue from Government 931,270 911,104 909,259 953,955 990,975

Surplus (Deficit) attributable to the Australian Government 47,276 - - - -

OTHER COMPREHENSIVE INCOME

Changes in asset revaluation reserves 239 - - - -

Total other comprehensive income 239 - - - -Total comprehensive income (loss) attributable to the Australian Government 47,515 - - - -


169

Table 92: Budgeted Departmental Balance Sheet (as at 30 June)

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

ASSETS

Financial assets





Property, plant and equipment 6,871 7,199 7,535 7,880 8,233

Intangibles 56 139 224 312 402

Other 1,366,024 1,366,024 1,366,024 1,366,024 1,366,024


Total assets 2,081,901 1,919,425 1,922,913 1,927,001 1,914,309

LIABILITIES

Payables

Suppliers 1,429,807 1,273,567 1,273,567 1,273,567 1,273,567

Grants 5,161 5,161 5,161 5,161 5,161

Other 76,923 77,704 80,148 82,616 63,608

Total payables 1,511,891 1,356,432 1,358,876 1,361,344 1,342,336

Provisions

Employee provisions 194,287 187,270 188,314 189,934 196,250

Other 5,698 5,698 5,698 5,698 5,698

Total provisions 199,985 192,968 194,012 195,632 201,948


NET ASSETS 370,025 370,025 370,025 370,025 370,025

EQUITY

Contributed equity 155,368 155,368 155,368 155,368 155,368

Reserves 239 239 239 239 239

Retained surplus (accumulated deficit) 214,418 214,418 214,418 214,418 214,418

Total parent entity interest 370,025 370,025 370,025 370,025 370,025

Total equity 370,025 370,025 370,025 370,025 370,025


170

Table 93: Departmental Statement of Changes in Equity - Summary of Movement (Budget year 2012-13)

Retained Earnings

$'000

Asset Revaluation

Reserve$'000

Other Reserves

$'000

Contributed Equity/Capital

$'000

Total Equity

$'000

Opening balance as at 1 July 2012

Balance carried forward from previous period 214,418 239 - 155,368 370,025

Adjustment for changes in accounting policies - - - - -

Adjusted opening balance 214,418 239 - 155,368 370,025

Surplus (Deficit) for the period - - - - -

Total comprehensive income recognised directly in equity - - - - -

Transactions with owners

Contributions by owners

Appropriation (equity injection) - - - - -

Departmental Capital Budget (DCBs) - - - - -

Sub-total transaction with owners - - - - -

Estimated closing balance as at 30 June 2013 214,418 239 - 155,368 370,025

Table 94: Budgeted Departmental Statement of Cash Flows (for the period ended 30 June)

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000


Cash received

Goods and services 10,517,058 8,243,463 8,524,212 9,815,525 11,728,676

Appropriations 870,000 943,029 906,192 950,300 1,004,110

Net GST received 676,359 558,795 589,524 674,361 801,361

Other 28,621 57,708 60,569 60,525 62,099


Cash used

Employees 570,710 609,521 558,855 609,191 654,069

Suppliers 9,853,657 8,435,766 8,906,947 10,183,532 12,134,271

Grants 20,448 27,911 22,160 30,540 3,381

Net GST paid 691,896 558,795 589,524 674,361 801,361

Other 858,223 142,786 - - -

Total cash used 11,994,934 9,774,779 10,077,486 11,497,624 13,593,082

Net cash from (used by) operating activities 97,104 28,216 3,011 3,087 3,164


Cash used

Purchase of property, plant and equipment 1,890 2,938 3,011 3,087 3,164

Total cash used 1,890 2,938 3,011 3,087 3,164

Net cash from (used by) investing activities -1,890 -2,938 -3,011 -3,087 -3,164

Net increase (decrease) in cash held 95,214 25,278 - - -

Cash and cash equivalents at the beginning of the reporting period -70,492 24,722 50,000 50,000 50,000



171

Table 95: Departmental Capital Budget Statement

2011-12ActualResult

$'000

2012-13Revised

Estimate$'000


$'000


$'000


$'000

PURCHASE OF NON-FINANCIAL ASSETS

Funded internally from departmental resources[1]1,890 2,938 3,011 3,087 3,164

Total 1,890 2,938 3,011 3,087 3,164Reconciliation of cash used to acquire assets to asset movement table

Total purchases 1,890 2,938 3,011 3,087 3,164

Total cash used to acquire assets 1,890 2,938 3,011 3,087 3,164

Note 1. Includes the following sources of funding:

- annual and prior year appropriations - donations and contributions - gifts - internally developed assets - s31 relevant agency receipts (for FMA agencies only) - proceeds from the sale of assets.

Table 96: Statement of Asset Movements (2012-13)

OtherProperty, Plant and

Equipment$'000

Intangibles$'000

Total$'000

As at 1 July 2012

Gross book value 7,120 1,393 8,513

Accumulated depreciation/amortisation and impairment -249 -1,337 -1,586

Opening net book balance 6,871 56 6,927

CAPITAL ASSET ADDITIONS

Estimated expenditure on new or replacement assets

By purchase - internal sources 2,370 568 2,938

Total Additions 2,370 568 2,938

Other Movements

Depreciation and amortisation -2,042 -485 -2,527

As at 30 June 2013

Gross book value 9,490 1,961 11,451

Accumulated depreciation/amortisation and impairment -2,291 -1,822 -4,113

Closing net book value 7,199 139 7,338

Asset Category


172

3.2.2 Analysis of budgeted financial statements

Revisions to the budgeted financial statements for the DMO since the Portfolio Budget Statements 2012-13 are presented in this section.

Income Statement

Analysis of the comprehensive income statement (Table 91) show a difference of $1,186.6m between the revised expense estimate for 2012-13 of $8,895.9m, and the 2011-12 actual expenses of $10,082.5m. This difference is largely as a result of the reprogramming of approved majors and reduction in unapproved majors that occurred during the Portfolio Budget Statements 2012-13 update.

A decrease in the DMO’s estimated income and expenditure for 2012-13 of $204.7m since the original budget is largely as a result of the following:

a reduction by Defence of the estimated value of projects to be approved and transferred to DMO for delivery during the remainder of 2012-13 of $56.4m

a decrease in sustainment funding of $62.6m reflecting customer demand and requirements

a reduction by Defence to the provision for personnel and operating costs of $123.1m anticipated to be transferred to DMO during the remainder of 2012-13

offset by increase in estimates due to foreign exchange rate movements of $51.1m.

Balance Sheet

The balance sheet has been updated to reflect the 2011-12 audited financial statements and adjustments to the income statement as described above.

Whereas the receivables and creditors are anticipated to reduce from the 30 June 2012 balances, the prepayments to suppliers are expected to increase.

Statement of Cash Flows

The estimated cash flow has been updated to reflect the changes in the income statement and balance sheet as noted above.


173

3.2.3 Administered Budgeted Financial Statements Tables

Table 97: Schedule of Budgeted Income and Expenses Administered on Behalf of Government (for the period ended 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Foreign exchange losses 705 - - - -

Total Expenses administered on behalf of Government 705 - - - -


Revenue

Non-taxation

Interest 542 6 6 6 6

Other 42 - - - -

Total Non-taxation 584 6 6 6 6Total Revenues administered on behalf of Government 584 6 6 6 6

Table 98: Schedule of Budgeted Assets and Liabilities Administered on Behalf of Government (as at 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Financial assets

Receivables 4,342 - - - -

Total Financial assets 4,342 - - - -

Total Assets administered on behalf of Government 4,342 - - - -


174

Table 99: Schedule of Budgeted Administered Cash Flows (for the period ended 30 June)

2011-12ActualResult

$'000


$'000


$'000


$'000


$'000


Cash received

Interest 3,673 4,348 6 6 6

Total Cash received 3,673 4,348 6 6 6

Net cash from or (used by) operating activities 3,673 4,348 6 6 6

Net increase (decrease) in cash held and cash equivalents held 3,673 4,348 6 6 6

Cash and cash equivalents at the beginning of reporting period - - - - -

Cash to the Official Public Account for:

- Transfers to other entities (Finance - Whole of Government) 3,673 4,348 6 6 6

Cash and cash equivalents at end of reporting period - - - - -

3.2.4 Notes to the Financial Statements

The notes on the budgeted financial statements (income, balance sheet, cash flows and capital budget statement) remain as reported in the Portfolio Budget Statements 2012-13.


175




1.1 Strategic Direction

1.2 DHA Resourcing


2.1 Outcomes and Performance Information





176


Section 1: DHA Overview and Resources

DHA advises no significant changes to targets published in the Portfolio Budget Statement 2012-13. However, the DHA Board and Advisory Committee compositions have changed and are detailed below.

The DHA Board members are:

Chairman Mr Derek Volker AO

Managing Director Mr Peter Hammond

Commercial Director Ms Margaret Walker

Commercial Director Ms Carol Holley

Commercial Director Hon JAL (Sandy) Macdonald

Commercial Director Hon Arch Bevis

Nominee Secretary of Defence Mr. Peter Sharp

Nominee Chief of Defence Force Air Vice Marshal Gary Beck AO (Rtd)

Nominee Secretary of Finance and Deregulation

Ms Janice Williams

DHA has an Advisory Committee which has the following members:

Chairman Air Vice Marshal Gary Beck AO (Rtd)

Convenor of Defence Families Australia Ms Julie Blackburn

Appointee of Chief of Navy RADM Trevor Jones AM, CSC, RAN

Appointee of Chief of Army Major General Angus J. Campbell, DSC, AM

Appointee of Chief of Air Force Air Vice Marshal Gavin (Leo) Davies CSC

Appointee of Defence Housing Australia Mr Peter Hammond


DHA advises no significant changes to targets published in the Portfolio Budget Statements 2012-13.


DHA advises no significant changes to targets published in the Portfolio Budget Statements 2012-13.

177

Appendices

Glossary

Acronyms and Abbreviations


178

Glossary Accumulated depreciation

The aggregate depreciation recorded for a particular depreciating asset.

Additional estimates Where amounts appropriated at Budget time are required to change, Parliament may make adjustments to portfolios through the Additional Estimates Acts.

Administered appropriation

Revenue, expenses, assets and liabilities administered by an agency for the Commonwealth (such as taxes, benefits payments and public debt) that are not concerned with running the agency or its commercial activities.

Administered items Expenses, revenues, assets or liabilities managed by agencies on behalf of the Commonwealth. Agencies do not control administered items. Administered expenses include grants, subsidies and benefits. In many cases, administered expenses fund the delivery of third party outputs.

Agency Assets, liabilities, revenues and expenses that are controlled by Defence or a subsidiary. Includes officials allocated to the organisation.

Amortisation A term used interchangeably with depreciation, except that it applies to a non-current physical asset under finance lease, or a non-current intangible asset, over its limited useful life.

Appropriation An authorisation by Parliament to spend money from the Consolidated Revenue Fund (the principal working fund of the Commonwealth) for a particular purpose.

Annual appropriation

Two Appropriation Bills are introduced into Parliament in May and comprise the Budget for the financial year beginning 1 July. Further Bills are introduced later in the financial year as part of the Additional Estimates.

Assets Future economic benefits controlled by Defence as a result of past transactions or other past events. Assets are initially recognised at the cost of acquisition. Non-financial assets are subject to ongoing revaluation assessment.

Assets under construction

Assets under construction by Defence for Defence, or for the use of another entity according to a construction contract where Defence controls the asset until completion, or assets under construction or otherwise being made ready by another entity for use by Defence.

Australian Accounting Standards

Specify techniques of accounting practice and the method of presenting financial information about a reporting entity.

Average funded strength

A budgetary measure used to count the average number of ADF members paid on a full-time equivalent basis during a financial year.

Capability The combination of military equipment, personnel, logistics support, training, resources, etc. that provides Defence with the ability to achieve its operational aims.

Capability Manager A Capability Manager is responsible for raising, training and sustaining in-service capabilities through the coordination of fundamental inputs to capability. Capability Managers include the Service Chiefs, the Chief of Joint Operations and the Chief Information Officer.

Capital budget All proposed capital expenditure funded by appropriation for outcomes, by equity injections or loans and/or appropriations for administered capital, or by other sources.

Glossary

179

Capital expenditure Expenditure by an agency on capital projects, for example purchasing a building.

Coalition Countries including Australia who provide troops, logistical support or assistance in Military Operations, peacekeeping or reconstruction efforts.

Combined exercise An exercise or activity involving one or more Services of the ADF with the forces of other countries.

Consolidated Revenue Fund

Section 81 of the Constitution stipulates that all revenue raised or money received by the Commonwealth forms the one consolidated revenue fund. The fund is not a bank account. The Official Public Account reflects most of the operations of the fund.

Corporate governance

The process by which agencies are directed and controlled. It is generally understood to encompass authority, accountability, stewardship, leadership, direction and control.

Defence Capability Plan

The Defence Capability Plan is a costed, detailed development plan for Australia’s military capabilities over a ten-year period. The plan is reviewed regularly to take account of changing strategic circumstances, new technologies and changed priorities, in the context of the overall Defence budget.

Defence information environment

Encompasses all of Defence’s computing and communication capabilities at all classification levels. It supports all Defence warfighting functions, including overseas deployed elements and connection to Coalition networks, as well as the day-to-day management functions.

Defence Management and Finance Plan

The Defence Management and Finance Plan provide Ministers and central agencies with a clear oversight of Defence planning and financing strategies. It describes the strategies agreed through the 2000 Defence White Paper and subsequent Strategic Review papers. As a compendium of information attached to Defence’s annual Portfolio Budget Submission, it is intended to help Ministers make informed strategic and budgetary decisions on Defence, by bringing into one document the expected financial position of the portfolio taking into account existing commitments and proposed new investments. The Plan also provides the Government with the information necessary to ensure that its investment in Defence is both affordable and sustainable.

Defence Procurement Review

An independent review initiated by the Government in December 2002 to examine the procurement process for major acquisitions in Defence. The review was led by Mr Malcolm Kinnaird and is also known as the Kinnaird Review.

Departmental items Assets, liabilities, revenues and expenses that are controlled by the agency in providing its outputs. Departmental items would generally include computers, plant and equipment assets used by agencies in providing goods and services and most employee expenses, supplier costs and other administrative expenses incurred.

Depreciation Apportionment of an asset’s capital value as an expense over its estimated useful life to take account of normal usage, obsolescence, or the passage of time.

Discretionary grants Payments where the portfolio Minister and paying agency have discretion in determining whether or not a particular applicant should receive funding and may or may not impose conditions in return for the grant. There is a central discretionary grants register.

Employee Any Australian Public Service officer of Defence or serving Defence Force member who receives a salary or wage, along with other benefits, for the provision of services whether on a full-time, part-time, permanent, casual or temporary basis.


180

Employee expenses Include, but are not limited to, benefits provided to employees in the form of salaries and wages, performance pay, senior officers’ allowances, leave, and superannuation, but does not include amounts paid or owed to employees as reimbursement of out-of-pocket expenses.

Equity injection An additional contribution, over and above the cost of outputs. Equity injections form part of the Commonwealth’s investment in Defence.

Expense Total value of all of the resources consumed in producing goods and services or the loss of future economic benefits in the form of reductions in assets or increases in liabilities of an entity.

Fair value The amount for which an asset could be exchanged, or a liability settled, between knowledgeable and willing parties in an arm’s length transaction. The fair value can be affected by the conditions of the sale, market conditions and the intentions of the asset holder.

Financial Management and Accountability Act 1997

The Act establishes the regulatory framework for financial management within Defence and other public sector agencies.

Force element A component of a unit, a unit or an association of units having common prime objectives and activities.

Force element group

A grouping of force elements with an appropriate command and control structure for a specified role or roles (eg the Navy Submarine Group).

Forward Estimates The level of proposed expenditure for future years, based on relevant demographic, economic and other future forecasting assumptions. The Government required Forward Estimates for the following three financial years to be published in each annual Federal Budget paper.

Garrison support services

Includes a range of base support services such as ground maintenance, hospitality, training area management, base security, transport, air support and fire fighting and rescue services.

Group A high-level organisational grouping of functions and activities used by the Defence Executive as its primary management grouping (e.g. the Capability Development Group).

Hardened and Networked Army

The Army’s key initiative to modernise and meet future operations demands and requirements of the Government. It will increase the size and firepower of the land force, improve the protection provided to troops, and allow them to communicate better on the future battlefield.

Infrastructure Items owned, leased or otherwise under the control of Defence in support of activities on land and within buildings. Infrastructure includes items such as runways, roads, car parks, parade grounds, ovals, lighting, water, sewerage and other general service related items. It does not include land upon which, or within which, it is constructed or those fixed items integral to, and under, buildings.

Interoperability The ability of systems, units or forces to provide the services to, and accept services from, other systems, units or forces and to use the services so exchanged to enable them to operate effectively together.

Glossary

181

Inventory Inventory is comprised of consumable stores and supplies, fuel and explosive ordnance used in the delivery of Defence services. These are items which are consumed in normal use, lose their identity during periods of use by incorporation into, or attachment upon, another assembly, as a result of wear and tear, cannot be reconditioned because their design does not make it possible or their specific values do not justify it.

Joint exercise An exercise involving two or more Services of the ADF.

Liabilities Sacrifices of future economic benefits that Defence is presently obliged to make to other entities as a result of past transactions or other past events.

Materiel Acquisition Agreements

Materiel Acquisition Agreements cover the Defence Materiel Organisation’s acquisition services to Defence for both major and minor capital equipment.

Materiel Sustainment Agreements

Materiel Sustainment Agreements are between the Capability Managers and the Chief Executive Officer of the Defence Materiel Organisation. These agreements cover the sustainment of current capability, including good and services such as repairs, maintenance, fuel and explosive ordnance.

Military response options

A set of generic tasks that describe the range of military options the Government could consider as a basis for a response to a particular situation or contingency.

Net assets See Equity.

Network Centric Warfare

The aim of Network Centric Warfare is to improve the ability of the ADF to collaborate internally with supporting agencies and with coalition partners across organisation and geographic boundaries. Network Centric Warfare would allow Defence to harness recent development in computing and communications technologies to enhance decision making and warfighting capability.

Operating result Equals revenue less expense.

Operational tempo The rate at which the ADF is able to deliver its operations effects, for example, the rate at which forces are dispatched and the time in which they are turned around for their next task. At the local level, this might translate to the crew of an aircraft spending a very small amount of time on the ground before it is re-tasked for its next mission. At the organisational level, this translates to available fighting forces spending very little time at home before they are deployed again for their next operation.

Outcomes The results that the Government seeks from Defence, and are achieved by the successful delivery of its outputs, to the standards set in the Portfolio Budget Statements. For more information, see Defence’s Section 2 - Planned Outcome Performance.

Permanent forces The permanent Navy, the regular Army and the permanent Air Force.

Platforms Refers to air, land, surface or sub-surface assets that are discrete and taskable elements within the ADF.

Portfolio Additional Estimates Statements

Similar to the portfolio budget statement and prepared at Additional Estimates time to support and update on the Government’s original annual budget for Defence.


182

Portfolio Budget Statements

The document presented by the Minister for Defence to Parliament to inform Senators and Members of the basis for the Defence budget appropriations in support of the provisions in Appropriations Bills 1 and 2. The statements summarise the Defence budget and provides detail of outcome performance forecasts and resources in order to justify expenditure for Defence.

Prescribed agency An agency established by regulation under the Financial Management and Accountability Act 1997. The Act provides financial management authority to, and requires accountability by the Chief Executive of an agency.

Price One of the three key efficiency indicators. The amount the government or the community pays for the delivery of agreed outputs.

Professional Service Providers

Individuals with specialist skills contracted to fill a line position.

Purchaser-provider arrangements

Arrangements under which the outputs of one agency are purchased by another agency to contribute to outcomes. Purchaser-provider arrangements can occur between Commonwealth agencies and state/territory government or private sector bodies.

Quality One of the three key efficiency indicators. Relates to the characteristics by which customers or stakeholders judge an organisation, product or service. Assessment of quality involves use of information gathered from interested parties to identify differences between user's expectations and experiences.

Quantity One of the three key efficiency indicators. Examples include: the size of an output; count or volume measures; how many or how much.

Readiness The readiness of forces to be committed to operations within a specified time, dependent on the availability and proficiency of personnel, equipment, facilities and consumables.

Reserves The Naval Reserve, the Army Reserve and the Air Force Reserve.

Revenues Inflows or other enhancements, or savings in outflows, of future economic benefits in the form of increases in assets or reductions in liabilities of Defence, other than those relating to contributions by the Commonwealth, that result in an increase in equity during the reporting period.

Risk management At the highest level, involves the identification and mitigation of those risks that have the potential to adversely affect the achievement of agreed output performance at the agreed output price.

Special account Balances existing within the Consolidated Revenue Fund, that are supported by standing appropriations (Financial Management and Accountability Act 1997, ss.20 and 21). Special accounts allow money in the Consolidated Revenue Fund to be acknowledged as set-aside (hypothecated) for a particular purpose. Amounts credited to a Special Account may only be spent for the purposes of the Special Account. Special Accounts can only be established by a written determination of the Finance Minister (s.20 of the Financial Management and Accountability Act 1997) or through an Act of Parliament (referred to in s.21 of the Financial Management and Accountability Act 1997).

Glossary

183

Special Appropriations (including Standing Appropriations)

An amount of money appropriated by a particular Act of Parliament for a specific purpose and number of years. For special appropriations the authority to withdraw funds from the Consolidated Revenue Fund does not generally cease at the end of the financial year. Standing appropriations are a sub-category consisting of ongoing special appropriations — the amount appropriated will depend on circumstances specified in the legislation.

Specialist military equipment

Items of a specific military nature and that are not available though the normal external market in their current form to other than government military purchasers. It includes the prime military equipment plus the direct support items associated with the equipment.

Standard Defence Supply System (SDSS)

A key information system for the financial management of inventory, general stores, repairable items and other assets associated with Defence’s logistic capability.

System Program Office

The office of the Program Manager. It serves as the single point of contact with industry, government agencies, and other activities participating in the acquisition process of a given system.

Theatre The area in which military operations and activities take place.

Two-pass approval process

The process by which major capital investment proposals are developed for consideration and approval by the Government.

Unit ready days The number of days that a force element is available for tasking, by the Maritime commander, either outside of major maintenance and within planned readiness requirements, or in accordance with contracted availability. Planned unit ready days are determined for each Force Element Group by aggregating total days for the unit in commission, less all days when the unit is programmed to be in major maintenance and conducting associated pre-workup (preparations for initial operational training) or based on the total number of days the force element is contracted to be available to Defence. Contracted availability applies to the Armidale-class patrol boats and may apply to other classes in the future.

Weighted average cost

An inventory valuation method which considers the fluctuating prices and quantities of acquired goods in computing of the cost of inventory. The weighted average method takes the prices of units at the beginning inventory and the varying prices of purchases made and are weighted by the number of units to determine the weighted average cost per unit. It may be computed as the weighted average cost of all available goods present in a given period, or as a weighted moving average cost adjusted when new goods are delivered.

Write-downs The reduction in the value of assets.


184


A

ACPB Armidale Class Patrol Boats

ADF Australian Defence Force

AGIMO Australian Government Information Management Office

AMCIP Approved Major Capital Investment Program

AMSO Australian Military Sales Office

ANAO Australian National Audit Office

ANSF Afghan National Security Forces

AUSAID Australian Agency for International Development

C

CDF Chief of the Defence Force

CEO Chief Executive Office

CIOG Chief Information Officer Group

COO Chief Operating Officer

D

DCBs Departmental Capital Budget

DCEO Deputy Chief Executive Officer

DCP Defence Capability Plan

DFAT Department of Foreign Affairs and Trade

DHA Defence Housing Australia

DMO Defence Materiel Organisation

DPG Defence People Group

DSRG Defence Support and Reform Group

F

FMA Financial Management and Accountability

G

GMCOM General Manager Commercial

GM LM General Manager Land and Maritime

GM JSA General Manager Joint, Systems and Air


185

I

ICT Information and Communications Technology

IISS International Institute for Strategic Studies

J

JPD Joint Project Directive

L

LEAP Living Environment and Accommodation Precinct

M

MECC Ministerial and Executive Coordination and Communication

MIMT Moorebank Intermodal Freight Terminal

MSA Materiel Sustainment Agreement

MSBS Military Superannuation and Benefits Scheme

O

OPA Official Public Account

P

PAES Portfolio Additional Estimates Statement

PBS Portfolio Budget Statements

PWEA Point Wilson Explosive Area

R

RADM Rear Admiral

S

SeMPRO Sexual Misconduct Prevention and Response Office

SOETM Services for Other Entities and Trust Moneys

SME Specialist Military Equipment

U

URD Unit Ready Days

V

VRs Voluntary Redundancies


186

Documents

PORTFOLIO ADDITIONAL ESTIMATES STATEMENTS 2012 ......Defence Portfolio Additional Estimates Statements 2012-13 vi Abbreviations and Conventions The following notations may be used: