No shocks in year-end Treasury update

Treasury secretary Gabriel Makhlouf said officials have offered some information on costings to political parties involved in negotiations. Photo: Sam Sachdeva.

The Treasury’s year-end financial statements have delivered no real surprises, adhering largely to the figures in the pre-election fiscal update.

Treasury secretary Gabriel Makhlouf has also confirmed officials have offered information on costings to some political parties as coalition negotiations get underway – although he is staying tight-lipped on who has asked for figures.

Speaking to media, Makhlouf said the 2016/17 financial results were slightly better than the Prefu prediction, with the OBEGAL surplus $363 million higher than forecast.

However, that was largely due to some capital spending being delayed into the next financial year, particularly relating to school properties.

“While individual years may differ, the June 2017 results don’t indicate a substantial departure from what we said in our pre-election update.”

There was an OBEGAL surplus of $4.1b for 2016/17, compared to $1.8b in 2015/16.

Core Crown tax revenue rose to $75.6 billion in nominal terms (28 .2 per cent of GDP) on the back of an increase in employment and in taxes on corporate profits.

Core Crown expenses increased by $2.4b to $76.3b (28.5 per cent of GDP), due to increased spending from Budget 2016 and rising superannuation costs.

Net capital spending was $3.7b in 2016/17 and gross capital spending $6.8b, with $4.5b spent on buying physical assets such as school classrooms and another $1.5b going towards student loans.

Real GDP increased 2.7 per cent in the year to June 2017 – similar to the previous year – with growth in private consumption and residential investment thanks in part to strong population growth.

With rising export prices and falling import costs, nominal GDP increased 5.9 per cent in 2016/17, up from 4.2 per cent in 2015/16.

Net debt fell in nominal terms to $59.5b (22.2 per cent of GDP). The value of total Crown assets increased by $20.9b to $313.6b, with liabilities similar to last year at $197.1b – leading to a net worth of $110.5b (up $21.2b on 2015/16).

There was a operating balance surplus of $12.3b, compared to a $5.4b deficit last year.