Legislative Assembly for the ACT: 2005 Week 08 Hansard (Tuesday, 28 June 2005) . . Page.. 2396 ..
The 2003-04 operating result was a $3.76 million deficit, despite the budget showing that a surplus of $3.020 million was expected—a $6.766 million difference between the expected position and the delivered result. So it is my concern that, despite budgeting for a $2.772 million return in 2004-05, they are already showing that the return will be smaller. In 2005-06, the budget allows for a result of a $2.784 million operating surplus.
Despite these figures, there appears to have been no allowances made for bad or doubtful debts. Despite having written off a combined total of $9.62 million in the past two financial years, 2002-03 and 2003-04, there has been no provision for this type of debt in the forward years. This is a concern for the opposition, and I would be interested to hear what explanation the Treasurer can provide for this situation. We can only assume that the results for 2004-05 and 2005-06 will not meet the budget outcomes. If that is the case, it is the ACT community, as always, that will suffer as a result.
MR QUINLAN (Molonglo—Treasurer, Minister for Economic Development and Business, Minister for Tourism, Minister for Sport and Recreation, and Minister for Racing and Gaming) (5.47): Let me say that, of course, the result will depend on interest rates more than anything. So it is an estimate as opposed to financial management—
Mr Seselja: We just want it to be a good estimate.
MR QUINLAN: Give us yours. In response to the question of annual review: we do not intend to go through and do that formally every year. But let me assure you that we do a little bit of informal analysis of it, just in case there is another $30 million lying around there that we could inject into housing, as we have done before.
Proposed expenditure agreed to.
Proposed expenditure—Part 1.9—InTACT, $2,341,000 (net cost of outputs) and $5,640,000 (capital injection), totalling $7,981,000—agreed to.
Proposed expenditure—Part 1.10—Superannuation Unit, $125,236,000 (capital injection), totalling $125,236,000.
MR MULCAHY (Molonglo) (5.50): There are not a lot of comments in relation to this. It is not a small amount of money, but this was an area that we explored at length in estimates. It is an issue of ongoing concern to the territory in terms of the cost of superannuation or the liabilities. It is worth remembering again Auditor-General’s Report No 10 on financial audits for 2003-04.
If I could cite the highlights: there was an unqualified opinion provided to the Treasurer in relation to the Superannuation Unit on 13 September 2004. But it is worth noting that the Superannuation Unit was unable to achieve the budgeted operating result because the significant increase in superannuation expenses far outweighed the above-budget investment returns. At that time the Auditor-General noted:
There are insufficient investments set aside to meet superannuation liabilities. The ratio of investments to super liabilities has declined steadily in recent years from $0.75 in 2001 to $0.59 in 2004 in investments for each dollar of superannuation liabilities.